Entire Document

Enbridge Inc. filed this Form 10-K/A on 3/9/2020

10-K/A
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM
10-K/A
Amendment No. 1
 
 
     
 
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934
 
 
 
 
 
 
 
 
 
 
For the fiscal year ended December 31, 2019
or
     
 
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934
 
 
 
 
 
 
 
 
 
 
For the transition period from          to
Commission file number
1-10934
 
 
 
ENBRIDGE INC.
(Exact Name of Registrant as Specified in Its Charter)
 
 
     
Canada
 
98-0377957
(State or Other Jurisdiction of
Incorporation or Organization)
 
(I.R.S. Employer
Identification No.)
 
 
 
 
 
 
 
 
 
 
200, 425 - 1st Street S.W.
Calgary, Alberta, Canada T2P 3L8
(Address of Principal Executive Offices) (Zip Code)
Registrant’s telephone number, including area code
(403) 231-3900
 
 
Securities registered pursuant to Section 12(b) of the Act:
         
Title of each class
 
Trading Symbol(s)
 
Name of each exchange on which registered
Common Shares
 
ENB
 
New York Stock Exchange
6.375% Fixed-to-Floating Rate Subordinated
Notes Series 2018-B due 2078
 
ENBA
 
New York Stock Exchange
 
 
 
 
 
 
 
 
 
 
Securities registered pursuant to Section 12(g) of the Act:         
None
 
 
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes
No
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes
No
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes
No
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation
S-T
(§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes
No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a
non-accelerated
filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule
12b-2
of the Exchange Act.
             
Large Accelerated Filer
 
 
Accelerated Filer
 
             
Non-Accelerated
Filer
 
 
Smaller reporting company
 
             
Emerging growth company
 
 
 
 
 
 
 
 
 
 
 
 
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule
12b-2
of the Exchange Act). Yes
No
The aggregate market value of the registrant’s common shares held by
non-affiliates
computed by reference to the price at which the common equity was last sold on June 30, 2019, was approximately US$73.1 billion.
As at February 7, 2020, the registrant had 2,024,814,011 common shares outstanding.

EXPLAN
A
TORY NOTE
Enbridge Inc., a corporation existing under the
Canada Business Corporations Act
, qualifies as a foreign private issuer in the United States for purposes of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Although, as a foreign private issuer, Enbridge Inc. is not required to do so, Enbridge Inc. currently continues to file annual reports on Form
10-K,
quarterly reports on
Form 10-Q,
and current reports on Form
8-K
with the Securities and Exchange Commission (“SEC”) instead of filing the reporting forms available to foreign private issuers. Enbridge Inc. prepares and files a management proxy circular and related material under Canadian requirements. As Enbridge Inc.’s management proxy circular is not filed pursuant to Regulation 14A, Enbridge Inc. may not incorporate by reference information required by Part III of its Form
10-K
from its management proxy circular.
Enbridge Inc. filed its Annual Report on Form
10-K
for the fiscal year ended December 31, 2019 (the “Original Filing”) on February 14, 2020. In reliance upon and as permitted by Instruction G(3) to
Form 10-K,
Enbridge Inc. is filing this Amendment No. 1 on Form
10-K/A
in order to include in the Original Filing the Part III information not previously included in the Original Filing.
Except as stated herein, no other changes have been made to the Original Filing. The Original Filing continues to speak as of the date of the Original Filing, and, other than the information provided in Parts III and IV hereof, we have not updated the disclosures contained in the Original Filing to reflect any events which occurred at a date subsequent to the filing of the Original Filing.
In this Amendment No. 1 on Form
10-K/A,
the terms “Enbridge,” “we,” “us,” “our” and “company” mean Enbridge Inc. “Board of Directors” or “Board” means the Board of Directors of Enbridge. All dollar amounts are in Canadian dollars (“C$” or “$”) unless stated otherwise.
All references to our websites and to our Canadian management proxy circular, dated March 2, 2020 and filed with the SEC on March 9, 2020 as Exhibit 99.1 to our Current Report on
Form 8-K
(the “Circular”), contained herein do not constitute incorporation by reference of information contained on such websites and the Circular and such information should not be considered part of this document.

         
  
 
  
  
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3
 
 
 
 
 

PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
DIRECTORS OF REGISTRANT
Director profiles
The profiles that follow provide information about the nominated directors, including their backgrounds, experience, current directorships, Enbridge securities held and the Board committees they sit on.
 
                                     
 
Pamela L. Carter
 
 
 
 
Age 70
Franklin, Tennessee, USA
 
Independent
 
Director since
February 27, 2017
 
Latest date of retirement
May 2025
 
2019 annual meeting votes for: 93.80%
 
 
 
 
 
Ms. Carter was the Vice President of Cummins Inc. and President of Cummins Distribution Business, a division of Cummins Inc., a designer, manufacturer and marketer of diesel engines and related components and power systems, from 2008 until her retirement in 2015. Ms. Carter joined Cummins Inc. in 1997 as Vice President – General Counsel and Corporate Secretary and held various management positions within Cummins. Prior to joining Cummins Inc., Ms. Carter served in the private practice of law as partner and associate and in various capacities with the State of Indiana, including Parliamentarian in the Indiana House of Representatives, Deputy Chief-of-Staff to governor Evan Bayh, Executive Assistant for Health Policy & Human Services and Securities Enforcement Attorney for the Office of the Secretary of State. She served as the Attorney General for the State of Indiana from 1993 to 1997 and was the first African-American woman to be elected state attorney general in the U.S.A. Ms. Carter holds a BA (Bachelor of Arts) from the University of Detroit, MSW (Master of Social Work) from the University of Michigan, J.D. (Doctor of Jurisprudence) from McKinney School of Law, Indiana University, Public Administration from Harvard Kennedy School. Ms. Carter received a 2018 Sandra Day O’Connor Board Excellence Award honoring her for her demonstrated commitment to board excellence and diversity. She also received an award as one of the top 100 board members from NACD in 2018 and top 25 director from Black Enterprise, 2018.
 
 
 
 
Enbridge Board/Board committee memberships
 
      
 
2019 meeting attendance
1
 
 
  Board of Directors
 
     7 out of 7      100%     
  Corporate Social Responsibility
 
     4 out of 4      100%     
  Governance (chair)
2
 
     4 out of 4      100%     
  Safety & Reliability
2
 
     2 out of 2      100%     
 
Total
 
 
    
17 out of 17
 
    
 
100%   
 
 
 
 
 
Enbridge securities held
3
 
                 
      
Enbridge shares
    
DSUs
4
      
 
Total market value of
Enbridge shares & DSUs
5
  
Minimum
required
6
 
 
 
    
 
42,559
 
 
 
    
 
8,056
 
 
 
    
$2,576,810
 
    
 
$1,108,679   
 
 
 
 
 
Other board/board committee memberships
7
 
                 
 
 
Public
7
 
                 
 
CSX Corporation
(public transportation company)
 
 
    
Director
Chair, finance committee
Member, governance committee and public affairs committee
 
 
 
 
 
Hewlett Packard Enterprise Company
(public technology company)
 
 
    
Director
Chair, human resources and compensation committee
 
 
 
  Broadridge Financial Solutions, Inc.
(public financial services company)
 
    
Director
Chair, audit committee
Member, governance and nominating committee
 
 
 
 
   
 
Former
US-listed
company directorships (last 5 years)
 
       
   
 
Spectra Energy Corp
 
               
 
 
 
 
4

                                             
 
Marcel R. Coutu
 
 
 
 
Age 66
Calgary, Alberta, Canada
 
Independent
 
Director since
July 28, 2014
 
Latest date of retirement
May 2029
 
2019 annual meeting
votes for: 87.86%
 
 
Mr. Coutu was the Chairman of Syncrude Canada Ltd. (integrated oil sands project) from 2003 to 2014 and was the President and Chief Executive Officer of Canadian Oil Sands Limited from 2001 until January 2014. From 1999 to 2001, he was Senior Vice President and Chief Financial Officer of Gulf Canada Resources Limited. Prior to 1999, Mr. Coutu held various executive positions with TransCanada PipeLines Limited and various positions in the areas of corporate finance, investment banking and mining and oil and gas exploration and development. Mr. Coutu holds an HBSc (Bachelor of Science, Honours Earth Science) from the University of Waterloo and an MBA (Master of Business Administration) from the University of Western Ontario.
 
