-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Ivdb2iPmjT9Q64N13yBV6N5t62b8xsDR7XN44lk3ZqGI5abUzq8rfTQYxwREGvFp HcQK7chsfYqAVoYb1JLnbQ== 0000950142-09-000418.txt : 20090320 0000950142-09-000418.hdr.sgml : 20090320 20090319183446 ACCESSION NUMBER: 0000950142-09-000418 CONFORMED SUBMISSION TYPE: 6-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20090319 FILED AS OF DATE: 20090320 DATE AS OF CHANGE: 20090319 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TECK COMINCO LTD CENTRAL INDEX KEY: 0000886986 STANDARD INDUSTRIAL CLASSIFICATION: MINING, QUARRYING OF NONMETALLIC MINERALS (NO FUELS) [1400] IRS NUMBER: 000000000 STATE OF INCORPORATION: A1 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 6-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-13184 FILM NUMBER: 09694247 BUSINESS ADDRESS: STREET 1: 550 BURRARD ST STREET 2: SUITE 3300, BENTALL 5 CITY: VANCOUVER STATE: A1 ZIP: V6C 0B3 BUSINESS PHONE: 604 699-4000 MAIL ADDRESS: STREET 1: 550 BURRARD ST STREET 2: SUITE 3300, BENTALL 5 CITY: VANCOUVER STATE: A1 ZIP: V6C 0B3 6-K 1 form6k_031909cir.txt REPORT OF FOREIGN PRIVATE ISSUER ================================================================================ UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 6-K REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO SECTION 13A-16 15D-16 OF THE SECURITIES EXCHANGE ACT OF 1934 Dated: March 19, 2009 Commission File Number: 001-13184 TECK COMINCO LIMITED (Exact name of registrant as specified in its charter) Suite 3300 - 550 Burrard Street, Vancouver, British Columbia V6C 0B3 (Address of principal executive offices) Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F. Form 20-F [_] Form 40-F [X] Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1).[_] Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders. Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):[_] Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant's "home country"), or under the rules of the home country exchange on which the registrant's securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant's security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR. Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934. Yes [_] No [X] If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-_____ =============================================================================== SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. TECK COMINCO LIMITED (Registrant) Date: March 19, 2009 By: /s/ KAREN L. DUNFEE ----------------------- Karen L. Dunfee Corporate Secretary TECK COMINCO LIMITED Suite 3300 - 550 Burrard Street Vancouver, BC V6C 0B3 NOTICE OF ANNUAL AND SPECIAL MEETING OF SHAREHOLDERS TAKE NOTICE that the Annual and Special Meeting (the "Meeting") of the shareholders of TECK COMINCO LIMITED (the "Corporation") will be held in Waterfront Ballroom C, Fairmont Waterfront Hotel, 900 Canada Place Way, Vancouver, British Columbia, on Wednesday, the 22nd day of April, 2009, at 11:00 a.m. Pacific Daylight Time, to: (a) receive the Annual Report of the Corporation containing the audited consolidated financial statements of the Corporation for the fiscal year ended December 31, 2008 and the report of the Auditor thereon; (b) elect 14 directors; (c) appoint the Auditor and authorize the directors to fix the Auditor's remuneration; (d) consider and, if deemed appropriate, to approve a special resolution authorizing an amendment to the Articles of the Corporation to (i) delete in their entirety, the authorized but unissued Preferred Shares Series 1 and the authorized but unissued Preferred Shares Series 2 in the capital of the Corporation and (ii) change the Corporation's name to Teck Resources Limited/Ressources Teck Limitee; and (e) transact such other business as may properly come before the Meeting or any adjournment thereof. NOTES: 1. For those shareholders who requested it, a copy of the Annual Report accompanies this Notice of Meeting. 2. A Management Proxy Circular and form of proxy accompanies this Notice of Meeting. Registered shareholders who are unable to attend the Meeting in person are requested to date and sign the enclosed form of proxy. A proxy will not be valid unless it is deposited at the offices of CIBC Mellon Trust Company, Attention: Proxy Department, P.O. Box 721, Agincourt, Ontario M5A 4K9 or if by hand, 320 Bay Street, Banking Hall Level, Toronto, Ontario at least 48 hours before the Meeting. 3. As provided in the CANADA BUSINESS CORPORATIONS ACT, the directors have fixed a Record Date of March 2, 2009. Accordingly, shareholders registered on the books of the Corporation at the close of business on March 2, 2009 are entitled to notice of the Meeting and to vote at the Meeting. 4. If you are a non-registered shareholder and receive these materials through your broker or other intermediary, please complete and return the materials in accordance with the instructions provided to you by your broker or intermediary. DATED this 2nd day of March, 2009. By order of the Board of Directors "KAREN L. DUNFEE" Karen L. Dunfee Corporate Secretary - i - =============================================================================== TECK MANAGEMENT PROXY CIRCULAR TABLE OF CONTENTS SOLICITATION OF PROXIES.................................................- 1 - VOTING OF SHARES........................................................- 2 - REGISTERED SHAREHOLDERS.................................................- 2 - NON-REGISTERED SHAREHOLDERS.............................................- 2 - OBJECTING BENEFICIAL OWNERS..........................................- 2 - NON-OBJECTING BENEFICIAL OWNERS......................................- 3 - VOTING SHARES AND PRINCIPAL HOLDERS OF VOTING SHARES....................- 3 - SUBORDINATE VOTING SHAREHOLDER PROTECTION...............................- 4 - RECORD DATE.............................................................- 4 - PARTICULARS OF MATTERS TO BE ACTED ON......................................- 5 - ELECTION OF DIRECTORS...................................................- 5 - APPOINTMENT OF AUDITOR.................................................- 11 - AUDITOR'S FEES......................................................- 11 - AMENDMENT OF ARTICLES.....................................................- 11 - REPORT OF THE CORPORATE GOVERNANCE AND NOMINATING COMMITTEE...............- 12 - INDEPENDENCE DETERMINATION..........................................- 12 - CHANGES TO MEMBERSHIP IN 2008.......................................- 12 - KEY ACTIVITIES IN 2008..............................................- 12 - CORPORATE GOVERNANCE PRACTICES......................................- 13 - SUCCESSION AND NOMINATION OF NEW DIRECTORS..........................- 13 - ETHICAL BUSINESS CONDUCT............................................- 13 - REPORT OF THE AUDIT COMMITTEE.............................................- 14 - FINANCIAL REPORTING.................................................- 14 - WITH RESPECT TO THE EXTERNAL AUDITOR................................- 15 - WITH RESPECT TO THE INTERNAL AUDITOR................................- 15 - FINANCIAL CONTROLS PROGRAM..........................................- 16 - CHARTER AND KEY PRACTICES...........................................- 16 - STATEMENT OF EXECUTIVE COMPENSATION.......................................- 17 - COMPENSATION COMMITTEE.................................................- 17 - COMPENSATION DISCUSSION AND ANALYSIS...................................- 17 - OBJECTIVES OF EXECUTIVE COMPENSATION...................................- 17 - STRUCTURE OF EXECUTIVE COMPENSATION....................................- 18 - BASE SALARY............................................................- 19 - ANNUAL INCENTIVE BONUS.................................................- 20 - LONG TERM INCENTIVES...................................................- 22 - PENSIONS...............................................................- 23 - BENEFITS...............................................................- 23 - TERMINATION AND CHANGE OF CONTROL BENEFITS.............................- 23 - =============================================================================== -ii- =============================================================================== SUMMARY COMPENSATION TABLE - NEOS......................................- 24 - INCENTIVE PLAN AWARDS..................................................- 25 - INCENTIVE PLAN AWARDS - VALUE VESTED OR EARNED DURING THE YEAR.........- 26 - STOCK OPTION PLANS.....................................................- 27 - SHARE UNIT PLANS.......................................................- 28 - PENSIONS...............................................................- 29 - DEFINED BENEFITS PENSION............................................- 29 - DEFINED CONTRIBUTION PENSION...........................................- 30 - TERMINATION AND CHANGE IN CONTROL......................................- 31 - SHARE PERFORMANCE GRAPH...................................................- 31 - COMPENSATION OF DIRECTORS.................................................- 32 - SUMMARY COMPENSATION TABLE - DIRECTORS.................................- 33 - OUTSTANDING SHARE-BASED AWARDS AND OPTION-BASED AWARDS.................- 33 - INCENTIVE PLAN AWARDS - VALUE VESTED OR EARNED DURING THE YEAR.........- 34 - MANDATORY SHAREHOLDING POLICY FOR DIRECTORS............................- 35 - SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS........- 35 - INSURANCE.................................................................- 36 - SHAREHOLDER PROPOSALS FOR THE 2010 ANNUAL MEETING.........................- 36 - ADDITIONAL INFORMATION....................................................- 37 - BOARD OF DIRECTORS' APPROVAL..............................................- 37 - SCHEDULE A...................................................................A-1 SCHEDULE B...................................................................B-1 SCHEDULE C...................................................................C-1 =============================================================================== SOLICITATION OF PROXIES THIS MANAGEMENT PROXY CIRCULAR IS FURNISHED IN CONNECTION WITH THE SOLICITATION BY THE MANAGEMENT OF TECK COMINCO LIMITED (THE "CORPORATION") OF PROXIES TO BE USED AT THE ANNUAL AND SPECIAL MEETING OF SHAREHOLDERS OF THE CORPORATION (THE "MEETING") TO BE HELD AT THE TIME AND PLACE AND FOR THE PURPOSES SET FORTH IN THE ACCOMPANYING NOTICE OF MEETING AND AT ANY ADJOURNMENT(S) THEREOF. Solicitation will be made primarily by mail, but may be supplemented by solicitation personally by directors, officers and employees of the Corporation without special compensation. The cost of solicitation by Management will be borne by the Corporation. The information contained herein is given as of March 2, 2009, unless otherwise stated. The persons named in the accompanying form of proxy are officers and/or directors of the Corporation. A SHAREHOLDER DESIRING TO APPOINT SOME OTHER PERSON (WHO NEED NOT BE A SHAREHOLDER OF THE CORPORATION) TO REPRESENT THE SHAREHOLDER AT THE MEETING MAY DO SO either by inserting such person's name in the blank space provided in the form of proxy and striking out the names of the other persons named in the form of proxy or by completing another form of proxy, and in either case delivering the completed form of proxy to CIBC Mellon Trust Company, Attention: Proxy Department, P.O. Box 721, Agincourt, Ontario M5A 4K9 or if by hand, 320 Bay Street, Banking Hall Level, Toronto, Ontario, or to the Corporate Secretary of the Corporation at the Corporation's registered office located at Suite 3300 - 550 Burrard Street, Vancouver, B.C. V6C 0B3 at least 48 hours before the Meeting. A shareholder may revoke a proxy by instrument in writing executed by the shareholder or by such shareholder's attorney authorized in writing and deposited either at the registered office of the Corporation at any time up to and including the last business day preceding the day of the Meeting, or any adjournment thereof, at which the proxy is to be used, or with the Chairman of the Meeting on the day of the Meeting or any adjournment thereof prior to the time the proxy is used, or in any other manner permitted by law. The shares represented by the persons named in the accompanying form of proxy will be voted for or against or withheld from voting on any ballot that may be called for in accordance with the directions contained therein. If the shareholder specifies a choice on the form of proxy, the shares represented by the persons named in the accompanying form of proxy will be voted accordingly. IN THE ABSENCE OF ANY SUCH DIRECTION, SUCH SHARES WILL BE VOTED: (I) FOR THE ELECTION OF DIRECTORS; (II) FOR THE APPOINTMENT OF THE AUDITOR AND TO AUTHORIZE THE DIRECTORS TO FIX THE AUDITOR'S REMUNERATION; (III) FOR THE SPECIAL RESOLUTION (A) TO DELETE IN THEIR ENTIRETY THE AUTHORIZED AND UNISSUED PREFERRED SHARES SERIES 1 AND THE AUTHORIZED AND UNISSUED PREFERRED SHARES SERIES 2 IN THE CAPITAL OF THE CORPORATION AND (B) TO CHANGE THE NAME OF THE CORPORATION TO TECK RESOURCES LIMITED/RESSOURCES TECK LIMITEE. A simple majority of the votes cast at the Meeting is required to pass the resolutions in respect of the election of directors and the appointment of the Auditor and to authorize the directors to fix the Auditor's remuneration proposed to be voted on at the Meeting. A majority of not less than two-thirds of the votes cast at the Meeting is required to pass the resolution in respect of changing the Corporation's name and to delete in their entirety the authorized but unissued Preferred Shares Series 1 and the authorized but unissued Preferred Shares Series 2 in the capital of the Corporation proposed to be voted on at the Meeting. The accompanying form of proxy confers discretionary authority upon the persons named therein with respect to amendments or variations to matters identified in the Notice of Meeting and with respect to other matters which may properly come before the Meeting. The management of the Corporation ("Management") knows of no such amendments or variations, or of any matters to come before the Meeting other than the matters referred to in the Notice of Meeting. -2- VOTING OF SHARES REGISTERED SHAREHOLDERS If you are a registered shareholder you may vote your shares by one of two methods. You may vote in person at the Meeting or by proxy as explained below. If your shares are held in the name of an intermediary, please see below under the heading, "Non-Registered Shareholders". If you are a registered shareholder and plan to attend the Meeting and vote your shares in person you do not need to complete and return the form of proxy. Your vote will be recorded and counted at the Meeting. Please register with a representative of CIBC Mellon Trust Company ("CIBC Mellon"), the transfer agent, upon arrival at the Meeting. If you are a registered shareholder and are unable to attend the Meeting in person, you may vote by proxy by completing, dating and signing the enclosed form of proxy and sending it by mail or delivery in the enclosed envelope to the Corporate Secretary of the Corporation c/o CIBC Mellon Trust Company, Attention: Proxy Department, P.O. Box 721, Agincourt, Ontario M5A 4K9 or if by hand, 320 Bay Street, Banking Hall Level, Toronto, Ontario, or to the Corporate Secretary of the Corporation at the Corporation's registered office located at Suite 3300 - 550 Burrard Street, Vancouver, B.C. V6C 0B3. You may also fax your completed proxy to 1-866-781-3111 or 416-368-2502 or vote by internet AT WWW.EXPROXYVOTING.COM/TECK and following the instructions on the enclosed proxy form. PLEASE NOTE THAT IN ORDER FOR YOUR VOTE TO BE RECORDED, YOUR PROXY MUST BE RECEIVED BY CIBC MELLON OR THE CORPORATE SECRETARY AT LEAST 48 HOURS BEFORE THE MEETING. NON-REGISTERED SHAREHOLDERS In the Notice of Meeting, this Management Proxy Circular and the form of proxy provided, all references to shareholders are to registered shareholders. In many cases, shares beneficially owned by a shareholder are registered either in the name of an intermediary that the non-registered shareholder deals with in respect of the shares or in the name of a clearing agency such as CDS Clearing and Depository Securities Inc. of which the intermediary of the non-registered shareholder is a participant. There are two kinds of beneficial owners: those who object to their names being made known to the Corporation, referred to as objecting beneficial owners ("OBOs") and those who do not object to the Corporation knowing who they are, referred to as non-objecting beneficial owners ("NOBOs"). The meeting materials are being sent to both OBOs and NOBOs. In accordance with new Canadian legal requirements, the Corporation has decided this year to distribute copies of the Notice of Meeting, Management Proxy Circular, the enclosed form of proxy and the Corporation's 2008 Annual Report to NOBOs directly. Their names and addresses and information about their holdings of securities have been obtained in accordance with applicable securities regulatory requirements from the intermediary holding on their behalf. By choosing to send the meeting materials to NOBOs directly, the Corporation has assumed responsibility for delivering these materials to them and executing their proper voting instructions. The meeting materials for OBOs will continue to be distributed through clearing houses and intermediaries, who often use a service company such as Broadridge Financial Solutions to forward meeting materials to non-registered shareholders. OBJECTING BENEFICIAL OWNERS Intermediaries are required to forward meeting materials to OBOs unless an OBO has waived the right to receive them. Generally, OBOs who have not waived the right to receive meeting materials will either be given a proxy which has already been signed by the intermediary and is restricted as to the number of shares beneficially owned by the OBO but which is otherwise not completed or, more typically, be given a voting instruction form ("VIF") which -3- must be completed and signed by the OBO in accordance with the directions on the VIF. NON-OBJECTING BENEFICIAL OWNERS The meeting materials with a form of proxy will be forwarded to NOBOs by the Corporation's transfer agent, CIBC Mellon. These proxies are to be completed and returned to CIBC Mellon in the envelope provided or by facsimile. CIBC Mellon will tabulate the results of the proxies received from NOBOs and will provide appropriate instructions at the Meeting with respect to the shares represented by the proxies they receive. The purpose of these procedures is to permit non-registered shareholders to direct the voting of the shares they beneficially own. Should a non-registered shareholder who receives either a proxy or a VIF wish to attend and vote at the Meeting in person (or have another person attend and vote on behalf of the non-registered shareholder), the non-registered shareholder should strike out the names of the persons named in the proxy and insert the non-registered shareholder's (or such other person's) name in the blank space provided, or in the case of a VIF, follow the instructions on the form. By doing so the non-registered shareholder is instructing the intermediary to appoint them or their designee as proxyholder. IN ANY EVENT, NON-REGISTERED SHAREHOLDERS SHOULD CAREFULLY FOLLOW THE INSTRUCTIONS OF THEIR INTERMEDIARIES AND THEIR SERVICE COMPANIES OR CIBC MELLON, AS THE CASE MAY BE. VOTING SHARES AND PRINCIPAL HOLDERS OF VOTING SHARES The Corporation is authorized to issue an unlimited number of Class A common shares, Class B subordinate voting shares and preference shares. At March 2, 2009, there were outstanding 9,353,470 Class A common shares, each carrying the right to 100 votes per share, and 477,513,286 Class B subordinate voting shares, each carrying the right to one vote per share. The Class B subordinate voting shares carry 33.80% of the aggregate voting rights attached to the Class A common and Class B subordinate voting shares. At March 2, 2009, no preference shares were outstanding. With the exception of the shareholders mentioned below, the directors and officers of the Corporation do not know of any person or company beneficially owning or exercising direction or control, directly or indirectly, over shares carrying more than 10% of the votes attached to any class of voting securities of the Corporation. Temagami Mining Company Limited ("Temagami") has informed the Corporation that as at March 2, 2009, it beneficially owned or exercised direction or control, directly or indirectly, over 4,300,000 Class A common shares (representing 45.97% of the Class A common shares outstanding) and 860,000 Class B subordinate voting shares (representing 0.18% of the Class B subordinate voting shares outstanding) of the Corporation, which shares represent 30.50% of the total votes attached to the combined outstanding Class A common shares and Class B subordinate voting shares. Keevil Holding Corporation beneficially owns 51% of the outstanding shares of Temagami, and SMM Resources Incorporated ("SMM"), a wholly owned subsidiary of Sumitomo Metal Mining Co. Ltd., beneficially owns 49% of the outstanding shares of Temagami. In addition to the foregoing, SMM has informed the Corporation that as at March 2, 2009, it beneficially owned and exercised direction or control, directly or indirectly, over 1,469,000 Class A common shares and 295,800 Class B subordinate voting shares of the Corporation. Accordingly, SMM exercises voting rights representing 10.49% of the total votes attached to the combined outstanding Class A common shares and Class B subordinate voting shares of the Corporation. -4- As of March 2, 2009, Caisse de depot et placement du Quebec held 1,587,600 Class A common shares which represents 16.87% of the Class A common shares. Those shares, together with 180,474 Class B subordinate voting shares (representing 0.04% of the Class B subordinate voting shares outstanding) held by it, represent 11.25% of the total votes attached to the combined outstanding Class A common shares and Class B subordinate voting shares of the Corporation. SUBORDINATE VOTING SHAREHOLDER PROTECTION The attributes of the Class B subordinate voting shares contain so-called "Coattail Provisions" which provide that in the event an offer (an "Exclusionary Offer") to purchase Class A common shares, which is required to be made to all or substantially all holders thereof, is not made concurrently with an offer to purchase Class B subordinate voting shares on identical terms, then each Class B subordinate voting share will be convertible into one Class A common share. The Class B subordinate voting shares will not be convertible in the event an Exclusionary Offer is not accepted by holders of a majority of the Class A common shares (excluding those shares held by the offeror making the Exclusionary Offer). If an offer to purchase Class A common shares does not, under applicable securities legislation or the requirements of any stock exchange having jurisdiction, constitute a "take-over bid" or is otherwise exempt from any requirement that such offer be made to all or substantially all holders of Class A common shares, the Coattail Provisions will not be applicable. The above is a summary only. Reference should be made to the full text of the Coattail Provisions contained in the articles of the Corporation, a copy of which may be obtained on SEDAR at www.sedar.com or by writing to the Corporate Secretary of the Corporation. RECORD DATE Each holder of issued and outstanding Class A common shares or Class B subordinate voting shares of record at the time of the close of business on March 2, 2009, (the "Record Date") will be given notice of the Meeting and will be entitled to vote at the Meeting, by proxy or in person, the number of shares held by such holder on the Record Date. -5- PARTICULARS OF MATTERS TO BE ACTED ON ELECTION OF DIRECTORS Directors are elected annually and the Board of Directors of the Corporation (the "Board of Directors" or the "Board") has determined that the number of directors to be elected is 14. Unless authority to vote is withheld, the shares represented by the proxies hereby solicited will be voted by the persons named therein FOR the election of the nominees whose names are set forth below. Of the 14 nominees, all but Mr. Jack Cockwell are presently members of the Board of Directors and the dates on which they were first elected or appointed are indicated below. Management does not contemplate that any nominee will be unable or unwilling to serve as a director, but if that should occur for any reason prior to the Meeting, the persons named in the enclosed form of proxy reserve the right to vote FOR another nominee in their discretion, unless the shareholder has specified in the accompanying form of proxy that such shareholder's shares are to be withheld from voting on the election of directors. Each of the following persons is nominated to hold office as a director until the next Annual Meeting or until his or her successor is duly elected or appointed.
