Metro inc. — Annual Report 2021

Dec 20, 2021

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Annual Information Form Financial year ended September 25, 2021

Contents

Contents
Forward-Looking Information	1
BACKGROUND	2
INCORPORATION	2
ABOUT OUR COMPANY	4
OUR FOOD DIVISION	5
OUR PHARMACY DIVISION	5
OUR PRODUCTS, BRANDS AND SERVICES	6
OUR PEOPLE	8
GENERAL DEVELOPMENT OF THE BUSINESS OVER THE LAST THREE (3) YEARS	10
CORPORATE RESPONSIBILITY	13
SHARE CAPITAL STRUCTURE	14
LONG-TERM DEBT	15
DIRECTORS AND OFFICERS	17
LEGAL PROCEEDINGS	20
INTERESTS AND MATERIAL CONTRACTS	21
ADDITIONAL INFORMATION	21
SCHEDULE A – INFORMATION ON THE AUDIT COMMITTEE	23
SCHEDULE B – MANDATE OF THE AUDIT COMMITTEE	25

Unless the context indicates otherwise, the use in this Annual Information Form of the terms “our”, “we”, “us” “METRO” and “Corporation” collectively refers to Metro Inc., its subsidiaries and partnerships, or, depending on the context, to one of them, and the term Metro refers to the stores operated under the Metro and Metro Plus banners.

All disclosures in this Annual Information Form are as of September 25, 2021 unless otherwise indicated. METRO’s public disclosure documents referred to from time to time in this Annual Information Form are incorporated by reference and may be found in their entirety on the System for Electronic Document Analysis and Retrieval (“SEDAR”) (sedar.com) or on METRO’s corporate website (corpo.metro.ca).

Unless stated otherwise, all amounts set forth herein are expressed in Canadian dollars. This Annual Information Form pertains to the 52-week fiscal year of the Corporation ended on September 25, 2021, unless stated otherwise and except for information in documents incorporated by reference that have a different date.

Forward-Looking Information

Throughout this annual information form (the “Annual Information Form”), different statements have been used that could, within the context of the regulations issued by the Canadian Securities Administrators, be construed as being forward-looking information. In general, any statement contained in this Annual Information Form, which does not constitute a historical fact, may be deemed a forward-looking statement. Expressions such as “continues”, “will”, “intends”, “considers”, “should”, “expects”, “plans”, “believes”, “projected”, “aimed” and other similar expressions as well as the use of the future or conditional tense are generally indicative of forward-looking statements.

The forward-looking statements contained in this Annual Information Form are based upon certain assumptions that we believe were reasonable as of December 10, 2021 regarding the Canadian food industry, the economy in general, our annual budget as well as our 2022 action plan and financial results for the 2021 financial year.

Risk factors that could cause actual results or events to differ materially from our expectations as expressed in, or implied by, our forward-looking statements are described and discussed under the “Risk Management” section on pages 32 to 35 of the Corporation’s 2021 Management’s Discussion and Analysis and Consolidated Financial Statements (the “2021 Annual Report”). As with the preceding risks, the COVID-19 pandemic constitutes a risk that could have an impact on the business, operations, projects, synergies and performance of the Corporation as well as on the forward-looking statements contained in this document.

The forward-looking statements contained in this Annual Information Form do not provide any guarantee as to the future performance of the Corporation and are subject to potential known and unknown risks, as well as uncertainties that could cause our financial position, financial performance, cash flows, business or reputation to differ significantly. Additional risks and uncertainties that we currently deem to be immaterial may also prove to have a material adverse effect. The Corporation believes these statements to be reasonable and relevant at the date of publication of this Annual Information Form and to represent its expectations. The Corporation does not intend to update any forwardlooking statement contained herein, except as required by applicable law.

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METRO INC. – 2021 Annual Information Form

Background

With a history going back to 1947, METRO is a leader in the food and pharmacy retailing industry with 1,600 retail outlets in Canada and annual sales of more than $18 billion.

Proudly founded in the province of Québec, we are a Canadian company governed by the Business Corporations Act (Québec). Our shares trade on the Toronto Stock Exchange (“TSX”) under the symbol “MRU”. As of September 25, 2021, we had a total market capitalization of $14,620,667,751.

Our business risks are discussed in our 2021 Annual Report, on pages 32 to 35, and the relevant section on risks of said 2021 Annual Report is incorporated by reference in this Annual Information Form. Our 2021 Annual Report is available on SEDAR (sedar.com) and on our website (corpo.metro.ca).

The following graph highlights the key events in the Corporation’s history:

1947 1986 1992 Magasins Lasalle Stores ltée A few independent grocery retailers decided to form a buying group. 1972 McMahon Distributeur pharmaceutique inc. The purchase of McMahon Distributeur pharmaceutique Inc. Steinberg In 1992, METRO concludes a major transaction: the acquisition of the leases and rights to 48 Steinberg grocery stores. 2018The Jean Coutu Group METRO acquires The Métro Food Stores Limited 25 years after it was founded, the company becomes les Marchés takes the Company into the pharmaceutical distribution sector. 2005A&P Canada 2014Première Moisson Jean Coutu Group (PJC) Inc. in the spring of 2018, creating a retail leader. d'Aliments Métro ltée. In August 2005, METRO METRO announced on June 10, purchases all the shares 2014, a partnership agreement of A&P Canada. with Première Moisson bakery. 1940 to 1970 1970 to 2000 2000 to 2021 1952 1986 1999 2011 Le groupe des épiciers Métro Montreal Stock Exchange Loeb Marché Adonis Le groupe des épiciers Métro is In 1985, the shareholders of Groupe In June 1999, METRO acquires the In October 2011, METRO announced that it founded, a division of Les Épiceries des Épiciers Unis Métro-Richelieu Loeb banner along with its two (2) had entered into a partnership agreement with Lasalle Groceteria ltée. Inc. unanimously agree to convert warehouses in Ottawa and a network Marché Adonis, an ethnic food retailer their advances into capital stock. An of 41 supermarkets in Eastern and specializing in fresh and Mediterranean initial public offering is launched in Northeastern Ontario. products and prepared meals. November 1986.

Incorporation

The Corporation is currently governed by the Business Corporations Act (Québec) and results from the amalgamation of Métro-Richelieu Group Inc. and United Grocers Inc. on April 30, 1982. The name of the resulting company was Groupe des Épiciers Unis Métro-Richelieu Inc.

Métro-Richelieu Group Inc. was incorporated under the name Magasins LaSalle Stores Limited by letters patent dated December 22, 1947 under the Companies Act (Québec). In September 1976, the Corporation, then known as Métro Food Stores Ltd., merged with Richelieu Groceries Limited to form Métro-Richelieu Inc. In 1979, it amended its name to Métro-Richelieu Group Inc.

United Grocers Inc. was incorporated under the Companies Act (Québec) by letters patent dated August 31, 1928.

After the amalgamation of Métro-Richelieu Group Inc. and United Grocers Inc. on April 30, 1982, Groupe des Épiciers Unis Métro-Richelieu Inc. changed its name twice: once by certificate of amendment dated September 25, 1986 from Groupe des Épiciers Unis Métro-Richelieu Inc., which name it had used since the amalgamation on April 30, 1982, to Métro-Richelieu Inc., and a second time by certificate of amendment dated January 26, 2000, to its present name.

The share capital of the Corporation is composed of an unlimited number of common shares and an unlimited number of preferred shares. The Corporation’s previous dual-class share structure was eliminated on February 1, 2012 by certificate of consolidation. All the issued and outstanding Class B multiple-voting shares of the Corporation at the time were converted into Class A subordinate-voting shares (one vote per share) on a one-to-one basis. The subordinate-voting shares were then designated as common shares. The Corporation has also amended its ticker symbol from “MRU.A” to “MRU” to reflect the elimination of its dual class-share structure.

The Corporation’s head office and principal place of business is located at 11011 Maurice-Duplessis Boulevard, Montréal (Québec) H1C 1V6.

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METRO INC. – 2021 Annual Information Form

Our subsidiaries

Metro Inc. is a holding company which carries on its business through its subsidiaries and affiliated entities. The following table lists the Corporation’s main subsidiaries and affiliated entities, the province in which they mainly carry on their activities and the jurisdiction under which they are incorporated or organized. All of our subsidiaries and affiliated entities were wholly-owned as of December 10, 2021.

incorporated or organized. All of our subsidiaries and affiliated entities were wholly-owned as of December 10, 2021.	incorporated or organized. All of our subsidiaries and affiliated entities were wholly-owned as of December 10, 2021.
Jurisdiction of incorporation
Québec
Metro Richelieu Inc.(“Metro Richelieu”) Canada
	McMahon Distributeurpharmaceutique Inc.(“McMahon”) Canada
	Metro Québec Real Estate Inc. Canada
	Adonis GroupInc.(“Adonis Group”) Canada
	Phoenicia GroupInc.(“Phoenicia Group”) Canada
	Première Moisson GroupInc.(“Première Moisson Group”) Canada
	Cuisine Centrale Prêt-à-Manger Inc. Canada
Metro Brands G.P. Québec
The Jean Coutu Group (PJC)Inc.(“Jean Coutu Group”) Québec
RX Information Centre Ltd Canada
Pro Doc Ltée(“Pro Doc”) Québec
Ontario
Metro Ontario Inc.(“Metro Ontario”) Canada
	Metro Ontario Pharmacies Limited Canada
	Metro Ontario Real Estate Limited Canada

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METRO INC. – 2021 Annual Information Form

About our company

With annual sales of more than $18 billion, METRO is a leader in the food and pharmacy industry in Québec and Ontario. As a retailer, franchisor, manufacturer and distributor, we operate a network of a total of 963 food stores and 649 drugstores and supply more than 350 neighbourhood grocery stores.

As of September 25, 2021 and September 26, 2020, METRO, its franchisees and affiliated retailers, operated under the following principal banners and in the following locations:

	Food 963 food stores 2021 2020 Supermarkets Metro 78 80 Metro Plus 118 114 Adonis 11 10 Discount stores Super C 98 98 Neighborhood stores Marché Richelieu 53 53 Marché Ami 307 301 Specialty stores Première Moisson 22 22 Les 5 Saisons 2 2 Supermarkets Metro 130 130 Adonis 4 4 Discount stores Food Basics 139 138 Specialty stores Première Moisson 1 1	Pharmacy
		649pharmacies
		2021 2020
Québec 689		Québec 538 PJC Jean Coutu 324 322 PJC Santé 38 37 PJC Santé Beauté 19 18 Brunet 73 75 Brunet Plus 51 51 Brunet Clinique 19 19 Clini Plus 14 15
		Ontario 83 PJC Jean Coutu 8 8 PJC Santé 1 1 Metro Pharmacy 45 45 Food Basics Pharmacy 29 29
		New Brunswick 28 PJC Jean Coutu 18 18 PJC Santé 2 2 PJC Santé Beauté 8 8
Ontario 274

It is important that METRO ensure that its supply chain works efficiently and that goods and information flow effectively between the various suppliers and its distribution centers and, ultimately, the stores. METRO continuously evaluates its supply chain, including methods of distribution, facilities, technologies, modes of transportation and relations with suppliers and, when appropriate, implements changes to its supply chain infrastructure to ensure a continued, cost-efficient system.