 
 
 
Enbridge Board/Board committee memberships
 
 
    
 
 
2019 meeting attendance
1
 
 
 
 
 
 
 
 
 
Board of Directors
 
       7 out of 7     
 
 
 
100%
 
 
 
  Audit, Finance & Risk
 
       3 out of 4        75%    
  Governance
8
 
       2 out of 2        100%    
  Human Resources & Compensation
 
       4 out of 5        80%    
 
Total
 
       16 out of 18        89%    
 
 
 
 
 
Enbridge securities held
3
 
 
 
 
  
 
Enbridge shares
 
  
 
DSUs
4
 
    
 
 
 
 
Total market value of
Enbridge shares and DSUs
5
 
 
 
  
 
Minimum
required
6

 
 
 
 
 
 
 
    
 
29,400
 
 
 
    
 
28,595
 
 
 
      
 
$2,952,525
 
 
 
    
 
$1,108,679
 
 
 
 
 
 
 
 
 
Other board/board committee memberships
7
 
 
 
 
 
 
 
 
Public
7
 
 
 
 
 
 
 
Brookfield Asset Management Inc.
(public global asset management company)
 
 
    
 
 
 
Director
Chair, audit committee
Member, management, resources and
compensation committee
 
 
 
 
 
 
 
Power Corporation of Canada
(public international management and holding company)
 
 
    
 
 
 
Director
Member, audit committee and compensation
committee
 
 
 
 
 
 
The Great-West Lifeco Inc.
(public international financial services holding
company that is an indirect subsidiary of Power
Corporation of Canada)
 
 
 
 
    
 


 
 
Director
Member, executive committee, governance
and nominating committee, human resources
committee, investment committee and risk
committee
 
 
 
 
 
 
 
 
IGM Financial Inc.
(public personal financial services company that is
an indirect subsidiary of Power Corporation of Canada)
 
 
 
    
 
 
 
Director
Member, executive committee, investment
committee and human resources committee
 
 
 
 
 
 
 
Not-for-profit
7
 
 
 
 
Calgary Exhibition and Stampede Board
 
 
    
 
 
 
 
Director
 
 
 
 
 
 
 
 
 
                                             
Susan M. Cunningham
 
 
 
 
Age 64
Houston, Texas, USA      
 
Independent
 
Director since
February 13, 2019
 
Latest date of retirement
May 2031
 
2019 annual meeting
votes for: 96.58%
 
 
 
 
Ms. Cunningham has been an Advisor for Darcy Partners (consulting firm) since 2017. From 2014 to 2017, Ms. Cunningham was Executive Vice President, EHSR (Environment, Health, Safety, Regulatory) and New Frontiers (global exploration, new ventures, geoscience and business innovation) at Noble Energy, Inc. From 2001 to 2013, she held various senior management roles with Noble Energy, Inc. Prior thereto, Ms. Cunningham held positions with Texaco U.S.A., Statoil Energy, Inc. and Amoco Corporation. Ms. Cunningham holds a BA in Geology and Geography from McMaster University and is a graduate of Rice University’s Executive Management Program. She was also Chairman of the OTC (Offshore Technology Conference) from 2010 to 2011.
 
 
 
 
Enbridge Board/Board committee memberships
 
         
2019 meeting attendance
1
 
        
 
Board of Directors
 
 
5 out of 6
  
 
83%
 
 
 
Human Resources & Compensation
 
 
2 out of 3
  
 
67%
 
 
 
Safety & Reliability
 
 
2 out of 3
  
 
67%
 
 
 
Total
 
 
 
9 out of 12
  
 
75%
 
 
 
 
 
 
 
Enbridge securities held
3
 
                     
      
Enbridge shares
    
DSUs
4
   
 
Total market value of
Enbridge shares and  DSUs
5
  
Minimum
required
6
       
 
 
    
 
947
 
 
 
    
 
3,281
 
 
 
 
$215,247
 
    
 
$1,108,679
 
 
 
 
 
 
 
 
 
Other board/board committee memberships
7
 
                     
 
 
Other foreign
 
                     
 
Oil Search Limited
(public oil and gas exploration and production)
 
 
 
 
Director
Member, people and nominations committee
 
 
 
 
 
 
 
 
 
Former US-listed company directorships (last 5 years)
 
              
 
 
Cliffs Natural Resources Inc.
 
                  
 
 
 
 
5

                                                     
 
Gregory L. Ebel
 
 
 
Age 55
Houston, Texas, USA
 
Not Independent
9
 
Director since
February 27, 2017
 
Latest date of retirement
May 2032
 
2019 annual meeting
votes for: 88.58%
 
 
 
 
Mr. Ebel served as Chairman, President and CEO of Spectra Energy from January 1, 2009 to February 27, 2017 at which time he became a Director of Enbridge and Chair of the Enbridge Board. Prior to that time, Mr. Ebel served as Spectra Energy’s Group Executive and Chief Financial Officer beginning in January 2007. He served as President of Union Gas Limited from January 2005 until January 2007, and Vice President, Investor & Shareholder Relations of Duke Energy Corporation from November 2002 until January 2005. Mr. Ebel joined Duke Energy in March 2002 as Managing Director of Mergers and Acquisitions in connection with Duke Energy’s acquisition of Westcoast Energy Inc. Mr. Ebel holds a BA (Bachelor of Arts, Honours) from York University.
 
 
 
Enbridge Board/Board committee memberships
 
 
  
2019 meeting attendance
1
 
 
 
 
 
 
 
Board of Directors
 
  
7 out of 7
  
 
100%
 
 
 
Audit, Finance & Risk
9
 
  
4 out of 4
  
 
100%
 
 
 
Corporate Social Responsibility
9
 
  
4 out of 4
  
 
100%
 
 
 
Governance
9
 
  
4 out of 4
  
 
100%
 
 
 
Human Resources & Compensation
9
 
  
5 out of 5
  
 
100%
 
 
 
Safety & Reliability
9
 
  
4 out of 4
  
 
100%
 
 
 
Total
 
 
  
28 out of 28
 
  
 
 
100%
 
 
 
 
 
 
 
 
 
Enbridge securities held
3
 
 
  
 
 
 
 
 
 
    
 
Enbridge shares
 
  
 
DSUs
4
 
    
 
Stock
Options
10
 
 
  
 
Total market value of Enbridge shares and DSUs
(excluding stock options)
5
  
 
Minimum
required
6
 
 
 
 
 
    
 
651,845
 
 
 
    
 
22,489
 
 
 
      
 
405,408
 
 
 
  
$34,330,344
 
    
 
$1,108,679
 
 
 
 
 
 
 
 
 
Other board/board committee memberships
7
 
 
  
 
 
 
 
 
 
 
 
Public
7
 
 
 
 
 
 
   
 
The Mosaic Company
(public producer and marketer of concentrated phosphate and potash)
 
 
  
 
Chairman of the board
Member, audit committee & corporate governance and nominating committee
 
 
 
 
 
 
 
   
 
Baker Hughes Incorporated
(public supplier of oilfield services and products)
 
 
  
 
Director
Chair, audit committee
Member, governance & nominating committee
 
 
 
 
 
 
 
 
   
 
Former US-listed company directorships (last 5 years)
 
  
 
 
 
 
 
 
 
   
 
Spectra Energy Corp
 
    
 
 
 
 
 
6

                                         
 
J. Herb England
 
 
 
 
Age 73
Naples, Florida, USA
 
Independent
 
Director since
January 1, 2007
 
Latest date of retirement
May 2022
11
 
2019 annual meeting
votes for: 96.84%
 
 
Mr. England has been Chair & Chief Executive Officer of Stahlman-England Irrigation Inc. (contracting company) in southwest Florida since 2000. From 1993 to 1997, Mr. England was the Chair, President & Chief Executive Officer of Sweet Ripe Drinks Ltd. (fruit beverage manufacturing company). Prior to 1993, Mr. England held various executive positions with John Labatt Limited (brewing company) and its operating companies, including the position of Chief Executive Officer of Labatt Brewing Company – Prairie Region (brewing company), Catelli Inc. (food manufacturing company) and Johanna Dairies Inc. (dairy company). In 1993, Mr. England retired as Senior Vice President, Finance and Corporate Development & Chief Financial Officer of John Labatt Limited. Mr. England holds a BA (Bachelor of Arts) from the Royal Military College of Canada and an MBA (Master of Business Administration) from York University. He also has a CA (Chartered Accountant) designation.
 