======================================= ============== ============================================================== MAYANK M. ASHAR Independent Mayank M. Ashar was appointed to the Board of Teck Cominco Director Since: 2007 (9) Limited in November 2007. He is a graduate of the University Shareholdings: of Toronto. Mr. Ashar is presently the Chief Operating 15,000 Class B Subordinate Voting [GRAPHIC Officer of Irving Oil Limited. From 2007 to 2008 he was 4,114 Deferred Share Units OMITTED] Executive Vice President of Suncor Energy and from 2003 to (6), (7) 2007 he was Executive Vice President of Suncor Energy USA. Mr. Ashar is a director of Operation Eyesight, a charity that works towards treatment and prevention initiatives in developing regions of the world, and the Vice Chair of the World Petroleum Congress, Canadian Chapter. Mr. Ashar is a resident of Saint John, New Brunswick, Canada and is 54. ======================================= ============== ============================================================== J. BRIAN AUNE Independent J. Brian Aune joined the Board of Teck Corporation in Director Since: 1995 (9) February 1995 and was a member of the Board of Cominco Ltd. Shareholdings: from 1997 to the date of the merger. Mr. Aune, a chartered 61,000 Class B Subordinate Voting [GRAPHIC accountant, joined Nesbitt Thomson Inc. in 1966 and served as 18,457 Deferred Share Units OMITTED] Chairman and Chief Executive Officer from 1980 to 1990. He is (1), (3), (4) President of Alderprise Inc. and was Chairman of St. James Financial Corporation from 1990 to September 2005 (both private investment companies). He is a director of a number of Canadian public and private corporations including Constellation Software Inc. and Power Financial Corporation. Mr. Aune is a resident of Magog, Quebec, Canada and is 69. ======================================= ============== ==============================================================
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======================================= ============== ============================================================== JALYNN H. BENNETT (13) Independent Jalynn H. Bennett joined the Board of Teck Cominco Limited in C.M. (9) April 2005. She is President of Jalynn H. Bennett and Director Since: 2005 Associates Ltd., a consulting firm specializing in strategic Shareholdings: [GRAPHIC planning and organizational development in both the public 2,329 Class B Subordinate Voting OMITTED] and private sectors. She holds a degree, specializing in 16,580 Deferred Share Units economics, from the University of Toronto. Ms. Bennett is (2), (4), (5) currently a director of the Canadian Imperial Bank of Commerce, Nortel Networks Limited, Nortel Networks Corporation, and Cadillac Fairview Corporation Limited. She is also a director of The Hospital for Sick Kids Foundation; a Member of the Lawrence National Centre for Policy and Management, Richard Ivey School of Business, The University of Western Ontario; and a Member of the Canada Millennium Scholarship Foundation. She is a past Commissioner of the Ontario Securities Commission and was a member of the Toronto Stock Exchange, Canadian Stock Exchange and the Canadian Institute of Chartered Accountants' Joint Committee on Corporate Governance (the Saucier Committee). Ms. Bennett is a resident of Toronto, Ontario, Canada and is 66. ======================================= ============== ============================================================== HUGH J. BOLTON Independent Hugh J. Bolton joined the Board of Cominco Ltd. in 1998 and F.C.A. (9) the Board of Teck Cominco in 2001. He is a graduate of the Director Since: 2001 University of Alberta (B.A. Economics). Mr. Bolton was Shareholdings: [GRAPHIC managing partner of Coopers & Lybrand Canada (accounting 12,000 Class B Subordinate Voting OMITTED] firm) from 1984 to 1990 and Chairman and Chief Executive 18,457 Deferred Share Units Officer from 1991 to 1998. He is presently Chairman of Epcor (2), (5) Utilities Inc., Chairman of Matrikon Inc., a director of the Toronto Dominion Bank, WestJet Airlines Ltd., Canadian National Railway Company and the Shock Trauma Air Rescue Society (STARS). Mr. Bolton is a resident of Edmonton, Alberta, Canada and is 69. ======================================= ============== ============================================================== JACK L. COCKWELL Independent Jack L. Cockwell is standing for election to the Board of New Nominee (9) Teck Cominco Limited for the first time. He is a graduate of the University of Cape Town (M.Com). Mr. Cockwell is Group [GRAPHIC Chairman of Brookfield Asset Management Inc. (asset OMITTED] management company) and has served as a director of Brookfield since September 1979. As Group Chairman, Mr. Cockwell represents Brookfield as a director on the Board of Brookfield Properties Corporation and other subsidiaries. He is also a director of Astral Media Inc. and Waterfront Toronto, and a governor of the Royal Ontario Museum and Ryerson University. Mr. Cockwell is a resident of Toronto, Ontario, Canada and is 68. ======================================= ============== ============================================================== NORMAN B. KEEVIL Not Norman B. Keevil joined the Board of Teck Corporation in 1963 Director Since: 1963 Independent and was a member of the Board of Cominco Ltd. from 1986 to Shareholdings: ((8)) the date of the merger. He is a graduate of the University of 418,880 Class A Toronto (B.A. Sc.) and the University of California at 608,232 Class B Subordinate Voting [GRAPHIC Berkeley (Ph. D.). He received an honorary LL.D from the 13,208 Restricted Share Units OMITTED] University of British Columbia in May 1993. He was Vice (1) President Exploration at Teck Corporation from 1962 to 1968, Executive Vice President from 1968 to 1981, President and Chief Executive Officer from 1981 to 2001 and has been Chairman of the Board of Teck Cominco since 2001. He is a lifetime director of the Mining Association of Canada. Dr. Keevil was inducted into the Canadian Mining Hall of Fame in January 2004. Dr. Keevil is a resident of West Vancouver, B.C., Canada and is 71. ======================================= ============== ==============================================================
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======================================= ============== ============================================================== NORMAN B. KEEVIL III Not Norman B. Keevil III joined the Board of Teck Corporation in Director Since: 1997 Independent 1997. He graduated from the University of British Columbia Shareholdings: ((11)) (B.A. Sc.) with a Mechanical Engineering degree. Mr. Keevil 20,000 Class B Subordinate Voting recently stepped down as Vice President of Engineering with 8,612 Deferred Share Units [GRAPHIC Triton Logging Inc. (underwater harvesting company) of 4,609 Restricted Share Units OMITTED] Victoria, B.C. in order to start a new technology venture. (4), (6), (7) Prior to joining Triton, he was President and Chief Executive Officer of Pyramid Automation Ltd. (manufacturing process automation company), a company he helped found in 1998. Mr. Keevil is a resident of Victoria, B.C., Canada and is 45. ======================================= ============== ============================================================== TAKASHI KURIYAMA Independent Takashi Kuriyama was appointed a director of Teck Cominco Director Since: 2006 (9) Limited in June 2006. He graduated from Akita University in Shareholdings: Japan (B.A. Eng.). Mr. Kuriyama is Executive Vice President 2,000 Class B Subordinate Voting(10) [GRAPHIC of Sumitomo Metal Mining America Inc., as well as a director 7,544 Deferred Share Units OMITTED] of several other companies which are subsidiaries of Sumitomo (6), (7) Metal Mining America Inc. (mining and mine development company). Mr. Kuriyama is a resident of Vancouver, B.C., Canada and is 58. ======================================= ============== ============================================================== DONALD R. LINDSAY Not Don Lindsay joined Teck Cominco Limited as President in Director Since: 2005 Independent January 2005, was appointed a director in February 2005 and Shareholdings: (12) Chief Executive Officer in April 2005. He is a graduate of 502,056 Class B Subordinate Voting Queens University (B.Sc., Hons.) and Harvard Business School 163,396 Deferred Share Units [GRAPHIC (M.B.A.). Mr. Lindsay was employed by CIBC World Markets Inc. 362,948 Restricted Share Units OMITTED] (investment banking) from 1985 to 2004 where he was President (1) of CIBC World Markets Inc., Head of Investment and Corporate Banking and Head of the Asia Pacific Region. Mr. Lindsay is a resident of Vancouver, B.C., Canada and is 50. ======================================= ============== ============================================================== TAKURO MOCHIHARA Independent Takuro Mochihara joined the Board of Teck Corporation in Director Since: 2000 (9) 2000. He is a graduate of the University of Tokyo, Faculty of Shareholdings: Law. Mr. Mochihara held managerial positions with Mitsubishi 2,000 Class B Subordinate Voting(10) [GRAPHIC Canada Ltd. and Mitsubishi Corporation (general trading 19,368 Deferred Share Units OMITTED] companies) from 1986 to 2000 when he joined Sumitomo Metal (1), (6) Mining Co. Ltd. (mining and mine development company) where he is currently a director and Senior Managing Executive Officer. Mr. Mochihara is a resident of Tokyo, Japan and is 63. ======================================= ============== ============================================================== DEREK G. PANNELL Independent Derek G. Pannell was appointed a director of Teck Cominco Director Since: 2006 (9) Limited in October 2006. He is a graduate of Imperial College Shareholdings: in London, England (BSc. Eng.) and the Royal School of Mines, 3,200 Class B Subordinate Voting [GRAPHIC London, England (ARSM). Mr. Pannell was President and Chief 7,544 Deferred Share Units OMITTED] Operating Officer of Noranda/Falconbridge from 2001 to (6), (7) October 2006 and Vice President, Operations of Compania Minera Antamina from 1999 - 2001. He is presently the Managing Partner of Brookfield Asset Management (asset management company), Chairman of Brookfield Infrastructure Partners and a director of Brookfield Infrastructure Partners, Agrium Inc. and Major Drilling Group International Inc. Mr. Pannell is also a professional engineer registered in Quebec and Peru. He is a resident of Bathurst, New Brunswick, Canada and is 62. ======================================= ============== ==============================================================
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======================================= ============== ============================================================== JANICE G. RENNIE Independent Janice Rennie was elected to the Board of Teck Cominco F.C.A. (9) Limited in April 2007. She is a graduate of the University of Director Since: 2007 Alberta (BComm.) and a Chartered Accountant. Ms. Rennie was Shareholdings: [GRAPHIC Sr. Vice President, Human Resources and Organizational 3,000 Class B Subordinate Voting OMITTED] Effectiveness for Epcor Utilities Inc. from 2004 to 2005. 7,544 Deferred Share Units Prior to 2004 she was Principal of Rennie & Associates which (2), (3), (5) provided investment and related advice to small and mid-size companies. She is a director of Matrikon Inc., Methanex Corp. and West Fraser Timber Co. Ltd. Ms. Rennie is a resident of Edmonton, Alberta, Canada and is 51. ======================================= ============== ============================================================== WARREN S.R. SEYFFERT Independent Warren S. R. Seyffert, Q.C. joined the Board of Teck Q.C. (9) Corporation in 1989 and was a member of the Board of Cominco Director Since: 1989 Ltd. from 2000 to the date of the merger. He is a graduate of Shareholdings: [GRAPHIC the University of Toronto Law School (LL.B.) and York 101,902 Class B Subordinate Voting OMITTED] University, Osgoode Hall (LL.M). He was a partner of the law 20,919 Deferred Share Units firm Lang Michener LLP from 1969 to 2001 and counsel from (1), (3), (5), (6) 2002 to 2007. He taught "Law of Corporate Management" for over 12 years at Osgoode Hall Law School. He is a director of various public and private corporations including Allstate Insurance Company of Canada, Pembridge Insurance Company, The Kensington Health Centre and St Andrew Goldfields Ltd. He is an Honourary Trustee of the Royal Ontario Museum. Mr. Seyffert is a resident of Toronto, Ontario, Canada and is 68. ======================================= ============== ============================================================== CHRIS M.T. THOMPSON Independent Chris M. T. Thompson joined the Board of Teck Cominco in June Director Since: 2003 (9) 2003. He is a graduate of Rhodes University, SA (BA Law & Shareholdings: Economics) and Bradford University, UK (MSc). Mr. Thompson 121,000 Class B Subordinate Voting [GRAPHIC was the Chief Executive Officer and Chairman of the Board of 13,422 Deferred Share Units OMITTED] Gold Fields Ltd. (precious metal producer) from 1998 - 2002 2,486 Restricted Share Units and was the Chairman of the Board from 1998 until November (1), (2), (3), (5), (7) 2005. He was Chairman of the World Gold Council from April 2002 until April 2005 and is currently a director of The Water Company. Mr. Thompson is a resident of Englewood, Colorado, U.S.A. and is 61. ======================================= ============== ===============================================================
-9- NOTES: (1) Member of the Executive Committee of the Board. (2) Member of the Audit Committee of the Board. (3) Member of the Compensation Committee of the Board. (4) Member of the Pension Committee of the Board. (5) Member of the Corporate Governance & Nominating Committee of the Board. (6) Member of the Safety & Sustainability Committee of the Board. (7) Member of the Reserves Committee. (8) N.B. Keevil is a director of Keevil Holding Corporation and trustee of a trust which holds shares carrying 98% of the votes attached to outstanding shares of Keevil Holding Corporation. The holdings of Keevil Holding Corporation are reported under the heading "Voting Shares and Principal Holders of Voting Shares" in this Management Proxy Circular. Dr. Keevil retired as Chief Executive Officer of the Corporation in 2001. The Board has determined that, as Chairman of the Board, he is not independent. (9) Director who is: (a) not a member of management and is free of any interest and any business, family or other relationship which could reasonably be perceived to interfere with the director's ability to act with a view to the best interests of the Corporation other than interests and relationships arising solely from holdings in the Corporation, and (b) is not considered to have a direct or indirect material relationship with the Corporation under subsection 1.4 of Multilateral Instrument 52-110. (10) Messrs. Mochihara and Kuriyama are employees of Sumitomo Metal Mining Co. Ltd. ("Sumitomo") and, as such, are required to hold these shares in trust for Sumitomo. (11) Family relationship with N.B. Keevil. (12) Officer of the Corporation. (13) Ms. Jalynn H. Bennett was a director of Nortel Networks Corporation and Nortel Networks Limited (collectively, the "Nortel Companies"), when the Nortel Companies announced on March 10, 2006 the need to restate certain of their previously reported financial results and the resulting delay in the filing of certain 2005 financial statements by the required filing dates. The Ontario Securities Commission ("OSC") issued a final management cease trade order on April 10, 2006 prohibiting all of the directors, officers and certain current and former employees, including Ms. Bennett, from trading in securities of the Nortel Companies until two business days following the receipt by the OSC of all of the filings the Nortel Companies were required to make under Ontario securities laws. The British Columbia Securities Commission ("BCSC") and Quebec Securities Commission ("QSC") also issued similar orders. Ms. Bennett was not subject to the orders issued by the BCSC and the QSC. The OSC lifted its cease trade order effective June 8, 2006. The BCSC and the QSC also lifted their cease trade orders shortly thereafter. Ms. Bennett remains a director of the Nortel Companies. On January 14, 2009, Nortel filed for creditor protection in Canada under the Companies' Creditors Arrangement Act. SHAREHOLDINGS OF BOARD MEMBERS AS AT MARCH 2, 2009 o Total number of Class A common shares held by all directors: 418,880 o Total number of Class A common shares held by all non-executive directors: 418,880 o Total number of Class B subordinate voting shares held by all directors: 1,498,629 o Total number of Class B subordinate voting shares held by all non-executive directors: 996,573 o Total value of Class A common shares held by all directors: $3,769,920 o Total value of Class B subordinate voting shares held by all directors: $5,919,585 o Total value of Class A common shares held by all non-executive directors: $3,769,920 o Total value of Class B subordinate voting shares held by all non-executive directors: $3,936,463 Values are based on the closing price of Class A common shares and Class B subordinate voting shares on the Toronto Stock Exchange on March 2, 2009 ($9.00 and $3.95 respectively). -10- The following directors are directors or trustees of other reporting issuers as set out after their names: J. Brian Aune Constellation Software Inc. and Power Financial Corporation. Jalynn H. Bennett Canadian Imperial Bank of Commerce, Nortel Networks Limited and Nortel Networks Corporation. Hugh J. Bolton Epcor Utilities Inc., Matrikon Inc., Toronto Dominion Bank, WestJet Airlines Ltd. and Canadian National Railway Company. Jack L. Cockwell Brookfield Asset Management Inc., Brookfield Properties Corporation, Fraser Papers Inc., Norbord Inc. and Astral Media Inc. Derek G. Pannell Agrium Inc. and Major Drilling Group International Inc. Janice G. Rennie Matrikon Inc., Methanex Corp. and West Fraser Timber Co. Ltd. Warren S. R. Seyffert St Andrew Goldfields Ltd. Chris M. T. Thompson The Water Company.