METRO’s activities are not dependent on a single customer or a small number of customers. It holds sufficient inventories to ensure product availability. METRO maintains business relationships with a large number of national and regional suppliers. It is not dependent on any one of these third-party providers.

METRO also strives to source its products in a responsible way. Additional information on METRO’s Responsible Procurement Framework can be found in the “Corporate Responsibility” section on page 13 of this Annual Information Form.

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METRO INC. – 2021 Annual Information Form

Our food division

Our activities in the food retail industry are located in the provinces of Québec and Ontario.

Each store is either operated by one of the Corporation’s subsidiaries (Metro Richelieu, Metro Ontario, Adonis Group or Première Moisson Group), by a franchisee or by an affiliate retailer under a franchise or an affiliation agreement, as applicable.

The majority of METRO’s food retail network is serviced by four (4) warehouses owned by METRO which ensure procurement and storage of grocery products, general merchandise, non-perishable goods and certain dairy products. It also operates nine (9) warehouses for the procurement and storage of meat, frozen foods, produce as well as products for the supply of neighbourhood grocery stores. Cuisine Centrale Prêt-à-Manger Inc. started its operations in June 2020 and produces a selection of ready-to-eat meals, salads and dips for various food stores.

	Each_Première Moisson_store is
	either a corporate store operated by
	Première Moisson Group or is a
	franchised or affiliated store operated
	by a franchised or affiliated retailer.
The_Adonis_stores are operated by Adonis Group and supplied by two (2) distribution centers operated by Phoenicia Group.	All 23_Première Moisson_stores are supplied by two (2) food preparation plants owned by Première Moisson Group.
Adonis Group also distributes a selection of products under the _Adonis_brand in several of METRO’s	Première Moisson Group also distributes a selection of products under the_Première Moisson_
food stores and Phoenicia Group also distributes products under its _Cedar_brand in these stores.	trademark in several of METRO’s food stores. The_Première Moisson_ products include ready-to-eat
	products, pastries, pies and cakes.

Our pharmacy division

418 drugstores are operated under the PJC Jean Coutu , PJC Santé and PJC Santé Beauté (collectively the “ PJC banners”, and the expression “ PJC drugstores” shall collectively refer to drugstores operated under the PJC banners) and more than 24,000 employees work in the pharmacy retail network. The Jean Coutu Group is the largest pharmacy chain in Québec. Its activities mainly include: franchising, wholesaling and generic drug distribution.

157 drugstores are operated under the Brunet , Brunet Plus , Brunet Clinique and Clini Plus banners (collectively the “ Brunet banners”, and the expression “ Brunet drugstores” shall collectively refer to drugstores operated under the Brunet banners).

The Corporation’s activities in the pharmacy retail industry cover a wide-ranging territory, which includes the provinces of Québec, Ontario and New Brunswick.

In Québec, the Corporation’s pharmacy retail activities are franchise based. Its subsidiary Jean Coutu Group acts as franchisor and wholesaler for all drugstores operating under the PJC banners. In addition, METRO’s subsidiary, McMahon, acts as franchisor and wholesaler for all Brunet drugstores.

In Ontario, the Corporation’s pharmacy retail activities are either corporate or franchise based. Some of METRO’s stores located in Ontario, which are operated by Metro Ontario under the Metro and Food Basics banners, have full in-store pharmacy services. These drugstores are operated under two (2) banners, namely Metro Pharmacy and Food Basics Pharmacy . The Jean Coutu Group supplies these drugstores. The Jean Coutu Group also acts as franchisor and wholesaler for the PJC drugstores in Ontario.

In New Brunswick, METRO has a strong presence through 28 drugstores under the PJC banners which are operated by the franchised drugstore owners affiliated to the PJC banners.

During the last fiscal year, METRO operated four (4) distribution centers that supplied all of its pharmacy retail network. Two (2) distribution centers were operated by McMahon and supplied a wide market of independent drugstores and health care institutions such as nursing homes as well as the Brunet drugstores. The Jean Coutu Group operates the other two (2) distribution centers which service all of the PJC and Ontario drugstores. As part of the integration plan put in place following the acquisition of the Jean Coutu Group by METRO, the operations of the two (2) distribution centers operated by McMahon were transferred to the distribution centers operated by the Jean Coutu Group in Varennes, Québec, towards the end of the 2021 financial year.

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METRO INC. – 2021 Annual Information Form

Distribution of generic drugs

The Corporation, through its subsidiary Jean Coutu Group, owns all interests in Pro Doc, a generic drug distributor located in Laval, Québec, that is mostly involved in the wholesale distribution of generic drugs. Pro Doc owns a portfolio of approximately 119 generic molecules and 326 different products. These products are sold under the Pro Doc trademark. The generic drugs distributed by Pro Doc are exclusively sold in Québec, mainly to the Jean Coutu Group and McMahon.

Our products, brands and services

METRO’s retail network meets customer needs by offering friendly stores, a personalized service and a wide range of quality products at very competitive prices.

Our private brands

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METRO owns several private brands offered in a majority of its stores such as the Irresistibles, Selection and Life Smart Mieux-être brands. Certain other private brands such as Adonis, Phoenicia and Cedar are offered in the Adonis stores and other food stores, whereas the Première Moisson stores offer a wide selection of products under the Première Moisson brand. Products under the Première Moisson brand are also sold in Metro , Super C , Adonis and Food Basics stores.

The PJC drugstores carry more than 3,800 private label product items. The Jean Coutu Group’s private label offering includes a line of beauty and cosmetic products, over-the-counter medications and personal care products, all of which are sold under the Personelle brand. The PJC drugstores also carry a selection of exclusive brand products.

METRO’s private label Irresistibles and Selection products are sold in the PJC drugstores. The Jean Coutu Group’s private brand for health and beauty products, Personnelle , is also sold in the Brunet drugstores and in Super C , Metro and Food Basics stores. Over-the-counter products bearing the Personnelle brand are also part of the Brunet drugstores’ product line-up.

METRO’s private brands products were honoured in 2021 with more than 22 awards for their innovation, design and recipes, including ten (10) Canadian Grand Prix new products awards, one (1) Vertex award, five (5) Canadian PAC Awards, two (2) PLMA awards, one (1) Grand Prix du design award, as well as three (3) DUX awards.

Product development

METRO, through its marketing research and consumer intelligence department , analyses consumer habits and needs. In addition, METRO works with several partners, including Dunnhumby, to develop and implement strategies to better meet customers’ needs and build strong loyalty.

This year, METRO continued to improve its product offering in its stores and to focus even more on customer experience and innovation. METRO’s teams constantly seek out innovative products as well as develop new in-store merchandising concepts. It has a department dedicated to customer experience, to define and implement a distinctive shopping experience in its Metro stores. The latest Metro stores in Québec and Ontario are part of a new generation of stores offering innovative products and services.

METRO completed this year the launch of over 350 new private brand products, brought improvements to more than 1,000 existing products, whether it be to the packaging, the costing or the recipe, including sodium reduction and other recipe improvements. Complete information on the sorting of materials for recycling purposes is now on the packaging of more than 1,400 products. METRO also launched 80 new healthy and sustainable products under the Selection, Irresistibles, Life Smart Mieux-être, Life Smart Mieux-être Naturalia , Life Smart Mieux-être plant based, Life Smart Mieux-être Organic, Selection Eco and Personnelle Baby brands.

Loyalty programs

Loyalty programs offered by METRO allow us to reach and reward more than 5.4 million customers across Québec, Ontario and New Brunswick.

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METRO INC. – 2021 Annual Information Form

In Québec, METRO, through its metro&moi loyalty program, allows consumers the opportunity to collect points that can be applied towards purchases in Metro stores and online at metro.ca. This program allows METRO to build customer loyalty through the development and implementation of consumer-focused strategies.

The Air Miles® Reward Program is offered to customers of the Metro banner throughout Ontario and in PJC drugstores across Québec, Ontario and New Brunswick. This program offers customers of these banners the possibility to accumulate Air Miles®, discounts and other loyalty rewards, while providing METRO with increased customer loyalty and insight into customer buying habits as part of an overall customer relationship management strategy.

All METRO banners have personalization and communication tools such as mobile applications, personalized communications and newsletters which allow customers to receive regular communications and relevant offers, adapted to their needs.

Digital platforms

In 2021, the Metro banner’s online grocery service experienced exceptional growth. With the significant increase in the number of customers turning online to fulfill their grocery shopping needs during the pandemic, Metro quickly accelerated expansion plans to meet this increased demand and introduced the click and collect service to 196 stores across Ontario and Québec. The delivery service was also expanded into new markets including Ottawa, selected areas of Durham (Pickering and Ajax), and Chicoutimi. This brings the total number of stores fulfilling eCommerce delivery orders to 14. The Metro banner’s online grocery service is now available to more customers, reaching 66% of Ontario and 89% of Québec residents, and offering more choices for the type of service they wish to receive.

METRO opened its first dedicated online grocery store in Ville Saint-Laurent in June 2021, that service customers on Montreal Island. This new centralized store offers more delivery timeslot options to customers and improved operating efficiencies while delivering the same quality, assortment, freshness and customization that customers expect when shopping in-person.

In April 2020, a new partnership with Cornershop, an on-demand grocery service was deployed adding a new channel for customers to access our product offering and receive orders directly to their home in as little as 60 minutes. We have continued to expand on this successful partnership, now offering this service to the customers of the Super C and Adonis banners.

The online grocery shopping service is part of the Corporation’s overall digital strategy, which aims to position METRO as the retailer that offers the food experience that best meets consumers’ needs and behaviors.

The Metro banner launched the My Health My Choices program earlier this year. This program provides consumers who want to make the best choices based on their lifestyle, values or health needs with an innovative and unique guide on the food attributes of products. Nearly 10,000 products found in store, online and on the My Metro app display one or more of the program's nearly 45 attributes, allowing consumers to make their shopping experience easier and faster.

The Jean Coutu Group has developed, through its subsidiary, Rx Information Centre Ltd., a proprietary pharmacy workflow and prescription management information system which is used in nearly all drugstores under the PJC and Brunet banners. This system is designed to enable an efficient workflow process that optimizes pharmacy services through fast prescription filling, verification of quality control, reduction in filling errors, reduced risks of adverse drug interaction, examination of workflow data, documentation and monitoring of patient records, and maximization of the availability of high-demand prescription products. At the patient's request, this system also allows customers to refill or transfer their prescriptions at any PJC or Brunet banner drugstores within the same province (except for Ontario). Patients can access, through the Jean Coutu Group’s mobile application or website, their Health Record, and when appropriate, their family’s. The Health Record contains the list and a copy of patients’ prescriptions as well as information on medications. This application also allows patients to process new prescriptions.

