HYDUKE ENERGY SERVICES INC.

ANNUAL INFORMATION FORM

FOR THE YEAR ENDED DECEMBER 31, 2011

Dated March 30, 2012

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 TABLE OF CONTENTS
FORWARD LOOKING INFORMATION .........................................................................2
CORPORATE STRUCTURE .............................................................................................5
NAME, ADDRESS AND INCORPORATION ....................................................................................................... 5
INTERCORPORATE RELATIONSHIPS .............................................................................................................. 5
GENERAL DEVELOPMENT OF THE BUSINESS..........................................................6
FOUR YEAR HISTORY .................................................................................................................................. 6
DESCRIPTION OF THE BUSINESS .................................................................................9
GENERAL ..................................................................................................................................................... 9
PRODUCTS AND SERVICES ......................................................................................................................... 10
COMPANY STRATEGY ................................................................................................................................. 12
COMPETITIVE CONDITIONS ........................................................................................................................ 13
SUPPLIERS .................................................................................................................................................. 13
TRENDS .................................................................................................................................................... 13
ENVIRONMENTAL REGULATIONS .............................................................................................................. 14
EMPLOYEES ............................................................................................................................................... 15
RISK FACTORS............................................................................................................................................ 15
DIVIDENDS ......................................................................................................................19
DESCRIPTION OF CAPITAL STRUCTURE .................................................................19
AUTHORIZED SHARE CAPITAL ................................................................................................................... 19
OPTIONS .................................................................................................................................................... 19
MARKET FOR SECURITIES ..........................................................................................19
DIRECTORS AND OFFICERS ........................................................................................20
CONFLICTS OF INTEREST ............................................................................................................................ 21
LEGAL PROCEEDINGS AND REGULATORY ACTIONS ..........................................22
INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS 22
TRANSFER AGENT AND REGISTRAR .......................................................................22
MATERIAL CONTRACTS .............................................................................................23
INTERESTS OF EXPERTS .............................................................................................23
AUDIT COMMITTEE INFORMATION ........................................................................23
COMPOSITION OF THE AUDIT COMMITTEE ................................................................................................. 23
EXTERNAL AUDITOR SERVICE FEES .......................................................................................................... 24
AUDIT FEES ................................................................................................................................................ 24
AUDIT RELATED FEES ................................................................................................................................ 24
TAX FEES ................................................................................................................................................... 24
ADDITIONAL INFORMATION .....................................................................................24

FORWARD LOOKING INFORMATION

In the interest of providing Hyduke shareholders and potential investors with information
about the Company and its subsidiaries, including management’s assessment of Hyduke’s
and its subsidiaries’ future plans and operations, certain information provided in this
Annual Information Form constitutes forward-looking statements or information
(collectively, "forward-looking statements"). Forward-looking statements are typically
identified by words such as "anticipate", "expect", "project", "estimate", "forecast",
"plan", "intend", "target", "believe", and similar words suggesting future outcomes or
statements regarding an outlook. Although Hyduke believes that these forward-looking
statements are reasonable based on the information available on the date such statements
are made, such statements are not guarantees of future performance and readers are
cautioned against placing undue reliance on forward-looking statements. By their nature,

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these statements involve a variety of assumptions, known and unknown risks and
uncertainties and other factors, which may cause actual results, levels of activity and
achievements to differ materially from those expressed or implied by such statements.

Hyduke’s forward-looking statements are subject to risks and uncertainties pertaining to,
among other things; industry activity levels, customer credit risk, competition, oil and gas
prices, product liability, fixed price contracts, development of new products, uninsured
and underinsured loses, access to additional financing, supply of raw material and third
party components, availability of key personnel, agreements and contracts, government
regulations, foreign exchange exposure, international scope of operations, environmental
health and safety regulations, including but not limited to those risks and uncertainties
discussed under the heading "Risk Factors" and elsewhere in this Annual Information
Form and the Company’s other filings with securities regulators. The impact of any one
risk, uncertainty or factor on a particular forward-looking statement is not determinable
with certainty as these are interdependent and Hyduke’s future course of action depends
on management’s assessment of all information available at the relevant time. Except to
the extent required by law, Hyduke assumes no obligation to publicly update or revise
any forward-looking statements made in this Annual Information Form, whether as a
result of new information, future events or otherwise. All subsequent forward-looking
statements, whether written or oral, attributable to Hyduke or persons acting on the
Company’s behalf, are expressly qualified in their entirety by these cautionary
statements.

Unless otherwise noted, all dollar references in this Annual Information Form are
expressed in Canadian dollars

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 GLOSSARY OF TERMS

The following is a glossary of terms and abbreviations used frequently throughout this
Annual Information Form.

"CDN$" means the currency of Canada;

"TSX" means the Toronto Stock Exchange;

"U.S." or "United States" means the United States of America;

"USD$" means the currency of the United States of America;

"Hyduke" or "the Company" or "the Corporation" or "us" or "we" means Hyduke Energy
Services Inc. and its subsidiaries unless otherwise indicated;

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 CORPORATE STRUCTURE

Name, Address and Incorporation

Hyduke was incorporated under the Business Corporations Act (Alberta) on December 8,
1995 as Hyduke Capital Resources Ltd. (“HCRL”) and completed its initial public
offering on April 9, 1996. HCRL was classified as a "junior capital pool company"
pursuant to the rules of the Alberta Stock Exchange, the predecessor to the TSX Venture
Exchange (the "TSXV"). The common shares of HCRL were listed and posted for
trading on the Alberta Stock Exchange, on May 24, 1996 using the trading symbol HYD.

The name of the Company was changed to Hyduke Resources Ltd. on November 16,
1998, and further changed to Hyduke Energy Services Inc. on January 18, 2002.

On September 24, 2007, the common shares of Hyduke commenced trading on the
Toronto Stock Exchange (the “TSX”) and were voluntarily delisted from the TSXV.

The authorized capital of the Company consists of an unlimited number of Common

Shares, an unlimited number of first preferred shares, issuable in series. See "Description
of Capital Structure". The Company is a reporting issuer in the Provinces of Alberta,
British Columbia and Ontario and the common shares are listed on the TSX under the
symbol "HYD".

The Company's principal offices are located at 609 - 21 Avenue, Nisku, Alberta, Canada
T9E 7X9 and its telephone number is (780) 955-0355. The Company's registered address
is Suite 400, 604 – 1St S.W., Calgary, Alberta T2P 1M7.