- ----------------------------------------------------------- ------------------------------------------------------------- SUMMARY OF BOARD & SUMMARY OF ATTENDANCE BY COMMITTEE MEETINGS HELD (1) DIRECTORS - ----------------------------------------------------------- ------------------------------------------------------------- DIRECTOR BOARD MEETINGS COMMITTEE ATTENDED MEETINGS ATTENDED Mayank M. Ashar(2) 18 of 21 8 of 8 J. Brian Aune 21 of 21 13 of 13 Board of Directors 21 Jalynn H. Bennett 21 of 21 12 of 12 (a) Audit Committee 8 Hugh J. Bolton(3) 20 of 21 10 of 12 (b) Executive Committee 3 Norman B. Keevil 19 of 21 3 of 3 (c) Corporate Governance & Nominating 2 Norman B. Keevil III(4) 21 of 21 9 of 10 Committee Takashi Kuriyama(5) 19 of 21 6 of 6 (d) Compensation Committee 6 Donald R. Lindsay 21 of 21 3 of 3 (e) Pension Committee 2 Takuro Mochihara 18 of 21 6 of 7 (f) Safety & Sustainability Committee 4 Derek G. Pannell 16 of 21 6 of 8 (g) Reserves Committee 4 Janice G. Rennie(6) 21 of 21 12 of 12 Warren S.R. Seyffert(7) 21 of 21 21 of 21 Keith E. Steeves(8) 20 of 21 12 of 14 Chris M. T. Thompson((9)) 20 of 21 18 of 21 - ---------------------------------------------------- ------ ------------------------------ ---------------- -------------
NOTES: (1) The overall attendance was 93.9% at Board meetings and 92.7% at Committee meetings for the year. (2) Mayank M. Ashar was appointed as a member of the Reserves Committee on February 12, 2008 and the Safety & Sustainability Committee on April 23, 2008. (3) Hugh J. Bolton was appointed as a member of the Corporate Governance & Nominating Committee and ceased to be a member of the Compensation Committee on April 23, 2008. (4) Norman B. Keevil III was appointed as a member of the Pension Committee on April 23, 2008. (5) Takashi Kuriyama was appointed as a member of the Reserves Committee on April 23, 2008. (6) Janice G. Rennie was appointed as a member of the Compensation Committee and the Corporate Governance & Nominating Committee and ceased to be a member of the Pension Committee on April 23, 2008. (7) Warren S.R. Seyffert was appointed as a member of the Executive Committee and Compensation Committee and ceased to be a member of the Audit Committee on April 23, 2008. (8) Keith E. Steeves will retire as an independent director when his term expires on the date of the Meeting. (9) Chris M.T. Thompson was appointed as a member of the Audit Committee on February 12, 2008 and ceased to be a member of the Corporate Governance & Nominating Committee on April 23, 2008. -11- APPOINTMENT OF AUDITOR Unless otherwise instructed, the persons named in the enclosed form of proxy intend to vote FOR the reappointment of PricewaterhouseCoopers LLP as the Auditor of the Corporation to hold office until the next Annual Meeting of shareholders and to authorize the directors to fix the Auditor's remuneration. PricewaterhouseCoopers LLP or its predecessor has been the Auditor of the Corporation for more than 5 years. AUDITOR'S FEES For the years ended December 31, 2008 and 2007, the Corporation paid the external auditor $4,579,054 and $4,142,000 respectively as detailed below: YEAR ENDED YEAR ENDED 2008 ($000) 2007 ($000) Audit Services(1) 3,706 3,217 Audit Related Services(2) 500 513 Tax Fees(3) 257 354 All Other Fees 116 58 NOTES: (1) Includes services that are provided by the Corporation's independent auditor in connection with the audit of the financial statements and internal controls over financial reporting. (2) Includes assurance and related services that are related to the performance of the audit, principally for quarterly reviews, pension plan audits and prospectuses. (3) Fees are for international tax services and advice provided to foreign offices. AMENDMENT OF ARTICLES At the Meeting, shareholders will be asked to consider, and if deemed advisable, to pass a special resolution authorizing an amendment to the articles of the Corporation to: (i) delete in their entirety, the authorized but unissued Preference Shares Series 1 and the authorized but unissued Preference Shares Series 2 in the capital of the Corporation, and the rights, privileges, restrictions and conditions attaching thereto; and (ii) change the Corporation's name from "Teck Cominco Limited" to: Teck Resources Limited Ressources Teck Limitee or to such other name as may deemed appropriate by Board of Directors in their sole discretion (the "AMENDMENT RESOLUTION"). The full text of the Amendment Resolution to be considered at the Meeting is set forth in Schedule A of this Management Proxy Circular. To take effect, the Amendment Resolution must be approved by at least two thirds (2/3) of the votes cast by holders of the Class A common shares and the holders of the Class B Subordinate Voting shares of the Corporation, voting as a group, present in person or represented by proxy at the Meeting. The Board of Directors unanimously recommends that shareholders vote FOR the Amendment Resolution. IF NAMED AS PROXY, THE CORPORATION'S MANAGEMENT DESIGNEES INTEND TO VOTE THE SHARES REPRESENTED BY SUCH PROXY AT THE MEETING FOR THE APPROVAL OF THE AMENDMENT RESOLUTION, UNLESS OTHERWISE DIRECTED IN THE FORM OF PROXY. -12- REPORT OF THE CORPORATE GOVERNANCE AND NOMINATING COMMITTEE The Corporate Governance and Nominating Committee considers and recommends corporate governance programs to the Board, proposes nominees for board and committee appointment and assists with Board and director evaluation to ensure that our governance practices are rigorous, relevant and appropriate to the Corporation. Our primary focus is on effective oversight of and independence from Management. The Committee is chaired by our Lead Director, Warren Seyffert, a corporate law and governance expert, and all of the members of the Committee are independent and knowledgeable about corporate governance programs. The Committee members have substantial and diversified board experience. See directors' biographies on pages 5 to 8 for additional information. INDEPENDENCE DETERMINATION The Board has determined that ownership of even a significant number of shares is not, by itself, a bar to a finding of independence. The Board has appointed Mr. Seyffert, who is independent, as the Lead Director. As Lead Director, Mr. Seyffert is either a member or ad hoc member of each of the committees of the Board. The majority of the Board and the nominees to the Board are independent. The following directors and nominees are independent: M. M. Ashar, J. B. Aune, J. H. Bennett, H. J. Bolton, J. L. Cockwell, J. G. Rennie, T. Kuriyama, D. J. Pannell, T. Mochihara, W.S.R. Seyffert and C. M. T. Thompson. The Audit, Corporate Governance and Nominating and Compensation Committees are comprised entirely of independent directors. The Canadian Securities Administrators' corporate governance guidance suggest that independent directors hold regularly scheduled meetings at which non-independent directors and members of Management are not in attendance. While we believe that it is important that the Board regularly meet without Management, we believe that open and candid discussion amongst independent directors is not inhibited by the presence of the non-independent directors and their exclusion from such meetings is not always warranted. CHANGES TO MEMBERSHIP IN 2008 In April 2008 upon Robert Wright's mandatory retirement from the Board, Warren Seyffert as Lead Director was appointed Chairman of the Committee. Hugh Bolton, Janice Rennie and Chris Thompson were appointed as additional directors at that time as well. Brian Aune stepped down from this Committee in April 2008. KEY ACTIVITIES IN 2008 The Committee addressed the concerns expressed in 2 shareholder proposals to the satisfaction of the shareholders involved and the proposals were withdrawn. Mr. Seyffert was appointed Lead Director of the Board succeeding Robert Wright who had served as Lead Director of the Corporation for 6 years. In recognition of his service, Mr. Wright was made an honourary director. As such, Mr. Wright is invited to attend and participate in board meetings and receives all board materials but has no official duties or responsibilities and has no vote on board decisions. He attended 5 meetings in 2008. The Committee completed its annual charter review and amendment. -12- The Committee reviewed the composition of all the board committees and made recommendations to the Board for the appointments that were made following the annual general meeting in 2008. CORPORATE GOVERNANCE PRACTICES Our governance practices are reported in the table in Schedule A which sets out our compliance with NATIONAL INSTRUMENT 58-101 - DISCLOSURE OF CORPORATE GOVERNANCE PRACTICES. SUCCESSION AND NOMINATION OF NEW DIRECTORS The Committee's responsibilities with respect to the nomination of directors include the identification of the appropriate competencies and skills considered to be necessary for the Board as a whole; developing and annually updating a long-term plan for the Board's composition that takes into consideration the independence, age, skills and experience required for the effective conduct of the Corporation's business; identifying nominees for election or re-election to the Board or to fill any vacancy that is anticipated; identifying and recommending to the Board individual directors to serve as members or chairs of Board committees and reviewing and making recommendations regarding the orientation and education of new Board members and their ongoing education. The Board appoints a Chairman of the Committee who is either the Chairman of the Board or the Lead Director. The Chairman of the Committee, in consultation with the Committee members, determines the schedule and frequency of Committee meetings provided that the Committee meets at least four times per year. ETHICAL BUSINESS CONDUCT The Board has adopted a written Code of Ethics for the directors, officers and staff employees (the "Code"). The Code is filed on SEDAR and posted on the Corporation's website. A copy of the Code can also be obtained from the Corporate Secretary of the Corporation at Suite 3300 - 550 Burrard Street, Vancouver, B.C. V6C 0B3. Compliance with the Code is monitored by an annual survey of directors and staff employees. Directors and employees are required to certify that they have complied with the Code, and are either not aware of any non-compliance or that they have reported instances of apparent Code infractions to management or the Chair of the Audit Committee. The Corporation maintains an anonymous Whistleblower Hotline under the "Doing What's Right Program" to encourage employees to report unethical conduct. Awareness of compliance and ethical issues was enhanced by a web-based training program for all staff introduced in 2007. Directors and executive officers are required to disclose a material interest in any transaction or agreement that the Board is considering. To ensure the exercise of independent judgment, directors or executive officers who have disclosed such an interest are prohibited from participating in the Board discussion or in voting on the transaction. Presented by the Corporate Governance and Nominating Committee: W.S.R. Seyffert (Chairman) J. H. Bennett H. J. Bolton J. G. Rennie C. M. T. Thompson -14- REPORT OF THE AUDIT COMMITTEE For more disclosure regarding the Corporation's Audit Committee please refer to the section titled "Audit Committee Information" in the Corporation's Annual Information Form for 2008. The purpose of the Audit Committee (the "Audit Committee") of the Board of Directors is to provide an open avenue of communication between Management, the external auditor, the internal auditors and the Board and to assist the Board in its oversight of the: o integrity, adequacy and timeliness of the Corporation's financial reporting and disclosure practices; o processes for identifying the principal financial reporting risks of the Corporation and the adequacy of the Corporation's internal control systems to ensure fair, complete and accurate financial reporting; o Corporation's compliance with legal and regulatory requirements related to financial reporting; o independence and performance of the Corporation's external auditor; o audit plans, programs and results of audits performed by the Corporation's internal audit department; o Corporation's antifraud programs and controls; and o the key financial estimates made by Management and reviewed by the external auditors. The Audit Committee performs any other activities consistent with its charter, the Corporation's by-laws and governing laws as the Audit Committee or Board deems necessary or appropriate. The Audit Committee is made up of five independent members of the Board. All of the members of the Audit Committee are financially literate to enable them to discharge their responsibilities in accordance with applicable laws and/or requirements of the stock exchanges on which the Corporation's securities trade. In addition, the Board has determined that there is at least one Audit Committee member who has the attributes of an Audit Committee financial expert. Hugh Bolton, Chair of the Corporation's Audit Committee, is an Audit Committee financial expert as defined by the U.S. Securities and Exchange Commission's regulation implementing Sections 406 and 407 of the Sarbanes-Oxley Act of 2002 and is independent under the applicable listing standards of the New York Stock Exchange. The Board's determination does not impose greater duties, obligations or liabilities on Mr. Bolton nor does it affect the duties, obligations or liabilities of other members of the Audit Committee or the Board. In carrying out its responsibilities, the Audit Committee meets regularly with the Chief Executive Officer and the Chief Financial Officer and without Management present with the external auditor, with the Corporation's internal auditor, and alone. THE FOLLOWING IS A BRIEF SUMMARY OF THE AUDIT COMMITTEE'S ACTIVITIES IN 2008. FINANCIAL REPORTING The Audit Committee: o reviewed the annual and interim financial statements, Management's Discussion and Analysis, news releases and other financial disclosures with Management and the external auditor prior to approval by the Board and to publication. These reviews included a discussion of -15- matters required or recommended to be disclosed under generally accepted accounting principles and securities regulations and laws. The Deputy Chairman of the Audit Committee attended a meeting of Management's Disclosure Committee to observe and assess senior Management's process for confirming full disclosure in financial news releases; o obtained assurances from Management and the external auditor that the Corporation is in full compliance with legal and regulatory requirements related to financial reporting; o ensured that an adequate system is in place for employees to report on a confidential and anonymous basis accounting, auditing, financial reporting and disclosure practices they find questionable; and o based on this information, the Audit Committee recommended to the Board that the audited financial statements be approved and included in the Annual Report to shareholders. WITH RESPECT TO THE EXTERNAL AUDITOR The Audit Committee: o reviewed with the external auditor the overall scope, the audit plans and results and all matters pertaining to professional auditing guidelines and standards in Canada and the United States; o received the written disclosures from the external auditor as recommended by the Canadian Institute of Chartered Accountants; o reviewed, with the external auditors, the independence of the external auditor including a review of non-audit services and the receipt of auditor's written assurance of its independent relationship with the Corporation; o required prior approval of all services provided by the external auditor; o approved the fees payable to the external auditor; and o reviewed the overall performance of the external auditor and on the recommendation of the Audit Committee, the Board is recommending that shareholders appoint PricewaterhouseCoopers LLP as the Auditor of the Corporation for 2009. WITH RESPECT TO THE INTERNAL AUDITOR The Audit Committee: o reviewed the independence of the internal auditors; and o reviewed with the Director, Compliance & Internal Audit the mandate, qualifications, resources and annual work plan of the Internal Audit Department and the results of internal audits. -16- FINANCIAL CONTROLS PROGRAM The Audit Committee: o continued its oversight of the Financial Controls Program ("FCP") to ensure that the program established in 2007 complies with Section 404 of the U.S. Sarbanes-Oxley Act of 2002 related to internal controls over financial reporting and equivalent Canadian rules is sustained. The FCP enabled Management to certify the effectiveness of the Corporation's internal controls structure and procedures for financial reporting, in accordance with the relevant rules. The external auditors have reported on and attested to Management's certification. The Audit Committee continues to monitor the FCP and oversee Management's maintenance of the Corporation's internal controls over financial reporting. o initiated an oversight process to monitor the Corporation's programs and progress to convert financial reporting and disclosure from the current Canadian and U.S. Generally Accepted Accounting Procedures (GAAP) to Internationally Financial Reporting Standards (IFRS) by the beginning of 2011. CHARTER AND KEY PRACTICES The Audit Committee: o annually reviews its mandate and in November 2008 revised its mandate in light of recent regulatory initiatives in the United States and Canada. o reviewed and approved the fees of the external auditor. A detailed breakdown of fees is set out on page 11 of this Management Proxy Circular; o in pursuit of continuous improvement, continued the process for assessing its effectiveness. As a result of discussions stimulated by a survey completed by Audit Committee members, senior financial Management and the external and internal auditors in 2008, a number of improvements were made to the Audit Committee's activities; and o ensured that the full text of the Audit Committee's Charter and Key Practices is included in the Corporation's Annual Information Form, which is filed on SEDAR (www.sedar.com) and on the Corporation's website. Presented by the Audit Committee: H. J. Bolton, Chairman K. E. Steeves, Deputy Chairman J. H. Bennett J. G. Rennie C. M. T. Thompson -17- STATEMENT OF EXECUTIVE COMPENSATION COMPENSATION COMMITTEE The Compensation Committee of the Board (the "Committee") has the following responsibilities: - reviewing and approving the corporate goals and objectives relevant to Chief Executive Officer ("CEO") compensation, evaluating the CEO's performance, and making recommendations to the Board with respect to the CEO's compensation level based upon this evaluation; - making recommendations to the Board with respect to compensation of executives and other senior managers, and for fixing the compensation of Named Executive Officers ("NEOs") (as defined below), including the granting of stock options and share units to them under the Corporation's long term incentive plans; - reviewing executive compensation disclosure before the Corporation publicly discloses this information; and - reviewing compensation policies and proposals with reference to industry sectors and markets in which the Corporation competes for executive and senior management talent. The Committee members are Janice Rennie, Chairperson, Brian Aune, Warren Seyffert and Chris Thompson, all of whom are independent directors. The Committee met six times during the year, including three in camera sessions. All meetings of the Committee are documented in the form of meeting minutes. In establishing policies covering base salaries, benefits, annual bonuses and long term incentive plans, the Committee takes into consideration the recommendations of Management. Mercer (Canada) Limited has been engaged by Management to provide specific support on executive and senior management compensation as well as director compensation, including surveys of market practices and a technical analysis of this information relative to the Corporation's compensation plans and practices. Additionally in 2008, the Committee retained the Hay Group to independently advise the Committee on CEO compensation. COMPENSATION DISCUSSION AND ANALYSIS OBJECTIVES OF EXECUTIVE COMPENSATION The Committee endeavors to ensure that the Corporation's compensation policies: - attract and retain highly qualified and experienced executives and managers; - recognize and reward contribution to the success of the Corporation as measured by the accomplishment of specific performance objectives; - ensure that a significant proportion of compensation is at risk and directly linked to the success of the Corporation; and - provide for health care coverage, disability and life insurance, and pension and retirement benefits. As the Committee assessed NEO performance at year-end and determined the appropriate compensation for the senior executive group, it took into consideration the objectives of executive compensation related to the annual incentive bonus and the long term incentive plans. In regards to recognizing the accomplishment of specific performance objectives, the Committee and the Board had extensive discussions with respect to the question of whether paying the annual incentive bonus to the NEOs was appropriate in the context of the rapid decline of our share price in the fourth quarter of 2008. We are acutely -18- aware that our shareholders, employees and other stakeholders have experienced significant financial losses as a result of the global economic slowdown, and that the Corporation's share price performance has been particularly affected by reason of the timing of the Fording acquisition in relation to the sudden deterioration of commodity prices and the closing of the credit markets. We are also cognizant that the Corporation's position is not unusual in the industry; several of the comparative companies are also burdened with excess debt from acquisitions. In regards to a significant proportion of compensation being at risk and linked to the Corporation's success, we have structured our long term incentives to ensure that the directors, executives and senior management have "skin in the game" and that compensation is closely aligned with shareholder interests. As a result, the fact that many years of long term compensation were wiped out in the crash of 2008, is consistent with the objectives of executive compensation. Unfortunately, the elimination of this value has also eliminated the retention effect of long term compensation with the Corporation now at risk of losing key employees to competitors, especially to the gold sector. Our annual incentive bonus is based on financial, safety and environment, functional and personal performance objectives. The Committee and the Board felt that it was important to respect the objectives of the annual incentive plan while taking into account the extraordinary events of late 2008. The company component of the annual incentive plan which is based on return on capital employed was rated at 60% of target reflecting overall operating performance of the Corporation. The personal component of the plan is where we dealt most directly with the consequences of the Fording transaction in light of the global economic slowdown. The executives most directly involved in the assessment and structuring of the transaction had their personal bonuses substantially reduced to reflect the outcome of the transaction in spite of the immense dedication and effort that they put into the execution of this transaction. STRUCTURE OF EXECUTIVE COMPENSATION The Corporation's executive compensation plan covers five areas: - Base salary - Annual incentive bonus - Long term incentives - Pensions, and - Benefits. In setting NEO compensation, the Committee refers to comparator groups comprised of North American mining and metal refining companies as well as other resource-based employers. For the CEO position, major global mining companies are also included in the comparator group, to ensure the compensation package provided to the CEO considers global compensation standards. These comparator groups generally represent the industry sectors and markets in which Teck competes for executive talent. The majority of companies in both peer groups are of a comparable size to Teck. Exceptions were made to include specific organizations with whom Teck competes for executive talent. The comparator group for the NEOs other than the CEO included: Agrium Inc. Alcan Inc. Alcoa Inc. Barrick Gold Corp. Cameco Corp. Canadian Natural Resources Canfor Corp. Finning International Inc. Freeport-McMoran Goldcorp Inc. Husky Energy Inc. Ipsco Inc. Newmont Mining Group Nexen Inc. Petro-Canada Potash Corp Sask Inc. Suncor Energy Inc. Talisman Energy Inc. West Fraser Timber Co. The CEO comparator group included: Alcan Inc. Anglo American PLC Asarco Inc. Barrick Gold Corp. BHP Billiton PLC Canfor Corp. Cia Vale do Rio Doce Falconbridge Ltd. Finning International Freeport-McMoran Goldcorp Inc. Inco Ltd. Kinross Gold Corp. Newcrest Mining Newmont Mining Group Petro-Canada Phelps Dodge Corp. Rio Tinto PLC Syncrude Canada West Fraser Timber Xstrata PLC Zinifex Ltd. Total direct compensation which includes base salary, annual bonus and long term incentives targets the median compensation level of the comparator group, with higher levels of compensation provided to executives and senior managers whom the Corporation considers to have consistently achieved superior levels of performance. BASE SALARY Base salary is determined through analysis of salaries paid by companies in the comparator groups, as well as individual performance as determined by the degree of achievement of business and operating goals. Base salaries are normally reviewed at the beginning of each year. The CEO recommends base salary adjustments to the Committee for the NEOs other than himself. The Committee determines the base salary adjustment for the CEO taking into consideration advice it has received from its compensation advisor. Base salary adjustments made as of January 1, 2008 reflect salary increases in the comparator group as well as individual performance and ranged from 2.9% to 5.6%. As a result of business conditions in late 2008, the Corporation decided to freeze base salaries of the NEOs, senior management, and other staff employees, and as a result the salary review which normally takes place on January 1 was deferred. The base salary increases for NEOs that were decided last year in February 2008 are set out below:
========================= ======================== ================ ===================== =========== NAMED EXECUTIVE TITLE BASE SALARY BASE SALARY AT PERCENT OFFICER INCREASE JANUARY 1, 2008 INCREASE - ------------------------- ------------------------ ---------------- --------------------- ----------- Donald R. Lindsay President and CEO $44,000 $1,144,000 4.0% - ------------------------- ------------------------ ---------------- --------------------- ----------- Peter G. Kukielski (1) EVP and Chief Operating $25,000 $850,000 3.0% Officer - ------------------------- ------------------------ ---------------- --------------------- ----------- Ronald A. Millos SVP, Finance and CFO $15,000 $440,000 3.5% - ------------------------- ------------------------ ---------------- --------------------- ----------- Ronald J. Vance SVP, Corporate $15,000 $540,000 2.9% Development - ------------------------- ------------------------ ---------------- --------------------- ----------- Peter C. Rozee SVP, Commercial Affairs $20,000 $495,000 4.2% - ------------------------- ------------------------ ---------------- --------------------- ----------- Douglas H. Horswill SVP, Sustainability and $25,000 $475,000 5.6% External Affairs ========================= ======================== ================ ===================== =========== Notes: (1) P. G. Kukielski, Executive Vice President and Chief Operating Officer left the company in late 2008.