 
 
 
Enbridge Board/Board committee memberships
 
 
  
2019 meeting attendance
1
   
 
 
 
Board of Directors
 
  
7 out of 7
  
 
100%   
 
 
Audit, Finance & Risk (chair)
 
  
4 out of 4
  
 
100%   
 
 
Governance Committee
11
 
  
2 out of 2
  
 
100%   
 
 
Total
 
 
  
13 out of 13
 
  
 
 
100%   
 
 
 
 
 
Enbridge securities held
3
 
 
    
 
Enbridge shares
 
  
 
DSUs
4
 
  
 
Total market value of Enbridge shares and DSUs
5
  
 
 
Minimum   
required
6
   
 
 
 
 
    
 
32,032
 
 
 
    
 
77,530
 
 
 
  
$5,577,801
 
    
 
$1,108,679   
 
 
 
 
 
Other board/board committee memberships
 
 
 
 
Public
7
 
 
 
 
FuelCell Energy, Inc.
(public fuel cell company in which Enbridge holds a small interest)
 
 
  
 
Chairman of the board
Member, audit and finance committee
 
 
 
 
 
Private
7
 
 
 
 
Stahlman-England Irrigation Inc.
(private contracting company)
 
 
   Chair, board of directors
Chief executive officer
 
 
 
USA Grading Inc.
(private excavating, grading and underground utilities company)
 
 
   Director
 
 
 
 
 
 
 
Former US public company directorships (last 5 years)
 
 
 
 
 
 
 
 
Enbridge Energy Management, LLC
 
 
 
   
 
Charles W.
Fischer, CM
 
 
 
Age 69
Calgary, Alberta, Canada
 
Independent
 
Director since
July 28, 2009
 
Latest date of retirement
May 2025
 
2019 annual meeting
votes for: 98.81%
 
 
Mr. Fischer was the President & Chief Executive Officer of Nexen Inc. (oil and gas company) from 2001 to 2008. From 1994 to 2001, Mr. Fischer held various executive positions within Nexen Inc., including the positions of Executive Vice President & Chief Operating Officer in which he was responsible for all Nexen’s conventional oil and gas business in Western Canada, the US Gulf Coast and all international locations, as well as oil sands, marketing and information systems activities worldwide. Prior thereto, Mr. Fischer held positions with Dome Petroleum Ltd. (oil and gas company), Hudson’s Bay Oil & Gas Ltd. (oil and gas company), Bow Valley Industries Ltd. (oil and gas company), Sproule Associates Ltd. (petroleum consulting firm) and Encor Energy Ltd. (oil and gas company). Mr. Fischer holds a BSc (Bachelor of Science in Chemical Engineering) and an MBA (Master of Business Administration), both from the University of Calgary.
 
 
 
 
Enbridge Board/Board committee memberships
 
    
2019 meeting attendance
1
   
 
 
 
Board of Directors
 
  
7 out of 7
  
 
100%   
 
 
Audit, Finance & Risk
 
  
4 out of 4
  
 
100%   
 
 
Corporate Social Responsibility
 
  
4 out of 4
  
 
100%   
 
 
Safety & Reliability (chair)
 
  
4 out of 4
  
 
100%   
 
 
Total
 
  
19 out of 19
  
 
100%   
 
 
 
Enbridge securities held
3
 
 
      
Enbridge shares
    
DSUs
4
    
 
Total market value of
Enbridge shares and DSUs
5
  
Minimum   
required
6
   
 
 
 
    
 
31,169
 
 
 
    
 
41,602
 
 
 
  
$3,704,772
 
    
 
$1,108,679
 
 
 
         
 
 
Other public board/board committee memberships
7
 
 
 
 
    
 
 
 
 
 
7

                                             
 
Gregory J. Goff
 
 
 
 
Age 63
San Antonio, Texas, USA
 
Independent
 
Director since
February 11, 2020
 
Latest date of retirement
May 2032
 
2019 annual meeting
votes for: N/A
 
 
 
 
Mr. Goff was Executive Vice Chairman of Marathon Petroleum Corporation (an integrated downstream energy company) from October 2018 until his retirement in December 2019. He was President and Chief Executive Officer of Andeavor (a petroleum refiner) from 2010 to 2018 and Chairman from December 2014 to 2018. Prior thereto, Mr. Goff held a number of senior leadership positions with ConocoPhillips Corporation (an oil and gas exploration and production company). Mr. Goff holds a BS (Bachelor of Science) and an MBA (Master of Business Administration) from the University of Utah.
 
 
Enbridge Board/Board committee memberships
    
2019 meeting attendance
        
  Board of Directors
 
   N/A      N/A    
 
Total
 
   N/A      N/A    
 
 
 
 
Enbridge securities held
3
                
      
Enbridge shares
    
DSUs
4
    
 
Total market value of
Enbridge shares and DSUs
5
  
Minimum
required
6
       
 
 
    
 
 
 
 
    
 
 
 
 
  
$–
 
    
 
$1,108,679
 
 
 
 
 
 
 
 
Other board/board committee memberships
7
                
 
Public
7
 
  
 
 
 
 
 
 
 
PolyOne Corporation
(public polymer company)
 
 
  
Chair, EHS committe
Member, nominating committee
 
 
 
 
 
 
 
 
                                                 
 
V. Maureen Kempston Darkes
 
 
 
 
Age 71
Toronto, Ontario, Canada
Lauderdale-by-the-Sea,
Florida, USA
 
Independent
 
Director since
November 2, 2010
 
Latest date of retirement
May 2024
 
2019 annual meeting votes for: 96.46%
 
 
 
 
Ms. Kempston Darkes is the retired Group Vice President and President Latin America, Africa and Middle East, General Motors Corporation (automotive corporation and vehicle manufacturer). From 1994 to 2001, she was the President and General Manager of General Motors of Canada Limited and Vice President of General Motors Corporation. Ms. Kempston Darkes holds a BA (Bachelor of Arts) and an LLB (Bachelor of Laws), both from the University of Toronto.
12
 
 
 
Enbridge Board/Board committee memberships
    
2019 meeting attendance
1
        
  Board of Directors
 
     7 out of 7        100%    
  Corporate Social Responsibility (chair)
 
     4 out of 4        100%    
  Human Resources & Compensation
 
     5 out of 5        100%    
  Safety & Reliability
 
     4 out of 4        100%    
 
Total
 
     20 out of 20        100%    
 
 
 
 
Enbridge securities held
3
                
      
Enbridge shares
    
DSUs
4
    
 
Total market value of
Enbridge shares and DSUs
5
    
Minimum
required
6
       
 
 
  
 
21,735
 
  
 
45,396
 
  
 
$3,417,639
 
  
 
$1,108,679
 
 
 
 
 
 
Other board/board committee memberships
                
 
Public
7
                
 
Brookfield Asset Management Inc.
(public global asset management company)
 
 
    
Director
 
Chair, risk management committee
Member, management resources and
compensation committee
 
 
 
 
 
 
 
 
 
Canadian National Railway Company
(public railway company)
 
 
    
Director
 
Member, audit committee, corporate
governance and nominating committee,
finance committee, strategic planning
committee and pension and investment
committee
 
 
 
 
 
 
 
 
 
 
 
8

                                             
 
Teresa S. Madden
 
 
 
Age 64
Boulder, Colorado, USA  
 
Independent
 
Director since
February 12, 2019
 
Latest date of retirement
May 2031
 
2019 annual meeting votes for: 98.98%
 
 
 
 
 
Ms. Madden was the Executive Vice President and Chief Financial Officer of Xcel Energy, Inc., an electric and natural gas utility, from 2011 until her retirement in 2016. She joined Xcel in 2003 as Vice President, Finance, Customer & Field Operations and was named Vice President and Controller in 2004. Prior thereto, Ms. Madden held positions with Rogue Wave Software, Inc. as well as New Century Energies and Public Service Company of Colorado, predecessor companies of Xcel Energy. Ms. Madden holds a BS (Bachelor of Science) in Accounting from Colorado State University and an MBA (Master of Business Administration) from Regis University.
 