Intercorporate Relationships

Hyduke has eight wholly-owned subsidiaries as follows:

675651 Alberta Ltd. - carries on business under three operating trade names: Hyduke
Well Service Solutions, BW Rig Supply and Reliable Airflow Sales and Service. 675651
Alberta Ltd. is incorporated under the Business Corporations Act (Alberta).

Canwest Crane and Equipment Ltd. - incorporated under the Business Corporations
Act (Alberta).

802097 Alberta Ltd. – parent company for wholly-owned subsidiary Hyduke Machining
Solutions Inc. (previously known as MCO Industries Inc.) 802097 Alberta Ltd. is
incorporated under the Business Corporations Act (Alberta).

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Hyduke Machining Solutions Inc. - incorporated under the Business Corporations Act
(Alberta) as MCO Industries Inc. Changed name to Hyduke Machining Solutions in
September, 2009.

Hyduke Drilling Solutions Inc. – carries on business under two operating trade names:
Hyduke Drilling Solutions Inc. and Hyduke Mechanical and Machining. Hyduke
Drilling Solutions Inc. is incorporated under the Business Corporations Act (Alberta).

T&T Inspections and Engineering Ltd, - incorporated under the Business Corporations
Act (Alberta).

756617 Alberta Ltd. – incorporated under the Business Corporations Act (Alberta).

Hyduke Energy Services US Inc. – incorporated in the state Delaware and operates in
the state of Texas.

Corporate Structure As At March 28, 2012:

Hyduke Energy Services Inc.

- includes an operating division called Big Rig Sandblasting, Painting and Repair

756617 Alberta Ltd.

Canwest Crane and T&T Inspections and – holds a premises Hyduke Energy
Equipment Ltd. Engineering Ltd. lease Services US Inc.

675651 Alberta Ltd. 802097 Alberta Ltd. Hyduke Drilling Solutions Inc.
- includes operating divisions called - includes an operating division
Hyduke Well Service Solutions, BW called Hyduke Mechanical and
Rig Supply and Reliable Airflow Hyduke Machining Machining
Sales and Service Solutions Inc.

GENERAL DEVELOPMENT OF THE BUSINESS

Three Year History

2009

In February 2009, Hyduke participated in the Oil and Gas Trade Show in Tripoli, Libya.
The Company returned to Libya in April 2009 to complete follow up meetings with
numerous contacts developed during the trade show.

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In March 2009, Hyduke delivered a service rig to a customer in eastern Saskatchewan.

In June 2009, Hyduke was awarded a contract to build a service rig for a customer in
Libya. This rig was delivered in December 2009.

In June 2009, Hyduke representatives attended the Expetro 2009 trade show in Mexico
and the MIOGE 2009 in Russia.

In October 2009, the Company was awarded a contract to provide four partial drilling rig
equipment packages for a Mexican drilling contractor. The contract, valued at
approximately $17,400,000, was completed over a five month period with the first rig
package being delivered in December 2009 and the final rig package being delivered in
March 2010.

In October 2009, Hyduke representatives attended the World Gas Conference in

Argentina and the Latin America Petroleum Show in Venezuela.

In November 2009, Hyduke representatives attended the International Havana Fair in

Cuba.

In December 2009, Hyduke representatives attended the Columbia Petroleum show in

Bogota.

2010

During March 2010, Hyduke participated in a trade fair in Libya, an international market
that the Company generates on-going sales and service revenue. Additional opportunities
for business development in Libya and other North African countries were discussed.

In March 2010, the Company successfully completed an in-country rig commissioning

and training on a 750HP work-over rig delivered in late 2010.

In March 2010, the Company successfully completed a consulting assignment for an oil
and gas drilling company in Columbia.

In May 2010, the Company successfully completed a contract to provide four partial
drilling rig equipment packages for a Mexican drilling contractor. The drilling rigs were
1500HP land rigs with capacity of 750,000 pounds.

In June 2010, the Company presented at the International Oil and Gas show in Calgary,
Alberta, Canada. The Company exhibited a 1500HP drilling rig mast and substructure
and received significant exposure to Canadian and International drilling rig contractors.

In June 2010, the Company presented at Neftegaz, an oil and gas conference and
exhibition in Russia.

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In August 2010, the Company presented at the Mexican Petroleum Congress in Mexico
City, Mexico.

In September 2010, the Company presented at an oil and gas trade conference and
exhibition in Brazil.

In October 2010, the Company presented at an oil and gas trade conference and
exhibition in Kazahkstan.

In October 2010, the Company travelled to numerous Middle Eastern and northern
African countries on an extensive marketing tour where the Company representatives
present at a number of oil and gas trade shows.

In October 2010, the Company travelled to India for purposes of a marketing trip.

In October 2010, the Company successfully delivered on a slant-style work-over rig for a
Canadian customer. This was the first slant work-over rig Hyduke had been involved
with. Subsequent to this delivery, the Company was awarded a four slant rig project for
the same customer.

In November 2010, the company travelled to numerous South American countries on an

extensive marketing tour where the Company representatives presented at a number of oil
and gas trade shows.

In December 2010, the Company travelled to Russia to continue marketing efforts.

In December 2010, the Company successfully completed and delivered a complete

drilling rig package for a US customer.

2011

In January 2011, the Company traveled to Colombia for purposes of a marketing tour.

In February 2011, the Company traveled to Western Siberia, Russia for purposes of a
marketing tour.

In May 2011, the Company traveled to Mexico for purposes of a marketing tour.

In May 2011, the Company presented at the Offshore Technology Conference in

Houston, Texas, USA.

In June 2011, the Company presented at an oil and gas trade conference and exhibition in
Mexico.

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In June 2011, the Company presented at an oil and gas trade conference and exhibition in
Moscow, Russia.

In July 2011, the Company traveled to Russia to negotiate a drilling equipment services
contract for a Russian drilling contractor.

In July 2011, the Company was awarded a $16,300,000 contract to provide a complete,
turn-key 1500HP AC electric drilling rig package for a United States based drilling
contractor.

In August 2011, the Company presented at an oil and gas trade conference and exhibition
in Colombia.

In August 2011, the Company travelled to Peru for purposes of a marketing tour.

In September 2011, the Company delivered a Hyduke 600 workover rig to a South
American company.

In October 2011, the Company entered into a commitment to lease a manufacturing and
service facility in Houston, Texas, USA.

In October 2011, the Company presented at an oil and gas trade conference and
exhibition in Argentina.