-20- ANNUAL INCENTIVE BONUS An annual incentive bonus plan (the "Bonus Plan") is in place to provide a variable component of total cash compensation that is directly related to the financial performance of the Corporation and its business units as well as the achievement of safety and environment objectives and individual performance objectives. Financial performance is measured in terms of Return on Capital Employed (ROCE). Corporate and business unit ROCE targets are based on the Corporation's annual financial plan and are adjusted at the end of the year to reflect actual zinc, copper, coal and gold prices. ROCE is used to focus Management attention on the returns being generated by assets in their areas of responsibility and to encourage investment of capital in new assets which will enhance ROCE performance. Price adjusting target ROCE provides for recognition of excellent operating performance during periods of low commodity prices while avoiding windfall payouts during periods of high metal prices. The Bonus Plan also reinforces the Corporation's corporate values of ensuring a safe and healthy workplace and protecting the environment. The Bonus Plan has three components: company, business unit, and personal performance. Weightings for these components vary by position, reflecting the impact each position has on company-wide and business unit performance. Weightings and performance measures for each component of the Bonus Plan for the NEOs are set out below.
============================================================================================================== TARGET COMPANY BUSINESS UNIT PERSONAL BONUS ========== =========================== ================================ ======================== (% OF WEIGHT PERFORMANCE WEIGHT PERFORMANCE MEASURE WEIGHT PERFORMANCE SALARY) MEASURE MEASURE - ------------------------ ---------- ---------------- ---------- --------------------- ---------- ------------- CEO 75% 50% ROCE 20% Safety and 30% Personal Environment performance objectives - ------------------------ ---------- ---------------- ---------- --------------------- ---------- ------------- Other Named 50% 40% ROCE 30% VARIOUS: 30% Personal Executive -------- performance Officers o Business objectives Unit ROCE o Safety and Environment o Functional objectives ==============================================================================================================
Target bonuses are expressed as a percentage of base salary and are payable when company ROCE, business unit ROCE, safety and environment, and personal performance objectives are met. Payouts under the Bonus Plan can range from 0% to 200% of target depending on the actual level of performance achieved. Based on results, the CEO recommends to the Committee ratings for the company and business unit components of the Bonus Plan, as well as the bonus payment for each NEO other than himself. The Committee determines the bonus payment for the CEO based on company ROCE, safety and environment performance, and the results the CEO has achieved on the personal performance objectives which were set at the beginning of the year. In 2008, the Corporation achieved a price adjusted ROCE of 11% compared to a target of 14%. Based on these results and the circumstances in which the results were achieved, the CEO assigned a performance rating for this element of the bonus plan of 60%, the lowest rating since this plan was formed in 2001. The performance rating took into consideration below plan performance in some areas as well as how results were rated in previous years. Target ROCE -21- was not achieved due to higher operating costs and lower throughput at some operations including Antamina, Red Dog, and in Coal. Price adjusted ROCE excluded the effect of significant write downs of some assets and goodwill which were recorded at year-end as these were considered to be market related adjustments much like the swing in commodity prices which are neutralized in the Bonus Plan results. Key achievements for 2008 which impacted the bonus calculations for the CEO and other NEOs included a significant improvement in safety, achieving a total recordable incident frequency of 1.56 compared to a target of 3.1 and severity of 12.8 compared to a target of 21.0, acquisition of the Relincho property, realized margin improvements totalling $176 million compared to a target of $115 million under the performance improvement program launched throughout the Corporation during the year, and significantly advancing key growth projects towards production including the Quebrada Blanca hypogene, Equinox and Frontier projects. The Fording transaction was a key growth project for the Corporation and was very well received by the market when announced in July. The Corporation's share price outperformed the major competitors for many weeks after the transaction was announced. However, as a result of the dramatic decline in global economic conditions during the latter half of the year and the adverse impact on all commodity prices, the Corporation has been left with a heavy debt load and a weakened balance sheet. While many other large diversified mining companies are either in the same situation or almost were, given the importance of the balance sheet strength objective, the CEO recommended significantly lower personal performance ratings for Mr. Millos, Mr. Vance, Mr. Rozee and Mr. Horswill than otherwise would have been calculated based on the achievement of other key personal objectives. As well, the CEO recommended a 0% rating for the personal component of his own bonus. The personal objectives of the NEOs in the final quarter of the year were refocused on dealing with the commodity price meltdown and the resolution of the liquidity crisis facing the company and they have been working tirelessly on a restructuring plan to refinance or reschedule the debt and to optimize cash flows and asset sales in order to reduce debt. That will remain the main focus of the executive team until the crisis has passed. Details of other performance achievements, ratings and bonus amounts are set out below.
==================== =============== ================== ================================ ================================== ACTUAL BONUS COMPANY BUSINESS UNIT PERSONAL (% OF TARGET) PERFORMANCE PERFORMANCE PERFORMANCE ==================== =============== ================== ================================ ================================== D. R Lindsay $500,000 Corporate ROCE Company wide safety and Mr. Lindsay's personal (58.3%) rating of 60%. environment performance objectives for 2008 covered: President and CEO equally weighted. Safety as launching a performance measured by Total Recordable improvement program throughout Incidents was 1.56 compared the Corporation, maintaining a to a target of 3.1, and strong balance sheet while Severity was 12.8 compared to funding significant growth a target of 21.0 resulting in projects, advancing growth a rating of 167.4%. Overall projects towards production, environmental performance was and improving corporate rated at 110.4%. knowledge of key exploration opportunities. While Mr. Lindsay accomplished a number of significant objectives, due to the balance sheet impact of the Fording transaction he recommended that his rating be set at 0%. - -------------------- --------------- ------------------ -------------------------------- ----------------------------------
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==================== =============== ================== ================================ ================================== ACTUAL BONUS COMPANY BUSINESS UNIT PERSONAL (% OF TARGET) PERFORMANCE PERFORMANCE PERFORMANCE ==================== =============== ================== ================================ ================================== R. A. Millos $170,000 Corporate ROCE Weighted average Business Mr. Millos' personal objectives (77.2%) rating of 60%. Unit ROCE rating of 107.0%. for 2008 covered: analytical SVP, Finance and While some of the operations support to acquisitions as well CFO had higher costs and lower as financing these transactions, production than plan, SOX compliance and restructuring Management's action to of internal and external address these challenges regulatory reporting resulted in ratings close to requirements consistent with the 100%. Trail and the Coal new commodity focused mines performed well during organization. the year resulting in ratings higher than 100% for these operations. ==================== =============== ================== ================================ ================================== R. J. Vance $195,000 Corporate ROCE Mr. Vance's business unit Mr. Vance's personal objectives (72.2%) rating of 60%. rating takes into for 2008 covered: analysis of SVP, Corporate consideration the achievement potential targets, complete Development of specific objectives for significant acquisitions, the Business Development corporate development group and Technology functions restructuring and development, which report to him. On this and investor relations. basis, Mr. Vance's overall business unit rating was 119.2%. - -------------------- --------------- ------------------ -------------------------------- ---------------------------------- P. C. Rozee $195,000 Corporate ROCE Mr. Rozee's business unit Mr. Rozee's personal objectives (78.8%) rating of 60%. rating of 107.0% was for 2008 covered: due SVP, Commercial determined in the same manner diligence, analysis, design and Affairs as the business unit rating financing of acquisitions, legal for Mr. Millos. oversight related to all major transactions, and disclosure document preparation and review. - -------------------- --------------- ------------------ -------------------------------- ---------------------------------- D. H. Horswill, $195,000 Corporate ROCE Mr. Horswill's business unit Mr. Horswill's personal (82.1%) rating of 60%. rating is equally weighted objectives for 2008 covered: SVP, between company wide Safety safety and environmental Sustainability & and Environment performance, performance, community, External Affairs and weighted average Business government and other key Unit ROCE. His overall stakeholder relations, and business unit rating was external communications and 122.9%. government relations. ==================== =============== ================== ================================ ==================================
Note: (1) P. G. Kukielski, Executive Vice President and Chief Operating Officer left the company before year-end and as a result forfeited his bonus for 2008. LONG TERM INCENTIVES The Corporation's long term incentives are designed to foster and promote the long-term financial success of the Corporation by strengthening the ability of the Corporation to attract and retain highly competent employees, motivate performance through incentive compensation, promote greater alignment of interests between employees and shareholders in creating long-term shareholder value, and enable employees to participate in the long-term growth and financial success of the Corporation. Long term incentives are comprised of stock options and share units, with approximately the same value of each being provided. The Black-Scholes method is used to value stock options. The share -23- price on the date of grant is used to value share units. Stock options provide employees with the opportunity to participate in the growth of the Corporation's share price as well as benefit from the favourable tax treatment applicable to this form of compensation. Share units also allow employees to participate in the growth in share price while at the same time providing the Corporation with the benefit of a tax deductible form of compensation and avoiding the potential effect of share dilution associated with stock option grants. The CEO recommends to the Committee grants of options and units to the NEOs other than himself as well as other executive, senior management, operations, commercial and technical function employees. In order to attract and retain talent, grants are designed along with base salary and the annual incentive bonus to achieve Corporation's target pay positioning relative to the comparator groups. Should amendments be required to either the stock option or share units plans, these changes are recommended by Management to the Committee. When granting stock options and share units, the Committee assesses the status of the stock option reserve and potential dilution resulting from a stock option grant, and share run rates relative to the comparator group of companies. To align with shareholder interests, the CEO is currently required to hold five times his annual base salary in shares or share units. On April 22, 2008, the date when the ownership requirement was determined, this amounted to a value of $5,720,000 or 120,421 shares. At the date of this Management Proxy Circular, Mr. Lindsay held 502,056 Class B subordinate voting shares and 526,344 share units. PENSIONS Prior to the merger of Teck and Cominco (effective July 20, 2001), executives hired by Teck became members of the Pension Plan for Executive and Qualified Senior Salaried Employees and a supplemental defined benefit arrangement. Prior to the merger, executives hired by Cominco became members of the defined contribution provision of the Teck Cominco Metals Ltd. Retirement Income Plan for Non Union Employees and a supplemental defined contribution arrangement. Upon the merger of Teck and Cominco, all new executives became members of the Pension Plan for Executive and Qualified Senior Salaried Employees and a supplemental defined benefit arrangement. During 2005, as part of a transition from defined benefit pension plans to defined contribution pension plans, new executives joining the Corporation became members of the Teck Cominco Metals Ltd. Retirement Income Plan for Non Union Employees as well as a supplemental defined contribution arrangement. BENEFITS The Corporation's executive benefit plan includes: medical, extended health, dental, disability and life insurance coverage. Perquisites consist of a car benefit, club memberships, and an annual health assessment. The Corporation provides retired executives with post retirement benefits including life insurance for up to 5 years after retirement, medical, extended health and dental coverage. These benefits and perquisites are comparable to what other Canadian-based mining and metal refining, and other resource sector companies provide executive level employees. TERMINATION AND CHANGE OF CONTROL BENEFITS The Corporation has entered into employment agreements with each NEO to provide a consistent and comprehensive framework of employment terms for each executive. These agreements set out terms and conditions in the event there is a change in control, or in other circumstances where the executive loses his job through no fault of his own. -24- SUMMARY COMPENSATION TABLE - NEOS The following table sets out total compensation for the financial year ending December 31, 2008 for the President and Chief Executive Officer, the Senior Vice President Finance and Chief Financial Officer and the three other most highly compensated executive officers of the Corporation and any of its subsidiaries (collectively called the "Named Executive Officers" or "NEOs"), as well as an additional executive who left the Corporation before year end. Please note that these share-based awards and option-based awards were valued and granted one year ago in February 2008, some eight months before the major market downturn. Their value today has decreased substantially.
=================== ======== ============ ============= ============== ============== =========== ================ ============== NAME AND ANNUAL PENSION ALL OTHER TOTAL PRINCIPAL SHARE-BASED OPTION-BASED INCENTIVE VALUE COMPENSATION COMPENSATION POSITION YEAR SALARY ($) AWARDS ($) AWARDS ($) PLANS ($) ($) ($) ($) (1) (2) (3) (4)(5) (6)(7)(8) =================== ======== ============ ============= ============== ============== =========== ================ ============== D.R. Lindsay President and CEO 2008 1,144,000 2,216,004 2,282,784 500,000 336,000 40,000 6,518,788 - ------------------- -------- ------------ ------------- -------------- -------------- ----------- ---------------- -------------- P.G. Kukielski Executive VP and 2008 811,327 1,141,392 61,750 68,391 2,082,860 COO - ------------------- -------- ------------ ------------- -------------- -------------- ----------- ---------------- -------------- R.A. Millos SVP Finance and 2008 440,000 539,578 570,696 170,000 57,200 4,215 1,781,689 CFO - ------------------- -------- ------------ ------------- -------------- -------------- ----------- ---------------- -------------- R.J. Vance SVP Corporate 2008 540,000 711,997 760,928 195,000 70,200 2,278,125 Development - ------------------- -------- ------------ ------------- -------------- -------------- ----------- ---------------- -------------- P.C. Rozee SVP Commercial 2008 495,000 734,104 760,928 195,000 108,000 2,293,032 Affairs - ------------------- -------- ------------ ------------- -------------- -------------- ----------- ---------------- -------------- D.H. Horswill SVP 2008 475,000 559,775 507,696 195,000 61,700 18,199 1,880,370 Sustainability and External Affairs =================== ======== ============ ============= ============== ============== =========== ================ ==============
Notes: (1) Share units in the form of DSUs or RSUs are granted on an annual basis under the Corporation's share unit plans. Dividend equivalents are credited to a participant's share unit account in the form of additional DSUs or RSUs as of each payment date in respect of which cash dividends are paid on the Class B subordinate voting shares. The units vest on the third anniversary of the end of the calendar year immediately preceding the grant. Dollar figures are based on $33.97 which was the closing price of the Class B subordinate voting shares on the day prior to the grant date. (See section on Long Term Incentives - Share Unit Plans on page 28.) (2) The options granted in the 2008 financial year were granted pursuant to the Stock Option Plan. (See section on Long Term Incentives - Stock Option Plan on page 27). For compensation purposes, the Black-Scholes option valuation model has been used to determine the fair value on the date of grant. The Black-Scholes option valuation is determined using the expected life of the stock option, expected volatility of the Corporation's common share price, expected dividend yield, and risk-free interest rate. The assumption used in the grant date fair value model is based on an expected life of 5.5 years, which is half the sum of the actual term of eight years and an assumed vesting period of three years, which is generally consistent with the US Securities and Exchange Commission ("SEC") safe harbor definition of expected life. The Black-Scholes grant date fair value for awards granted on February 14, 2008 was 26.4% of the option exercise price. The grant date fair value of stock option awards will differ slightly from the accounting fair value disclosed in the Corporation's financial statements. Section 3870 of the Handbook of the Canadian Institute of Chartered Accountants (CICA) requires recognition in the Corporation's financial statements of an expense for option awards using the fair value method of accounting. Under this method, the fair -25- value of an award at the grant date is amortized over the applicable vesting period and recognized as a compensation expense. To calculate the accounting fair value, the Black-Scholes option valuation model is also used. However, the assumptions in the accounting model, which is consistent with the CICA's section 3870 rules, is based on an expected term of eight years, the Corporation's historical option exercise pattern. The accounting fair value for grants made under the Corporation's Stock Option Plan during the year ended December 31, 2008 was based on a Black-Scholes value of 28% of the option exercise price. (3) The annual incentive figures are the 2008 bonus which is paid out in March, 2009. The bonus consists of three components: Company, Business Unit and Personal. P. G. Kukielski, Executive Vice President and Chief Operating Officer left the company before yearend and as a result forfeited his bonus for 2008. See Annual Incentive Bonus section on page 20 for details. (4) See Pension section on page 29 for details. (5) P.G. Kukielski, Executive Vice President and Chief Operating Officer left the Corporation before year-end. The value of the pension for Mr. Kukielski includes Company contributions to the DC Pension Plan and notional Company contributions to the DC Supplementary Plan account in 2008. Mr. Kukielski was 48.44% vested in his DC Supplementary Plan at the time he left the Corporation. (6) All other compensation for D.R. Lindsay is based on his director's fees and retainer for 2008 in connection with his membership on the Teck Board. (7) All other compensation for R.A. Millos, P.G. Kukielski and D.H. Horswill is for vacation time that was paid out in 2008. (8) Perquisites have not been included, as they do not reach the prescribed threshold of the lesser of $50,000 and 10% of total salary for the financial year 2008. INCENTIVE PLAN AWARDS Outstanding Share-Based Awards and Option-Based Awards The following table shows all awards outstanding to each Named Executive Officer for the fiscal year ending December 31, 2008.