 
 
Enbridge Board/Board committee memberships
         
2019 meeting attendance
1
        
  Board of Directors
 
 
6 out of 7
     83%    
  Audit, Finance & Risk
 
 
3 out of 3
     100%    
  Governance
 
 
3 out of 3
     100%    
 
Total
 
 
12 out of 13
     92%    
 
 
 
 
Enbridge securities held
3
                     
      
Enbridge shares
    
DSUs
4
   
 
Total market value of
Enbridge shares and  DSUs
5
  
Minimum
required
6
       
 
 
  
 
 
  
 
3,281
 
 
$167,036
  
 
$1,108,679
 
 
 
 
 
 
Other board/board committee memberships
7
                     
 
Public
7
                     
 
Peabody Energy Corp.
(public pure-play coal company)
 
 
 
                                               Director
                                               Chair, audit committee
                                               Member, health, safety, security &
                                               environmental committee and executive
                                               committee
 
 
 
 
 
 
              
 
 
 
 
                                             
 
Al Monaco
 
 
 
 
Age 60
Calgary, Alberta, Canada
 
Not independent
 
Director since
February 27, 2012
 
Latest date of retirement
May 2027
 
2019 annual meeting votes for: 98.86%
 
 
 
 
Mr. Monaco joined Enbridge in 1995 and has held increasingly senior positions. He has been President & Chief Executive Officer of Enbridge since October 1, 2012 and served as Director and President of Enbridge from February 27, 2012 to September 30, 2012. Mr. Monaco holds an MBA (Master of Business Administration) from the University of Calgary and has a Chartered Professional Accountant designation.
 
 
 
 
Enbridge Board/Board committee memberships
13
 
      
 
2019 meeting attendance
1
   
 
 
 
 
Board of Directors
 
 
    
 
7 out of 7
 
  
 
 
 
 
100%
 
 
 
 
 
 
 
 
 
 
Enbridge securities held
3
 
           
      
Enbridge shares
    
Stock
options
      
Total market value of
Enbridge shares
(excluding stock options)
5
  
Minimum
required
14
       
 
 
     876,512        3,987,520        $44,623,226         
 
 
 
 
 
Other board/board committee memberships
 
 
 
 
Public
7
 
 
 
 
Weyerhaeuser Company
(public timberlands company and wood products manufacturer)
 
 
 
     Director
 
 
 
 
 
 
 
Private
7
 
 
 
 
DCP Midstream, LLC
(a private 50/50 joint venture between Enbridge and Phillips 66 and the general partner of DCP Midstream GP, LLC, the general partner of DCP Midstream GP, LP, the general partner of DCP Midstream Partners, LP, a midstream master limited partnership with public unitholders)
 
 
 
 
    
Director
Member, human resources and compensation committee
 
 
 
 
 
 
 
 
Not-for-profit
7
 
 
   
 
American Petroleum Institute
(not-for-profit trade association)
 
 
 
    
Director
Member, executive committee and finance committee
 
 
 
 
   
 
Business Council of Canada
(not-for-profit, non-partisan organization composed of CEOs of Canada’s leading enterprises)
 
 
 
     Member
 
 
   
 
U.S. National Petroleum Council
 
 
    
Member
 
 
   
 
Catalyst Canada Advisory Board
 
 
     Member
 
 
 
 
 
 
9

                                 
 
Dan C. Tutcher
 
 
 
Age 70
Houston, Texas, USA
 
Not Independent
 
Director since
May 3, 2006
 
Latest date of retirement
May 2024
 
2019 annual meeting
votes in favor: 98.55%
 
  
 
Mr. Tutcher is a Managing Director and Portfolio Manager on the Energy Infrastructure Equities team for Brookfield’s Public Securities Group. Mr. Tutcher is also on the Board of Directors of Gulf Capital Bank, where he is Chairman of the Governance Committee. Prior to joining Brookfield in 2018, Mr. Tutcher was President & Chair of the Board of Trustees of Center Coast MLP & Infrastructure Fund since 2013 and a Principal in Center Coast Capital Advisors L.P. since its inception in 2007. He was the Group Vice President, Transportation South of Enbridge, as well as President of Enbridge Energy Company, Inc. (general partner of former Enbridge sponsored affiliate Enbridge Energy Partners, L.P.) and Enbridge Energy Management, L.L.C. (another former Enbridge sponsored vehicle) from May 2001 until May 1, 2006. From 1992 to May 2001, he was the Chair of the Board of Directors, President & Chief Executive Officer of Midcoast Energy Resources, Inc. Mr. Tutcher holds a BBA (Bachelor of Business Administration) from Washburn University.
 
  
 
Enbridge Board/Board committee memberships
 
 
    
2019 meeting attendance
1
   
 
   Board of Directors
 
    
7 out of 7
  100%   
   Corporate Social Responsibility
 
    
3 out of 4
  75%   
   Safety & Reliability
 
    
3 out of 4
  75%   
  
Total
 
    
13 out of 15
  87%   
  
 
Enbridge securities held
3
 
     
 
Enbridge shares
 
    
 
DSUs
4
 
    
 
Total market value of Enbridge shares & DSUs
5
 
Minimum   
required
6
   
  
 
  
 
 
637,523
 
 
 
    
 
 
120,743
 
 
 
    
$38,603,322
 
 
$1,108,679   
 
  
 
Other board/board committee memberships
7
 
  
 
Private
7
 
  
 
Gulf Capital Bank
(private financial institution)
 
 
 
    
 
Director
Chair, governance committee
  
 
Former
US-listed
company directorships (last 5 years)
 
  
 
Centre Coast MLP & Infrastructure Fund
 
 
    
 
 
 
 
1.
Percentages are rounded to the nearest whole number.
 
 
 
2.
Ms. Carter was appointed as Chair of the Governance Committee on February 13, 2019 and ceased being a member of the Safety & Reliability Committee on May 8, 2019.
 
 
 
3.
Information about beneficial ownership and about securities controlled or directed was provided by the director nominees and is as at March 2, 2020.
 
 
 
4.
DSUs refer to deferred share units and are defined on page 55 of this Amendment No. 1 on Form 10-K/A.
 
 
 
5.
Total market value = number of common shares or deferred share units × closing price of Enbridge shares on the Toronto Stock Exchange (“TSX”) on March 2, 2020 of $50.91, rounded to the nearest dollar.
 
 
 
6.
Directors must hold at least three times their annual Board retainer in DSUs or Enbridge shares within five years of becoming a director on our Board. Amounts are converted to C$ using US$1 = C$1.2967, the published WM/Reuters 4 pm London exchange rate for December 31, 2019. All director nominees meet or exceed this requirement except Mses. Madden and Cunningham, who have until February 12, 2024 and February 13, 2024, respectively, and Mr. Goff, who has until February 11, 2025.
 
 
 
7.
Public
means a corporation or trust that is a reporting issuer in Canada, a registrant in the US, or both, and that has publicly listed equity securities.
 
 
 
Private
means a corporation or trust that is not a reporting issuer or registrant.
Not
-for
-profit
means a corporation, society or other entity organized for a charitable, civil or other social purpose which does not generate profits for its members.
8.
Mr. Coutu ceased being a member of the Governance Committee on May 8, 2019.
 
 
 
9.
The Board will re-evaluate Mr. Ebel’s independence after the NYSE three-year look-back rule for independence ends on April 15, 2020 and is expected to determine that Mr. Ebel is independent, subject to no new material relationships affecting his independence at that time. Mr. Ebel is not a member of any Board committee, but as Chair of the Board he attends their meetings.
 
 
 
10.
Mr. Ebel’s stock options were Spectra Energy options that converted into options to purchase Enbridge shares upon the closing of the Merger Transaction (as defined on page 62). No new Enbridge stock options were granted to Mr. Ebel in his capacity as a Director of Enbridge or Chair of the Enbridge Board.
 
 
 
11.
Mr. England was appointed to the Governance Committee on May 8, 2019. In February 2020, the Board unanimously approved the extension of the term limit for Mr. England as a director for an additional two years following the Meeting.
 
 
 
 
10

12.
Ms. Kempston Darkes was an executive officer of General Motors Corporation (“GM”) from January 1, 2002 to December 1, 2009. GM filed for bankruptcy protection under Chapter 11 of the U.S. Bankruptcy Code on June 1, 2009. None of the operations for which she was directly responsible in Latin America, Africa and the Middle East were included in the bankruptcy filing. GM emerged from bankruptcy protection on July 10, 2009 in a reorganization in which a new entity acquired GM’s most valuable assets.
 
 
 
13.
Mr. Monaco is not a member of any Board committee, but as President & Chief Executive Officer he attends their meetings at the request of such committees.
 
 
 
14.
As President & CEO, Mr. Monaco is required to hold Enbridge shares equal to six times his base salary (see page 40). Mr. Monaco is not required to hold Enbridge shares as a director.
 
 
 
15.
Ms. Williams ceased being a member of the Audit, Finance & Risk Committee and was appointed to the Governance Committee on May 8, 2019.
 