In October 2011, the Company was awarded a $3 million contract to provide drilling
equipment services for a Russian drilling contractor.

In October 2011, the Company was awarded a $32,200,000 contract to provide two
complete, turn-key 1000HP AC electric drilling rig packages for a South American based
customer.

In November 2011, the Company presented at an oil and gas trade conference and
exhibition in Ukraine.

In November 2011, the Company travelled to Russia for purposes of a marketing tour.

In November 2011, the Company presented at an oil and gas trade conference and
exhibition in Colombia.

In November 2011, the Company presented at an oil and gas trade conference and
exhibition in Brazil.

In December 2011, incorporates Hyduke Energy Services US Inc.

In December 2011, the Company presented at an oil and gas trade conference and
exhibition in Doha, Qatar.

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 DESCRIPTION OF THE BUSINESS

General
Hyduke Energy Services Inc. is an integrated oilfield services company with over thirty
years experience in the manufacture, repair and distribution of oilfield equipment and
supplies in Canada and worldwide. The Company specializes in providing customized
and integrated solutions to the drilling and well service industries including:

- Turn-Key Equipment - drilling rig and service rig packages including in-house
design, engineering and drafting, major component procurement and overall
project management;
- Life Cycle Management - inspection, certification, service, repair and supply
services throughout the operating life of the drilling or well service rig; and
- Single Source Supply - providing new capital equipment, repair and maintenance
on existing capital equipment and supply of operating consumables.

The Company operates its businesses through a number of subsidiaries operating in four
segments:

Manufacturing
The Manufacturing segment includes the design, manufacture, refurbishment and repair
of land-based drilling rigs, well service and workover rigs, drilling support equipment
and well service and workover support equipment.

Distribution
The Distribution segment includes the procurement and distribution of spare parts,
equipment components, operating supplies and pneumatic controls to the drilling and
well service industries.

Truck Mounted Equipment

The Truck Mounted Equipment segment includes the distribution, service and repair of
truck-mounted cranes, winches and dump boxes.

Other Services
The Other Services segment includes the inspection and certification of drilling rig and
well service equipment, the design, manufacture and distribution of cased hole and
overburden drilling downhole tools, custom and production machining services,
industrial sandblasting and painting, heavy duty equipment collision repair and corporate
head office.

The principal market for these products and services is Western Canada with
approximately 22% of annual sales revenue generated internationally in 2011.

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Revenues for the two most recent completed fiscal years for each operating segment are:

Year Year
Operating Segment Ended December 31, Ended December 31,
(000’s) 2011 2010
($) ($)
Manufacturing 42,273 36,745
Distribution 27,525 19,572
Truck Mounted Equipment 2,198 3,056
Other Services 12,521 6,597
Total 84,517 65,970

Products and Services

Hyduke’s products and services are provided to its customers under the following
operating divisions:

Turn-Key Equipment

Hyduke Drilling Solutions (“HDS”) - HDS has been designing, manufacturing,

repairing and retrofitting drilling equipment since 1977. Operating out of five owned and
leased facilities in Nisku, Alberta comprising over 100,000 square feet on approximately
15 acres of fenced yard, HDS provides new build and repair services to a wide variety of
Canadian and international drilling contractors. New build equipment ranges from the
HDS models of single, double and triple drilling rigs to custom built drilling rigs and
ancillary equipment. Based on having obtained API 4F certification in February 2005, in
addition to other quality assurance programs, management believes Hyduke’s quality
assurance program meets the highest quality standards. HDS offers 24 hour on-call
repair services for both in-the-field and in the shop emergencies. Management believes
HDS has all the elements required to provide full-service turn-key equipment solutions to
the drilling industry including: appropriate facilities, experienced and trained staff, strong
relationships with all major component suppliers, knowledge of customers’ equipment
needs and the access to the integrated services of the Hyduke group of companies.

Hyduke Well Service Solutions (“HWSS”) - HWSS has been designing,

manufacturing, repairing and retrofitting well service equipment since 1972. Operating
out of a 42,000 square foot leased facility in Edmonton, Alberta, HWSS provides new
build and repair services to a wide variety of Canadian and international well service
contractors. New build equipment includes but is not limited to HWS models of service
rigs, pump trucks and drawworks, custom built service rigs, pump trucks, pump
buildings, mud tanks, doghouses and junk trucks. HWSS offers 24 hour on-call repair
services for both in the field and in the shop emergencies. All new equipment meets
Transport Canada’s motor vehicle safety standards as HWS is licensed to certify

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equipment with the National Safety Mark. HWSS manufactures their own standard
models of single and telescoping double service rigs (HWSS 400 and HWSS 600 series)
which operate in arctic, tropical and desert applications and will also design, engineer and
manufacture customized service rigs to meet specialized customer needs. HWSS also
manufactures proprietary models of double drum drawworks (HWSS 400 and HWSS
600). Additionally, HWSS is the exclusive Canadian distributor for the XJ line of
drawworks and the SJ line of plunger pumps manufactured by the SJ Petroleum
Machinery Co. of China. Management believes HWSS has all the elements required to
provide full-service turn-key equipment solutions to the well service industry: the
facilities together with experienced and trained staff, relationships with all major
component suppliers, knowledge of customers’ equipment needs and the access to the
integrated services of the Hyduke group of companies.

Life-cycle Management

Hyduke provides a complete range of support services including equipment inspection

and certification, repair and maintenance, field service, complete refurbishment and
retrofit services, supply of operating consumables, procurement of major equipment
components, sand blasting and painting, truck mounted support equipment and custom
mechanical and machining. These Life Cycle Management products and services are
offered under the following business units:

Hyduke Mechanical and Machining (“HMM”) – HMM has been providing full
mechanical and machining repair services since 2002. Operating out of a 14,000 square
feet leased facility on three acres of fenced yard in Nisku, Alberta, HMM offers high
quality mechanical and machining repair services on mud pumps, rotary tables,
drawworks, handling equipment and traveling equipment. HMM offers 24 hour on-call
repair services for both in the field and in the shop emergencies.

B.W. Rig Supply (“BW”) – BW has been providing oilfield supply products since 1972.
BW operates out of three leased distribution locations, Nisku, Red Deer and
Lloydminster, Alberta, with over 50,000 square feet of aggregate warehouse space. BW
specializes in general oilfield supply sales, carries over 20,000 items in stock and
provides prompt, reliable service.