===================================================================================== ================================= OPTION-BASED AWARDS SHARE-BASED AWARDS - ------------------- --------------- ---------------- --------------- ---------------- ----------------- --------------- Market or Number of Value of Payout Value Name Securities Option Unexercised No. of Shares of Share Underlying Exercise Price Option Expiry In-The-Money or Units that Awards that Unexercised Date Options (1) have not vested have not Options ($) ($) (#) vested (2) (#) ($) - ------------------- --------------- ---------------- --------------- ---------------- ----------------- --------------- D. R. Lindsay 150,000 22.64 Mar. 14, 2011 0 100,000 33.20 Feb 15, 2014 0 47,948 RSUs 288,647 CEO 120,000 43.74 Feb. 16, 2015 0 47,948 DSUs 288,647 240,000 33.97 Feb. 14, 2016 0 - ------------------- --------------- ---------------- --------------- ---------------- ----------------- --------------- R. A. Millos 36,000 6.00 Feb. 20, 2009 720 43,200 5.75 Feb. 14, 2010 11,664 14,482 RSUs 87,182 SVP, Finance and 30,000 33.20 Feb. 15, 2014 0 13,117 DSUs 78,964 CFO 30,000 43.74 Feb. 16, 2015 0 60,000 33.97 Feb. 14, 2016 0 - ------------------- --------------- ---------------- --------------- ---------------- ----------------- --------------- R. J. Vance 33,300 33.20 Feb. 15, 2014 0 SVP, Corporate 40,000 43.74 Feb. 16, 2015 0 34,728 RSUs 209,063 Development 80,000 33.97 Feb. 14, 2016 0 - ------------------- --------------- ---------------- --------------- ---------------- ----------------- ---------------
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===================================================================================== ================================= OPTION-BASED AWARDS SHARE-BASED AWARDS - ------------------- --------------- ---------------- --------------- ---------------- ----------------- --------------- Market or Number of Value of Payout Value Name Securities Option Unexercised No. of Shares of Share Underlying Exercise Price Option Expiry In-The-Money or Units that Awards that Unexercised Date Options (1) have not vested have not Options ($) ($) (#) vested (2) (#) ($) - ------------------- --------------- ---------------- --------------- ---------------- ----------------- --------------- P. C. Rozee 36,000 6.00 Feb. 20, 2009 720 30,000 12.545 Feb. 20, 2010 0 19,386 RSUs 116,704 SVP, Commercial 20,000 22.64 Mar. 14, 2011 0 15,341 DSUs 92,353 Affairs 30,000 33.20 Feb. 15, 2014 0 40,000 43.74 Feb. 16, 2015 0 80,000 33.97 Feb. 14, 2016 0 - ------------------- --------------- ---------------- --------------- ---------------- ----------------- --------------- D. H. Horswill 5,000 12.545 Feb. 20, 2010 0 27,601 DSUs 166,158 SVP, 20,000 22.64 Mar. 14, 2011 0 Sustainability & 30,000 33.20 Feb. 15, 2014 0 External Affairs 30,000 43.74 Feb. 16, 2015 0 60,000 33.97 Feb. 14, 2016 0 - ------------------- --------------- ---------------- --------------- ---------------- ----------------- ---------------
Notes: (1) Maximum value at December 31, 2008 calculated by determining the difference between the closing price of the Class B subordinate voting shares underlying the options on the TSX at December 31, 2008 ($6.02) and the exercise price of the options. (2) Market or Payout Value calculated by multiplying the number of share units (RSUs and/or DSUs) held at December 31, 2008 by the closing price of the Class B subordinate voting shares on the TSX at December 31, 2008 ($6.02). INCENTIVE PLAN AWARDS - VALUE VESTED OR EARNED DURING THE YEAR The following table shows the incentive plan awards value vested or earned for each NEO for the fiscal year ending December 31, 2008.
================================= ================================ ================================= NAME OPTION-BASED SHARE-BASED (DSU/RSU) AWARDS - AWARDS - VALUE VALUE VESTED DURING THE YEAR (1) VESTED DURING THE YEAR ($) ($) ================================= ================================ ================================= D.R. Lindsay President and CEO 997,667 97,340 (2) / 97,340 (3) --------------------------------- -------------------------------- --------------------------------- R.A. Millos SVP Finance and CFO 800 57,254 (2) / 0 (3) --------------------------------- -------------------------------- --------------------------------- R.J. Vance SVP Corporate Development 888 46,096 (2) / 95,635 (3) --------------------------------- -------------------------------- --------------------------------- P.C. Rozee SVP Commercial Affairs 133,453 57,254 (2) / 0 (3) --------------------------------- -------------------------------- --------------------------------- D.H. Horswill SVP Sustainability and External 133,453 57,254 (2) / 0 (3) Affairs ================================= ================================ =================================
-27- Notes: (1) The amount represents the aggregate dollar value that would have been realized if the options had been exercised on the vesting date, based on the difference between the closing price of the Class B subordinate voting shares on the TSX and the exercise price on such vesting date. (2) Deferred Share Units vested but are not redeemable until the recipient retires, resigns or their employment is otherwise terminated. (3) The amount represents the aggregate dollar value that has been realized upon vesting of the share units as of December 19, 2008, using the closing price of the Class B subordinate voting shares on the TSX on December 18, 2008 ($5.38). STOCK OPTION PLANS The Corporation maintains two stock option plans (defined as compensation plans under which Class B subordinate voting shares have been authorized for issuance): the 2001 Stock Option Plan and the 1995 Stock Option Plan. In addition, options (the "Merger Options") were issued in exchange for options of Teck Cominco Metals Ltd. (formerly Cominco Ltd.) in connection with the 2001 merger of the Corporation and Cominco Ltd. Since May 1, 2001 no further options have been or may be issued under the 1995 Stock Option Plan. The 2001 Stock Option Plan (the "Plan") continues to be instrumental in providing a market-competitive total compensation package for attracting and retaining executives and key employees and linking long-term compensation to the performance of the Class B subordinate voting shares. The eligible participants are full time employees of the Corporation and its affiliates, including the NEOs, and consultants to the Corporation. Option grants have a term of eight years and vest on the basis of one third on the first anniversary, one-third on the second anniversary and one-third on the third anniversary of the grant. The exercise price of an option is the closing price for the Class B subordinate voting shares on the Toronto Stock Exchange ("TSX") on the trading day preceding the date of grant of the option. As of December 31, 2008, there were 4,531,612 options outstanding representing 0.95% of the outstanding Class B subordinate voting shares and 5,727,569 options remaining available for issuance under the Plan, representing 1.2% of the outstanding Class B subordinate voting shares. The outstanding options and options available for issuance together represent 2.2% of the outstanding Class B subordinate voting shares. See also "Securities Authorized for Issuance Under Equity Compensation Plans" page 35. As of March 2, 2009, there were 6,639,280 options outstanding representing 1.4% of the outstanding Class B subordinate voting shares and 3,619,901 options remaining available for issuance under the Plan, representing 0.8% of the outstanding Class B subordinate voting shares. The outstanding options and options available for issuance together represent 2.2% of the outstanding Class B subordinate voting shares. Options are not assignable except to the personal registered retirement savings plan or personal registered retirement income fund of an optionee. The Plan provides that (i) the number of Class B subordinate voting shares issuable to insiders of the Corporation collectively at any time under all equity compensation arrangements of the Corporation may not exceed 10% of the issued and outstanding common shares of the Corporation; (ii) the number of Class B subordinate voting shares issued to insiders of the Corporation under all equity compensation arrangements of the Corporation in any 12 month period may not exceed 10% of the issued and outstanding common shares of the Corporation; (iii) the number of Class B subordinate voting shares issuable to any one person at any time under all equity compensation arrangements of the Corporation may not exceed 5% of the issued and outstanding common shares of the Corporation. -28- In lieu of exercising an option, an optionee may exercise the right to realize the appreciation in value of the option (the "Share Appreciation Right"). The Share Appreciation Right per option is the "market value" of the Class B subordinate voting share less the option exercise price. The "market value" is the weighted average price of the Class B subordinate voting share for the five business days preceding the date of receipt by the Corporation from the optionee of a notice of exercise of the Share Appreciation Right. In the case of the death of an employee participant under the Plan, the legal representative of the participant may exercise the participant's options that have vested as of the date of death or that vest within three years of the date of death in whole at any time or in part from time to time until the earlier of (i) the third anniversary of the date of death; and (ii) the date that is the later of the first anniversary of the date of death and the date of expiry of such option. In the case of the death of a director participant under the Plan, the legal representative of the participant may exercise the participant's options that have vested as of the date of death or that vest within one year of the date of death in whole at any time or in part from time to time until one year after the date of death, notwithstanding the date of expiry of such option. In the case of termination of the employment of an optionee, other than by death or dismissal for cause, after the optionee has reached the normal retirement age under the Corporation's policies, all options vest on the date of retirement and may be exercised until the earlier of the third anniversary of the date of retirement or the expiry date of the option. If an optionee retires before the normal retirement age at the request or with the concurrence of the Corporation, options that have vested prior to the retirement are exercisable until a date not later than the expiry date, as determined by the President of the Corporation and further subject to the President's discretion to treat the optionee as if he or she had reached the normal retirement age. If an employee resigns in circumstances other than as described above, options held by the employee that have vested prior to the date of resignation may be exercised until the earlier of 90 days after the date of resignation or the expiry date of the option. If an employee is terminated by the Corporation otherwise than for cause or as described above, than options that have vested prior to the termination are exercisable until the earlier of one year after the date of termination of employment or the expiry date of the option. In the case of the termination of the appointment or engagement of directors and consultants who are not full-time employees, the options that vested prior to the termination of membership on the Board or termination of the consulting agreement are exerciseable until the earlier of one year after the termination or the expiry date of the option. The Board has the power to make amendments to the Plan without the approval of shareholders of the Corporation other than amendments relating to the following, which require shareholder approval: (i) the limitations on grants of options to insiders and the number of shares that may be reserved for issuance to insiders; (ii) the maximum number of shares reserved for issuance upon exercise of options; (iii) the eligibility of non-executive directors for the grant of options; (iv) any decrease in the exercise price of outstanding options; (v) the extension of the term of an outstanding option other than as contemplated in the event of the death of the optionee. In addition, amendments that will adversely affect outstanding options require the consent of the optionee. SHARE UNIT PLANS Effective April 28, 2004, directors and senior executive officers were eligible to participate in the Corporation's Deferred Share Unit Plan ("DSU") or Restricted Share Unit Plan ("RSU"). These plans provide for an annual grant to each director and certain senior executive officers. Non-executive directors also have the right to elect on an annual basis to receive some or all of their annual retainer in DSUs. Dividend equivalents are credited to a participant's -29- account in the form of additional DSUs or RSUs as of each payment date in respect of which cash dividends are paid on the Class B subordinate voting shares, based on the closing price of the shares on the dividend payment date. In the case of the senior executive officers, DSUs and RSUs vest on the third anniversary of the end of the calendar year immediately preceding the date of grant. DSUs are paid out in cash on termination of employment, retirement or death. DSUs for directors are paid out in cash when the participant ceases to be a member of the Board. RSUs are paid out in cash prior to the third anniversary of the year ended immediately prior to the grant. Other executives and managers became eligible to participate in the share unit plans in 2005. As of December 31, 2008, directors, executives and managers held a total of 586,040 DSUs and 515,160 RSUs. PENSIONS DEFINED BENEFITS PENSION Mr. Lindsay, CEO, is accruing benefits under the Corporation's Pension Plan for Executive and Qualified Senior Salaried Employees (the "Retirement Plan"), a registered pension plan under the Income Tax Act and under an Executive Retirement Agreement (the "Executive Agreement"). His total annual retirement benefit is equal to 2.5% of highest average annual earnings in a 36 consecutive month period, multiplied by years of service. Earnings include base pay only and exclude bonuses and director's fees. The normal retirement age for payment of the accrued pension is age 60. Mr. Lindsay may retire at any time after attainment of age 55 or, with the consent of the Corporation, upon completion of 10 years of continuous service. His accrued pension payable at his early retirement date will be reduced on an actuarial equivalent basis to reflect commencement prior to age 60. The pension is payable in the form of a joint and two-thirds survivor pension with a five year guarantee. Mr. Rozee, SVP, Commercial Affairs is accruing benefits under the Retirement Plan and under a supplemental pension arrangement. His total annual retirement benefit is equal to 2.0% of highest average annual earnings in a 36 consecutive month period, multiplied by years of service. Earnings include base pay only and exclude bonuses and director's fees. The normal retirement age for payment of the accrued pension is age 60. Mr. Rozee may retire at any time after attainment of age 55. His accrued pension payable at his early retirement date will be reduced on an actuarial equivalent basis to reflect commencement prior to age 60. The pension is payable in the form of a joint and 60% survivor pension with a five year guarantee. The following table provides relevant information with respect to the pension entitlements of Mr. Lindsay and Mr. Rozee as of December 31, 2008:
======================================================================================================================== Annual Benefits Payable - ------------------------ ------------------------- -------------------------------------------------------------------- Name Years of Accrued At Age 65 Accrued Compensatory Non-Compensatory Accrued Credited at End of Obligation at Obligation at Service Year Start of Year End of Year - ------------- ----------- ----------- ------------- --------------- ----------------- ----------------- ---------------- D.R. Lindsay 4.00 $104,800 $492,300 $1,008,000 $336,000 $(456,000) $888,000 P.C. Rozee 7.75 $69,200 $215,300 $722,000 $108,000 $(272,000) $558,000 ========================================================================================================================
The annual benefits payable are based on highest annual average earnings at December 31, 2008. The actuarial valuation method and the significant assumptions that the Corporation applied in quantifying the accrued -30- obligation at the end of the year are described in the footnotes to the Corporation's financial statements for the year ended December 31, 2008. The amounts in the "compensatory" column include the service cost for the year and the impact of any differences between the estimated earnings at the start of the year and the actual earnings at the end of the year on the accrued obligation. The amounts shown in the "non-compensatory" amounts include interest and the impact of changes that were made to the assumptions used to value the accrued benefits, the results of which reduced the accrued obligation. DEFINED CONTRIBUTION PENSION Mr. Millos, Mr. Vance and Mr. Horswill are participants in the defined contribution provision of the Teck Cominco Metals Ltd. Retirement Income Plan (the "DC Pension Plan"), a registered pension plan under the Income Tax Act, and the defined contribution provision of the Supplementary Retirement Income Plan (the "DC Supplementary Plan"). The DC Pension Plan provides for vesting on date of entry to the DC Pension Plan and the DC Supplementary Plan provides for 100% vesting after the completion of five years of service from the date of becoming a DC Supplementary Plan member. For each of the these NEOs, the contributions remitted in 2008 by the Corporation to the DC Pension Plan were equal to the maximum contribution limit under the Income Tax Act of $21,000. The DC Supplementary Plan provides for notional contributions of 13% of earnings minus the contributions remitted to the DC Pension Plan. Earnings include base pay only and exclude bonuses and directors' fees. Each NEO's notional account balance under the DC Supplementary Plan is credited with notional investment income based on the investment return earned by the NEO under the DC Pension Plan. The account balances under the DC Pension Plan are invested in accordance with the individual participants' election from the investment options offered by the Corporation to all plan members including Canadian, U.S., International and Foreign Equity funds, a Bond fund, a Money Market Fund, five Asset Mix options and a Guaranteed Investment Certificate. Upon retirement, the participant is entitled to the distribution of the accumulated value of the Corporation's contributions under the DC Pension Plan as a lump sum and to the distribution of the accumulated value of the notional contributions under the DC Supplementary Plan as a series of 120 equal monthly payments. The amounts reported in the table below show the combined defined contribution account balances for the two plans for each of the NEOs at the start of the year and at the end of the year, including a reconciliation of the change in the defined contribution account balances.
================ ===================== ================= ===================== ================== NAME ACCUMULATED VALUE COMPENSATORY NON-COMPENSATORY ACCUMULATED VALUE AT START OF YEAR AT YEAR END ================ ===================== ================= ===================== ================== R.A. Millos $ 267,700 $ 57,200 ($ 55,400) $ 269,500 ---------------- --------------------- ----------------- --------------------- ------------------ R.J. Vance $ 123,400 $ 70,200 ($ 39,200) $ 154,400 ---------------- --------------------- ----------------- --------------------- ------------------ D.H. Horswill $ 559,900 $ 61,700 ($ 77,700) $ 543,900 ================ ===================== ================= ===================== ==================
The amounts in the "compensatory" column include the employer contributions to the DC Pension Plan and notional contributions to the participant's DC Supplementary Plan accounts. The amounts shown in the "non-compensatory" column represent the investment earnings during the year, which for 2008 were negative. None of these NEOs participate in defined benefit pension plan arrangements. -31- TERMINATION AND CHANGE IN CONTROL The employment agreements cover position, term, duties, employee obligations, compensation including base salary, bonus, share units and stock options, pension, other benefits, vacation and car benefit, and provisions covering termination for cause, without cause and in the event of a change in control. If the CEO's employment is terminated by the Corporation without cause or by the CEO for good reason subsequent to a change in control, the Corporation will pay the CEO a lump sum equal to three times the CEO's base salary plus an amount equal to three times the average amount of the bonus received by the CEO for the three years immediately preceding the year in which the termination of employment occurs. For the other NEOs, the Corporation will pay a lump sum equal to two times base salary plus an amount equal to two times the average amount of the bonus received by the executive for the three years immediately preceding the year in which the termination of employment occurs. In the event of a change in control, all unvested stock option and share unit grants vest and become payable. Where the executive is terminated without cause, in order to receive these payments, the executive must (i) not use knowledge or experience gained as an employee of the Corporation in any manner which would be detrimental to the business interests of the Corporation or its affiliates, (ii) not directly or indirectly recruit or solicit any employee of the Corporation for a period of 12 months following termination, (iii) keep non-public information concerning the business of the Corporation and its affiliates, including information related to business opportunities, in strictest confidence, (iv) comply with the Corporation's Employee Technology and Confidentiality Agreement and the Code of Ethics, and (v) upon termination, return to the Corporation all assets of the Corporation including any documents, recordings or other format on which information of the Corporation is stored. These obligations do not apply if the executive is terminated by the Corporation within 12 months of a change in control or where the executive resigns for good reason within 12 months of the change in control. The following table shows the estimated compensation where an NEO is terminated without cause, or following a change in control as if the termination occurred on December 31, 2008.