 
 
Retiring director
Catherine L. Williams is not standing for re-election as a director of Enbridge and will retire at the end of the Meeting. Ms. Williams has served on our Board since November 1, 2007 and is 69 years old. Ms. Williams was the Chief Financial Officer for Shell Canada Limited (oil and gas company) from 2003 to 2007. Prior thereto, she held various positions with Shell Canada Limited, Shell Europe Oil Products, Shell Canada Oil Products and Shell International (oil and gas companies) from 1984 to 2003. Ms. Williams holds a BA (Bachelor of Arts) from the University of Western Ontario and an MBA (Master of Business Administration, Finance) from Queen’s School of Business (now Smith School of Business at Queen’s University). Ms. Williams’ other public company board and committee memberships are as follows:
 
                             
 
Public
 
 
 
 
 
Vermilion Energy Inc.
(public oil and gas company)
  
Director
Chair, audit committee
Member, governance and human resources committee
 
 
 
 
 
 
 
 
Director independence
 
             
 
  Director
 
  
 
Independent
 
  
 
Non-Independent
 
  
 
Reason for
non-independence
 
  Pamela L. Carter
  
 
  
 
  
 
  Marcel R. Coutu
  
  
 
  
 
  Susan M. Cunningham
  
  
 
  
 
  Gregory L. Ebel
  
 
  
  
Former Chairman, President and CEO of Spectra Energy and a
non-executive
Spectra Energy employee until April 15, 2017. The Board will re-evaluate Mr. Ebel’s independence after the NYSE three-year look-back rule for independence ends on April 15, 2020 and is expected to determine that Mr. Ebel is independent, subject to no new material relationships affecting his independence at that time.
  J. Herb England
  
     
  Charles W. Fischer
  
  
 
  
 
  Gregory J. Goff
  
  
 
  
 
  V. Maureen Kempston Darkes
  
  
 
  
 
  Teresa S. Madden
  
  
 
  
 
  Al Monaco
  
 
  
  
President & CEO of the company
  Dan C. Tutcher
  
 
  
  
Employee of Brookfield, whose subsidiary and institutional partners made payments to Enbridge for property or services in an amount which exceeds 2% of Brookfield’s consolidated gross revenues
  Catherine L. Williams
  
  
 
  
 
 
 
 
 
11

Current Board committee participation
 
                                         
           
  Director
 
  
Audit, Finance
& Risk
Committee
 
    
Corporate
Social
Responsibility
Committee
 
    
Governance
Committee
 
    
Human
Resources &
Compensation
Committee
 
    
Safety &
Reliability
Committee
 
 
  Not independent
  
 
 
 
  
 
 
 
  
 
 
 
  
 
 
 
  
 
 
 
  Gregory L. Ebel
1
  
 
 
 
  
 
 
 
  
 
 
 
  
 
 
 
  
 
 
 
  Al Monaco
1
  
 
 
 
  
 
 
 
  
 
 
 
  
 
 
 
  
 
 
 
  Dan C. Tutcher
  
 
 
 
  
 
 
  
 
 
 
  
 
 
 
  
 
 
  Independent
  
 
 
 
  
 
 
 
  
 
 
 
  
 
 
 
  
 
 
 
  Pamela L. Carter
  
 
 
 
  
 
 
  
 
committee chair
 
  
 
 
 
  
 
 
 
  Marcel R. Coutu
2
  
 
 
  
 
 
 
  
 
 
 
  
 
 
  
 
 
 
  Susan M. Cunningham
  
 
 
 
  
 
 
 
  
 
 
 
  
 
 
  
 
 
  J. Herb England
2
  
 
committee chair
 
  
 
 
 
  
 
 
  
 
 
 
  
 
 
 
  Charles W. Fischer
  
 
 
  
 
 
  
 
 
 
  
 
 
 
  
 
committee chair
 
  Gregory J. Goff
3
  
 
 
 
  
 
 
 
  
 
 
 
  
 
 
 
  
 
 
 
  V. Maureen Kempston Darkes
  
 
 
 
  
 
committee chair
 
  
 
 
 
  
 
 
  
 
 
  Teresa S. Madden
2
  
 
 
  
 
 
 
  
 
 
  
 
 
 
  
 
 
 
  Catherine L. Williams
2
  
 
 
 
  
 
 
 
  
 
 
  
 
committee chair
 
  
 
 
 
 
 
 
 
1.
Messrs. Ebel and Monaco are not members of any of the committees of the Board. They attend committee meetings in their capacities as Chair of the Board and President & CEO, respectively.
 
 
 
2.
Mses. Madden and Williams and Messrs. Coutu and England each qualify as an audit committee financial expert, as defined under the
U.S. Securities Exchange Act of 1934
, as amended. The Board has also determined that all the members of the Audit, Finance & Risk Committee are financially literate according to the meaning of National Instrument
52-110
Audit Committees
and the rules of the NYSE.
 
 
 
3.
Mr. Goff has not yet been appointed to any Board committees.
 
 
 
EXECUTIVE OFFICERS OF REGISTRANT
The information regarding executive officers is included in
Part I.
Item 1. Business—Executive Officers
of the Original Filing
CORPORATE GOVERNANCE
As of June 30, 2019, Enbridge regained its status as a “foreign private issuer” pursuant to applicable U.S. securities laws. Accordingly, Enbridge is permitted to follow home country practice instead of certain governance requirements set out in the New York Stock Exchange (the “NYSE”) rules, provided we disclose any significant differences between our governance practices and those required by the NYSE. Further information regarding those differences is available on our website (www.enbridge.com).
We have a comprehensive system of stewardship and accountability that meets applicable Canadian and U.S. requirements, including: Canadian Securities Administrators (CSA) National Policy 58-201
Corporate Governance Guidelines;
National Instrument 58-101
Disclosure of Corporate Governance Practices
; National Instrument 52-110
Audit Committees;
requirements of the
Canada Business Corporations Act
; and the corporate governance guidelines of the NYSE.
STATEMENT ON BUSINESS CONDUCT
Our Statement on Business Conduct (available on our website at www.enbridge.com) is our formal statement of expectations for all individuals engaged by Enbridge. It applies to everyone at Enbridge and our subsidiaries, including our directors, officers, employees, contingent workers as well as consultants and contractors retained by Enbridge.
 
12

It discusses what we expect in areas like:
 
 
  complying with the law, applicable rules and all policies;
 
 
 
 
  how to avoid conflicts of interest, including examples of acceptable forms of gifts and entertainment;
 
 
 
 
  anti-corruption and money laundering;
 
 
 
 
  acquiring, using and maintaining assets (including computers and communication devices) appropriately;
 
 
 
 
  data privacy, records management, and proprietary, confidential and insider information;
 
 
 
 
  protecting health, safety and the environment;
 
 
 
 
  interacting with landowners, customers, shareholders, employees and others; and
 
 
 
 
  respectful workplace/no harassment.
 
 
 
 
The Board approved a revised Statement on Business Conduct in 2017 and the revised Statement on Business Conduct became effective on September 29, 2017. We intend to post any amendment or waiver to the Statement on Business Conduct on our website within the time period required by the SEC.
On the commencement of employment with Enbridge and annually thereafter, all Enbridge employees and contingent workers active in the Company’s human resources information system are required to complete a Statement on Business Conduct training and certify compliance with the Statement on Business Conduct. In addition, employees and contingent workers are also required to disclose any actual or potential conflicts of interest.
Directors must also certify their compliance with the Statement on Business Conduct on an annual basis.
During January 2020, all employees and contingent workers active in the company’s human resources information system were required to complete online Statement on Business Conduct training and applicable compliance certification, and were required to declare any real or potential conflicts of interest. As of the date of the Circular, approximately 98% of these Enbridge employees had certified compliance with the Statement on Business Conduct for the year ended December 31, 2019. All 11 current directors on the Board who were directors in 2019 have also certified their compliance with the Statement on Business Conduct for the year ended December 31, 2019.
AUDIT FINANCE & RISK COMMITTEE
The Audit, Finance & Risk Committee fulfills public company audit committee obligations and assists the Board with oversight of: the integrity of the company’s financial statements; the company’s compliance with legal and regulatory requirements; the independent auditor’s qualifications and independence; and the performance of the company’s internal audit function and external auditors. The committee also assists the Board with the company’s risk identification, assessment and management program.
Financial literacy
The Board defines an individual as financially literate if he or she can read and understand financial statements that are generally comparable to ours in breadth and complexity of issues. The Board has determined that all of the members of the Audit, Finance & Risk Committee are financially literate according to the meaning of NI 52-110 and the rules of the NYSE. It has also determined that Mses. Madden and Williams and Messrs. Coutu and England each qualify as “audit committee financial experts” as defined by the Exchange Act. The Board bases this determination on each director’s education, skills and experience.
 