Reliable Airflow Sales & Service (“RAS”) – RAS has been providing sales and service
of pneumatic and air-control products since 1984. Operating out of 5,000 square feet of
leased facility in Edmonton, Alberta, RAS offers sales and service of pneumatic and air-
control products used on drilling rigs, service rigs and other industrial equipment.

T&T Inspections and Engineering (“T&T”) – Located in Nisku, Alberta, T&T has
been providing full engineering and inspection services for oilfield equipment and
overhead equipment since 1996.

Hyduke Machining Solutions (“HMS”) – HMS was previously known as MCO

Industries Inc. (“MCO”). HMS has been providing machining services since 1980.
Operating out of a leased 30,000 square foot facility in Calgary, Alberta, HMS
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specializes in general machining, production machining, structural fabrication and the
manufacture and distribution of proprietary overburden drilling tools marketed under the
brand name “Stratex”.

CanWest Crane and Equipment (“CWC”) – CWC has been providing truck mounted
equipment sales and service since 1992. Operating out of a leased 15,000 square foot
facility in Edmonton, Alberta, CWC specializes in the sale, installation and repair of
truck mounted boom cranes, folding cranes, winches and gravel boxes used in the
oilfield, mining and construction industries.

Big Rig Sandblasting, Painting and Repair (“BRSP”) – BRSP has been providing
industrial sandblasting, painting and collision repair services since 1958. Operating out
of a modern, 32,000 square foot leased facility in Leduc, Alberta, BRSP specializes in
oilfield equipment, steel structures, tanks, vessels, trailers and industrial equipment.

Hyduke Energy Services US Inc (“HUS”) – Incorporated in the state of Delaware in

December 2011, HUS is Hyduke’s first facility outside of Canada. Operating out of
40,000 square feet of leased facility near the Port of Houston, HUS not only increases the
manufacturing capacity of the Hyduke group, but will strengthen its access to both US
and international market opportunities.

Company Strategy

Hyduke’s strategy is to be an integrated supplier to its customers through providing turn-

key land drilling and well service rig packages, offering related repair and maintenance
services and ancillary products and providing the consumables used in the operation of
this equipment. Hyduke believes that this integration of products and services will allow
it to grow and capture additional market share along with enabling it to balance the
economic conditions that occur in the various oilfield segments that the Company
operates in.

In the long term, Hyduke also intends to grow through acquisitions by seeking acquisition
targets based on the following criteria:
• Manufacturing, repair and supply companies with excellent reputations in their
niche of the oil and gas industries;
• Well established, preferably older than 10 years, with a solid record of
profitability and strong cash flow;
• Must be synergistic in some respect with Hyduke’s existing business;
• Quality management people that can be retained to continue to grow their
businesses with the combined resources of Hyduke; and
• Must be accretive to Hyduke’s shareholder value.

Specialized Skills and Knowledge

Hyduke’s business operations do not generally require specialized knowledge and skills
that cannot be obtained competitively in the local employment market. However,
depending on local employment conditions, certain types of employees such as engineers,

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draftspersons, machinists, heavy-duty mechanics, millwrights and welders may be more
difficult to retain than at other times. Western Canada has had and continues to have a
shortage of skilled labour and other qualified personnel. Hyduke has developed or
participates in a number of initiatives to assist it in recruiting and retaining employees
including internal and external training programs, apprenticeship programs, performance-
based incentive programs, access to foreign workers and overall, providing a respectful
and safe working environment.

See “Availability of Key Personnel” under Risk Factors.

Competitive Conditions
The Western Canadian market is highly competitive with domestic competitors ranging
from smaller, privately-owned companies to larger publicly-traded companies. The
smaller, privately-owned competitors are characterized by having a single product or
service offering and are focused primarily on the domestic market. The larger, publicly-
traded competitors range from offering a diversified product offering of which one
business line competes with Hyduke’s platform of services to more of a full-service,
integrated competitor whose product offerings compete with most of Hyduke’s platform
of services (i.e. National Oilwell Varco). While it is difficult to assess Hyduke’s market
share in an industry characterized by private companies, an estimate of market share
domestically ranges from 5% to 50% depending on the product or service being offered.

Internationally, Hyduke competes with larger, full-service competitors such as National

Oilwell Varco and international equipment manufacturers from the United States, China,
Russia, Germany and Italy. It is estimated that Hyduke’s market share of the
international land-based drilling and well service new equipment market is less than 5%.

Suppliers
Hyduke’s suppliers range from larger, multi-national companies to smaller, Alberta based
companies. Generally speaking, Hyduke does not have undue reliance on one particular
supplier as there are a number of options available for our companies with respect to raw
materials and parts.

Trends
The oil and gas services industry is a cyclical industry. Drilling activity levels in Canada
throughout 2011 were up from the 2010. Reduced domestic industry activity levels
impacted Hyduke’s business in 2009 and 2010; however, in order to mitigate against an
economic downturn in any one industry segment, Hyduke’s business plan was and
continues to be focused on three key strategic elements.
First, the Company continues active expansion into international markets. Generally
speaking, when activity in Western Canada is slow, all domestic drilling and well service
contractors are negatively affected. In order to offset any potential domestic slowdown,
Hyduke has developed relationships with contractors in many oil and gas producing
regions worldwide. Over the past 6 years, Hyduke has sold equipment into numerous
foreign countries to specific foreign customers. The countries include the Russian

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Federation, Cuba, Peru, Columbia, Ecuador, Algeria, Libya, Malaysia, the United States,
Kazakhstan, India, Indonesia, Australia and Egypt. Hyduke is actively developing these
foreign markets and is well positioned to offset the effects of a domestic slowdown.
Hyduke’s continued focus on international markets is expected to continue to contribute
to the Corporation's revenue base for 2012 and into the future.
Second, Hyduke’s platform of products/services contains a balance of new capital
equipment and less cyclical businesses (i.e. service, repair and consumables). Generally
speaking, the fluctuations in new capital equipment investment are more significant than
the fluctuations in service, repair and consumables activities. For example, there are
times when the industry is not building significant amounts of new equipment but repair
and maintenance needs are high and consumable supply needs are high.
Third, Hyduke’s business has exposure to both the drilling industry and the well service
industry. Again, the cyclicality of the two industries is somewhat different. Drilling
tends to be more intensive with higher peaks and lower valleys compared to the well
service industry which tends to be less cyclical.