METRO continues to focus on improving the overall experience for its customers across all digital platforms, including the PJC and Brunet ’s mobile applications. In addition to viewing the list of current prescriptions and submitting refill requests, customers can now also select the online payment and in-store pickup option for products ordered online.

Banner services

METRO’s banner networks are structured to meet specific consumer needs. Each one presents a consistent image to the public and is supported by specialized technical support services.

METRO offers a range of services to affiliated retailers and franchisees operating under the Metro , Metro Plus and Marché Richelieu banners and many of these services are invoiced directly to their users in order to ensure their self-financing. The services include merchandising, marketing and advertising programs as well as retail accounting and data processing, store layouts and equipment, insurance programs and other analysis and advisory programs. Overall, these products and programs reflect METRO’s objective to offer these retailers a comprehensive, high-quality service. METRO also offers these retailers a range of commercial programs, as well as rebates and loyalty incentives, all of which are competitive in the food industry. Metro Richelieu and Metro Ontario generate revenues from the sale of products to the retailers, most of such products being delivered from their distribution centers, and from services rendered to them.

The franchised owners of the PJC and Brunet drugstores own their businesses and are responsible for managing their stores and layout, and for funding their inventory. The Jean Coutu Group and McMahon generate revenues from royalties, based on a percentage of drugstore sales, and from the sale of products to the franchised drugstore owners, mainly delivered from the Jean Coutu Group’s two (2) distribution centers, and from

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METRO INC. – 2021 Annual Information Form

services rendered to such franchisees. The Jean Coutu Group and McMahon each provides several other services to their franchised drugstore owners, which may include centralized purchasing, marketing, training, human resources, operational consulting, information systems, and private label programs.

METRO grants the right to operate under any of its banners at its sole discretion. Retailers who wish to operate under one of METRO’s banners must first meet certain criteria. Most banner retailers are bound by various agreements with METRO.

Intellectual property

METRO uses and has exclusive ownership of several trademarks and trade names. Its principal banners, which are all trademarks owned by METRO, are Metro , Metro Plus , Super C , Food Basics , Marché Richelieu , Marché Ami , Adonis , Première Moisson , PJC Jean Coutu , PJC Santé , PJC Santé Beauté, Brunet , Brunet Plus , Brunet Clinique , Clini Plus , Metro Pharmacy and Food Basics Pharmacy . Its main private label products are identified by the following trademarks, among others: Irresistibles , Selection , Personnelle , PJC , PJC Délices , Adonis , Phoenicia , Cedar , Première Moisson and Pro Doc . METRO takes appropriate measures to protect its intellectual property including registering same with the intellectual property authorities.

Competitive environment

The food and drugstore industry in Canada is highly competitive, but METRO continues to work to increase its market share[] , including by carefully selecting sites for future stores, actively focusing its dynamic marketing efforts on consumer needs, and modernizing its stores, information systems, distribution facilities and digital platforms. METRO’s retail network competes with local, regional, national and international businesses, including independently owned drugstores and supermarkets, mass merchandisers, warehouse clubs, online retailers, discount stores, convenience stores and other specialty chains, groups and banners.

Seasonality

Other than certain holiday periods in the year that correlate with higher sales, there is no significant seasonality factors affecting METRO’s business.

Regulations

METRO’s operating activities require certain government permits and licences. In particular, METRO holds licences and permits for the sale of alcoholic beverages, tobacco, lottery tickets and for the distribution of pharmaceutical products and medical devices. METRO believes that it holds all licences and permits required for the proper conduct of its activities in accordance with the law. Moreover, METRO sells or distributes certain food and health products which are subject to price regulation, such as prescription drugs, milk, beer and wine.

Loan operations

The Corporation does not have any loan operations. However, in the normal course of its business, situations may arise where METRO grants loans to various parties, including to its retailers .

Risk factors

The risk factors that may affect the Corporation are described on pages 32 to 35 of the 2021 Annual Report under the “Risk Management” Section.

Our people

As at September 25, 2021, METRO employed directly 44,097 people, 35,936 of whom were governed by 162 collective agreements. If we add to this number, the structured entities’, this number goes up to approximately 52,793 and this represents the number of employees for whom wages and fringe benefits are accounted for at note 4 of the Consolidated Financial Statements on page 56 of the Corporation’s 2021 Annual Report. This number amounts to approximately 29,525 full-time equivalent employees as 63% of METRO employees are part-time employees. These positions are most often found in the stores and are frequently first-time jobs for people who are entering the job market for the first time. Throughout its network, METRO provides employment to approximately 90,000 people.

During the last financial year, METRO negotiated and renewed 39 collective agreements covering 5,309 employees. These agreements were in effect for periods ranging from 34 months to 84 months and will expire between September 12, 2023 and July 28, 2028. As at

September 25, 2021, nine (9) collective agreements covering 2,440 employees had expired and were or were soon to be under negotiation. Over the next financial year, 28 collective agreements covering 10,289 employees will expire. Finally, 86 collective agreements will expire between December 31, 2022 and April 19, 2027. These collective agreements cover 17,898 employees.

METRO considers* its labour relations to be satisfactory.

 See the “Forward-Looking Information” section on page 1 of this Annual Information Form.

• See the “Forward-Looking Information” section on page 1 of this Annual Information Form.

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METRO INC. – 2021 Annual Information Form

With respect to METRO’s employees’ participation in pension plans, most of the employees participate in multi-employer pension plans. For accounting purposes, these plans are considered as defined contribution plans and are not administrated by METRO because said plans cover employees of a number of different corporations.

The remaining portion of METRO’s employees either participate in defined contribution pension plans or in defined benefit pension plans. By law, the administration of all Québec employees’ pension plans is the responsibility of each plan’s respective pension committee. In Ontario, these plans are administrated by METRO or by a board of trustees.

The investment policies of the above plans are reviewed annually in order to ensure that the asset allocation is appropriate.

The liabilities associated with the defined benefit pension plans represent a small portion of the Corporation’s market capitalization and compares favourably to other public corporations.

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METRO INC. – 2021 Annual Information Form

General development of the business over the last three (3) years

Over the past three (3) financial years, both METRO and its retailers carried major work on a total of 71 food stores, which included the opening of 20 stores (including relocations), the expansion of ten (10) stores and the renovation of 41 stores. This represents an increase of 2.03% of its food retail network area for all food banners combined.

These investments laid solid and durable foundations for METRO and its retailers to continue to grow the network. Below are more details on the highlights of the past three (3) years.

2021

Operational Developments

We realized several projects over the fiscal year, including the following major ones:

• The crisis related to COVID-19 continued to test our resilience and adaptability throughout the year and all of our employees, our retailers, and pharmacist owners, as well as our supplier partners, worked together to provide to our customers the essential services of food and pharmacy while never compromising on safety.

• METRO, through the commitment of its affiliated pharmacists and their presence in the community, as well as through its participation in the establishment of four (4) corporate clinics, has actively contributed to the campaign to immunize the population against COVID-19. To date, more than 540,000 vaccinations have been administered through our diverse initiatives.

• In March 2020, METRO announced a $420 million investment over five (5) years for the construction of a new, automated distribution centre for fresh and frozen products in Terrebonne, just north of Montréal, and the expansion of its produce and dairy products distribution centre in Laval. These investments will enable METRO to better meet the expectations of its current and future customers and to continue its growth. The new Terrebonne distribution centre is expected to open in 2023, while the expansion of the Laval distribution centre is expected to be completed in 2024. We have invested almost $137 million in this project so far.

• In October 2017, we announced a $400 million investment over six (6) years in our Ontario distribution network. Phase 1 of the project, our new fresh distribution centre, was commissioned during the year and is now fully operational. The start-up of Phase 2, the frozen distribution facility, is expected* to occur in January 2022. Equipped with state-of-the-art technology, these facilities will help us improve service to our store network and offer greater product freshness and variety. METRO will be able to better meet the constantly evolving customer preferences and position itself as the retailer providing the best customer experience in each of its banners.

• We have accelerated our plans to increase capacity of our online grocery service. During the year, we executed on the next phase of our omnichannel strategy with the opening of a dedicated store for online grocery serving Montréal. We also expanded our click-and-collect service, which is now available in 196 stores, and is expected to exceed 200 by the end of fiscal 2022*.

• We completed the combination of pharmacy activities and best practices between METRO and the Jean Coutu Group with the integration of our McMahon distribution center into the modern Jean Coutu Group facility in Varennes.

• We continued to invest in our retail network. In Québec, we opened two (2) Metro Plus stores and one (1) Adonis store, we also relocated a Metro Plus store, and we carried out major renovations and expansions at four (4) other stores. In Ontario, we opened a Food Basics store, and carried out major renovations and expansions at five (5) other stores.

• In 2021, we invested a record level of capital expenditures of nearly $600 million related to the Corporation’s major projects including supply chain modernization, store network and omnichannel strategy.

• In 2021, we focused our efforts on key Corporate Responsibility programs that will continue with a long-term vision. The health and safety of our colleagues and customers remained the number one priority throughout this pandemic year. We have multiplied our initiatives in support of local purchasing at a time when our customers are looking more than ever for these products, structured our approach to deploy our packaging and printing materials optimization actions and continued our efforts to reduce our greenhouse gas emissions more efficiently. Our One more bite food donation program continued in a context where the demand for food aid has exploded.

Together with the management team, we worked to develop our Corporate Responsibility 2022-2026 Plan. We paid particular attention to identifying our priorities, goals, and targets, as well as solidifying our disclosure practices and tools.

Corporate and Financial Developments

On September 3, 2021, METRO and its banking syndicate agreed to an extension of the maturity date of the existing $600 million revolving, unsecured, renewable credit facility (the “Credit Facility”) from November 3, 2024 to September 3, 2026.

The Board of Directors of the Corporation (the “Board of Directors”) authorized, on November 16, 2021, the renewal of the normal course issuer bid program for the 2021-2022 period. The Corporation bought back, in the normal course of business, between November 25, 2020 and November 24, 2021, 8.5 million of its common shares.

On November 30, 2021, the Corporation issued through a private placement Series J Notes due December 2, 2024 (the “Series J Notes”). The Series J Notes carry a coupon of 1.922% and were priced at $1,000 per $1,000 principal amount, for an effective yield of 1.922% per annum if held to maturity. METRO used the proceeds

* See the “Forward-Looking Information” section on page 1 of this Annual Information Form.

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METRO INC. – 2021 Annual Information Form

of the offering for the repayment of the Series C senior unsecured notes due December 1, 2021 and for general corporate purposes. In conjunction with this offering, METRO entered into a $300 million interest rate swap effectively locking in a floating rate of interest of 11 basis points (0.11%) over the 3-month bankers’ acceptance rate (CDOR) over the life of the Series J Notes.