13

ITEM 11. EXECUTIVE COMPENSATION
As a foreign private issuer in the United States, we are deemed to comply with this Item if we provide information required by Items 6.B and 6.E.2 of Form
20-F,
with more detailed information provided if otherwise made publicly available or required to be disclosed in Canada. We have provided information required by Items 6.B and 6.E.2 of Form
20-F
in the Circular. As a foreign private issuer in the United States we are not required to disclose executive compensation according to the requirements of Regulation
S-K
that apply to U.S. domestic issuers, and we are not otherwise required to adhere to the U.S. requirements relative to certain other proxy disclosures and requirements. Our executive compensation disclosure complies with Canadian requirements, which are, in many respects, substantially similar to U.S. rules.
Compensation committee interlocks and insider participation
The table below sets out the board interlocks in 2019. The Board has determined that the board interlocks set out below do not impair the ability of these directors to exercise independent judgment as members of our Board.
 
         
  Directors
  
Serve together on this board of a public
company
 
  Serve on these committees
 
  Marcel R. Coutu
  
 
Brookfield Asset Management Inc.
 
 
  Chair, audit committee
  Member, management, resources and   compensation committee
 
 
  V. Maureen Kempston Darkes
  
 
 
 
  Chair, risk management committee
  Member, management, resources and   compensation committee
 
 
 
 
 
14

Compensation discussion & analysis
Executive compensation
         
    16  
 
    17  
 
    17  
 
    18  
 
    20  
 
    20  
 
    20  
 
    23  
    27  
   
 
 
 
         
    28  
 
    33  
 
    33  
 
    34  
 
    35  
 
    38  
 
    39  
 
    40  
 
 
 
 
 
The following Compensation Discussion and Analysis describes the 2019 compensation program for our Named Executive Officers (NEOs). For 2019, our NEOs were:
 
         
 
 
 
 
 
 
 
 
 
Al Monaco
 
President & Chief
Executive Officer (CEO)
 
 
Colin K. Gruending
1
 
Executive Vice President & Chief
Financial Officer (CFO)
 
 
John K. Whelen
2
 
Executive Vice President &
Chief Development Officer (CDO)
 
 
 
 
 
 
 
 
 
William T. Yardley
 
Executive Vice President & President,
Gas Transmission & Midstream
 
 
D. Guy Jarvis
 
Former Executive Vice President,
Liquids Pipelines
 
 
Vern D. Yu
 
Executive Vice President &
President, Liquids Pipelines
 
 
 
 
1.
Mr. Gruending served as Executive Vice President & CFO from June 1 to December 31, 2019.
 
 
 
2.
Mr. Whelen served as Executive Vice President & CFO from January 1 to June 1, 2019.
 
 
 
 
15

Executive summary
Strategic focus
Enbridge’s strategic priorities remain focused on growing our three core lines of business – Liquids Pipelines, Natural Gas Pipelines and Gas Distribution – within a regulated pipeline and utility model, while improving our competitive position by optimizing our operations, strengthening our financial position, and seeking efficiencies through continuous process improvement and the application of technology solutions. The safety and reliability of our systems is our number one priority.
Compensation philosophy
Our executive compensation program is grounded in a
pay-for-performance
philosophy. Accordingly, base salary is the sole fixed source of our NEOs’ cash compensation and variable compensation amounts earned by our NEOs are strongly aligned to the achievement of Enbridge’s strategic priorities. Compensation is targeted at median within the markets where Enbridge competes, with performance driving “at risk” incentive payouts up or down accordingly. The vast majority of executive compensation is considered “at risk” because its value is based on specific performance criteria and/or share price and payout is not guaranteed.
Performance highlights for 2019
 
         
  Priorities
  
Actions
  1.   
Deliver distributable cash flow (“DCF”) and dividend growth
  
   Strong financial and operating performance
   Executed projects with an aggregate value of $9B
   Increased dividend for the 24th consecutive year, with a 10% increase over
 2018
   Implemented cost management and optimization measures
  2.   
Advance Line 3 replacement
  
   Placed Canadian segment into service December 1, 2019
   Obtained Minnesota Public Utilities Commission approval
   Minnesota Department of Commerce completed amended Environmental  Impact Statement
  3.   
Advance priority access on Mainline
  
   Filed regulatory application in support of contracting the mainline with Canada  Energy Regulator; achieved significant customer support
  4.   
Extend secured growth
  
   Secured $2.5B of new growth capital projects
  5.   
Maintain balance sheet strength and flexibility
  
   4.5x
Debt-to-EBITBA
   Completed sale of Canadian gathering and processing assets
 
 
 
Compensation highlights for 2019
In 2019, considering company performance, the following key compensation decisions were made for the NEOs, in each case as a percentage of base salary:
 
                                     
  Executive
  
Base pay
adjustment
    
Short-term
incentive
payment
  
Medium-term
incentive award
    
Long-term
incentive award
    
Special award    
 
 
  Al Monaco
 
    
 
10%
(1)
   
 
 
 
   226%
 
    
 
360%        
 
 
 
    
 
240%        
 
 
 
    
 
–             
 
 
 
 
  Colin K. Gruending
 
 
    
 
40%
(2)
   
 
 
 
   111%
 
    
 
284%
(3)
    
 
 
 
    
 
90%
(3)
    
 
 
 
    
 
–             
 
 
 
 
  John K. Whelen
 
 
    
 
4%       
 
 
 
   128%
 
    
 
225%        
 
 
 
    
 
150%        
 
 
 
    
 
–             
 
 
 
 
  William T. Yardley
 
 
    
 
4%       
 
 
 
   104%
 
    
 
225%        
 
 
 
    
 
150%        
 
 
 
    
 
274%
(4)
         
 
 
 
 
  D. Guy Jarvis
 
    
 
7%       
 
 
 
   122%
 
    
 
225%        
 
 
 
    
 
150%        
 
 
 
    
 
–             
 
 
 
 
  Vern D. Yu
 
    
 
4%       
 
 
 
   125%
 
    
 
225%        
 
 
 
    
 
150%        
 
 
 
    
 
–             
 
 
 
 
 
 
 
1.
Mr. Monaco received a base salary increase to better align his positioning relative to the competitive market.
 
 
 
2.
Mr. Gruending received a base salary increase upon promotion to Executive Vice President & CFO to recognize the significant increase in scope and responsibilities.
 
 
 
3.
Mr. Gruending received an annual grant based on the incentive targets of his prior role and received a
top-up
in PSUs upon his promotion to Executive Vice President & CFO to offset the difference in targets and reflect his new role and responsibilities.
 
 
 
4.
On May 8, 2019, Mr. Yardley was awarded a retention award in the form of restricted stock units, 20% of which vest on each of the first and second anniversaries of the grant date and 60% of which vest on the third anniversary of the grant date.
 
 
 
 
16

Compensation policies and practices
 
     
   
  What we do
  
What we don’t do
   Use a pay-for-performance philosophy whereby the majority of compensation  provided to executives is “at risk”
   Use a blend of short-, medium- and long-term incentive awards that are linked to  business plans for the respective timeframe
   Incorporate risk management principles into all decision-making processes to  ensure compensation programs do not encourage inappropriate or excessive
 risk-taking by executives
   Regularly review executive compensation programs through third-party experts to  ensure the ongoing alignment with shareholders and regulatory compliance
   Use both preventative and incident-based safety, environmental and operational  metrics that are directly linked to short-term incentive awards
   Have meaningful stock ownership requirements that align the interests of  executives with those of Enbridge shareholders
   Benchmark executive compensation programs against a group of similar  companies in Canada and the U.S. to ensure that executives are rewarded at  competitive levels
   Have an incentive compensation clawback policy
   Use double-trigger change-in-control provisions within all incentive plan  agreements from 2017 onward
  
   Pay out incentive awards when unwarranted by performance
   Count performance stock units, restricted stock units or unexercised stock  options toward stock ownership requirements
   Grant stock options with exercise prices below 100% fair market value or
 re-price out-of-the-money options
   Use employment agreements with single-trigger voluntary termination rights in  favor of executives
   Permit hedging of Enbridge securities
   Grant loans to directors or senior executives
   Provide stock options to non-employee directors
   Guarantee bonuses
   Apply tax gross-ups to awards
 