Environmental Regulations

The Company is subject to various environmental laws and regulations enacted in the
jurisdictions in which we operate, which primarily govern the manufacturing, processing,
transportation, handling and disposal of certain materials used in our operations.
Management believes that Hyduke is currently in compliance with such laws and
regulations. Our customers are subject to similar laws and regulations. Management
believes that the political climate appears to favor new programs for environmental laws
and regulation and there is no assurance that such programs, laws or regulations, if
proposed and enacted, will not result in reduced industry activity and negatively affect
our operations. Hyduke may be required to increase operating expenses or capital
expenditures in order to comply with any new restrictions or regulations.

Historically, environmental protection requirements have not had a significant financial

or operational effect on our capital expenditures, earnings or competitive position.
Environmental protection requirements are not presently anticipated to have a significant
effect on such matters in 2011.

Employees

As at December 31, 2011, the Company employed approximately 350 employees.

Risk Factors

a) Industry Activity Levels

The demand, pricing and terms for oilfield services largely depend upon the level of
industry activity for Canadian natural gas and, to a lesser extent, oil exploration and
development. Industry activity levels are influenced by numerous factors over which the
Company has no control, including: the level of oil and gas prices; expectations about

15
future oil and gas prices; the cost of exploring for, producing and delivering oil and gas;
the expected rates of declining current production; access to investment capital; the
discovery rates of new oil and gas reserves; available pipeline and other oil and gas
transportation capacity; worldwide weather conditions; global political, military,
regulatory and economic conditions; and the ability of oil and gas companies to raise
equity capital or debt financing.

The level of activity in the Canadian oil and gas exploration and production industry is
volatile. No assurance can be given that expected trends in oil and gas production
activities will continue or that demand for oilfield services will reflect the level of activity
in the industry. Any prolonged substantial reduction in oil and natural gas prices would
likely affect oil and gas production levels and therefore affect the demand for services to
oil and gas customers. A material decline in oil or gas prices or Canadian industry
activity could have a material adverse effect on the Company’s business, financial
condition, results of operations and cash flows.

b) Oil and Gas Prices

Market fluctuations in the price of oil and gas affect the level of drilling in the oil and gas
industry. A decline in the market price of oil and gas generally results in reduced drilling
activity, which in turn affects the demand for the Company’s products and services.
Large fluctuations in the demand for the Company's products and services could
adversely affect the Company's manufacturing operations and product distribution,
thereby affecting the profitability of the Company. The Company is heavily dependent
on the general activity level of oil and gas exploration and production in Canada and
internationally, and the level of that activity can fluctuate dramatically according to
political and economic factors which are beyond the control of the management of the
Company.

c) Competition
The oilfield services business in which the Company operates is highly competitive. To
be successful, the Company must provide services that meet the specific needs of its
customers at competitive prices. The principal competitive factors in the markets in
which the Company operates are: service quality and availability; reliability and
performance of equipment used to provide its services; technical knowledge and
experience; and reputation for safety and price.

The Company competes with several competitors that are both smaller and larger than it
is. These competitors offer similar services in all geographic regions in which the
Company operates. As a result of the effects of competition, the Company may be unable
to continue to provide its present services or to acquire additional business opportunities,
which may affect the Company’s business, financial condition, results of operations and
cash flows.

d) Availability of Key Personnel

The Company relies heavily on its ability to attract and retain highly skilled personnel in
a competitive environment. The successful operation of the Company depends upon the

16
abilities, expertise, judgment, discretion, integrity and good faith of its executive officers
and employees. The unexpected loss of Company key personnel, or the inability to retain
or recruit skilled personnel, could have an adverse effect on the Company's growth,
results of operations and prospects.

e) Source of Supply of Raw Material and Third Party Components

Generally speaking, all raw material and third party components required for the
manufacturing of products by the Company or their subsidiary entities can be procured
from multiple sources at competitive prices. Certain third party components are not
readily available "off-the-shelf" and are subject to significant lead times from suppliers.
These lead times may cause delays in the production of products that may result in cost
overruns and/or trigger penalty payments to customers. The Company endeavors to
confirm price and delivery for all critical components prior to entering into contracts with
customers.

f) International Scope of Operations

From time to time, a portion of revenue is earned from foreign customers susceptible to
political and economic forces. Associated risks are mitigated for larger contracts with
contractual credit terms that require cash deposits, progress payments and letters of credit
to guarantee payment of contract amounts. Additionally, the Company may utilize
Export Development Canada ("EDC") to insure foreign contracts and receivables.
However, if a situation requires reliance on EDC coverage, realization can be
significantly postponed and may be less than total contract amounts.

g) Foreign Exchange Exposure

A portion of the Company’s business is conducted in foreign markets with the U.S. dollar
as the negotiating currency. These transactions include sales of products and the purchase
of parts and components required to manufacture products. This dependence on U.S.
currency for both sales and purchases exposes the Company to risks of currency
fluctuations. Exchange rate fluctuations are beyond the Company’s control and there can
be no assurance that such fluctuations will not have a material adverse effect on reported
results.

h) Customer Credit Risk

A substantial portion of the accounts receivable of the Company are with customers
involved in the oil and gas industry, whose revenues are impacted by fluctuations in
commodity prices. The Company does not have significant exposure to any individual
customer or counter-party. Although collection of these receivables could be influenced
by economic factors affecting this industry, management considers the risk of a
significant loss to be remote at this time.

i) Fixed Price Contracts

The Company enters into fixed price manufacturing contracts based upon estimates of
technical risks and total production costs. These estimates, if materially inaccurate, can
result in potentially large losses related to fulfilling the contractual obligations of the

17
Company. The Company utilizes cost escalation clauses for material and labor in the
majority of its contracts that have a term of one year or greater.

j) Agreements and Contracts

In certain instances, the business operations of the Company depend on verbal
agreements with its customer base that are cancelable at any time by either the Company
or its customers. The key factors that will determine whether a customer continues to use
the Company are service quality and equipment availability, reliability and performance
of equipment used to perform its services, technical knowledge and experience,
reputation for safety and competitive price.