On December 1, 2021, the Corporation redeemed all of the Series C Notes in the amount of $300 million that matured on the same day.

2020

Operational Developments

The crisis related to COVID-19 was unprecedented and solicited all our resources to ensure the safety of our employees and customers, the resilience of our supply chain and our ability to maintain in-store operations. All of our employees, our retailers, and pharmacist owners, as well as our supplier partners, pulled together to provide our customers the essential services of food and pharmacy while never compromising on safety.

In the context of the pandemic, METRO donated over $4 million to support communities. Answering the call of these long-time community partners, the money was donated primarily to Feed Ontario, Food Banks of Quebec and to the emergency fund of United Way/Centraide.

In March 2020, METRO announced a $420 million investment over five (5) years[] in the construction of a new, automated distribution centre for fresh and frozen products in Terrebonne, Québec, north of Montréal, and the expansion of its produce and dairy products distribution centre in Laval, Québec. These investments will enable METRO to better meet the expectations of its current and future customers and to continue its growth. The new Terrebonne distribution centre is expected to open in 2023, while the expansion of the Laval distribution centre is expected to be completed in 2024*.

After announcing, in October 2017, a $400 million investment over six (6) years in the Corporation’s Ontario distribution network. Phase 1 of the project launched in 2019 was delayed slightly due to the pandemic but is now nearing completion. This facility equipped with state-of-the-art technology will help us improve service to our store network and offer greater product freshness and variety.

We have accelerated our plans to increase capacity of our online grocery service. During the year, we expanded our service in Québec by adding hub stores in Québec City and Sherbrooke and will also be adding a third store in Ontario. We announced our plan to open a dedicated store for online grocery to serve Montreal.

Basics and carried out major renovations at eight (8) other stores.

We pursued the implementation of our corporate responsibility plan while also adapting our programs in the pandemic. We adopted a series of measures to ensure the safety of our customers and employees and revised our hiring practices to attain our recruitment targets within the health constraints. During 2020, we continued to roll out our local purchasing, sustainable procurement and food waste reduction initiatives and launched our actions to optimize our packaging and printed materials and decreased the intensity of our greenhouse gas emissions.

We acquired the minority interest in Première Moisson Group during the first quarter of fiscal 2020.

Corporate and Financial Developments

On October 10, 2019, METRO’s banking syndicate agreed to an extension of the Credit Facility from November 3, 2023 to November 3, 2024.

On February 26, 2020, the Corporation issued through a private placement Series I unsecured senior notes in the aggregate principal amount of $400 million bearing interest at a fixed nominal rate of 3.41%, maturing on February 28, 2050, and redeemable at fair value at the issuer’s option at any time prior to maturity. On February 27, 2020, the Corporation redeemed all of the Series E notes in the amount of $400 million that matured on the same day.

The Board of Directors of the Corporation authorized, on November 17, 2020, the renewal of the normal course issuer bid program for the 2020-2021 period. The Corporation bought back, in the normal course of business, between November 25, 2019 and November 24, 2020, over four (4) millions of its common shares.

We continued to combine pharmacy activities and best practices between METRO and the Jean Coutu Group. By the end of fiscal year 2020, we had achieved our objective of generating $75 million in annualized cost synergies within three (3) years of the acquisition.

We continued to invest in our retail network. In Québec, we opened a Metro Plus and a Super C , we also relocated a Metro Plus and a Super C , and we carried out major renovations at seven (7) other stores. In Ontario, we opened a Metro , a Food Basics and an Adonis , converted two (2) Metro stores into Food

 See the “Forward-Looking Information” section on page 1 of this Annual Information Form.

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METRO INC. – 2021 Annual Information Form

2019

Operational Developments

In 2019, METRO continued to combine pharmacy activities and share best practices between METRO and the Jean Coutu Group. The first phase of consolidation of the Corporation’s wholesale pharmaceutical business was completed during the summer of 2019 and orders from over 300 Ontario clients were then centralized at the Jean Coutu Group’s state-of-the-art Varennes distribution centre. This constituted a first step toward implementing an integrated pharmacy operational chain for greater agility and efficiency.

The Jean Coutu Group celebrated 50 years of operations, namely 50 years of quality customer service, innovations and friendships.

In accordance with the agreement entered into with the Commissioner of Competition of Canada, METRO completed the divestiture of rights in ten (10) drugstores during the course of the year.

The Corporation launched its online grocery service in Ontario in May 2019, allowing a potential of 1.9 million households in the Greater Toronto Area to benefit from this service. Customers can pick up their orders in one (1) of the two (2) stores providing online grocery services or have them delivered to their home. Products are selected by specially trained METRO employees.

In 2019, METRO continued to invest in its stores. In Québec, one (1) Adonis and one (1) Super C stores were relocated and major renovations were carried out at ten (10) other stores. In Ontario, two (2) new Metro stores and three (3) Food Basics stores as well as one (1) Adonis store were opened. In addition, two (2) Metro stores were converted to Food Basics and major renovations were carried out at ten (10) other stores.

Première Moisson Group opened a new retail location in the greater Montréal area, bringing the number of operating Première Moisson bakeries to 22 for the Montréal area in addition to one (1) in Québec City and two (2) in the GatineauOttawa area.

After announcing, in October 2017, a $400 million investment over six (6) years* in the Corporation’s Ontario distribution network, construction of the new semi-automated fresh food

distribution located at METRO’s Vickers Road facility in Toronto started in August 2019. This new distribution centre equipped with state-of-the-art technology will help METRO improve service to its store network and offer greater product freshness and variety*.

METRO was ranked number ten (10) by the Reputation Institute among companies doing business in Canada, marking the first time METRO made the top 50 most reputable companies in Canada. The first Canadian BrandZ report was published in 2019 and ranked Metro as the food brand with the most value and the 19[th] Canadian brand with the most value globally.

On January 17, 2019, along with other companies, METRO made a public statement that we would seek to reduce by 50% food waste in our operations by 2025. The Corporation had already implemented major projects to this end, namely the waste management program and the Récupartage food donation program. During the year, we unveiled our packaging and print management policy and reaffirmed our intent to reduce by 50% single-use plastic bags in METRO's food and pharmacy banners by the end of fiscal 2023. These initiatives complement those already in place, namely the energy efficiency of the Corporation’s buildings, a program to improve recycling information on the packaging of private label food products and the opportunity for Québec's Metro stores’ customers to bring their reusable containers to purchase fresh products.

Corporate and Financial Development

After a period of approximately one (1) year during which the normal course issuer bid program was not renewed, in particular because the Corporation intended, during this period, to allocate the surplus cash available to reimburse part of the debt incurred following the acquisition of the Jean Coutu Group by the Corporation on May 11, 2018 (the “Transaction”), the Board of Directors of the Corporation authorized, on November 20, 2018, the reinstatement of the normal course issuer bid program starting on November 23, 2018. The Corporation bought back, in the normal course of business, between November 23, 2018 and November 22, 2019, over three (3) millions of its common shares and renewed the normal course issuer bid program for 20192020.

.

• See the “Forward-Looking Information” section on page 1 of this Annual Information Form.

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METRO INC. – 2021 Annual Information Form

Corporate responsibility

METRO adopted a corporate responsibility approach in 2010. Since then, it has implemented structuring programs pertaining to responsible procurement, the environment as well as equity, diversity and inclusion.

Disclosure

METRO published its first corporate responsibility report for fiscal year 2011 and has been reporting on its progress annually ever since. The reports disclose how value is created through corporate responsibility for METRO and its stakeholders – customers, employees, suppliers, shareholders and community partners. Sound management of environmental, social and governance (“ESG”) matters is central to METRO’s approach and enables it to be a responsible food and pharmacy leader who integrates a sustainable development perspective into its business model.

New 2022-2026 Corporate Responsibility Plan

During the course of 2021, the new 2022-2026 Corporate Responsibility Plan was developed through the leadership of senior management who was involved at each step with the teams engaged in the development of the plan. Each priority of the plan was assigned to a member of the executive committee. The executive committee received two (2) formal presentations on the new corporate responsibility plan, first to approve the guidelines and then to approve the plan.

In developing the new plan, which will be released in January 2022, METRO focused its attention and efforts on major programs that will continue in the coming years. The new plan will be METRO’s third Corporate Responsibility Plan. Particular attention was paid to identifying priorities, objectives and targets, as well as solidifying processes and reporting tools.

The Governance and Corporate Responsibility Committee was involved throughout the development of the new plan as it received formal presentations from the executive officers responsible for the development of the new plan. The Governance and Corporate Responsibility Committee provided comments and input to management on the guidelines and the development of the plan. The Board of Directors also reviewed the new plan and, upon recommendation of the Governance and Corporate Responsibility Committee, approved the 2022-2026 Corporate Responsibility Plan.

Corporate responsibility governance

Corporate responsibility is part of the Corporation’s management structure and involves key individuals at each decision-making and implementation stage under the guidance of the Board of Directors.

==> picture [428 x 243] intentionally omitted <==

----- Start of picture text -----

Board of Directors
The Governance and Corporate Responsibility Committee is responsible for the oversight of the Corporation’s activities and
disclosure with regards to corporate responsibility, including ESG matters. The Board of Directors approves corporate
responsibility plans and reports.
Executive Committee
Approves the corporate responsibility strategy, and ensures the priorities are in line with the Corporation's business
strategy and that objectives have been achieved.
Vice-Presidency, Public Affairs and Communication
Develops the strategic corporate responsibility directions and reports on progress to the executive committee and to
the Governance and Corporate Responsibility Committee.
In-house teams
Reporting to the vice-presidencies responsible for the programs of the corporate responsibility plan, the teams assigned to the
initiatives ensure their progress against the goals and targets set.
----- End of picture text -----

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METRO INC. – 2021 Annual Information Form

Share capital structure

The common shares are the only shares of the Corporation carrying the right to vote at a meeting of shareholders. Each holder of common shares is entitled, at the meeting or any adjournment thereof, to one (1) vote for each common share registered in the name of such holder at the close of business on the record date. As at December 3, 2021, there were 241,067,649 common shares of the Corporation issued and outstanding, representing in the aggregate 100% of the votes attached to all common shares of the Corporation.

Information concerning the issued share capital at the end of the 2021 financial year can be found in note 18 of the Consolidated Financial Statements on pages 68 to 71 of the Corporation’s 2021 Annual Report.

Transfer agent

TSX Trust Company is our transfer agent and registrar.

The registers of transfers for our common shares are held in Montréal.

Trading price and volume

The common shares of the Corporation are traded on the TSX under the ticker symbol MRU.

The table below shows the monthly range close-of-market highs and lows, monthly trading volume and average daily volume for the last financial year. The month of September 2021 includes September 1 to 25, 2021, the last day of the 2021 financial year.