 
 
Assessing 2019 performance
Corporate actions
 
     
   
  Delivered strong financial results
 
  Achieved DCF/share
(1)
at top end of guidance range
  Solid operational performance across all business lines
  Completed final phase of $8B
non-core
asset sales
  4.5x
Debt-to-EBITDA
 
  
Optimized the base business
 
   Delivered 100 kbpd Mainline throughput optimizations
   Filed Mainline term contract application with Canada Energy Regulator
   Reached Texas Eastern rate settlement with customers
   Captured synergies through amalgamated utilities
 
  Growing organically
 
   Secured $2.5B of new growth capital projects in 2019
   Advanced U.S. Gulf Coast liquified natural gas supply strategy and liquids export strategy
   Announced $0.8B Gas Transmission 2020 modernization program
 
  
Executed capital program
 
   Placed $9B of secured growth capital into service, including Gray Oak, Hohe See and Canadian segment of Line 3 Replacement
 
 
 
 
 
1.
DCF per share is a
non-GAAP
measure; this measure is defined and reconciled in
Item 11
—“Non-GAAP Reconciliation”.
 
 
 
 
17

2019 project execution
 
 
 
1.
U.S. dollars have been converted to Canadian dollars using an exchange rate of US$1 = C$1.30.
 
 
 
 
Distributable cash flow
(1)
(millions of Canadian dollars)
 
 
     
 
 
 
   Strong results driven by solid operating performance across the entire asset base
   Achieved DCF/share at top end of guidance
   3% DCF per share increase over 2018
 
 
 
 
1.
DCF and DCF per share are non-GAAP measure; these measures are defined and reconciled in
Item 11
—“Non-GAAP
Reconciliation”.
 
 
 
Approach to executive compensation
Enbridge’s approach to executive compensation is set by the HRC Committee and approved by the Board. These programs are designed to accomplish three objectives:
 
 
attract and retain a highly effective executive team;
 
 
 
 
align executives’ actions with Enbridge’s business strategy and the interests of Enbridge shareholders and other stakeholders; and
 
 
 
 
reward executives for short-, medium- and long-term performance.
 
 
 
Alignment with company strategy
Enbridge’s vision is to be the leading energy delivery company in North America. To achieve this goal, we are committed to delivering the energy people need and want, and creating value for our shareholders. We aim to be the first choice of our customers, attract and retain energized employees and maintain the trust of our stakeholders.
 
             
Central to achieving this vision is a relentless focus on safety, operational reliability and protection of the environment to ensure that the needs of all stakeholders are met, and that Enbridge continues to be a good citizen within the communities in which we live and operate.    
Safety and operational reliability is Enbridge’s number one priority.
 
 
 
 
Enbridge’s executive compensation programs are aligned with the achievement of our strategic priorities and are designed to link payouts to those outcomes. They motivate management to deliver exceptional value to Enbridge shareholders through strong corporate performance and investing capital in ways that minimize risk and maximize return, while always supporting the core business goal of delivering energy safely and reliably.
Management is committed to delivering steady, visible and predictable results, and operating assets in an ethical and responsible manner.
 
18

Executive compensation design
Enbridge’s executive compensation program is made up of several components that balance the use of short- (STIP), medium- (performance stock units) and long-term vehicles (stock options). The following chart describes the NEOs’ compensation components, and the time horizon for vesting and/or realized value.
 
 
 
Pay-for-performance
 
             
Performance is the cornerstone of Enbridge’s executive compensation program. The Board reviews Enbridge’s business plans over the short-, medium- and long- term and the HRC Committee ensures the compensation programs are linked to these time frames. This focuses management on delivering value to Enbridge shareholders not only in the short term, but also continued performance over the long term.
   
 
    
Performance is foundational to Enbridge’s executive compensation program; incentive compensation plans incorporate operational and financial performance conditions.
 
 
 
 
 
Relevant corporate and business unit performance measures are established for the STIP that focus on the critical safety, system reliability, environmental, customer, employee and financial aspects of the business.
The performance measures for the medium- and long-term incentive plans focus on overall corporate performance aligned with Enbridge shareholder expectations for cash flow growth and total shareholder return.
When assessing performance, the HRC Committee considers performance results in the context of other qualitative factors not captured in the formal metrics, including key performance indicators relative to peers and the qualitative aspects of management’s responsibilities.
At-risk
compensation
 
             
The chart below shows the target compensation mix for the President & CEO and the average for the other NEOs. The short-, medium- and long-term incentives are considered to be “at risk” because their value is based on specific performance criteria and payout is not guaranteed.
   
 
    
The vast majority of compensation for Enbridge’s President & CEO and other NEOs is considered “at risk”.
 
 
 
 
 
In 2019, 88% of the target total direct compensation for the President & CEO, and an average of 82% for the other NEOs, was at risk, directly aligning corporate, business unit and individual performance with the interests of Enbridge shareholders.
 
 
 
 
19

2019 compensation decisions
Base salary
Base salary adjustments, as shown below, were provided to the President & CEO and other NEOs (with the exception of Mr. Gruending) to better align positioning relative to the competitive market. Mr. Gruending received a base salary increase upon his promotion to Executive Vice President & CFO to recognize the significant increase in scope and responsibilities. As Mr. Whelen’s new role was considered a lateral change, no compensation adjustments were provided related to this change.
 
             
       
  Executive
  
Base Pay at January 1, 2019
(1)
  
Change in 2019 (%)
 
Base Pay at December 31, 2019
(1)
  
  Al Monaco    $1,479,450    10%   $1,630,000  
  Colin K. Gruending       $375,000    40%      $525,000  
  John K. Whelen       $619,500      4%      $641,200  
  William T. Yardley       $713,174      4%      $738,174  
  D. Guy Jarvis       $630,000      7%      $674,100  
  Vern D. Yu       $550,000      4%      $569,300  
 
 
 
1.
U.S. dollars have been converted to Canadian dollars using the published WM/Reuters 4 pm London
year-end
exchange rate of US$1 = C$1.2967.
 
 
Short-term
incentive
It is critically important to ensure all Enbridge executives are incentivized to achieve not only financial results but also operational results in areas such as safety and environmental performance. For this reason, our Short Term Incentive Plan (“STIP”) awards are designed to be a comprehensive analysis of corporate, business unit and individual performance, as determined in the discretion of our HRC Committee.
 
 
Corporate performance.
The corporate component of the performance metrics is based on a single, objective company-wide performance metric that is designed to drive achievement of near-term business strategies and financial results for the organization.
 
 
 
Business unit performance.
Business unit performance is assessed relative to a scorecard of metrics and targets established for each business and their senior management teams, as applicable to those objectives relating to the business unit.
 
 
 
Individual performance.
Individual performance metrics for each of our NEOs are established to align with financial, strategic and operational priorities related to each executive’s portfolio and their contributions to the overall organization in consultation with the President and CEO, in order to recognize and differentiate individual actions and contributions in final pay decisions.
 
 
Performance metrics and ranges for threshold, target and maximum incentive opportunities for the corporate component of the STIP award are determined by the HRC Committee at the beginning of the year. Each executive’s target award and payout range reflect the level of responsibility associated with their role, as well as competitive practice, and is established as a percentage of base salary. For 2019, each NEO’s target STIP award and corresponding weighting of corporate, business unit and individual performance metrics were as follows:
 
                         
  Executive
  
2019 target STIP
(as % base salary)
 
2019 target
STIP
(1)
  
Performance Measure Weighting
    
  
Corporate
 
Business Unit
 
Individual
 
2018 target STIP  
(as % base salary)  
  Al Monaco    140%   $2,282,000    60%   20%   20%  
130%  
  Colin K. Gruending
(2)
     68%      $354,410    60%   20%   20%  
  50%  
  John K. Whelen      80%      $512,960    60%   20%   20%  
  80%  
  William T. Yardley      80%      $590,540    40%   40%   20%  
  80%  
  D. Guy Jarvis      80%      $539,280    40%   40%   20%  
  80%  
  Vern D. Yu
(3)
     80%      $455,440    48%   32%   20%  
  77%  
 
 
 
1.
U.S. dollars have been converted to Canadian dollars using the published WM/Reuters 4 pm London
year-end
exchange rate of US$1 = C$1.2967.
 