There can be no assurance that the Company’s relationships with its customers will
continue, and a significant reduction or total loss of the business from these customers, if
not offset by sales to new or existing customers, could have a material adverse effect on
Hyduke’s business, financial condition, results of operations and cash flows.

k) Product Liability
The Company is subject to potential product liabilities connected with its operations,
including liabilities and expenses associated with product defects. These operations of the
Company have product liability and other insurance coverage that management of the
Company believes is generally in accordance with the market practice in its industry, but
there can be no assurance that the Company will always be adequately insured against all
such potential liabilities.

l) Uninsured and Underinsured Losses

The Company obtains and maintains, at all times insurance coverage in respect of
potential liabilities of the Company and the accidental loss of value of the assets from
risks, in such amounts, with such insurers, and on such terms, as management considers
appropriate, taking into account all relevant factors including the practices of owners of
similar assets and operations. Management believes that the Company maintains
insurance coverage in amounts sufficient to repair or replace any assets physically
damaged or destroyed, including coverage for resultant business interruption losses, or
extra expenses sustained, and to cover claims for bodily injury or property damage
arising out of assets or operations. However, not all risk factors are covered by insurance,
and no assurance can be given that insurance will be consistently available on an
economically feasible basis or that the amounts of insurance will at all times be sufficient
to cover each and every loss or claim that may occur involving the assets or Company.

m) Access to Financing
The Company may find it necessary to replace existing sources of financing or to obtain
additional debt or equity to support ongoing operations, to undertake capital expenditures
or to undertake acquisitions or other Company combination transactions. There can be no
assurance that replacement or additional financing will be available to the Company
when needed or on terms acceptable to the Company. The Company's inability to raise
financing to support ongoing operations or to finance Company capital expenditures or

18
acquisitions could limit the Company's growth and may have a material adverse effect
upon the Company.

n) Government Regulations
The oil and gas industry is subject to extensive controls and regulations established by
various levels of government. It is not expected that any of these controls or regulations
will affect the operations of the Company in a manner that is materially different from the
effect that they would have on other oilfield service companies of a similar size to the
Company.

o) Market Liquidity
There is currently limited active trading in the Company’s Common Shares, which could
result in a lack of liquidity for those shares. The market price for the Common Shares
could be subject to wide fluctuations.

p) Development of New Products

From time to time, the Company develops new products of a specialized nature that have
inherent risks. The major risks include:
(a) technical risk that either the product does not perform as desired or unacceptable
reliability issues render the new product un-merchantable; and
(b) supplier risk that required modules, components and engines procured from third
party vendors, do not perform in an acceptable manner, thereby having an adverse
impact on marketability of such new products and the Company’s product liability.

q) Environmental, Health and Safety Regulations

The Company is subject to federal, provincial, state, municipal and local statutes,
regulations and by-laws and other requirements with respect to workers' health and safety
and environmental matters in both Canada and the United States. Environmental
legislation, orders, permits, approvals, common law and other requirements impose
obligations relating to, among other things: the release of substances into the natural
environment; the production, processing, preparation, handling, storage, transportation,
disposal, and management of substances; and the prevention and remediation of
environmental impacts such as the contamination of soil and water. As a result of these
requirements, the operations and ownership of the Company carry a risk of
environmental liability (including potential civil actions, compliance or remediation
orders, fines and other penalties).

Workers' health and safety legislation and other requirements impose a number of
obligations on the Company.

DIVIDENDS

Currently, Hyduke is in its growth phase and has not declared any dividends.

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Hyduke is a taxable public corporation resident in Canada. All dividends that would be
paid to shareholders would be designated as “eligible” dividends” as defined in the
Income Tax Act (Canada).

DESCRIPTION OF CAPITAL STRUCTURE

Authorized Share Capital

Hyduke is authorized to issue an unlimited number of common shares. At December 31,
2011 our issued and outstanding share capital consisted of 24,162,364 common shares.
The rights, privileges, restrictions and conditions attaching to the common shares entitle
the holders to vote at any meeting of shareholders, receive dividends declared by the
Company and to receive the remaining property on dissolution.

Hyduke is authorized to issue an unlimited number of preferred shares. The directors of

the Company may fix before issuance the designation, rights, privileges, restrictions and
conditions to be attached to the preferred shares. The preferred shares are entitled to
preference over the common shares with respect to the payment of dividends and in the
distribution of assets in the event of liquidation, dissolution or winding up of the
Company. The Company has not issued any preferred shares to date.

Options
As at December 31, 2011 there were 1,819,450 stock options outstanding as outlined in
Note 15 of the audited financial statements of the Corporation for the fiscal period ended
December 31, 2011.

MARKET FOR SECURITIES

Hyduke’s common shares are listed for trading on the Toronto Stock Exchange (TSX)
and trade under the symbol HYD. The following table sets forth the high and low closing
prices and the aggregate volume of trading of the common shares on the TSX for the
most recently completed fiscal year.
Toronto Stock Exchange
2011 Period High Low Volume
($) ($)
January 0.48 0.43 307,300
February 0.73 0.46 772,200
March 0.62 0.44 407,900
April 0.49 0.39 131,700
May 0.45 0.36 135,700
June 0.52 0.40 242,800
July 0.59 0.48 154,000
August 0.56 0.43 119,900
September 0.45 0.33 83,600
October 0.57 0.34 394,100
November 0.50 0.44 286,900
December 0.50 0.40 241,400

20
 DIRECTORS AND OFFICERS

Hyduke’s Board of Directors, as of December 31, 2011, was comprised of six directors.
The following information is presented with respect to the Directors of Hyduke as at
December 31, 2011:

Name, Province, Country, Common Shares

and Positions Held with the Principal Occupation for the Past Five Years Beneficially Owned
Corporation or Controlled as at
Date Hereof
MYRON YURKO (2) (3) Chairman of the Corporation (2006-present), Co-Chairman 69,900
Alberta, Canada of the Corporation (2004 – 2006). Director of the 0.25%
Chairman since October 2006 Corporation (2002 – present). Retired in 1998 as President
and Director since June 2002 of Canuck Well Service.

GORDON ROBERT President and Chief Executive Officer of the Corporation 289,200
MCCORMACK (2004 – present). President and Chief Financial Officer of 1.20%
Alberta, Canada the Corporation (2003 – 2004). Interim Chief Executive
President and Chief Executive Officer and Chief Financial Officer of the Corporation
Officer since September 2004 (2002 – 2003).
and Director since September
2005
BORIS MAKOWECKI Executive Vice-President of the Corporation (2003 – 740,833
Alberta, Canada present). President of the Corporation (1995 – 2002). 3.07%
Executive Vice-President since Director of Echo-B-Canada Ltd. (1993 - present), a private
January 2003 and Director company which provides sales and rentals of mobile
since December 1995 bridges.
EUGENE WIRSTA Director of Corporation (2002- present) Co-Chairman of 2,330,300
Alberta, Canada the Corporation (2004 – 2006). Interim Chairman of the 9.64%
Director since March 2002 Corporation (2003 – 2004). Vice President Operations of
the Corporation (2001 – 2002). Founder and President of
Go Getter Welding Ltd. (1978 – 2001).
ERV LACK (2) (3) Director of the Corporation (1998 – present). President of 6,195
Alberta, Canada Canada Overseas Trade (2000) Corporation (1996 – 0.03%
Director since October 1998 present).
JOHN PINSENT, CA (2)(3) Partner of St. Arnaud Pinsent Steman, Chartered 4,000
Alberta, Canada Accountants (2005 – Present). Senior Audit Manager – 0.08%
Director since June 2008 Ernst & Young LLP (1994-2005)

TOTAL 3,440,428
14.24%

Notes:
(1) The term of office for each proposed director will expire on the date of the next annual general meeting.
(2) Member of the Audit Committee of the Board of Directors.
(3) Member of the Compensation and Corporate Governance Committee of the Board of Directors.