Month	High monthly ($)	Low monthly($)	Total monthly volume	Average
				daily
				volume
2020
October	64.20	61.36	11,951,595	569,124
November	66.25	59.20	19,253,123	916,815
December	60.37	56.75	12,824,589	610,695
2021
January	58.61	55.17	12,126,762	606,338
February	56.52	52.63	15,415,902	811,363
March	58.02	52.72	16,286,769	708,120
April	60.23	55.50	8,951,692	426,271
May	59.03	56.00	9,352,094	467,605
June	59.77	57.91	10,413,454	473,339
July	64.79	58.82	6,941,677	330,556
August	65.85	60.71	8,609,461	409,974
September	64.96	59.41	8,167,591	480,447

Dividends

In January 2020, the Board of Directors of the Corporation changed the dividend policy which used to be based on offering annual dividends that represented 20% to 30% of the preceding financial year’s adjusted net earnings with a target payout of 25%. Under the new dividend policy, the dividend payout range will be between 30% to 40% of the previous year’s adjusted net earnings without any target.

In the past three (3) financial years, the Corporation paid the following dividends per share:

Class of shares	2021	2020	2019
Common shares	$0.9750	$0.8750	$0.7800

• See Section on “Non-IFRS measurements” of the 2021 Annual Report.

** See the “Forward-Looking Information” section on page 1 of this Annual Information Form.

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METRO INC. – 2021 Annual Information Form

Escrowed securities and securities subject to contractual restriction on transfer

Escrowed Securities (as at September 25, 2021)

Class of shares	Number of Escrowed Securities	Percentage of Class
Common shares	383,277	0.2%

The escrowed securities are common shares of the Corporation pledged to METRO by some of its retailers. Escrowed shares are held as collateral by METRO to be released and returned to the owner according to the required terms of credit or when the owner is no longer a client of METRO and no longer has any debts towards METRO.

Long-term debt

Credit facilities and senior unsecured notes

The Corporation has access to a $600 million revolving credit facility since 2011. The Credit Facility is unsecured, renewable and bears interest at rates which vary in accordance with bankers’ acceptance rates. The Credit Facility’s maturity date has been extended to September 3, 2026.

On October 12, 2005, the Corporation issued the following medium-term notes: i) 10-year series A medium term notes maturing on October 15, 2015 in a principal amount of $200 million bearing interest at a rate of 4.98% per annum (the “Series A Notes”); and ii) 30-year series B medium term notes maturing on October 15, 2035 in a principal amount of $400 million bearing interest at a rate of 5.97% (the “Series B Notes”).

On December 1, 2014, the Corporation closed a private placement of $300 million aggregate principal amount of 3.20% series C senior unsecured notes due December 1, 2021 (the “Series C Notes”) and $300 million aggregate principal amount of 5.03% series D senior unsecured notes due December 1, 2044 (the “Series D Notes”). The Series C Notes carry a coupon of 3.20% and were priced at $999.88 per $1,000 principal amount, for an effective yield of 3.202% per annum if held to maturity. The Series D Notes carry a coupon of 5.03% and were priced at $999.54 per $1,000 principal amount, for an effective yield of 5.033% per annum if held to maturity. The Corporation reimbursed all Series A Notes on December 31, 2014 using part of the proceeds of the Series C Notes and Series D Notes offering. The redemption price was $1,029.28 per $1,000 principal amount of the notes redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. The remaining portion of the proceeds of the offering was used for working capital and other general corporate purposes. On December 1, 2021, the Corporation redeemed all of the Series C Notes in the amount of $300 million that matured on the same day.

On February 27, 2017, the Corporation closed a private placement offering of $400 million aggregate principal amount of Series E floating rate senior unsecured notes due February 27, 2020 (the “Series E notes”). The Series E Notes were issued at par and bear interest at a rate equal to the 3-month bankers' acceptance rate (CDOR) plus 57 basis points (or 0.57%), to be set quarterly commencing on the day of closing. The Corporation used the net proceeds for the repayment of indebtedness outstanding under the Credit Facility and for general corporate purposes.

In October 2017, to finance the cash portion of the purchase price payable in relation to the Transaction, the Corporation secured access to committed bank facilities fully underwritten by Bank of Montreal, Canadian Imperial Bank of Commerce and National Bank of Canada which consisted of a $500 million term loan facility (itself consisting of a 3-year $100 million tranche A, 4-year $150 million tranche B and a 5-year $250 million tranche C), a 1-month $250 million bridge term facility, an asset sale term facility of $1.5 billion and a 1-year $1.2 billion term facility. In the end, only the $500 million term loan facility and the 1-month $250 million bridge term facility were used as the Corporation financed the remaining cash portion of the purchase price of the acquisition by disposing of its investment in Alimentation Couche-Tard Inc. and by issuing unsecured senior notes by way of private placement, the whole as described below.

The Corporation completed the sale of a majority of its interests in Alimentation Couche-Tard Inc. in October 2017, for proceeds, net of the related fees and commissions, of $1.534 billion. The proceeds of such sale were used to finance part of the cash portion of the purchase price payable in relation to the Transaction. The $1.5 billion asset sale term facility was thus terminated.

The Corporation completed its issuance of unsecured senior notes by private placement on December 4, 2017 for an aggregate principal amount of $1.2 billion. Such private placement was comprised of $300 million aggregate principal amount of Series F unsecured senior notes, bearing interest at a fixed nominal rate of 2.68% and maturing on December 5, 2022 (the “Series F Notes”); $450 million aggregate principal amount of Series G unsecured senior notes, bearing interest at a fixed nominal rate of 3.39% and maturing on December 6, 2027 (the “Series G Notes”); and $450 million aggregate principal amount of Series H unsecured senior notes, bearing interest at a fixed nominal rate of 4.27% and maturing on December 4, 2047 (the “Series H Notes”). The Series F Notes carry a coupon of 2.68% and were priced at $999.95 per $1,000 principal amount, for an effective yield of 2.681% per annum if held to maturity. The Series G Notes carry a coupon of 3.39% and were priced at $999.41 per $1,000 principal amount, for an effective yield of 3.397% per annum if held to maturity. The Series H Notes carry a coupon of 4.27% and were priced at $998.99 per $1,000 principal amount, for an effective yield of 4.276% per annum if held to maturity. The proceeds of such issuance were used to finance the last part of the cash portion of the purchase price payable in relation to the Transaction. The Corporation therefore terminated the $1.2 billion term facility.

On December 6, 2017, the Corporation amended the terms of the $500 million term loan facility, resulting in a one-year $100 million tranche A, a 2-year $200 million tranche B and a 3-year $200 million tranche C. On May 11, 2018, the Corporation reimbursed the $100 million tranche A and

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METRO INC. – 2021 Annual Information Form

the $250 million bridge loan, and on June 11, 2018 the Corporation reimbursed half of tranche B ($100 million). During the fourth quarter of the 2018 financial year, the Corporation reimbursed the $100 million balance of tranche B and the total amount of the 200 million tranche C. Both facilities were officially terminated on September 10, 2018.

On February 26, 2020, the Corporation issued through a private placement Series I unsecured senior notes in the aggregate principal amount of $400 million bearing interest at a fixed nominal rate of 3.41%, maturing on February 28, 2050, and redeemable at fair value at the issuer’s option at any time prior to maturity. On February 27, 2020, the Corporation redeemed all of the Series E Notes in the amount of $400 million that matured on the same day.

On November 30, 2021, the Corporation issued through a private placement the Series J Notes due December 2, 2024. The Series J Notes carry a coupon of 1.922% and were priced at $1,000 per $1,000 principal amount, for an effective yield of 1.922% per annum if held to maturity. METRO used the proceeds of the offering for the repayment of the Series C senior unsecured notes due December 1, 2021 and for general corporate purposes. In conjunction with this offering, Metro entered into a $300 million interest rate swap effectively locking in a floating rate of interest of 11 basis points (0.11%) over the 3-month bankers’ acceptance rate (CDOR) over the life of the Series J Notes.

The Corporation’s financial debt position as at September 25, 2021 was comprised of:

• The Credit Facility to a maximum of $600 million;

• Series B notes in the amount of $400 million, bearing interest at a fixed nominal rate of 5.97% and maturing October 15, 2035;

• Series C notes in the amount of $300 million, bearing interest at a fixed nominal rate of 3.20% and maturing December 1, 2021;

• Series D notes in the amount of $300 million, bearing interest at the fixed nominal rate of 5.03% and maturing December 1, 2044;

• Series F notes in the amount of $300 million, bearing interest at the fixed nominal rate of 2.68% and maturing December 5, 2022;

• Series G notes in the amount of $450 million, bearing interest at the fixed nominal rate of 3.39% and maturing December 6, 2027;

• Series H notes in the amount of $450 million, bearing interest at the fixed nominal rate of 4.27% and maturing December 4, 2047; and

• Series I notes in the amount of $400 million, bearing interest at the fixed nominal rate of 3.41% and maturing February 28, 2050.

The table below indicates the principal amount outstanding at the end of the financial year of the Credit Facility and medium-term notes mentioned hereinabove.

Financing[(1)]

Financing(1)
		Principal amount	Principal amount
		outstanding as of	outstanding as of
Type	Maturing	September 25, 2021	September 26, 2020
RevolvingCredit Facility(2)	Sep. 3, 2026	—	—
Medium (C) term notes (7 years)	Dec. 1, 2021(3)	$300 million	$300 million
Medium(F)term notes(5years)	Dec. 5, 2022	$300 million	$300 million
Medium (G) term notes (10 years)	Dec. 6, 2027	$450 million	$450 million
Medium(B)term notes(30years)	Oct. 15, 2035	$400 million	$400 million
Medium(D)term notes(30years)	Dec. 1, 2044	$300 million	$300 million
Medium (H) term notes (30 years)	Dec. 4, 2047	$450 million	$450 million
Medium(I)term notes(30years)	Feb. 28, 2050	$400 million	$400 million
TOTAL	―	$2,600 million	$2,600 million

Notes:

(1) Amounts shown are rounded to the nearest million.

(2) As at September 26, 2020 and September 25, 2021, $600 million remained undrawn from the Credit Facility.

(3) On December 1, 2021, the Corporation redeemed all of the Series C Notes in the amount of $300 million.

The medium-term notes are neither traded nor listed on any recognized stock exchange.

Credit ratings

Credit ratings established by rating agencies are based on quantitative and qualitative considerations relevant to the Corporation. The credit ratings are intended to indicate the risk that the Corporation will not satisfy its obligations on a timely basis and disregard certain factors such as market risk or price risk, since these factors should be considered by investors as risk factors in their decision-making process. Such ratings do not constitute a recommendation to purchase, hold or sell the securities and may be changed or withdrawn at any time by the rating agencies.

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METRO INC. – 2021 Annual Information Form

During this financial year, the Corporation maintained the following credit ratings:

Standard & Poor’s	BBB
Dominion Bond Rating Services (“DBRS”)	BBB/Stable trend

The Standard & Poor’s and DBRS ratings for long-term borrowing vary between AAA and D. The BBB rating granted by Standard & Poor’s and the BBB/Stable trend granted by DBRS confirm the existence of adequate protection mechanisms. However, an unfavourable economic situation or changing circumstances could have a greater effect on the Corporation’s ability to meet its financial commitments compared to companies that have obtained a higher rating.