============================ ============================================= =================== ================= NAMED EXECUTIVE OFFICER TITLE TERMINATION TERMINATION WITHOUT CAUSE CHANGE IN CONTROL ============================ ============================================= =================== ================= D.R. Lindsay President and CEO $6,132,000 $6,720,708 ---------------------------- --------------------------------------------- ------------------- ----------------- R.A. Millos SVP, Finance and CFO $1,430,000 $1,599,752 ---------------------------- --------------------------------------------- ------------------- ----------------- R.J. Vance SVP, Corporate Development $1,750,000 $1,959,063 ---------------------------- --------------------------------------------- ------------------- ----------------- P.C. Rozee SVP, Commercial Affairs $1,660,000 $1,873,433 ---------------------------- --------------------------------------------- ------------------- ----------------- D.H. Horswill SVP, Sustainability and External Affairs $1,530,000 $1,699,776 ============================ ============================================= =================== =================
There would be no incremental payments in connection with the resignation or retirement of the above NEOs other than as described above. SHARE PERFORMANCE GRAPH The following graph illustrates the Corporation's five-year (to December 31, 2008) cumulative total shareholder return (assuming reinvestment of dividends on each dividend payment date) on a $100 investment on January 1, 2003 in Class A common shares and Class B subordinate voting shares compared to the return on a comparable investment on the Diversified Metals & Mining Index (Sub Industry), the S&P TSX Composite Index and the Materials Index (Sector). The trend shown by the performance graph below represents strong growth in shareholder returns through 2007, followed by a decrease starting in the second half of the last financial year. Executive compensation increased -32- through this period, including base salary, bonus, and long-term incentive grants awarded at the beginning of 2008. However, compensation adjustments in 2009 reflect the current market conditions, where base salaries have been frozen, and bonus and long-term incentive awards have been significantly reduced. TECK COMINCO LIMITED COMPARISON OF 5 YEAR TOTAL COMMON SHAREHOLDERS' RETURN - ------------------------------------------------------------------------------- 2003 2004 2005 2006 2007 2008 - ------------------------------------------------------------------------------- Teck A 100 161 287 405 410 68 - ------------------------------------------------------------------------------- Teck B 100 170 290 422 349 60 - ------------------------------------------------------------------------------- Diversified Metals & Mining Index (Sub Industry) 100 115 169 283 328 99 - ------------------------------------------------------------------------------- Materials Index (Sector) 100 107 123 172 224 165 - ------------------------------------------------------------------------------- S&P/TSX Composite Index 100 114 142 167 183 123 - ------------------------------------------------------------------------------- COMPENSATION OF DIRECTORS Commencing on April 25, 2007 the Corporation paid each of its directors an annual retainer of $40,000. In addition, the Chairman of the Board was paid an annual retainer of $300,000, the non-executive Lead Director of the Board was paid an annual retainer of $100,000, the Chairman and Deputy Chairman of the Audit Committee received additional fees of $20,000 and the Chairs of the Executive Committee, Compensation Committee, Pension Committee, Corporate Governance & Nominating Committee, Safety and Sustainability Committee and Reserves Committee received an additional fee of $3,500 per annum. Directors who were not executives of the Corporation also received a fee of $1,500 for each Board meeting attended and $1,500 for each committee meeting attended, $6,000 per annum for service on the Audit Committee, $4,000 per annum for service on the Executive Committee, Compensation Committee, Pension Committee, Corporate Governance & Nominating Committee, Safety and Sustainability Committee and Reserves Committee, reimbursement of all travel costs, a payment of $1,500 per annum for other expenses related to their duties and $1,000 per meeting fee for each director who travels from out of province the day before a Board meeting. In conjunction with our asset sale and debt restructuring initiatives, the Board asked the Executive Committee to meet weekly with the CEO to monitor progress and support Management's efforts. The Committee members have waived -33- meeting fees for this additional oversight responsibility. Four meetings were held on this basis in 2008 and they will continue into 2009 until the restructuring is complete. Directors are also eligible for participation in the Corporation's Deferred Share Unit Plans (see page 28). On April 23, 2008 non-executive directors received 2,100 share units with a grant day value of $47.50 per unit. The Chairman received 6,300 units with a grant day value of $47.50 per unit. The following table sets forth all annual compensation paid in respect of the directors of the Corporation at December 31, 2008, other than Mr. Lindsay whose compensation as a director is fully reflected in the summary compensation table for NEOs. SUMMARY COMPENSATION TABLE - DIRECTORS
====================== ================= ========================= ================== NAME FEES EARNED SHARE-BASED AWARDS ($) TOTAL (1) ($) (2) (3) ($) ====================== ================= ========================= ================== M. M. Ashar 68,500 120,758 189,258 ---------------------- ----------------- ------------------------- ------------------ J. B. Aune 105,500 116,650 222,150 ---------------------- ----------------- ------------------------- ------------------ J. H. Bennett 66,125 152,363 218,488 ---------------------- ----------------- ------------------------- ------------------ H. J. Bolton 115,000 116,650 231,650 ---------------------- ----------------- ------------------------- ------------------ N. B. Keevil 380,500 302,359 682,859 ---------------------- ----------------- ------------------------- ------------------ N. B. Keevil, III 96,500 117,529 214,029 ---------------------- ----------------- ------------------------- ------------------ T. Kuriyama 44,500 143,588 188,088 ---------------------- ----------------- ------------------------- ------------------ T. Mochihara 86,000 117,533 203,533 ---------------------- ----------------- ------------------------- ------------------ D. G. Pannell 47,125 143,588 190,713 ---------------------- ----------------- ------------------------- ------------------ J. G. Rennie 69,625 143,588 213,213 ---------------------- ----------------- ------------------------- ------------------ W.S.R. Seyffert 208,500 146,807 355,307 ---------------------- ----------------- ------------------------- ------------------ K. E. Steeves 85,375 157,047 242,422 ---------------------- ----------------- ------------------------- ------------------ C. M. T. Thompson 126,000 114,209 240,209 ====================== ================= ========================= ==================
Notes: (1) Director Fees paid to D. R. Lindsay are reflected in the table on page 24. (2) The value noted is the grant date value. (3) Dividend equivalents are credited to a participant's account in the form of additional share units as of each payment date in respect of which cash dividends are paid on the Class B subordinate voting shares. On April 28, 2004, the Board discontinued grants of options under the 2001 Stock Option Plan to non-executive directors. Non-executive directors that continue to hold options that were granted to them previously are summarized in the table below. OUTSTANDING SHARE-BASED AWARDS AND OPTION-BASED AWARDS The following table shows all awards outstanding to each director for the fiscal year ending December 31, 2008. -34-
======================================================================================== ================================= OPTION-BASED AWARDS SHARE-BASED AWARDS - ---------------------------------------------------------------------------------------- --------------------------------- Number of Market or Securities Value of No. of Shares Payout Value Name Underlying Option Unexercised or Units that of Share (1) Unexercised Exercise Price Option Expiry In-The-Money have not vested Awards that Options Date Options ((2)) (#) have not ($) ($) vested ((3)) (#) ($) - ----------------------- -------------- ---------------- --------------- ---------------- ----------------- --------------- M. M. Ashar 0 0 n/a 0 0 0 - ----------------------- -------------- ---------------- --------------- ---------------- ----------------- --------------- 36,000 5.75 Feb. 14, 2010 9,720 J. B. Aune 36,000 5.09 Feb. 12, 2011 33,660 0 0 20,000 5.36 Apr. 23, 2009 13,200 - ----------------------- -------------- ---------------- --------------- ---------------- ----------------- --------------- J. H. Bennett 0 0 n/a 0 0 0 - ----------------------- -------------- ---------------- --------------- ---------------- ----------------- --------------- H. J. Bolton 0 0 n/a 0 0 0 - ----------------------- -------------- ---------------- --------------- ---------------- ----------------- --------------- N. B. Keevil 200,000 5.36 Apr. 23, 2009 64,560 13,208 RSU 79,512 - ----------------------- -------------- ---------------- --------------- ---------------- ----------------- --------------- N. B. Keevil III 0 0 n/a 0 4,609 RSU 27,746 - ----------------------- -------------- ---------------- --------------- ---------------- ----------------- --------------- T. Kuriyama 0 0 n/a 0 0 0 - ----------------------- -------------- ---------------- --------------- ---------------- ----------------- --------------- T. Mochihara 0 0 n/a 0 0 0 - ----------------------- -------------- ---------------- --------------- ---------------- ----------------- --------------- D.G. Pannell 0 0 n/a 0 0 0 - ----------------------- -------------- ---------------- --------------- ---------------- ----------------- --------------- J. G. Rennie 0 0 n/a 0 0 0 - ----------------------- -------------- ---------------- --------------- ---------------- ----------------- --------------- W.S.R. Seyffert 20,000 4.48 Apr. 27, 2010 30,900 0 0 36,000 5.09 Feb. 12, 2011 33,660 0 0 - ----------------------- -------------- ---------------- --------------- ---------------- ----------------- --------------- K. E. Steeves 0 0 n/a 0 0 0 - ----------------------- -------------- ---------------- --------------- ---------------- ----------------- --------------- C.M. T. Thompson 0 0 n/a 0 2,486 RSU 14,966 ======================= ============== ================ =============== ================ ================= ===============
NOTES: (1) Information on D. R. Lindsay is reflected in the table on page 25. (2) Maximum value at December 31, 2008 calculated by determining the difference between the closing price of the Class B subordinate voting shares underlying the options on the TSX at December 31, 2008 ($6.02) and the exercise price of the options. (3) Market or Payout Value calculated by multiplying the number of RSU held at December 31, 2008 by the closing price of the Class B subordinate voting shares on the TSX at December 31, 2008 ($6.02). INCENTIVE PLAN AWARDS - VALUE VESTED OR EARNED DURING THE YEAR The following table shows the incentive plan awards value vested or earned for each director for the fiscal year ending December 31, 2008. -35-
================================= ================================ ================================= OPTION-BASED SHARE-BASED (DSU/RSU) AWARDS - NAME AWARDS - VALUE VALUE (1) VESTED DURING THE YEAR ((2)) VESTED DURING THE YEAR ((3)) (4) ($) ($) ================================= ================================ ================================= M. M. Ashar 0 120,758 / 0 - --------------------------------- -------------------------------- --------------------------------- J. B. Aune 0 116,650 / 0 - --------------------------------- -------------------------------- --------------------------------- J. H. Bennett 0 152,363 / 0 - --------------------------------- -------------------------------- --------------------------------- H. J. Bolton 0 116,650 / 0 - --------------------------------- -------------------------------- --------------------------------- N. B. Keevil 0 0 / 78,589 - --------------------------------- -------------------------------- --------------------------------- N. B. Keevil, III 0 16,743 / 13,713 - --------------------------------- -------------------------------- --------------------------------- T. Kuriyama 0 143,588 / 0 - --------------------------------- -------------------------------- --------------------------------- T. Mochihara 0 117,533 / 0 - --------------------------------- -------------------------------- --------------------------------- D. G. Pannell 0 143,588 / 0 - --------------------------------- -------------------------------- --------------------------------- J. G. Rennie 0 143,588 / 0 - --------------------------------- -------------------------------- --------------------------------- W.S.R. Seyffert 0 146,807 / 0 - --------------------------------- -------------------------------- --------------------------------- K. E. Steeves 0 157,047 / 0 - --------------------------------- -------------------------------- --------------------------------- C. M. T. Thompson 0 111,804 / 13,714 ================================= ================================ =================================
NOTES: (1) Information on D. R. Lindsay is reflected in the table on page 26. (2) No outstanding options held by directors vested during 2008. (3) The amount represents the aggregate dollar value that has been realized upon vesting of the share units as of the vesting date. As directors' DSUs vest immediately, the market value for DSUs was as of the grant date. (4) DSUs vested on the grant date but are not redeemable until the recipient retires, resigns or their employment is otherwise terminated. The value of the DSUs on the payout date is based on the price of the Class B subordinate voting shares on the payout date and, accordingly, the amount of the final payout is not known until that time. MANDATORY SHAREHOLDING POLICY FOR DIRECTORS In February 2007, the Board amended the Mandatory Shareholding Policy (the "Policy") for non-executive directors. The amendment requires directors to own shares and/or DSUs or RSUs equivalent in value to five times their annual retainer including both cash and unit compensation. Directors have a period of five years from the institution of the policy or the date they join the Board within which to reach the mandatory level.
SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS ================================ ============================ ============================ ============================ NUMBER OF SECURITIES NUMBER OF SECURITIES TO BE WEIGHTED-AVERAGE EXERCISE REMAINING AVAILABLE FOR ISSUED UPON EXERCISE OF PRICE OF OUTSTANDING FUTURE ISSUANCE UNDER PLAN CATEGORY OUTSTANDING OPTIONS OPTIONS EQUITY COMPENSATION PLANS (EXCLUDING SECURITIES (a) (b) REFLECTED IN COLUMN (a)) (c) ================================ ============================ ============================ ============================ Equity Compensation Plans 4,531,612(1) $28.282 5,727,569 approved by shareholders - -------------------------------- ---------------------------- ---------------------------- ---------------------------- Equity Compensation Plans not approved by shareholders N/A N/A N/A - -------------------------------- ---------------------------- ---------------------------- ---------------------------- Total 4,531,612 (2) $28.282 5,727,569 (2) ================================ ============================ ============================ ============================
-36- Notes: (1) The Class B subordinate voting shares to be issued upon exercise of outstanding options are comprised of (i) 4,322,212 Class B subordinate voting shares reserved for issuance in respect of options previously granted under the 2001 Stock Option Plan and (ii) 209,400 Class B subordinate voting shares reserved for issuance in respect of options issued in connection with the Merger Options. The aggregate number of Class B subordinate voting shares reserved for issuance in respect of such outstanding options represents 0.93% of the aggregate number of Class A common shares and Class B subordinate voting shares and 0.95% of the outstanding Class B subordinate voting shares. (2) The aggregate of 10,529,181 Class B subordinate voting shares reserved for issuance under (i) the 2001 Stock Option Plan in respect of outstanding options and options which may be granted in future thereunder and (ii) outstanding options granted in 2001 as a result of the merger of the Corporation and Cominco Ltd. represents 2.16% of the aggregate number of outstanding Class A common shares and Class B subordinate voting shares and 2.20% of the number of outstanding Class B subordinate voting shares. INSURANCE General By-law No. 1 of the Corporation provides for the indemnification of each director and officer against all costs, charges and expenses reasonably incurred by him or her in respect of any action or proceeding to which he or she is made a party by reason of being a director or officer of the Corporation, subject to the limitations contained in General By-law No. 1 and in the CANADA BUSINESS CORPORATIONS ACT. Further to General By-Law No. 1, each director and officer is provided with an Indemnity Agreement consistent with the by-law provisions. During 2008, the Corporation purchased policies of insurance for the benefit of itself and its directors and officers against liability incurred by them in the performance of their duties as directors or as officers. The cumulative amount of the premium paid in respect of the policies in 2008 was approximately US$2,353,324. The entire premium was paid by the Corporation. The aggregate amount of coverage under the policies was US$140 million in respect of the directors and officers and US$130 million in respect of the Corporation. There is no deductible in the case of directors and officers and a deductible of US$100,000 for the Corporation. The policies contain standard industry exclusions and no claims have been made to date. SHAREHOLDER PROPOSALS FOR THE 2010 ANNUAL MEETING In order to be included in proxy material for the 2010 Annual Meeting of shareholders, shareholder proposals must be received by the Corporation at its offices at Suite 3300, Bentall 5, 550 Burrard Street, Box 31, Vancouver, British Columbia, V6C 0B3, Attention: Corporate Secretary, no later than November 27, 2009. -37- ADDITIONAL INFORMATION Copies of the following documents are available without charge to shareholders upon written request to the Corporate Secretary at Suite 3300 - 550 Burrard Street, Vancouver, British Columbia, V6C 0B3: (i) the 2008 Annual Report to shareholders containing the consolidated financial statements for the year ended December 31, 2008, together with the accompanying report of the external auditor; (ii) this Management Proxy Circular; (iii) the Corporation's most recent Annual Information Form; (iv) comparative financial statements for the year ended December 31, 2008; and (v) Management's Discussion and Analysis in respect of the comparative financial statements for the year ended December 31, 2008 ("MD&A"). Financial information is provided in the Corporation's comparative financial statements and MD&A for 2008. Additional information relating to the Corporation is on SEDAR at www.sedar.com. BOARD OF DIRECTORS' APPROVAL The contents and sending of this Management Proxy Circular have been approved by the Board of Directors of the Corporation. DATED this 2nd day of March, 2009. By Order of the Board "KAREN L. DUNFEE" Karen L. Dunfee Corporate Secretary A-1 SCHEDULE A AMENDMENT OF ARTICLES The following special resolution is being submitted for consideration at the Meeting and, if thought advisable, approval: BE IT RESOLVED, AS A SPECIAL RESOLUTION, THAT: 1. the articles of Teck Cominco Limited (the "CORPORATION") be and are hereby amended to: (a) delete in their entirety, the authorized but unissued Preference Shares Series 1 and the authorized but unissued Preference Shares Series 2 in the capital of the Corporation, and the rights, privileges, restrictions and conditions attaching thereto; and (b) change the Corporation's name to: Teck Resources Limited Ressources Teck Limitee or to such other name as may be deemed appropriate by the directors of the Corporation, in their sole discretion and to provide that the Corporation may use its name in either the English form, the French form or a combination of the English form and the French form. 2. notwithstanding that this resolution has been duly passed by the holders of Class A common shares of the Corporation (the "CLASS A HOLDERS") and the holders of the Class B Subordinate Voting shares of the Corporation (together with the Class A Holders, the "SHAREHOLDERS"), the directors of the Corporation, in their sole discretion, be and they are hereby authorized and empowered, without further approval of the Shareholders, to revoke, postpone and/or abandon this resolution at any time prior to the filing of articles of amendment; and 3. any one officer or director of the Corporation be and is hereby authorized and directed to prepare, execute (whether under the corporate seal or otherwise) and deliver any and all such other instrument(s) in the name and on behalf of the Corporation, and to do and to perform or cause to be done and performed any and all such other acts and things as such officer or director may determine to be necessary or advisable in order to carry out the purposes and intent of the foregoing resolution, the execution, delivery and filing of any and all such other instrument(s) and the performance or the causing of the performance of any and all such other acts and things to be conclusive evidence of such determination. B-2 SCHEDULE B MANDATE OF THE BOARD OF DIRECTORS The Board of Directors is responsible for the stewardship of the Corporation. The Board has implemented a system of corporate governance that is designed to assist the Board in overseeing the management of the business and affairs of the Corporation. Management of the Corporation and execution of the strategic plan is delegated to the Chief Executive Officer and Management. The Board provides guidance and direction to Management in pursuit of the Corporation's goals and strategic plans and, without limiting the foregoing, is responsible for: (a) selecting, setting goals for, monitoring the performance and competence of and planning for the succession of the Chief Executive Officer (CEO) and satisfying itself as to the integrity of the CEO and the other senior officers and satisfying itself that they create a culture of integrity throughout the organization; (b) succession planning, including the training and monitoring of Management; (c) with the advice of the Compensation Committee, approving the compensation of the senior management team and approving an appropriate compensation program for the Corporation's personnel; (d) approving the annual and quarterly reports, including the financial statements and related regulatory filings prior to their filing with applicable regulatory agencies and their release to the public; (e) adopting a strategic planning process in approving, on at least an annual basis, a strategic plan which takes into account, among other things, the opportunities and risks of the business; (f) identifying the principal risks of the Corporation's business and ensuring the implementation of appropriate systems to manage those risks; (g) adopting a communication and continuous disclosure policy for the Corporation and monitoring its implementation; (h) overseeing the policies and procedures implemented by Management to ensure the integrity of the Corporation's internal control, financial reporting and management information systems; (i) adopting an appropriate, formal orientation program for new directors and ongoing education sessions on the various business units and strategies of the Corporation for all directors; (j) appointing Board committees, however designated, and delegating to any such Board committees any of the powers of the Board except those which pertain to items which, under the CANADA BUSINESS CORPORATIONS ACT, a Board committee has no authority to exercise; (k) determining whether individual directors meet the requirements for independence set out in the rules of the stock exchanges and securities regulatory authorities to which the Corporation is subject, and make such disclosures as are required with respect to that determination; and (l) developing the Corporation's approach to corporate governance, including developing a set of corporate governance principles and guidelines that are specifically applicable to Teck. B-2 DECISIONS REQUIRING BOARD APPROVAL The CEO has been delegated by the Board the authority to approve individual commitments and expenditures for any corporate purpose up to a maximum of $10 million per item or group of similar items. The CEO, together with the Chairman, have been delegated the authority to approve individual commitments and expenditures for any corporate purpose up to a maximum of $20 million per item or group of similar items. The CEO is also authorized to approve commitments and expenditures of any amount for purposes that have appeared in a financial plan or otherwise have been adopted by the Board of Directors. Projects involving expenditures or commitments in excess of these limits must receive Board approval. The Board retains responsibility for significant changes in the Corporation's affairs such as approval of major capital expenditures, new debt financing arrangements and significant investments, acquisitions and divestitures. No securities can be issued without the authorization of the Board and the Board must specifically authorize the purchase, redemption or other acquisition of shares issued by the Corporation. MEASURES FOR RECEIVING FEEDBACK FROM SECURITY HOLDERS The Corporation has an investor relations department which is responsible for communications with investors. Investors have the opportunity to provide feedback to the Corporation via the investor relations group through email at the Corporation's website, through direct or telephone contact with the investor relations officer (a contact person is identified in each press release) and through regular mail service. In addition, the Corporation regularly has face-to-face meetings with investment analysts and institutional investors where feedback is provided directly to the investor relations officer and senior management present at the meeting. The investor relations department responds to all investor enquiries in a timely manner either directly or by passing the request along to the appropriate department in the Corporation for their response. Investor feedback is evaluated by the Vice President, Investor Relations & Strategic Analysis and summarized for senior management. This evaluation takes into account the nature and frequency of the feedback and the sensitivity of the subject under discussion. Significant shareholder comments and analysts' reports on the Corporation are reported quarterly to the Board. EXPECTATIONS OF MANAGEMENT The day-to-day management of the Corporation and its operations is the responsibility of Management under the direction of the CEO. The Board expects Management to manage and maintain the Corporation's operations efficiently and safely. The Board has adopted a Code of Ethics that requires each employee to maintain the highest ethical standards of behaviour while conducting the Corporation's business. EXPECTATIONS AND RESPONSIBILITIES OF DIRECTORS Directors are expected to attend all regularly scheduled Board and Committee meetings and to have reviewed in advance the meeting materials. DIRECTOR ORIENTATION AND EDUCATION The Board shall ensure that all new directors receive a comprehensive orientation. New directors shall be provided with a copy of the Corporation's key policies, codes and mandates. The Board shall encourage and provide continuing education opportunities to directors including regularly scheduled briefings on the Corporation's operations, business and key issues. C-1 SCHEDULE C DISCLOSURE OF CORPORATE GOVERNANCE PRACTICES The following table discloses the Corporation's current corporate governance practices in accordance with the requirements of National Instrument 58-101.