21
 The following information is presented with respect to our executive officers as at
December 31, 2011:

Name, Province, Country, Common Shares

and Positions Held with the Principal Occupation for the Past Five Years Beneficially Owned
Corporation or Controlled as at
Date Hereof
GORDON ROBERT President and Chief Executive Officer of the Corporation 289,200
MCCORMACK (2004 – present). President and Chief Financial Officer of 1.20%
Alberta, Canada the Corporation (2003 – 2004). Interim Chief Executive
President and Chief Executive Officer and Chief Financial Officer of the Corporation
Officer since September 2004 (2002 – 2003).
BORIS MAKOWECKI Executive Vice-President of the Corporation (2003 – 740,833
Alberta, Canada present). President of the Corporation (1995 – 2002). 3.07%
Executive Vice-President since Director of Echo-B-Canada Ltd. (1993 - present), a private
January 2003 company which provides sales and rentals of mobile
bridges.
RICK RUTHERFORD President of Hyduke Drilling Solutions Inc. (2009 – 2,196,533
Alberta, Canada present). President and Chief Executive Officer of Horizon 9.09%
President, Hyduke Drilling Drilling Inc. (2004 – 2009).
Solutions since September 2009
DAVID BEATTY Vice President Operations (2008 – present) Vice President, 2,000
Alberta, Canada Life Cycle Management (2007-2008), Branch Manager, 0.01%
Vice President, Operations Red Deer Branch BW Rig Supply (2002 – 2007)
since October 2008

VERONICA DUTCHAK Chief Financial Officer (2004- 2010; 2011-present). 10,000

Alberta, Canada Divisional Controller of Hyduke Energy Services Inc 0.04%
Chief Financial Officer (2003-2004)
November 2004-August 2010;
September 2011- present
TOTAL 3,238,566
13.40%

Conflicts of Interest

Conflicts of interest may arise as a result of the directors and officers of the Company or
its subsidiaries also holding positions as directors and/or officers and/or shareholders of
other companies. Some of the directors and officers have been and will continue to be
engaged in the identification and evaluation of assets and businesses, with a view to
potential acquisition of interests in businesses and companies on their own behalf and on
behalf of other companies, and situations may arise where the directors and officers may
be in direct competition with the Company or its subsidiaries. In accordance with the
provisions of the Business Corporations Act (Alberta), directors are required to act
honestly, in good faith and in the best interests of the Company. In addition, directors in a
conflict of interest position are required to disclose such conflicts to the Company and
may be required to abstain from voting on any material decisions relating to the conflict
of interest position.

22
 LEGAL PROCEEDINGS AND REGULATORY ACTIONS

Hyduke was not party to, nor was any of its property subject to, any legal proceedings
during the year ended December 31, 2011 other than those disclosed in the notes to the
financial statements for the year ended December 31, 2011.

INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS

Other than as disclosed below, management of the Corporation is not aware of any
material interest, direct or indirect, of any director or senior officer of the Corporation, or
any shareholder of the Corporation who beneficially owns more than 10% of any class or
series of outstanding voting securities, or any known associate or affiliate of the
foregoing persons, in any transaction within the past three completed financial years or
during the current financial year that has materially affected or will materially affect the
Corporation:

GDB Enterprises (which is controlled by Mr. Eugene Wirsta, a director) was paid
$410,796 by the Corporation for rental of premises which was supplied to the
Corporation at normal commercial rates.

TRANSFER AGENT AND REGISTRAR

The transfer agent and registrar for the Common Shares of the Corporation is
Computershare Trust Company of Canada at its principal offices in Calgary, Alberta and
Toronto, Ontario.

MATERIAL CONTRACTS

The Corporation did not enter into any material contracts, other than contracts entered
into in the ordinary course of business, within the most recently completed financial year
or prior to the most recently completed financial year.

INTERESTS OF EXPERTS

Ernst & Young LLP, Chartered Accountants, have audited the financial statements of the
Corporation for the year ended December 31, 2011. As at the date hereof, Ernst & Young
LLP, Chartered Accountants are independent in accordance with the Alberta Institute of
Chartered Accountants’ Rules of Professional Conduct

23
 AUDIT COMMITTEE INFORMATION

The charter of the Audit Committee (the "Audit Committee") of the Board of Directors
is set forth in Schedule "A" attached hereto.

Composition of the Audit Committee

The Corporation's Audit Committee is composed of the following members: Myron
Yurko, Erv Lack and John Pinsent, CA (Chairman) each of whom is independent and
financially literate within the meaning of NI 52-110. The following comprises a brief
summary of each member’s education and experience.

Myron Yurko: Over 30 years experience as a business owner, business executive,

and director of private companies

Erv Lack, P.Eng., MBA, over 30 years experience as a business executive,

extensive experience as a director of numerous private and public companies

John H.C. Pinsent, CA over 20 years experience in senior finance and

audit/accounting roles in both public and private practice. He is a founding
member of St. Arnaud Pinsent Steman Chartered Accountants. John also has
extensive experience as a director of many other companies.

External Auditor Service Fees

The following summarizes the aggregate fees billed by Ernst & Young LLP, Chartered
Accountants, the external auditor of the Corporation, for the years ended December 31,
2011 and December 31, 2010. The Corporation's Audit Committee has implemented a
policy (the Audit Committee Charter) restricting the services that may be provided by the
auditors and the fees paid to the auditors without pre-approval by the Audit Committee.