In 2021, the Corporation paid fees to rating agencies to obtain its credit rating and expects* to pay similar fees in the future. The Corporation also paid a one-time rating service fee in relation to the Series J Notes issued on November 30, 2021.

Directors and officers

The name, principal occupation and place of residence of each director of the Corporation as of December 10, 2021 as well as the composition of the Human Resources, Governance and Corporate Responsibility, and Audit Committees on the date of this Annual Information Form are indicated below. Each director’s term of office expires at the Corporation’s next annual general meeting.

Directors

Name/Place of residence Position Principal occupation Principal occupation during the past five (5) years if different than current principal occupation	Name/Place of residence Position Principal occupation Principal occupation during the past five (5) years if different than current principal occupation	Name/Place of residence Position Principal occupation Principal occupation during the past five (5) years if different than current principal occupation
Maryse Bertrand Westmount, Québec Director (since 2015) Corporate Director and Business Advisor Strategic Advisor and Counsel, Borden Ladner Gervais LLP (2016 to 2017)
Pierre Boivin Montréal, Québec Director (since 2019) President and Chief Executive Officer, Claridge Inc. _____
François J. Coutu Montréal, Québec Director (since 2018) Pharmacist President, The Jean Coutu Group (PJC) Inc. (2007 to 2019)
Michel Coutu Montréal, Québec Director (since 2018) President, MMC Investments Inc. _____
Stephanie Coyles Toronto, Ontario Director (since 2015) Corporate Director Strategy consultant, self employed (2012 to 2017)
Claude Dussault Québec, Québec Director (since 2005) President, ACVA Investing Corporation _____
Russell Goodman Mont-Tremblant, Québec Director (since 2012) Corporate Director _____
Marc Guay Oakville, Ontario Director (since 2016) Corporate Director _____
Christian W.E. Haub Munich, Germany Director (since 2006) Chief Executive Officer, The Tengelmann Group Co-Chief Executive Officer, The Tengelmann Group (2012 to 2018)
Eric R. La Flèche Town of Mount-Royal, Québec Director and President and Chief Executive Officer (since 2008) President and Chief Executive Officer, METRO _____

• See the “Forward-Looking Information” section on page 1 of this Annual Information Form.

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METRO INC. – 2021 Annual Information Form

Name/Place of residence Position Principal occupation Principal occupation during the past five (5) years if different than current principal occupation	Name/Place of residence Position Principal occupation Principal occupation during the past five (5) years if different than current principal occupation	Name/Place of residence Position Principal occupation Principal occupation during the past five (5) years if different than current principal occupation
Christine Magee Oakville, Ontario Director (since 2016) Co-founder and Chair of the Board, Sleep Country Canada Holdings Inc. _____
Brian McMcanus Senneville, Québec Director (since 2021) Executive Chair and Chief Executive Officer, Uni-Select Inc. Partner, Senior Advisor, Cafa Financial Corporation (2020); President and CEO, Stella- Jones Inc. (2001 to 2019)

Composition of the standing committees of the Board of Directors

As of December 10, 2021, the standing committees of the Board of Directors of the Corporation are composed of the following directors:

s of December 10, 2021, the standing committees of the Board of Directors of the Corporation are composed of the following directors:	s of December 10, 2021, the standing committees of the Board of Directors of the Corporation are composed of the following directors:
Human Resources Committee Audit Committee Governance and Corporate Responsibility Committee
Claude Dussault Marc Guay (Chair) Christian W.E. Haub Christine Magee Maryse Bertrand Stephanie Coyles Russell Goodman (Chair) Marc Guay Brian McManus Maryse Bertrand (Chair) Stephanie Coyles Claude Dussault Russell Goodman Christine Magee

The information on the Audit Committee mandated by regulatory standards can be found in Schedules A and B hereto.

Officers

The name, place of residence, current position at METRO and principal occupation during the past five (5) years of the executive officers of the Corporation as of December 10, 2021 are indicated below.

orporation as of December 10, 2021 are indicated below.	orporation as of December 10, 2021 are indicated below.
Name and place of residence Current position Principal occupation during the past five (5) years if different than current position
Eric R. La Flèche Town of Mount-Royal, Québec President and Chief Executive Officer _____
François Thibault Beaconsfield, Québec Executive Vice President, Chief Financial Officer and Treasurer Senior Vice-President, Chief Financial Officer and Treasurer, METRO (2012 to 2016)
Marc Giroux Town of Mount-Royal, Québec Executive Vice President, Québec Division Head and eCommerce Senior Vice President, Metro Banner, METRO (2016 to 2019); Vice-President, Metro Merchandising and Digital Strategy, METRO (2015 to 2016)
Carmine Fortino Stoney Creek, Ontario Executive Vice President, Ontario Division Head and National Supply Chain Executive Vice-President and Ontario Division Head, METRO (2014 to 2019)
Alain Champagne Montréal, Québec President, Jean Coutu Group Chief Executive Officer, Optimé International (2016 to 2019); President, McKesson Canada (2014 to 2016)

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METRO INC. – 2021 Annual Information Form

Name and place of residence Current position Principal occupation during the past five (5) years if different than current position	Name and place of residence Current position Principal occupation during the past five (5) years if different than current position
Serge Boulanger Candiac, Québec Senior Vice President, National Procurement and Corporate Brands _____
Martin Allaire Saint-Lambert, Québec Vice President, Real Estate and Engineering _____
Marie-Claude Bacon Brossard, Québec Vice President, Public Affairs and Communications Senior Director, Public Affairs and Communications, METRO (2013 to 2018)
Christina Bédard St-Bruno-de-Montarville, Québec Vice President, E-Commerce and Digital Strategy Senior Director, E-Commerce, METRO (2017 to 2020); Director, E-Commerce, METRO (2016 to 2017); Director, Digital platforms, METRO (2014 to 2016)
Sam Bernier Candiac, Québec Vice President, Technological Infrastructure Senior Director Security, Access Control and Compliance, CISO, METRO (2021); Director Infrastructure, METRO (2019 to 2021); Vice President, Consulting, CGI (2007 to 2018)
Geneviève Bich Westmount, Québec Vice President, Human Resources _____
Dan Gabbard Mississauga, Ontario Vice President, Supply Chain Vice President, Logistics and Distribution, Ontario, METRO (2019 to 2020); Vice President, Supply Chain, METRO (2016 to 2019)
Karin Jonsson Montréal, Québec Vice President, corporate controller Independent Consultant (2019 to 2020); Corporate Controller, CSL Group (2016 to 2019); Director, Corporate Finance, Rio Tinto (2011 to 2016)
Frédéric Legault Montréal, Québec Vice President, Information Systems _____
Simon Rivet Longueuil, Québec Vice President, General Counsel and Corporate Secretary _____
Alain Tadros Saint-Bruno-de-Montarville, Québec Vice President, Marketing Vice-President, Marketing, Québec, METRO (2016 to 2019); President, Publicis Montréal (2013 to 2016)
Yves Vézina Montréal, Québec National Vice President, Logistics and Distribution _____

To the Corporation’s knowledge, the directors and executive officers of the Corporation own or control as a group and directly or indirectly, 514,524 common shares corresponding to 0.21% of the issued and outstanding shares of the Corporation as at December 3, 2021.

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Cease trade order, bankruptcies, penalties or sanctions

To the Corporation’s knowledge, no director or executive officer of the Corporation, as at the date of this Annual Information Form, and no shareholder holding a sufficient number of securities of the Corporation to affect materially the control of the Corporation:

• a) is or was, in the past ten (10) years before the date of this Annual Information Form, a director or chief executive officer or chief financial officer of any other corporation that:

• i) was the subject of a cease trade or similar order, or an order that denied such person or corporation access to any exemption under securities legislation for a period of more than 30 consecutive days, where such order was issued while the director or officer was acting as director, chief executive officer or chief financial officer; or

• ii) after that person ceased to act in that capacity, was the subject of a cease trade or similar order or an order that denied that person or corporation access to any exemption under securities legislation for a period of more than 30 consecutive days as a result of an event that occurred while that person was acting in the capacity of director, chief executive officer or chief financial officer; or

• b) is, as at the date of the Annual Information Form, or has been within the ten (10) years before the date of the Annual Information Form, a director or executive officer of any company that, while that person was acting in that capacity, or within a year of that person ceasing to act in that capacity, became bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency or was subject to or instituted any proceedings, arrangement or compromise with creditors or had a receiver, receiver manager or trustee appointed to hold its assets, except for i) Ms. Stephanie Coyles, who was a director of Postmedia Network Canada Corp., while it completed a restructuring under a plan of arrangement under the Canada Business Corporations Act in 2016; and ii) Mr. Marc Guay, who was a director of Trusted Health Group Inc. until May 13, 2016 for which company a receiver was appointed on November 28, 2016; or

• c) has, or an entity controlled, directly or indirectly, by such director or executive officer has, within the ten (10) years before the date of the Annual Information Form, become bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency, or become subject to or instituted any proceedings, arrangement or compromise with creditors, or had a receiver, receiver manager or trustee appointed to hold such person’s assets; or

• d) was subject to penalties or sanctions relating to securities legislation imposed by a court or by a securities regulatory authority, or entered into a settlement agreement with such authority; or

• e) was subject to any other penalties or sanctions imposed by a court or regulatory body that would likely be considered important to a reasonable investor in making an investment decision.

Conflicts of interests

To the Corporation’s knowledge, no director or officer of the Corporation or of one of its subsidiaries has an existing or potential material conflict of interest with the Corporation or one of its subsidiaries, with the exception of the following: Mr. François J. Coutu, director of the Corporation and former President of the Jean Coutu Group, has a client to supplier business relationship with the Jean Coutu Group as a franchised drugstore owner of PJC drugstores. This relationship has no material impact on the Corporation or its subsidiaries and is concluded in the normal course of the Corporation’s business, in accordance with the same terms and conditions applicable to other Jean Coutu Group franchised drugstore owners.

Legal proceedings

In the normal course of business, various proceedings and claims are instituted against the Corporation. The Corporation contests the validity of these claims and proceedings and at this stage, the Corporation does not believe that these matters will have a material effect on the Corporation's financial position or on consolidated earnings. However, since any litigation involves uncertainty, it is not possible to predict the outcome of these litigations or the amount of potential losses. No accruals or provisions for contingent losses have been recognized in the Corporation’s annual consolidated financial statements.