- -------------------------------------------------------- ----------------- ------------------------------------------------------ Teck Cominco Disclosure Requirement under Form 58-101F1 Compliance Comments & Discussion - -------------------------------------------------------- ----------------- ------------------------------------------------------ 1. (a) Disclose the identity of directors who are Yes The Board has determined that all of the directors of independent. the Corporation with the exception of Messrs. Keevil, Keevil III and Lindsay are independent. See disclosure under the "Election of Directors" section of this Management Proxy Circular. - -------------------------------------------------------- ----------------- ------------------------------------------------------ (b) Disclose the identity of directors who are not Yes See disclosure under the "Election of Directors" independent, and describe the basis for that section of this Management Proxy Circular. determination. - -------------------------------------------------------- ----------------- ------------------------------------------------------ (c) Disclose whether or not a majority of Yes 11 of 14 or 79% of the Corporation's current directors are independent. If a majority of directors are independent. directors are not independent, describe what the board of directors (the "Board") does to facilitate its exercise of independent judgment in carrying out its responsibilities. - -------------------------------------------------------- ----------------- ------------------------------------------------------ (d) If a director is presently a director of any Yes Such other directorships have been disclosed in the other issuer that is a reporting issuer (or "Election of Directors" section of this Management the equivalent) in a jurisdiction or a foreign Proxy Circular. jurisdiction, identify both the director and the other issuer. - -------------------------------------------------------- ----------------- ------------------------------------------------------ (e) Disclose whether or not the independent Yes The Board has adopted a policy for the independent directors hold regularly scheduled meetings members of the Board to meet without Management at which non-independent directors and present at regularly scheduled meetings of the members of management are not in attendance. Board. These sessions are of no fixed duration and If the independent directors hold such participating directors are encouraged to raise and meetings, disclose the number of meetings discuss any issues of concern. In camera sessions held since the beginning of the issuer's most are on each meeting agenda and were held at three recently completed financial year. If the meetings of the Board in 2008. independent directors do not hold such meetings, describe what the Board does to facilitate open and candid discussion among its independent directors. - -------------------------------------------------------- ----------------- ------------------------------------------------------ (f) Disclose whether or not the chair of the Yes Norman B. Keevil serves as the Board Chair, and is Board is an independent director. If the not an independent director. He has served as Board Board has a Chair or Lead Director who is an Chair since 2001. independent director, disclose the identity of the independent Chair or Lead Director, Robert Wright served as Lead Director from 2000 to and describe his or her role and 2008. Mr. Wright retired from the Board when his responsibilities. If the Board has neither a term expired at the annual and special meeting of Chair that is independent nor a Lead Director shareholders of the Corporation in 2008. Warren that is independent, describe what the Board Seyffert, an independent director, was appointed does to provide leadership for its Lead Director on February 12, 2008. independent directors. A position description for the Lead Director has been developed and approved by the Board. Amongst other things, the Lead Director is expected to: (a) provide leadership to ensure effective functioning of the Board; (b) lead in the assessment of Board performance; (c) act as an effective liaison between the Board and Management. - -------------------------------------------------------- ----------------- ------------------------------------------------------
C-2
- -------------------------------------------------------- ----------------- ------------------------------------------------------ Teck Cominco Disclosure Requirement under Form 58-101F1 Compliance Comments & Discussion - -------------------------------------------------------- ----------------- ------------------------------------------------------ (g) Disclose the attendance record of each Yes Attendance records are fully disclosed on page 10 of director for all Board meetings held since the this Management Proxy Circular. Directors are beginning of the issuer's most recently expected to attend all meetings of the Board and completed financial year. Board committees upon which they serve, to come to such meetings fully prepared, and to remain in attendance for the duration of the meetings. - -------------------------------------------------------- ----------------- ------------------------------------------------------ 2. Disclose the text of the Board's written mandate. Yes The Board of Directors' Mandate is found in this If the Board does not have a written mandate, how Management Proxy Circular at Schedule B. the Board delineates its role and responsibilities. - -------------------------------------------------------- ----------------- ------------------------------------------------------ 3. (a) Disclose whether or not the Board has Yes A position description for the Board and Executive developed written position descriptions for Committee Chair and each Board Committee Chair the Chair and the Chair of each Board (which are attached to the relevant Board Committee committee. If the Board has not developed Charters) has been developed and approved by the written position descriptions for the Chair Board and can be found on the Corporation's website and/or the Chair of each Board committee, at www.teck.com. briefly describe how the Board delineates the role and responsibilities of each such position. - -------------------------------------------------------- ----------------- ------------------------------------------------------ (b) Disclose whether or not the Board and CEO have Yes A written position description for the Chief developed a written position description for Executive Officer has been developed and approved by the CEO. If the Board and CEO have not the Board. developed such a position description, briefly describe how the Board delineates the role and The Chief Executive Officer reports to the Board and responsibilities of the CEO. has general supervision and control over the business and affairs of the Corporation. Amongst other things, the Chief Executive Officer is expected to: (a) foster a corporate culture that promotes ethical practices, encourages individual integrity and fulfils social responsibility; (b) develop and recommend to the Board a long-term strategy and vision for the Corporation that leads to creation of shareholder value; (c) develop and recommend to the Board annual business plans and budgets that support the Corporation's long-term strategy; and (d) consistently strive to achieve the Corporation's financial and operating goals and objectives. - -------------------------------------------------------- ----------------- ------------------------------------------------------
C-3
- -------------------------------------------------------- ----------------- ------------------------------------------------------ Teck Cominco Disclosure Requirement under Form 58-101F1 Compliance Comments & Discussion - -------------------------------------------------------- ----------------- ------------------------------------------------------ 4. (a) Briefly describe what measures the Board takes Yes The Board has adopted a New Director Orientation to orient new directors regarding the role of Program designed to: the Board, its committees and its directors, and the nature and operation of the issuer's (a) provide each new director with a baseline of business. knowledge about the Corporation that will serve as a basis for informed decision-making; (b) tailor the program for each new director, taking into account his or her unique mix of skills, experience, education, knowledge and needs; and (c) deliver information over a period of time to minimize the likelihood of overload and maximize the lasting educational impact. The orientation program consists of a combination of written materials, one-on-one meetings with senior management, site visits and other briefings and training as appropriate. - -------------------------------------------------------- ----------------- ------------------------------------------------------ (b) Briefly describe what measures, if any, the Yes The Board recognizes the importance of ongoing Board takes to provide continuing education director education and the need for each director to for its directors. If the Board does not take personal responsibility for this process. To provide continuing education, describe how the facilitate ongoing education, the Corporation: Board ensures that its directors maintain the skill and knowledge necessary for them to meet (a) is developing a directors' intranet site to their obligations as directors. facilitate the exchange of views and published information; (b) encourages presentations by internal and outside experts to the Board or Committees on matters of particular import or emerging significance; (c) receives regular briefings on matters of particular interest in advance of scheduled board meetings; and (d) participates in case studies conducted by the emerging leaders of the Corporation on key issues affecting the Corporation. - -------------------------------------------------------- ----------------- ------------------------------------------------------ 5. (a) (i) Disclose whether or not the Board has Yes The Board has adopted a Code of Ethics. The complete adopted a written code for its directors, text of the Code of Ethics, as well as other officers and employees. If the Board has governance related documents, can be found at adopted a written code, disclose how a www.teck.com and are available in print to any person or company may obtain a copy of shareholder who requests them. the written code. - -------------------------------------------------------- ----------------- ------------------------------------------------------
C-4
- -------------------------------------------------------- ----------------- ------------------------------------------------------ Teck Cominco Disclosure Requirement under Form 58-101F1 Compliance Comments & Discussion - -------------------------------------------------------- ----------------- ------------------------------------------------------ (ii) Describe how the Board monitors Yes Management reports quarterly on the operation of the compliance with its code, or if the Board Corporation's fraud reporting system and its does not monitor compliance, explain Whistleblower Hotline. Staff employees, officers and whether and how the Board satisfies directors annually certify their compliance with the itself regarding compliance with its Code of Ethics. code. - -------------------------------------------------------- ----------------- ------------------------------------------------------ (iii) If the Board has adopted a written code, Yes The Corporation has not had occasion to file any provide a cross-reference to any material such report. change report filed since the beginning of the issuer's most recently completed financial year that pertains to any conduct of a director or executive officer that constitutes a departure from the code. - -------------------------------------------------------- ----------------- ------------------------------------------------------ (b) Describe any steps the Board takes to ensure Yes Each director must possess and exhibit the highest directors exercise independent judgment in degree of integrity, professionalism and values. A considering transactions and agreements in director who has a real or perceived conflict of respect of which a director or executive interest regarding any matter under consideration is officer has a material interest. required to advise the Board, refrain from debate on the matter and abstain from voting on it. - -------------------------------------------------------- ----------------- ------------------------------------------------------ (c) Describe any other steps the Board takes to Yes In conjunction with the introduction of a encourage and promote a culture of ethical Whistleblower Hotline in 2006, the Corporation business conduct. released the "Doing What's Right" program to reinforce the core values set out in the Code of Ethics. Those values will be continually reinforced through our on-line training program introduced in 2007. - -------------------------------------------------------- ----------------- ------------------------------------------------------
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- -------------------------------------------------------- ----------------- ------------------------------------------------------ Teck Cominco Disclosure Requirement under Form 58-101F1 Compliance Comments & Discussion - -------------------------------------------------------- ----------------- ------------------------------------------------------ 6. (a) Describe the process by which the Board Yes The Corporate Governance and Nominating Committee identifies new candidates for Board (the "CG&N Committee") is responsible for recruiting nomination. and proposing to the full Board new nominees for directors. The CG&N Committee, in the discharge of its duties: (a) consults with the Board and Chief Executive Officer and, on an ongoing basis, identifies the mix of expertise and qualities required for the Board; (b) assesses the attributes new directors should have for the appropriate mix to be maintained; (c) in consultation with the Board and Chief Executive Officer and on an ongoing basis, maintains a database of potential candidates; (d) has implemented a procedure to identify, with as much advance notice as practicable, impending Board vacancies, so as to allow sufficient time for recruitment and for introduction of proposed nominees to the existing Board; (e) develops a "short-list" of candidates and arranges for each candidate to meet with the CG&N Committee, the Board Chair and the Chief Executive Officer; (f) recommends to the Board, as a whole, proposed nominee(s) and arranges for their introduction to as many Board members as practicable; (g) ensures that prospective candidates are informed of the degree of energy and commitment the Corporation expects of its directors; and (h) encourages diversity in the composition of the Board. - -------------------------------------------------------- ----------------- ------------------------------------------------------ (b) Disclose whether or not the Board has a Yes The Corporation has a standing CG&N Committee. nominating committee composed entirely of independent directors. If the Board does not Each of the four directors who comprise the CG&N have a nominating committee composed entirely Committee is independent. Please refer to "Director of independent directors, describe what steps Independence and Other Relationships" and the "Report the Board takes to encourage an objective on Corporate Governance and Nominating Matters" nomination process. sections of this Management Proxy Circular for additional information. - -------------------------------------------------------- ----------------- ------------------------------------------------------
C-6
- -------------------------------------------------------- ----------------- ------------------------------------------------------ Teck Cominco Disclosure Requirement under Form 58-101F1 Compliance Comments & Discussion - -------------------------------------------------------- ----------------- ------------------------------------------------------ (c) If the Board has a nominating committee, Yes The responsibilities, powers and operation of the describe the responsibilities, powers and CG&N Committee are set out in its Charter, which is operation of the nominating committee. available on the Corporation's website at www.teck.com. Pursuant to the CG&N Committee Charter, the purpose of the CG&N Committee is to identify the individuals qualified to become members of the Board, to recommend to the Board nominees for election to the Board at each annual meeting of shareholders or to fill vacancies on the Board and to address related matters. Please refer to the "Report on Corporate Governance and Nominating Matters" section of this Management Proxy Circular for additional information. - -------------------------------------------------------- ----------------- ------------------------------------------------------ 7. (a) Describe the process by which the Board Yes Director and officer compensation is established on determines the compensation for the issuer's the advice of independent consultants, with a view to directors and officers. establishing target compensation at the median of the applicable comparator group. Please refer to the "Compensation Discussion and Analysis" and the "Director Compensation" sections of this Management Proxy Circular, as well as the response to 7(d) below for additional information. - -------------------------------------------------------- ----------------- ------------------------------------------------------ (b) Disclose whether or not the Board has a Yes The Corporation has a standing Compensation Compensation Committee composed entirely of Committee. Each of the four directors who comprise independent directors. If the Board does not the Compensation Committee is independent. Please have a Compensation Committee composed refer to the "Director Independence and Other entirely of independent directors, describe Relationships" and "Compensation Discussion and what steps the Board takes to ensure an Analysis" sections of this Management Proxy Circular objective process for determining such for additional information. compensation. - -------------------------------------------------------- ----------------- ------------------------------------------------------ (c) If the Board has a Compensation Committee, Yes The responsibilities, powers and operation of the describe the responsibilities, powers and Compensation Committee are set out in its Charter, operation of the Compensation Committee. which is available on the Corporation's website at www.teck.com. Pursuant to the Compensation Committee Charter, the purpose of the Compensation Committee is to carry out the Board's responsibility for: (a) executive compensation (including policy and programs); (b) Management development and succession; (c) Board compensation; and (d) broadly applicable compensation and benefit programs. Please refer to the "Compensation Discussion and Analysis" section of this Management Proxy Circular for additional information. - -------------------------------------------------------- ----------------- ------------------------------------------------------
C-7
- -------------------------------------------------------- ----------------- ------------------------------------------------------ Teck Cominco Disclosure Requirement under Form 58-101F1 Compliance Comments & Discussion - -------------------------------------------------------- ----------------- ------------------------------------------------------ (d) If a compensation consultant or advisor has, Yes In 2008, the Compensation Committee retained the Hay at any time since the beginning of the Group to advise them on the compensation of the issuer's most recently completed financial Chief Executive Officer. Hay Group is an year, been retained to assist in determining independent consultant having no other significant compensation for any of the issuer's consulting relationship with the Corporation. directors and officers, disclose the identity Mercer's has provided human resources consulting of the consultant or advisor and briefly services for the Corporation. Management and the summarize the mandate for which they have Committee will continue to use Mercer's survey data been retained. If the consultant or advisor to benchmark the salary, bonus and long term has been retained to perform any other work compensation of the named executive officers. for the issuer, state that fact and briefly describe the nature of the work. - -------------------------------------------------------- ----------------- ------------------------------------------------------ 8. If the Board has standing committees other than the Yes The Board has an Executive Committee to enable it to Audit, Compensation and Nominating committees, react quickly to emerging issues and opportunities; a identify the committees and describe their Pension Committee to assist in the oversight of the function. governance and management of its pension plans; a Reserves Committee to provide enhanced oversight of the Corporation's policies and management of its mineral and oil reserves and resources; and an Safety and Sustainability Committee to review corporate policies, procedures and performance with respect to these important matters. - -------------------------------------------------------- ----------------- ------------------------------------------------------ 9. Disclose whether or not the Board, its committees Yes Each year Board members complete a detailed and individual directors are regularly assessed questionnaire which: with respect to their effectiveness and contribution. If assessments are regularly (a) provides for quantitative ratings of their and conducted, describe the process used for the the Board's performance in key areas; and assessments. If assessments are not regularly conducted, describe how the Board satisfies itself (b) seeks subjective comment in each of those that it, its committees, and individual directors areas. are performing effectively. The questionnaire is administered by the Corporate Secretary who compiles the responses in a summary report. The summary report and individual responses are reviewed by the Lead Director and then reported to the full Board by the CG&N Committee. Matters requiring follow-up are identified and action plans developed which are monitored by the CG&N Committee. - -------------------------------------------------------- ----------------- ------------------------------------------------------
