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Financial Services Regulatory Authority of Ontario

IN THE MATTER OF the Pension Benefits Act, R.S.O. 1990, c. P.8 (the "Act"), as amended;

AND IN THE MATTER OF the Canada Forgings Inc. Pension Plan for Salaried Employees, Registration Number 0929687 ("Salaried Plan");

AND IN THE MATTER OF the Canada Forgings Inc. Pension Plan for Members of Unifor Local 199, Registration Number 0236240 ("Hourly Plan").


MINUTES OF SETTLEMENT AND UNDERTAKING

    PART I - INTRODUCTION

  1. Canada Forgings Inc. ("Canada Forgings") is the administrator and employer with respect to the Salaried Plan and the Hourly Plan (collectively, the "Plans").

  2. On April 11, 2023, the Director, Pension Plan Operations ("Director"), by delegated authority from the Chief Executive Officer ("CEO") of the Financial Services Regulatory Authority of Ontario ("FSRA"), issued a Notice of Intended Decision ("NOID") to make an order under section 87 of the Act against Canada Forgings, respecting the Plans.

  3. The NOID alleged that Canada Forgings failed to remit contributions to the Plans from May 2022 to April 11, 2023.

  4. On April 28, 2023, Canada Forgings remitted contributions for both the Salaried Plan and the Hourly Plan. However, due to an error in calculating interest, Canada Forgings Inc. did not remit $4,809.01 in applicable interest on the contributions.

  5. On June 2, 2023, Canada Forgings remitted the outstanding interest on the contributions.

  6. To avoid a hearing before the Financial Services Tribunal ("Tribunal") and the issuance of an order, the Director and Canada Forgings (collectively the "Parties") are entering into this agreement.

    7. PART II - AGREED FACTS

  7. The Parties agree to the following facts:

    1. Canada Forgings failed to make the required employee and employer contributions to the Salaried Plan. The failed remittances were for May 2022 to February 2023.

    2. Canada Forgings failed to make the required employee contributions to the Hourly Plan. The failed remittances were for May 2022 to February 2023.

    3. On April 28, 2023, Canada Forgings remitted $161,183.35 to the Plans.

    4. On April 28, 2023, the Plans actuary noted an error in calculating the required interest for the payments. As such, the amount Canada Forgings remitted was $4,809.01 less than required.

    5. On May 28, 2023, Canada Forgings terminated its' Chief Executive Officer, Scott Narr, in part due to his role in Canada Forgings' failure to remit contributions to the Plans.

    6. On June 2, 2023, Canada Forgings remitted $4,809.01 to the Plans.


    8. PART Ill - NON-COMPLIANCE WITH STATUTORY PROVISIONS

  8. By engaging in the conduct described above Part II above, Canada Forgings admits and acknowledges that they breached section 55(2) the Act.

  9. In view of the above, Canada Forgings agrees and consents to the Terms of Settlement denoted in Part IV of these Minutes.

    10. PART IV - TERMS OF SETTLEMENT

  10. Canada Forgings acknowledges and agrees that it has been given the opportunity to seek independent legal advice, and is entering into these Minutes voluntarily, understanding the consequences of doing so.

  11. Canada Forgings acknowledges that these Minutes are an undertaking within the meaning of the Act, that these Minutes are binding on it, and that a failure to comply may result in immediate regulatory action including, but not limited to, the issuance of a Notice of Intended Decision to impose an administrative penalty, or a prosecution under the Provincial Offences Act.

    12. (a) Remittance and NOID Termination

  12. Canada Forgings has remitted the outstanding contributions to the Plans as outlined in the NOID.

  13. The Director agrees that FSRA and the Director will not issue the Order as outlined in the NOID. This settlement agreement will become the final disposition of the NOID.

    14. (b) Process for Execution of Settlement

  14. Canada Forgings acknowledges that these Minutes are not binding on the Director until signed by the Director.

  15. These Minutes may be executed in counterparts and may be executed and delivered by facsimile or e-mail and all such counterparts and facsimiles or e-mails, as applicable, shall together constitute one and the same agreement.

  16. The Parties accept and understand that these Minutes and any rights within the Minutes shall enure to the Parties and to any successors or assigns of the Parties.

    17. (c) Disclosure of Minutes

  17. The Parties will keep the terms of these Minutes confidential until these Minutes are executed by the Parties, except that the Director shall be permitted to disclose the Minutes within FSRA

  18. If either of the Parties do not sign these Minutes:

    1. These Minutes, and all related discussions and negotiations will be without prejudice to the Parties; and

    2. The Parties will each be entitled to all available proceedings, remedies and challenges, including proceeding to a hearing of the allegations contained in the NOID. Any proceedings, remedies and challenges will not be affected by these Minutes, or any related discussions or negotiations.


  19. Upon the signing of the Minutes:

    1. Canada Forgings agrees that these Minutes form part of its administrative record for the purposes of any future regulatory action or as an aggravating factor in respect of a future administrative penalty or prosecution against it or any affiliated entities;

    2. Canada Forgings acknowledges that these Minutes are public and will be published by FSRA on its public website (or that of its successor) along with a press release that summarizes these Minutes; and

    3. The Parties agree not to make representations to any member of the public or media or in a public forum that are inconsistent with these Minutes.


    20. (d) Further Proceedings

  20. Whether or not these Minutes are executed, Canada Forgings will not use, in any proceeding, these Minutes or the negotiation or process of approval of these Minutes as the basis for any attack on FSRA's jurisdiction, alleged bias, alleged unfairness, or any other remedies or challenges that may be available.

  21. Upon the execution of these Minutes:

    1. Canada Forgings waives all rights to a hearing before the Tribunal regarding the NOID;

    2. The Director agrees that FSRA will not take any further proceedings against Canada Forgings arising solely from the facts contained in the NOID and in these Minutes, unless facts not disclosed by Canada Forgings come to the attention of FSRA that are materially different from those contained in the NOID and in these Minutes, or if Canada Forgings fails to comply with any term in these Minutes; and

    3. Canada Forgings agrees that if it fails to comply with any term in these Minutes, FSRA is entitled to bring any proceedings available to it.

DATED August 23, 2023

(for Canada Forgings Inc.)

DATED August 23, 2023

Witness

DATED at Toronto, Ontario, September 8, 2023.

Original signed by

Claire Woodcock
Director, Pension Plan Operations
Financial Services Regulatory Authority of Ontario

By delegated authority from the Chief Executive Officer

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