In May 2019, two (2) proposed class actions relating to opioids were filed in Ontario and in Québec by opioid end users against a large group of defendants including, in Québec, a subsidiary of the Corporation, Pro Doc, and, in Ontario, Pro Doc and Jean Coutu Group. In February 2020, a proposed class action relating to opioids was filed in British Columbia by opioid end users against a large group of defendants including subsidiaries of the Corporation, Pro Doc and Jean Coutu Group. In April 2021, multiple defendants, including Pro Doc and Jean Coutu Group, were served with a proposed class action relating to opioids and filed by the City of Grande Prairie, in Alberta. In September 2021, multiple defendants, including Pro Doc and Jean Coutu Group, were served with a proposed class action relating to opioids and filed by the Peter Ballantyne Cree Nation and the Lac La Ronge Indian Band, in Saskatchewan. The allegations in these proposed class actions are similar to the allegations contained in the proposed class action filed by the Province of British Columbia in August 2018 against numerous manufacturers and distributors of opioids, including subsidiaries of the Corporation, Pro Doc and Jean Coutu Group. All these proposed class actions contain allegations of breach of the Competition Act , of fraudulent misrepresentation and deceit, and negligence. The Province of British Columbia seeks damages (unquantified) on behalf of all federal, provincial and territorial governments and agencies for expenses allegedly incurred in paying for opioid prescriptions and other healthcare costs that would be related to opioid addiction and abuse while the Ontario, Québec and British Columbia proposed claims filed by opioid end users seek recovery of damages on behalf of opioid end users in general. The City of Grande Prairie, on its behalf and on behalf of all Canadian municipalities and local governments, seeks damages which are unquantified in relation to

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public safety, social service, and criminal justice costs allegedly incurred due to the opioid crisis. The Peter Ballantyne Cree Nation and the Lac La Ronge Indian Band are attempting a similar recourse, claiming unquantified damages from multiple defendants on their own behalf and on behalf of all Indigenous, First Nations, Inuit and Metis communities and governments in Canada. The Corporation believes* these proceedings are without merits and that, in certain cases, there is no jurisdiction. No provision for contingent losses has been recognized in the Corporation’s annual consolidated financial statements.

In October 2017, the Canadian Competition Bureau began an investigation into the supply and sale of commercial bread which involves certain Canadian suppliers and retailers, including the Corporation. Based on the information available to date, the Corporation does not believe that it or any of its employees have violated the Competition Act . Proposed class-action lawsuits have also been filed against the Corporation, suppliers and other retailers. On December 19, 2019, the Québec Superior Court granted the application for authorization to institute one of these class actions, the authorization process being merely a procedural step and the judgment in no way decides the case on the merits. The Corporation is contesting all these actions at the certification stage and on the merits. No provision for contingent losses has been recognized in the Corporation’s annual consolidated financial statements.

During the 2016 fiscal year, an application for authorization to institute a class action was served on Jean Coutu Group by Sopropharm, an association incorporated under the Professional Syndicates Act of which certain franchised drugstore owners of the Jean Coutu Group are members. The application seeks to have the class action authorized in the form of a declaratory action seeking amongst others (i) to set aside certain contractual provisions of the Jean Coutu Group’s standard franchise agreements, including the clause providing for the payment of royalties on sales of medication by franchised establishments; (ii) to restore certain benefits; and (iii) to reduce certain contractual obligations. On November 1, 2018, the Québec Superior Court granted the application for authorization to institute a class action, the authorization process being merely a procedural step and the judgment in no way decides the case on the merits. The Corporation contests this action on the merits. No provision for contingent losses has been recognized in the Corporation's annual consolidated financial statements.

Interests and material contracts

There are no persons with an interest in material transactions.

Except for the Combination Agreement with the Jean Coutu Group which was filed on October 6, 2017 on the Corporation’s profile on SEDAR (sedar.com), the Corporation is not bound by any material contracts for which a filing is required.

Interest of experts

Ernst & Young LLP are the Corporation’s external auditors (the “Auditors”).

For the 2021 financial year, the Corporation’s Audit Committee obtained written confirmation from Ernst & Young LLP confirming the auditor’s independence and objectivity with respect to the Corporation, in accordance with the Code of Ethics of the Québec Order of Chartered Professional Accountants.

Additional information

Additional information regarding directors’ and officers’ compensation and information regarding principal holders of the Corporation’s securities, options to purchase securities and interest of insiders in material transactions, are, where appropriate, contained in the Corporation’s Management Proxy Circular dated December 10, 2021 prepared for its next Annual General Shareholders’ Meeting. Additional financial information is included in the 2021 Management’s Discussion and Analysis and Consolidated Financial Statements contained in the Corporation’s 2021 Annual Report.

These documents are available to the public under the conditions stipulated by law and copies of same may be obtained from the Finance Department at the Corporation’s head office, 11011 Maurice-Duplessis Boulevard, Montréal (Québec) H1C 1V6, or through SEDAR’s website (sedar.com) and the Corporation’s corporate website (corpo.metro.ca).

Additional information concerning the Corporation is also available on SEDAR’s website (sedar.com) and on the Corporation’s corporate website (corpo.metro.ca).

Upon request to the Corporate Secretary, the Corporation will provide to any person or corporation,

• a) when the securities of the Corporation are in the course of a distribution under a preliminary short form prospectus or a short form prospectus:

• i) one (1) copy of the Corporation’s Annual Information Form, together with one (1) copy of any document, or the relevant pages of any document, incorporated by reference in the Annual Information Form;

ii) one (1) copy of the Corporation’s consolidated financial statements for its most recently completed financial year for which financial statements have been filed together with the independent auditor’s accompanying report and one (1) copy of the

• See the “Forward-Looking Information” section on page 1 of this Annual Information Form.

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Corporation’s most recent interim financial statements that have been filed, if any, for any period after the end of its most recently completed financial year;

• iii) one (1) copy of the Management Proxy Circular for the Corporation’s most recent Annual General Shareholders’ Meeting that involved the election of directors, or one (1) copy of any annual filing prepared instead of that management proxy circular, as appropriate;

• iv) one (1) copy of any other document that is incorporated by reference into the preliminary short form prospectus or the short form prospectus and are not required to be provided under clauses i), ii) or iii);

• b) at any other time, one (1) copy of any other document referred to in a) i), ii) and iii), for which the Corporation may require payment of a reasonable charge if the request is made by a person or corporation that does not hold Corporation securities.

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SCHEDULE A – Information on the Audit Committee

Mandate of the Audit Committee

The mandate of the Audit Committee, which was approved by the Board of Directors, is set forth in Exhibit B to this Annual Information Form.

Composition of the Audit Committee, training and experience of its members

At the end of the 2021 financial year, the Audit Committee was composed of the following independent directors: Maryse Bertrand, Stephanie Coyles, Line Rivard, Russell Goodman (Chair), Marc Guay and Brian McManus.

Each of the member has training and experience that is relevant to the performance of his or her duties on the Audit Committee and to be considered financially literate.

• Russell Goodman is a Chartered Professional Accountant who acquired his experience by serving as a partner at PricewaterhouseCoopers LLP for a period of 24 years. Mr. Goodman is also a director and Chair of the Audit Committee of Northland Power Inc. and a director and member of the Audit Committee of Gildan Activewear Inc. He was also a director and chair of the Audit Committee of Whistler Blackcomb Holdings Inc.

• Maryse Bertrand is a member of the Audit Committee of National Bank of Canada and of Gildan Activewear Inc., and a member of the Investment and Risk Committee of PSP Investments. She was special counsel at Borden Ladner Gervais LLP in matters of risk management and governance and holds a Master’s degree in Risk Management.

• Stephanie Coyles is a member of the Audit Committee of Corus Entertainment Inc. and was a member of the Audit Committee of Sun Life Financial Inc. until November 2021. She also acquired her experience while she acted as Senior Vice-President and Chief Strategic Officer of LoyaltyOne Co. which reported its results in accordance with the International Financial Reporting Standards (“IFRS”).

• Marc Guay served as president for a period of 15 years, first at Frito Lay Canada Inc. and then at PepsiCo Foods Canada Inc. Mr. Guay is also a member of the audit committees of Boston Pizza Royalties Income Fund and of Boston Pizza GP Inc., the general partner of the administrator of Boston Pizza Royalties Income Fund, Boston Pizza Royalties Limited Partnership.

• Brian McManus acquired his experience while he acted as President and Chief Executive Officer of Stella-Jones Inc., a publicly traded company.

• Line Rivard has held, for more than 20 years, various positions at BMO Capital Markets, including Vice-president and Managing Director, Corporate Investment Banking - Montréal. She also served on the board of directors of Ivanhoe Cambridge Inc. for which she was also Chair of the Investment Committee as well as a member of its Audit Committee. She was also Special Advisor to the Governor of the Bank of Canada.

On November 17, 2021, Ms. Rivard resigned as director of the Corporation to accept the position of Delegate General of Québec in London, United Kingdom.

Pre-approval policies and procedures

The Audit Committee approved the Policy concerning the pre-approval of audit services and non-audit services the main components of which are described below.

The Auditors are appointed to audit the annual Consolidated Financial Statements of the Corporation. The Auditors may also be called upon to provide audit-related services, tax services and non-audit services, as long as these services do not interfere with their independence.

The Audit Committee, reviews, among other things, the quality of the work of the Auditors. It must pre-approve all services that the Auditors may render to the Corporation and its subsidiaries. On an annual basis, the Audit Committee examines and pre-approves the details of the services which may be provided by the Auditors and the fee levels in connection therewith. Any type of service that has not already been approved by the Audit Committee must specifically be pre-approved by the Audit Committee if it is to be provided by the Auditors. Same applies if the services offered exceed the pre-approved fee levels. The Audit Committee has delegated to its Chair the authority to pre-approve services that have not already been specifically approved. However, the Chair of the Audit Committee must communicate all such decisions at the following committee meeting.

On a quarterly basis, the Audit Committee examines the pre-approval status of any services other than audit services that the Auditors were asked to provide or could be asked to provide during the following quarter.

Policy concerning complaints

The Audit Committee approved a policy allowing anyone, including the employees of the Corporation, to submit an anonymous complaint regarding illegal acts (such as fraud, theft, vandalism, harassment, intimidation, questionable practices, including questionable practices regarding accounting, internal controls and auditing matters) in connection with the Corporation’s activities. Complaints may be submitted over the telephone, by email, through an online platform or by mail. All complaints received that are related to questionable practices regarding accounting, internal controls and auditing matters are sent directly to the Senior Director, Internal Audit, who is responsible for reviewing such complaints and, if needed, making due inquiry. At each of its meetings the Audit Committee is provided with, a report of all complaints received together with the results of any inquiry investigation and, if applicable, any corrective measures to be implemented. Complaints that are not related to questionable practices regarding accounting, internal controls and auditing matters are reviewed by the Corporation’s Senior Director, Corporate Security Resiliency and, if needed, investigated. A report of all such complaints is made at every meeting of the Human Resources Committee.

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The full text of the Corporation’s policy regarding complaints can be found on the Corporation’s corporate website (corpo.metro.ca).