 
2.
Mr. Gruending’s incentive target increased from 50% to 80% upon his promotion to Executive Vice President & CFO. His 2019 short-term incentive award was calculated on a prorated basis with a target of 50% from January 1 to June 1, 2019, and a target of 80% from June 2 to December 31, 2019. His performance weightings remained unchanged.
 
 
 
20

3.
Mr. Yu’s performance weightings changed from 60%/20%/20% to 40%/40%/20% Corporate/Business Unit/Individual, respectively, upon his appointment to President & Chief Operating Officer, Liquids Pipelines. His short-term incentive award was calculated on a prorated basis with performance weightings of 60%/20%/20% Corporate/Business Unit/Individual from January 1 to June 1, 2019, and performance weightings of 40%/40%/20% from June 2 to December 31, 2019.
 
 
The HRC Committee retains discretion to change performance measures, scorecards and the award levels when it believes it is reasonable to do so, considering matters such as key performance indicators and the business environment in which the performance was achieved. In addition, the HRC Committee retains discretion to approve adjustments to the calculated STIP award to reflect extraordinary events and other factors not contemplated in the original measures or targets.
As illustrated below, STIP awards are earned between
0-200%
of the target award based on achievement of the applicable corporate, business unit and individual performance metrics and giving effect to the applicable weighting of each metric.
 
 
 
Corporate performance
The corporate performance metric is reviewed annually to select measures that align with our strategy and are appropriate for measuring annual performance. The same corporate component metrics and goals apply to each NEO. In February 2019, the HRC Committee approved Management’s recommendation to use DCF per share. The HRC retains discretion to consider other factors (including our performance relative to our peers, other key performance indicators and market conditions) in assessing the strength of the corporate performance metrics and also retains discretion to determine the overall corporate performance payout.
The HRC Committee agreed to the use of DCF per share as the corporate performance metric because it believes DCF per share is an appropriate measure of financial performance for the enterprise. Focusing management on this metric will enhance transparency of Enbridge’s cash flow growth, increase comparability of results relative to peers and help ensure full value recognition for Enbridge’s superior assets and commercial and growth arrangements, which provides a low risk value proposition for shareholders.
For 2019, DCF per share targets were set using the external financial guidance range to determine threshold and target payments. For any payout to occur, Enbridge must achieve threshold performance. For a maximum payout to occur, Enbridge must achieve the top of the guidance range, which ensures there is appropriate stretch in the plan.
For purposes of Enbridge’s 2019 STIP awards, 2019 DCF per share was determined to be $4.54 and resulted in a performance multiplier of 1.60x representing 100% of the corporate performance metric.
 
                     
  2019 corporate STIP metric
    
DCF per share
(1)
performance anchors
    
Performance  
multiplier
(2)
  
  Threshold (guidance minimum)          $4.30          0.5x  
  Target (guidance
mid-point)
         $4.45          1.0x  
  Maximum (guidance maximum)          $4.60          2.0x  
  Actual
      
 
$4.54
 
      
 
1.60x  
 
 
 
 
1.
DCF per share is a
non-GAAP
measure; this measure is defined and reconciled in
Item 11
—“Non-GAAP Reconciliation”.
 
 
2.
DCF per share between the thresholds in this table results in a performance multiplier calculated on a linear basis.
 
 
 
21

Business unit performance
The HRC Committee approved the application of the following scorecards for each of the NEOs. While the specific metrics used vary by business unit, each scorecard includes objectives relating to operational performance and reliability, financial performance and project execution as outlined below:
 
         
  Executive
  
Business unit metrics
(1)
  
Description
  Al Monaco    Composite measure   
    Non-financial operating measures for the combined enterprise (including enterprise safety and environment)
 
  Colin K. Gruending    Corporate Office   
    Weighted-average of overall business unit results
    Financial (corporate cost containment)
 
  John K. Whelen
(2)
   Corporate Office (82%)   
    Weighted-average of overall business unit results
    Financial (corporate cost containment)
 
   Energy Marketing (12%)   
    Financial, operating and commercial measures for the Energy Marketing business unit
 
   Power Operations (6%)   
    Financial, operating and commercial measures for the Power Operations business unit
 
  William T. Yardley    Gas Transmission and Midstream   
    Financial, operating and commercial measures for the Gas Transmission and Midstream business unit
 
  D. Guy Jarvis    Liquids Pipelines (90%)   
    Financial, operating and commercial measures for the Liquids Pipelines business unit
 
   Projects (10%)   
    Safety, quality, execution and environmental measures for the Projects business unit
 
  Vern D. Yu
(2)
   Corporate Office (33%)   
    Weighted-average of overall business unit results
    Financial (corporate cost containment)
 
   Liquids Pipelines (59%)   
    Financial, operating and commercial measures for the Liquids Pipelines business unit
 
   Energy Marketing (8%)   
    Financial, operating and commercial measures for the Energy Marketing business unit
 
 
 
 
1.
The business unit metric for Mr. Monaco is a composite measure, representing enterprise-wide performance as, in his capacity as President and CEO, he oversees the overall organization.
 
 
2.
The weightings on each business unit scorecard is based on time spent in different roles throughout the year.
 
 
Individual performance
In the first quarter of 2019, after discussion with the Board, the HRC Committee approved individual performance objectives for Mr. Monaco, taking into consideration the company’s financial and strategic priorities. For our other NEOs, Mr. Monaco established individual objectives for 2019 at the start of the year, basing them on strategic and operational priorities related to each executive’s portfolio and other factors.
Short-term incentive award outcomes
Each NEO’s calculated STIP award, as well as the actual award, is as follows:
 
                                                     
  Executive
  
Corporate
multiplier
  
x
  
Weight
 
+
  
Business
unit
multiplier
  
x
  
Weight
 
+
  
Individual
multiplier
  
x
  
Weight
 
=
  
Overall
multiplier
  Al Monaco    1.60    x    60%   +    1.28    x    20%   +    2.00    x    20%   =    1.62
  Colin K. Gruending    1.60    x    60%   +    1.43    x    20%   +    2.00    x    20%   =    1.65
  John K. Whelen    1.60    x    60%   +    1.45    x    20%   +    1.75    x    20%   =    1.60
  William T. Yardley    1.60    x    40%   +    0.80    x    40%   +    1.70    x    20%   =    1.30
  D. Guy Jarvis    1.60    x    40%   +    1.37    x    40%   +    1.70    x    20%   =    1.53
  Vern D. Yu    1.60    x    48%   +    1.41    x    32%   +    1.75    x    20%   =    1.56
 
 
 
22

Short-term incentive award calculations
 
                                                                 
  Executive
  
Base salary
(1)
($)
    
x
    
STIP target
(%)
   
x
    
Overall
multiplier
    
=
    
Calculated
award
($)
    
Actual award
($)
 
  Al Monaco      1,630,000        x        140     x        1.62        =        3,687,712        3,687,712  
  Colin K. Gruending      525,000        x        68     x        1.65        =        583,360        583,360  
  John K. Whelen      641,200        x        80     x        1.60        =        821,199        821,199  
  William T. Yardley      738,174        x        80     x        1.30        =        767,701        767,701  
  D. Guy Jarvis      674,100        x        80     x        1.53        =        822,941        822,941  
  Vern D. Yu      569,300        x        80     x        1.56        =        711,996        711,996  
 
 
 
1.
U.S. dollars have been converted to Canadian dollars using the published WM/Reuters 4 pm London
year-end
exchange rate of US$1 = C$1.2967.
 
 
Medium- and long-term incentives
Enbridge adopted the Enbridge Inc. 2019 Long Term Incentive Plan (“2019 LTIP”) effective February 13, 2019, under which medium- and long-term awards were granted in 2019.
Enbridge’s medium- and long-term incentive awards for executives include two primary vehicles: performance stock units (“PSUs”) and incentive stock options (“ISOs”).
Enbridge views medium- and long-term incentives as forward-looking compensation vehicles, and as such, grants are considered as part of the compensation for the year of grant and onwards instead of in recognition of prior performance.
The various awards that apply to executives have different terms, vesting conditions and performance criteria, mitigating the risk that executives produce only short-term results for individual profit. This approach also benefits shareholders and helps maximize the ongoing retentive value of the medium- and long-term incentives granted to executives.
Medium- and long-term incentive grants are determined as follows:
 
 
 
The table below outlines the medium- and long-term incentive awards used in 2019.
 
         
     
Medium-term incentive (PSU)
  
Long-term incentive (ISO)