Audit Fees
The aggregate fees billed or expected to be billed by our external auditor for audit
services are:

2011 – $220,000
2010 – $220,000

Audit Related Fees

The aggregate fees billed by our external auditor for assurance and related services that
are reasonably related to the performance of the audit or review of the financial
statements (not included in audit services fees) are:

2011 – $109,760
2010 – Nil

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Tax Fees
The aggregate fees billed by our external auditor for professional services for tax
compliance, tax advice and tax planning are:

2011 – Nil
2010 – Nil

ADDITIONAL INFORMATION

Additional information relating to the Corporation is on SEDAR at www.sedar.com.

Additional financial information is provided in the Corporation's audited consolidated

financial statements and management discussion and analysis for the financial year ended
December 31, 2011. Furthermore, additional information, including directors’ and
officers’ remuneration and indebtedness, principal holders of the Company’s securities
and securities authorized for issuance under equity compensation plans, is contained in
the Company’s information circular for the most recent annual meeting of security
holders that involved the election of directs. These documents are incorporated herein by
reference and form an integral part of this Annual Information Form.

Any request for any documents referred to above should be made to the Chief Financial
Officer, Hyduke Energy Services Inc., 609 – 21 Avenue, Nisku, Alberta, T9E 7X9 or by
fax at (780) 955-0366.

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 SCHEDULE “A” AUDIT COMMITTEE’S CHARTER

Mandate
The primary function of the audit committee (the “Committee”) is to assist the Board of Directors in fulfilling its
financial oversight responsibilities by reviewing the financial reports and other financial information provided by
the Corporation to regulatory authorities and shareholders, the Corporation’s systems of internal controls
regarding finance and accounting and the Corporation’s auditing, accounting and financial reporting processes.
Consistent with this function, the Committee will encourage continuous improvement of, and should foster
adherence to, the Corporation’s policies, procedures and practices at all levels.

The Committee’s primary duties and responsibilities are to:

• Serve as an independent and objective party to monitor the Corporation’s financial reporting and
internal control system and review the Corporation’s financial statements.
• Review and appraise the performance of the Corporation’s external auditors.
• Provide an open avenue of communication among the Corporation’s auditors, financial and senior
management and the Board of Directors.

Composition
The Committee shall be comprised of three directors as determined by the Board of Directors, whom shall be
free from any relationship that, in the opinion of the Board of Directors, would interfere with the exercise of his
or her independent judgment as a member of the Committee.

At least one member of the Committee shall have accounting or related financial management expertise. All
members of the Committee that are not financially literate will work towards becoming financially literate to
obtain a working familiarity with basic finance and accounting practices. For the purposes of the Corporation’s
Charter, the definition of “financially literate” is the ability to read and understand a set of financial statements
that present a breadth and level of complexity of accounting issues that are generally comparable to the breadth
and complexity of the issues that can presumably be expected to be raised by the Corporation’s financial
statements.

The members of the Committee shall be elected by the Board of Directors at its first meeting following the
annual shareholders’ meeting. Unless a Chair is elected by the full Board of Directors, the members of the
Committee may designate a Chair by a majority vote of the full Committee membership.

Meetings
The Committee shall meet a least twice annually, or more frequently as circumstances dictate. As part of its job
to foster open communication, the Committee will meet at least annually with the Chief Financial Officer and the
external auditors in separate sessions.

Responsibilities and Duties

To fulfill its responsibilities and duties, the Committee shall:

Documents/Reports Review
(a) Review and update this Charter annually.
(b) Review the Corporation’s financial statements, MD&A and any annual and interim earnings, press releases
before the Corporation publicly discloses this information and any reports or other financial information
(including quarterly financial statements), which are submitted to any governmental body, or to the public,
including any certification, report, opinion, or review rendered by the external auditors.

External Auditors
(a) Review annually, the performance of the external auditors who shall be ultimately accountable to the Board
of Directors and the Committee as representatives of the shareholders of the Corporation.
(b) Review and discuss with the external auditors any disclosed relationships or services that may impact the
objectivity and independence of the external auditors.
(c) Take, or recommend that the full Board of Directors take, appropriate action to oversee the independence of
the external auditors.

26
(d) Recommend to the Board of Directors the selection and, where applicable, the replacement of the external
auditors nominated annually for shareholder approval.
(e) Consult with the external auditors, without the presence of management, about the quality
of the Corporation’s accounting principles, internal controls and the completeness and accuracy of the
Corporation’s financial statements.
(f) Review and approve the Corporation’s hiring policies regarding partners, employees and former partners
and employees of the present and former external auditors of the Corporation.
(g) Review with management and the external auditors the audit plan for the year-end financial statements and
intended template for such statements.
(h) Review and pre-approve all audit and audit-related services and the fees and other compensation related
thereto, and any non-audit services, provided by the Corporation’s external auditors. The pre-approval
requirement is waived with respect to the provision of non-audit services if:
• the aggregate amount of all such non-audit services provided to the Corporation constitutes
not more than five percent of the total amount of revenues paid by the Corporation to its
external auditors during the fiscal year in which the non-audit services are provided;
• such services were not recognized by the Corporation at the time of the engagement to be
non-audit services; and
• such services are promptly brought to the attention of the Committee by the Corporation and
approved prior to the completion of the audit by the Committee or by one or more members of
the Committee who are members of the Board of Directors to whom authority to grant such
approvals has been delegated by the Committee.

Provided the pre-approval of the non-audit services is presented to the Committee’s first scheduled meeting
following such approval such authority may be delegated by the Committee to one or more independent
members of the Committee.

Financial Reporting Processes

(a) In consultation with the external auditors, review with management the integrity of the Corporation’s
financial reporting process, both internal and external.
(b) Consider the external auditors’ judgments about the quality and appropriateness of the Corporation’s
accounting principles as applied in its financial reporting.
(c) Consider and approve, if appropriate, changes to the Corporation’s auditing and accounting principles and
practices as suggested by the external auditors and management.
(d) Review significant judgments made by management in the preparation of the financial statements and the
view of the external auditors as to appropriateness of such judgments.
(e) Following completion of the annual audit, review separately with management and the external auditors any
significant difficulties encountered during the course of the audit, including any restrictions on the scope of
work or access to required information.
(f) Review any significant disagreement among management and the external auditors in connection with the
preparation of the financial statements.
(g) Review with the external auditors and management the extent to which changes and improvements in
financial or accounting practices have been implemented.
(h) Review any complaints or concerns about any questionable accounting, internal accounting controls or
auditing matters.
(i) Review certification process.
(j) Establish a procedure for the confidential, anonymous submission by employees of the Corporation of
concerns regarding questionable accounting or auditing matters.

Other
Review any related-party transactions.

27