Policy concerning the hiring of partners or employees of the Auditors

The Audit Committee has approved a policy governing the Corporation’s hiring of certain candidates to key positions. This policy applies to any partner, employee or former partner or employee of the current or former external auditors of the Corporation who applies for a position which entitles the candidate to exercise decision-making authority or significantly influence decision-making regarding the presentation of financial information or auditing matters. More specifically, the candidate must not have been involved in the auditing of the Corporation’s financial statements within the 12 months preceding the hiring date. Moreover, the eventual hiring of such candidate must not compromise the independence of the Auditors.

Review of the quality of the work of the Auditors

The Audit Committee has examined the qualifications, performance and independence of the Auditors and has ensured that the Auditors are registered with the Canadian Public Accountability Board as compliant participants. The Audit Committee examines every year the quality of the work performed by the Auditors in order to make an informed recommendation concerning the appointment of the audit firm which will act as external auditors of the Corporation. In 2021, this evaluation, which was discussed with the Auditors focused on:

• The quality of the Auditors’ annual audit plan and team;

• The depth and breadth of relevant public company and industry experience of the Auditors’ engagement partners responsible for the Corporation’s audit, including the depth of experience and engagement of specialists partners for complex areas;

• The quality of the Auditors’ quarterly review, annual audit examination and evaluation of internal controls;

• The transparency, timeliness and quality of the Auditors’ communications to the Audit Committee and management;

• The Auditors’ demonstration of professional skepticism, most particularly in its review of the Corporation’s accounting estimates and areas involving significant auditor and management judgment;

• Management feedback as to the timeliness and quality of the Auditors’ work; and

• The reasonableness of the Auditors’ audit and audit-related fees.

Fees for the services of the Auditors

For each of the financial years ended September 25, 2021 and September 26, 2020, the following fees were billed by the Auditors for audit services, auditrelated services, tax services and other services provided by the Auditors:

Audit fees	2021 2020
	$1,749,788 $1,774,200
Audit-related fees	$560,960 $278,211
Tax fees	$143,331 $114,336
All other fees	― ―
Total	$2,454,079 $2,166,747

Audit-related fees consist primarily of fees invoiced for consultations concerning financial accounting or the presentation of financial information which are not categorized as “audit services”, fees invoiced for the audits of financial statements of pension plans and fees invoiced for the execution of tests on internal controls.

Tax fees consist primarily of fees invoiced for assistance with regulatory tax matters concerning federal and provincial income tax returns and sales tax and excise tax reporting, fees invoiced for consultations concerning the income tax, customs duty or sales tax impact of certain transactions, as well as fees invoiced for assistance with the annual audit or federal and provincial government audits involving income tax, sales tax, customs duties or deductions at source.

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SCHEDULE B – Mandate of the Audit Committee

1. Objectives of the Committee and general scope of responsibilities of the parties:

• 1.1. The objectives of the Committee are to review the adequacy and effectiveness of the actions taken by the various parties herein involved to discharge themselves of their responsibilities herein described and to assist the Board in its oversight of:

• 1.1.1. the integrity of the Company’s financial statements;

• 1.1.2. the internal and external auditor qualifications and independence;

• 1.1.3. the performance of the Company’s internal audit function and external auditor;

• 1.1.4. the effectiveness of internal controls;

• 1.1.5. the Company’s compliance with legal and regulatory requirements; and

• 1.1.6. the identification of the material risks that may affect the Company and the implementation of appropriate measures to manage such risks.

• 1.2. Management is responsible for:

• 1.2.1. the preparation, presentation and integrity of the Company’s financial statements and for maintaining appropriate accounting policies and internal controls and procedures designed to ensure compliance with accounting standards and applicable laws and regulations; and

• 1.2.2. identifying the material risks and putting in place appropriate measures allowing to manage such risks.

• 1.3. The external auditor is responsible for auditing the Company’s annual financial statements and reviewing the Company’s interim financial statements.

• 1.4. The internal auditor is responsible, by bringing a systematic and disciplined approach, for evaluating and improving the effectiveness of the Company’s risk management and control processes.

2. Scope of mandate

The responsibilities of the Committee extend to Metro Inc., its subsidiaries and their divisions. In this mandate, the word «Company» refers to Metro Inc., its subsidiaries and their divisions.

3. Composition and Organization

• 3.1. The Committee is composed of a minimum of 3 and a maximum of 6 members of the Board of Directors who are all independent directors. All members must be financially literate.

• 3.2. At any time, the Committee may communicate directly with the external auditor, the internal auditor or the management of the Company.

4. Specific responsibilities

The Audit Committee must periodically inform the Board about its work and advise it about its recommendation.

• 4.1. Financial Information

• 4.1.1. The Committee reviews, before their public disclosure, the audited annual and interim financial statements, the MD&A and all press releases relating to the financial statements and/or financial outlook information.

• 4.1.2. The Committee reviews with the management of the Company and the external auditor the choice of accounting policies and its justification as well as the various estimates made by management which may have a significant impact on the financial position.

• 4.1.3. The Committee ensures that adequate procedures are in place for the review of the Company’s disclosure to the public of information extracted or derived from the Company’s financial statements, other than the information covered by paragraph 4.1.1 hereof, and periodically assesses the adequacy of such procedures.

• 4.1.4. The Committee reviews, before they are released, any prospectus relating to the issuance of securities by the Company, the Annual Information Form and the Management Proxy Circular.

• 4.2. Internal Control

• 4.2.1. The Committee verifies that Company Management has implemented mechanisms in order to comply with regulations on internal controls and financial reporting.

• 4.2.2. Every quarter and every fiscal year, the Committee reviews with Company Management the conclusions of the work supporting the certification letters to be filed with the authorities.

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• 4.2.3. The Committee reviews with the Company Management all material weaknesses and significant deficiencies identified pertaining to internal controls and financial reporting, as well as any fraud, and the corrective measures implemented.

• 4.3. Internal Audit

• 4.3.1. The Committee oversees and approves the appointment, replacement, reassignment or dismissal of the Senior Director of the Internal Audit Department and reviews the mandate, annual audit plan, and resources of the internal audit function.

• 4.3.2. The Committee meets the Senior Director of the Internal Audit Department to review the results of the internal audit activities, including all material risk assessments and audit reporting as well as any significant issues reported to management by the internal audit function and management’s responses and/or corrective actions.

• 4.3.3. The Committee reviews the performance, degree of independence and objectivity of the internal audit function and adequacy of the internal audit process.

• 4.3.4. The Committee reviews with the Senior Director of the Internal Audit Department any issues that may be brought forward by him, including any difficulties encountered by the internal audit function, such as audit scope, access to information and staffing restrictions.

• 4.3.5. The Committee ensures the effectiveness of the coordination between the internal audit and the external audit.

• 4.4. External Audit

• 4.4.1. The Committee has the authority and the responsibility to recommend to the Board of directors:

  • i) the appointment and the revocation of any public accounting firm engaged for the purpose of preparing or issuing an audit report, or performing other audit, review or certification services (collectively the “external auditor”); and

  • ii) the compensation of the external auditor.

• 4.4.2. The external auditor communicates directly with the Committee. The Committee reviews the reports of the external auditor which are sent to it directly which include reports on its auditing of the Company’s annual financial statements, on its review of the Company’s interim financial statements and on its review of the Non-IFRS financial measures found in the quarterly or annual financial disclosure of the Company to determine if such measures are in line with the Company’s Policy on Non-IFRS Financial Measures. The Committee also monitors all the work performed by the external auditors, its audit plans and the results of its audits.

• 4.4.3. The Committee discusses with the external auditors, by means of meetings, problems encountered during the audit, including the existence, if applicable, of restrictions imposed by the management of the Company or areas of disagreement with the latter about the financial information and ensures that such disagreements are resolved.

• 4.4.4. The Committee, or one or more of its members to whom it has delegated authority, pre-approves non-audit services that are assigned to the external auditors. The Committee may also adopt policies and procedures concerning the pre-approval of non-audit services that are assigned to the external auditors. It monitors the fees paid with respect to such mandates.

• 4.4.5. The Committee makes sure that the external auditor has obtained the cooperation of the employees and officers of the Company.

• 4.4.6. The Committee examines the post-audit letter or the recommendation letter of the external auditor as well as the reactions of management and management’s response to the deficiencies observed.

• 4.4.7. The Committee examines the qualifications, performance and independence of the external auditor and ensures that the audit report accompanying the financial statements is issued by an audit firm that is a participant in the program of the Canadian Public Accountability Board (“CPAB”) and that the firm respects any sanctions and restrictions imposed by this Board. The Committee takes into account the opinions of management and the Company’s internal auditor in assessing the qualifications, performance and independence of the external auditor. In particular, the Committee examines each year the quality of the work performed by the external auditor in order to facilitate an informed recommendation concerning the appointment of the audit firm which will act as external auditor of the Company.

• 4.4.8. At least, once a year, or at any other time indicated below, the external auditor i) reports to the Committee on the external auditor’s internal quality-control procedures in place; ii) reports to the Committee as to its internal evaluation of the quality of work of the members of the audit firm involved in the audit of the Company; iii) reports to the Committee as to its inscription as a duly registered participant of the CPAB and whether its holds proper authority to audit Canadian issuers; iv) provides the members of the Committee, in a timely fashion, with a copy of any report, notice, information and findings of the CPAB which the external auditor may or must provide copy of to the Committee, including any annual public report on the quality of audits performed by public accounting firms as well as any significant findings emerging from any inspection of the audit file of the Company, the content of which the external auditor must discuss with the members of the Committee.

• 4.4.9. The Committee reviews and approves the Company’s hiring policy concerning (current and former) partners and (current and former) employees of the (current and former) external auditor.

• 4.5. Miscellaneous

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• 4.5.1. The Committee establishes procedures for the receipt, retention and treatment of complaints regarding accounting, internal accounting controls or auditing matters and to preserve confidentiality and the protection of the anonymity of persons who may file such complaints.

• 4.5.2. The Committee has the authority to engage any advisor it deems necessary in order to help it in the performance of its duties, and to set the compensation of such advisor as well as to obtain from the Company the funds necessary to pay such compensation.

• 4.5.3. The Committee analyses the conditions surrounding the departure or appointment of the officer responsible for finance and any other key financial executive who participates in the financial information process.

• 4.6. Compliance with legal and regulatory requirements

The Committee reviews the reports received from time to time regarding any material legal or regulatory issues that could have a significant impact over the Company’s business.

• 4.7. Risk Management

• 4.7.1. The Committee reviews the material risks identified by Company Management. The Committee examines the effectiveness of the measures put in place to manage these risks by questioning the management of the Company regarding how risks are managed as well as obtaining opinions from management regarding the degree of integrity of the risk mitigation systems and acceptable thresholds.

• 4.7.2. The Committee reviews on a regular basis the management policies regarding material risks recommended by Company Management and obtains from the management of the Company on a regular basis reasonable assurance that the Company’s risk management policies for material risks are being adhered to. The Committee also reviews reports on material risks, including financial hedging activities and environment.

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