TECK COMINCO LIMITED PROXY - CLASS A COMMON SHARES ANNUAL AND SPECIAL MEETING APRIL 22, 2009 THIS PROXY IS SOLICITED BY THE MANAGEMENT OF THE CORPORATION The undersigned shareholder of TECK COMINCO LIMITED (the "Corporation") hereby appoints Norman B. Keevil, Chairman of the Board of the Corporation, or failing him, Warren S.R. Seyffert, a director of the Board of the Corporation or failing him, Donald R. Lindsay, President and Chief Executive Officer, OR ALTERNATIVELY _________________________ as proxyholder of the undersigned to attend, vote and otherwise act for and on behalf of the undersigned in respect of all matters that may come before the Annual and Special Meeting of Shareholders of the Corporation (the "Meeting") to be held on April 22, 2009 and any adjournment thereof. The undersigned hereby acknowledges receipt of the accompanying Notice of Meeting and Management Proxy Circular. The undersigned hereby ratifies and confirms and agrees to ratify and confirm all that the proxyholder may lawfully do by virtue hereof and hereby revokes any proxy previously given. Without limiting the general authorization and power hereby given, the proxyholder appointed above is hereby authorized to represent and vote, as specified below, all the shares represented by this proxy: 1. To elect as directors all nominees named in the accompanying Management Proxy Circular. FOR ______________ WITHHOLD VOTE _________ 2. To appoint PricewaterhouseCoopers LLP as Auditors and to authorize the directors to fix the Auditors' remuneration. FOR ______________ WITHHOLD VOTE _________ 3. To approve a special resolution authorizing an amendment to the Articles of the Corporation (i) to delete in their entirety the authorized but unissued Preferred Shares Series 1 and the authorized but unissued Preferred Shares Series 2, and (ii) to change the Corporation's name to Teck Resources Limited/Ressources Teck Limitee. FOR ______________ AGAINST _________ IF THE PROXYHOLDER APPOINTED ABOVE IS THE NOMINEE OF MANAGEMENT OF THE CORPORATION AND IF THE SHAREHOLDER MAKES NO CHOICE AS ABOVE PROVIDED, THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED FOR THE MATTERS REFERRED TO IN EACH OF THE ITEMS. THE PROXYHOLDER APPOINTED ABOVE HAS THE AUTHORITY TO VOTE THE SHARES REPRESENTED BY THIS PROXY IN HIS OR HER DISCRETION IN RESPECT OF AMENDMENTS OR VARIATIONS TO MATTERS IDENTIFIED IN THE NOTICE OF MEETING OR OTHER MATTERS THAT MAY PROPERLY COME BEFORE THE MEETING. A SHAREHOLDER DESIRING TO APPOINT SOME OTHER PERSON (WHO NEED NOT BE A SHAREHOLDER) TO ATTEND, VOTE FOR AND ACT ON BEHALF OF THE SHAREHOLDER AT THE MEETING MAY DO SO BY INSERTING SUCH PERSON'S NAME IN THE SPACE PROVIDED ABOVE FOR THAT PURPOSE AND STRIKING OUT THE NAMES OF THE NOMINEES OF MANAGEMENT OF THE CORPORATION. DATED this ______________ day of _________________, 2009. ____________________________________ _______________________________________ Signature of Shareholder (Number of Shares Represented) (SEE NOTES OVER) - 2 - VOTE BY MAIL: This proxy should be dated and signed by the shareholder or the authorized attorney of the shareholder, such authorization (or a notarial copy thereof) to accompany the proxy. Please sign exactly as your name appears on the label below. If undated, this proxy will be deemed to bear the date on which it was mailed by management to the shareholder. If the shareholder is a corporation, either its corporate seal must be affixed or the proxy should be signed by a duly authorized officer or attorney of the corporation, such authorization (or a notarial copy thereof) to accompany the proxy. Executors, administrators, trustees, and the like should so indicate when signing on behalf of a shareholder. Where shares are held jointly, each owner must sign. VOTE BY INTERNET: To vote by internet, use the internet to transmit your voting instructions and for electronic delivery of information. Have this form of Proxy available when you access the website at WWW.EPROXYVOTING.COM/TECK. You will be prompted to enter your 13-digit Control Number which is located below. You may also appoint a person other than the persons designated on this form of Proxy by following the instructions provided on the website. By resolution of the directors, proxies to be used at the Meeting must be deposited with the Corporation's Registrar and Transfer Agent, CIBC Mellon Trust Company, Attention: Proxy Department, P.O. Box 721, Agincourt, Ontario M5A 4K9 or if by hand, 320 Bay Street, Banking Hall Level, Toronto, Ontario or to the Corporate Secretary of the Corporation, at the Corporation's registered office located at Suite 3300 - 550 Burrard Street, Vancouver, B.C. V6C 0B3 or voted by internet at least 48 hours before the date of the Meeting. The Chairman of the Meeting has the discretion to accept proxies filed less than 48 hours before the date of the Meeting. Your name and address are shown as registered. Please notify CIBC Mellon Trust Company of any change in your address. Control Number TECK COMINCO LIMITED PROXY - CLASS B SUBORDINATE VOTING SHARES ANNUAL AND SPECIAL MEETING APRIL 22, 2009 THIS PROXY IS SOLICITED BY THE MANAGEMENT OF THE CORPORATION The undersigned shareholder of TECK COMINCO LIMITED (the "Corporation") hereby appoints Norman B. Keevil, Chairman of the Board of the Corporation, or failing him, Warren S.R. Seyffert, a director of the Board of the Corporation or failing him, Donald R. Lindsay, President and Chief Executive Officer, OR ALTERNATIVELY _________________________ as proxyholder of the undersigned to attend, vote and otherwise act for and on behalf of the undersigned in respect of all matters that may come before the Annual and Special Meeting of Shareholders of the Corporation (the "Meeting") to be held on April 22, 2009 and any adjournment thereof. The undersigned hereby acknowledges receipt of the accompanying Notice of Meeting and Management Proxy Circular. The undersigned hereby ratifies and confirms and agrees to ratify and confirm all that the proxyholder may lawfully do by virtue hereof and hereby revokes any proxy previously given. Without limiting the general authorization and power hereby given, the proxyholder appointed above is hereby authorized to represent and vote, as specified below, all the shares represented by this proxy: 1. To elect as directors all nominees named in the accompanying Management Proxy Circular. FOR ______________ WITHHOLD VOTE _________ 2. To appoint PricewaterhouseCoopers LLP as Auditors and to authorize the directors to fix the Auditors' remuneration. FOR ______________ WITHHOLD VOTE _________ 3. To approve a special resolution authorizing an amendment to the Articles of the Corporation (i) to delete in their entirety the authorized but unissued Preferred Shares Series 1 and the authorized but unissued Preferred Shares Series 2, and (ii) to change the Corporation's name to Teck Resources Limited/Ressources Teck Limitee. FOR ______________ AGAINST _________ IF THE PROXYHOLDER APPOINTED ABOVE IS THE NOMINEE OF MANAGEMENT OF THE CORPORATION AND IF THE SHAREHOLDER MAKES NO CHOICE AS ABOVE PROVIDED, THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED FOR THE MATTERS REFERRED TO IN EACH OF THE ITEMS. THE PROXYHOLDER APPOINTED ABOVE HAS THE AUTHORITY TO VOTE THE SHARES REPRESENTED BY THIS PROXY IN HIS OR HER DISCRETION IN RESPECT OF AMENDMENTS OR VARIATIONS TO MATTERS IDENTIFIED IN THE NOTICE OF MEETING OR OTHER MATTERS THAT MAY PROPERLY COME BEFORE THE MEETING. A SHAREHOLDER DESIRING TO APPOINT SOME OTHER PERSON (WHO NEED NOT BE A SHAREHOLDER) TO ATTEND, VOTE FOR AND ACT ON BEHALF OF THE SHAREHOLDER AT THE MEETING MAY DO SO BY INSERTING SUCH PERSON'S NAME IN THE SPACE PROVIDED ABOVE FOR THAT PURPOSE AND STRIKING OUT THE NAMES OF THE NOMINEES OF MANAGEMENT OF THE CORPORATION. DATED this ______________ day of _________________, 2009. ____________________________________ _______________________________________ Signature of Shareholder (Number of Shares Represented) (SEE NOTES OVER) - 2 - VOTE BY MAIL: This proxy should be dated and signed by the shareholder or the authorized attorney of the shareholder, such authorization (or a notarial copy thereof) to accompany the proxy. Please sign exactly as your name appears on the label below. If undated, this proxy will be deemed to bear the date on which it was mailed by management to the shareholder. If the shareholder is a corporation, either its corporate seal must be affixed or the proxy should be signed by a duly authorized officer or attorney of the corporation, such authorization (or a notarial copy thereof) to accompany the proxy. Executors, administrators, trustees, and the like should so indicate when signing on behalf of a shareholder. Where shares are held jointly, each owner must sign. VOTE BY INTERNET: To vote by internet, use the internet to transmit your voting instructions and for electronic delivery of information. Have this form of Proxy available when you access the website at WWW.EPROXYVOTING.COM/TECK. You will be prompted to enter your 13-digit Control Number which is located below. You may also appoint a person other than the persons designated on this form of Proxy by following the instructions provided on the website. By resolution of the directors, proxies to be used at the Meeting must be deposited with the Corporation's Registrar and Transfer Agent, CIBC Mellon Trust Company, Attention: Proxy Department, P.O. Box 721, Agincourt, Ontario M5A 4K9 or if by hand, 320 Bay Street, Banking Hall Level, Toronto, Ontario or to the Corporate Secretary of the Corporation, at the Corporation's registered office located at Suite 3300 - 550 Burrard Street, Vancouver, B.C. V6C 0B3 or voted by internet at least 48 hours before the date of the Meeting. The Chairman of the Meeting has the discretion to accept proxies filed less than 48 hours before the date of the Meeting. Your name and address are shown as registered. Please notify CIBC Mellon Trust Company of any change in your address. Control Number TECK COMINCO LIMITED REQUEST FOR FINANCIAL STATEMENTS Dear Shareholder: TO: CIBC Mellon Trust Company As a non-registered shareholder of Please add my name to the TECK COMINCO LIMITED, you are entitled Supplemental Mailing List for TECK to receive our interim financial COMINCO LIMITED and send me their statements, annual financial financial statements as indicated statements, or both. If you wish to below: receive them, please either complete and return this card by mail or submit INTERIM FINANCIAL STATEMENTS [_] your request online (see address ANNUAL FINANCIAL STATEMENTS [_] below). Your name will then be placed on the Supplemental Mailing List (Please Print) maintained by our Transfer Agent and Registrar, CIBC Mellon Trust Company. Name ______________________________ As long as you remain a non-registered Address ___________________________ shareholder, you will receive this card each year and will be required to ___________________________________ renew your request to receive these financial statements. If you have any ___________________________________ questions about this procedure, please contact CIBC Mellon Trust Company by Postal Code/Zip Code ______________ phone at 1-800-387-0825 or (604) 688-4330 or at www.cibcmellon.com/ InvestorInquiry. WE ENCOURAGE YOU TO SUBMIT YOUR REQUEST ONLINE AT WWW.CIBCMELLON.COM/ FINANCIALSTATEMENTS. OUR COMPANY CODE NUMBER IS 7330A. NOTE: Do not return this card by mail if you have submitted your request online. NOTICE TO REGISTERED SHAREHOLDERS REGARDING INTERIM FINANCIAL STATEMENTS AND CONSENT TO ELECTRONIC DELIVERY OF DOCUMENT DEAR SHAREHOLDER, As a registered shareholder of Teck Cominco Limited ("Teck"), you are entitled to receive our interim financial statements. If you wish to receive these financial statements, please complete the bottom of this notice and return to our Transfer Agent and Registrar, CIBC Mellon Trust Company, by facsimile, mail or by submitting your request electronically at WWW.CIBCMELLON.COM/INVESTORINQUIRY. Your name will then be added to the mailing list maintained by CIBC Mellon Trust Company. Please be assured that if you do not elect to receive our financial statements you will still receive annually our Notice of Annual Meeting, Management Proxy Circular and a Proxy Form. If you elect to receive either our annual financial statements, interim financial statements or both your election will be effective until you notify CIBC Mellon Trust Company of a change to your election. You may change your election with respect to the financial statements at any time by contacting CIBC Mellon Trust Company at the address noted below. We will send you a similar election notice each year. In addition if you wish to receive delivery of certain of Teck's corporate documents via the Internet rather than by mail, please check that preference on the bottom of this notice or enrol online at WWW.CIBCMELLON.COM/ELECTRONICDELIVERY. FINANCIAL STATEMENTS ELECTION NOTICE To: CIBC Mellon Trust Company (PLEASE PRINT) PO Box 7010 Name __________________________ Adelaide Street Postal Station Toronto, ON M5C 2W9 Address ________________________ Canada Fax: (416) 643-3135 ________________________________ ELECTRONICALLY: WWW.CIBCMELLON.COM/ INVESTORINQUIRY ________________________________ Postal/Zip Code ________________ I wish to receive interim financial statements of Teck Cominco Limited: Country _______________________ Email Address __________________ I understand that this election notice will be effective until I notify CIBC Mellon Trust Company of a change in my election and that I may change my election at any time by contacting CIBC Mellon Trust Company at the address noted above. CHECK ONE: [_] By Mail [_] By electronic delivery. I have read and understood the terms of this Consent set forth on the reverse side of this notice and I consent to the electronic delivery of the Documents indicated in Item 1 on the reverse side of this notice. (See Reverse Side) TERMS AND CONDITIONS FOR ELECTRONIC DELIVERY OF DOCUMENTS TECK COMINCO LIMITED ("Teck") has implemented an electronic delivery program under which you, as a shareholder, would be notified that Teck's interim financial statements, annual report and other corporate information is available on the Teck's website at www.teck.com. If you consent to electronic delivery, a notification will be sent to you confirming when Teck has implemented its electronic delivery program. With your consent, Teck will be able to make the information available to you electronically instead of sending you the information by mail. To enable Teck to provide increased convenience to shareholders, benefit the environment and reduce costs, Teck encourages its shareholders to take advantage of the electronic delivery program. If you would like to take advantage of this electronic delivery program, you must complete the consent form below and return it to our transfer agent, CIBC Mellon Trust Company by fax 416-643-5501 or mail to CIBC Mellon Trust Company, P.O. Box 7010, Adelaide Street Postal Station, Toronto, Ontario, Canada, M5C 2W9. Teck encourages you to read the consent form carefully so that you understand the terms under which electronic delivery is made. If you would like to continue receiving these documents by mail, simply complete the enclosed Supplemental Mail List Return Card and return it to CIBC Mellon Trust Company. You do not have to complete the consent form below. TO: TECK COMINCO LIMITED 1. I consent to receiving all documents to which I am entitled, electronically rather than by mail. I understand that the documents I am entitled to receive may include: > Teck's Interim Financial Report > Teck's Annual Report (including Annual Financial Statements and MD&A) > Notice of Teck's Annual or Special Meeting of Shareholders and related Management Proxy Circular > Teck's Supplemental Mailing List Return Card 2. I understand and agree that Teck will notify me when a document which I am entitled to receive is available on their website www.teck.com once Teck has filed the documents with securities regulators. I agree that notification will be sent to me at my e-mail address set out below or in such other manner as Teck may determine. 3. I acknowledge that access to Internet e-mail and the world wide web is required for me to access a document electronically and I confirm that I have such access. 4. I understand and agree that: > Any e-mail notice or other notification will not contain an actual document > Any e-mail notice or other notification will contain Teck's web address (or a hyperlink) identifying where a document is located by entering Teck's web address into my web browser, I can access, view, download, and print a document from my computer > The system requirements to view and download a document will be specified in Teck's website; currently a document distributed electronically will be in Adobe's Portable Document Format (PDF) the Adobe Acrobat Reader software is required to view a document in PDF format and is available free of charge from Adobe's web site at www.adobe.com 5. I understand that I may request a paper copy of a document for which I have consented to electronic delivery by: calling Teck at 604-699-4000; sending Teck a fax at 604-699-4729; sending Teck an e-mail to info@teck.com or by sending a request in writing by mail to Teck Cominco Limited, Suite 3300 - 550 Burrard Street, Vancouver, B.C., V6C 0B3. 6. I understand and agree that: > At any time and without giving me advance notice, Teck may elect not to send me a document electronically, in which case a paper copy of the document will be mailed to me > If a document intended to be sent to me electronically is not available electronically, a paper copy of the document will be mailed to me, and > If my e-mail address is found to be invalid, a paper copy of the document will be mailed to me. 7. I understand that Teck will maintain, on its website, any document sent to me electronically, for at least 6 months from the date of posting to the website. 8. I understand that I may revoke or modify my consent and that I may change my e-mail address to which documents are delivered to me, at any time, by notifying Teck by telephone: 604-699-4000, fax: 604-699-4729, email: info@teck.com or mail: Suite 3300 - 550 Burrard Street, Vancouver, B.C., V6C 0B3. I understand that if I change my e-mail address or revoke or modify my consent, I must notify Teck and they must actually receive and acknowledge my notification for my request to be effective. 9. I understand that I am not required to consent to electronic delivery. I am a security holder of Teck Cominco Limited. I have read and understand the terms of this "Consent to Electronic Delivery of Documents" form and, on those terms, I consent to the electronic delivery of the documents I am entitled to receive. NOTICE TO BENEFICIAL SHAREHOLDERS REGARDING QUARTERLY AND ANNUAL REPORTS AND CONSENT TO ELECTRONIC DELIVERY OF DOCUMENT DEAR SHAREHOLDER, As a non-registered shareholder of Teck Cominco Limited ("Teck"), you are entitled to receive our annual financial statements, interim financial statements or both. If you wish to receive these financial statements, please either complete and return this notice by mail or submit your request online (see address below). Your name will then be placed on the Supplemental Mailing List maintained by our Transfer Agent and Registrar, CIBC Mellon Trust Company. As long as you remain a non-registered shareholder, your will receive this card each year and will be required to renew your request to receive these financial statements. If you have an questions about this procedure, please contact CIBC Mellon Trust Company by phone at 1-800-387-0825 or (416) 643-5500 or at WWW.CIBCMELLON.COM/INVESTORINQUIRY. We encourage you to submit your request online at WWW.CIBCMELLON.COM/ FINANCIALSTATEMENTS. Our Company code number is 7330A FINANCIAL STATEMENTS ELECTION NOTICE To: CIBC Mellon Trust Company (PLEASE PRINT) PO Box 7010 Name __________________________ Adelaide Street Postal Station Toronto, ON M5C 2W9 Address ________________________ Canada Fax: (416) 643-3135 ________________________________ ELECTRONICALLY: WWW.CIBCMELLON.COM/ INVESTORINQUIRY ________________________________ Postal/Zip Code ________________ Please add my name to the Supplemental Mailing List for Teck Cominco Limited Country ________________________ and send me their financial statements As indicated below: Email Address __________________ [_] Annual Financial Statements ________________________________ [_] Interim Financial Statements CHECK ONE: [_] By Mail [_] By electronic delivery. I have read and understood the terms of this Consent set forth on the reverse side of this notice and I consent to the electronic delivery of the Documents indicated in Item 1 on the reverse side of this notice. (See Reverse Side) TERMS AND CONDITIONS FOR ELECTRONIC DELIVERY OF DOCUMENTS TECK COMINCO LIMITED ( "Teck") has implemented an electronic delivery program under which you, as a shareholder, would be notified that Teck's interim financial statements, annual report and other corporate information is available on Teck's website at www.teck.com. If you consent to electronic delivery, a notification will be sent to you confirming when Teck has implemented its electronic delivery program. With your consent, Teck will be able to make the information available to you electronically instead of sending you the information by mail. To enable Teck to provide increased convenience to shareholders, benefit the environment and reduce costs, Teck encourages its shareholders to take advantage of the electronic delivery program. If you would like to take advantage of this electronic delivery program, you must complete the consent form below and return it to our transfer agent, CIBC Mellon Trust Company by fax 416-643-5501 or mail to CIBC Mellon Trust Company, P.O. Box 7010, Adelaide Street Postal Station, Toronto, Ontario, Canada, M5C 2W9. Teck encourages you to read the consent form carefully so that you understand the terms under which electronic delivery is made. If you would like to continue receiving these documents by mail, simply complete the enclosed Supplemental Mail List Return Card and return it to CIBC Mellon Trust Company. You do not have to complete the consent form below. TO: TECK COMINCO LIMITED 1. I consent to receiving all documents to which I am entitled, electronically rather than by mail. I understand that the documents I am entitled to receive may include: > Teck's Interim Financial Reports > Teck's Annual Report (including Annual Financial Statements and MD&A) > Notice of Teck's Annual or Special Meeting of Shareholders and related Management Proxy Circular > Teck's Supplemental Mailing List Return Card 2. I understand and agree that Teck will notify me when a document which I am entitled to receive is available on their website www.teck.com once Teck has filed the documents with securities regulators. I agree that notification will be sent to me at my e-mail address set out below or in such other manner as Teck may determine. 3. I acknowledge that access to Internet e-mail and the world wide web is required for me to access a document electronically and I confirm that I have such access. 4. I understand and agree that: > Any e-mail notice or other notification will not contain an actual document > Any e-mail notice or other notification will contain Teck's web address (or a hyperlink) identifying where a document is located by entering Teck's web address into my web browser, I can access, view, download, and print a document from my computer > The system requirements to view and download a document will be specified in Teck's website; currently a document distributed electronically will be in Adobe's Portable Document Format (PDF) the Adobe Acrobat Reader software is required to view a document in PDF format and is available free of charge from Adobe's web site at www.adobe.com 5. I understand that I may request a paper copy of a document for which I have consented to electronic delivery by: calling Teck at 604-699-4000; sending Teck a fax at 604-699-4729; sending Teck an e-mail to info@teck.com or by sending a request in writing by mail to Teck Cominco Limited, Suite 3300-550 Burrard Street, Vancouver, B.C., V6C 0B3. 6. I understand and agree that: > At any time and without giving me advance notice, Teck may elect not to send me a document electronically, in which case a paper copy of the document will be mailed to me > If a document intended to be sent to me electronically is not available electronically, a paper copy of the document will be mailed to me, and > If my e-mail address is found to be invalid, a paper copy of the document will be mailed to me. 7. I understand that Teck will maintain, on its website, any document sent to me electronically, for at least 6 months from the date of posting to the website. 8. I understand that I may revoke or modify my consent and that I may change my e-mail address to which documents are delivered to me, at any time, by notifying Teck by telephone: 604-699-4000, fax: 604-699-4729, email: info@teck.com or mail: Suite 3300 - 550 Burrard Street, Vancouver, B.C., V6C 0B3. I understand that if I change my e-mail address or revoke or modify my consent, I must notify Teck and they must actually receive and acknowledge my notification for my request to be effective. 9. I understand that I am not required to consent to electronic delivery. I am a security holder of Teck Cominco Limited. I have read and understand the terms of this "Consent to Electronic Delivery of Documents" form and, on those terms, I consent to the electronic delivery of the documents I am entitled to receive. -----END PRIVACY-ENHANCED MESSAGE-----