tim hortons stock purchase direct share purchase dividend reinvestment plan
Tim Hortons DRIP/SPP Campaign

June, 2011 - At Tim Horton's 2011 Annual General Meeting several changes were adopted to its Dividend Reinvestment and Share Purchase Plan, including the first Direct Share Purchase Plan (DSPP) open to ALL Canadians.  There was also some changes to the fees charged as well improvements to the employee and franchisee share purchase plans.

Let's start with the Positives:  First significant improvement is the creation of the first Direct Share Purchase Plan open to all Canadians.  Some investors may already be aware that Fortis Inc. permits residents of Newfoundland and Labrador, and PEI to start directly in their Share Purchase Plan.  In the U.S. DSPP's are quite common and often free to investors, but unheard of in Canada which some attribute to the complex and multi-province securities laws.  Now, any Canadian can become a direct shareholder of Tim Hortons for a minimum initial investment of $25.00.  Simply fill out the form here ("Enrolment Form - for Interested Investors")
, write a cheque for $25 or more, and pop it in an envelope.  That's it. 

The second improvement is that now there are no fees associated with the Dividend Reinvestment Plan.  This is important since all discount brokerages offer free synthetic DRIP programs.  Previously, it was a complicated formula ("5% of the amount reinvested, up to a maximum of $3.00 plus $0.03 per share purchased").  It's also good to note that MANY Canadian DRIP plans offer a DISCOUNT when reinvesting dividends (Canadian DRIP List), so the Tim Hortons plan appeared to be have originally written in bizarro world.

It's also good to note that the Plan also still offers a recurring optional payment plan (like a Pre-Authorized Chequing) and it would seem to encourage this option the fee charged PER PURCHASE has decreased from $2.50 to $1.50 per purchase.


Now onto the Negatives: Whether originated from Computershare or Tim Hortons, the fees charged to the investor for enrollment and optional cash purchases (OCP) have increased.   The fee to simply sign up with the Tim Hortons DRIP/SPP plan has increased from $8.25 to $10.00.  The fee for
optional cash purchases has increased from $5.00 + $.03/share to a flat $6.00.  It's important to note Computershare/Tim Hortons doesn't double-double dip for these 2 fees above when you become an investor VIA the Direct Share Purchase Plan.  An investor is only charged the enrollment fee and not the OCP Fee with their initial purchase.  How generous.


Comparison Table

  2010 Plan
2011 Plan
Enrollment
$8.25 (No DSPP available)
$10.00 (DSPP available)
 Dividend Reinvestment Maximum of $3.00 plus $0.03 per share purchased FREE
 Optional Cash Purchases (non-recurring) $5.00 + $.03/share
$6.00
 Optional Cash Purchases (Recurring) $2.50
$1.50
Sale of Shares $15.00 plus $0.12/share
 $15.00 plus $0.12/share
Tax documents for sold shares
$11.00
$5.50


I am still recommending that all Canadians write to Tim Hortons Inc. asking them to remove all fees from their DRIP/SPP/DSPP plans, as to encourage participating and to thank Canadians for making Tim Hortons a Canadian success story.

Contact Details:


Tim Hortons Inc.
Scott Bonikowsky, Vice-President, Investor Relations
 874 Sinclair Rd, Oakville, ON, L6K 2Y1

Tel: (905) 845-6511 Fax: (905) 846-0265

Email: investor_relations@timhortons.com




To Enroll Directly in the Tim Hortons DRIP/SPP Plan:

1. Fill out this Form (Pdf file)
2. Include a cheque for $25.00 or more (remember $10 enrollment fee)
3. Mail both form and cheque to: 

Computershare
9th Floor, North Tower
100 University Ave
 Toronto Ontario M5J 2Y1







Old Information Below for Archival Purposes (initially posted February, 2010)


Financial Blogger Canadian Capitalist, gives his take on the new Tim Hortons plan.

Tim Hortons Investor Relations responds to my letter.
 
Please continue to write to Tim Hortons telling them you want to be an Investor in their company.


Tim Hortons, one of Canada's most prolific brands and storied franchises, recently introduced a company-sponsored Dividend Reinvestment Plan and Share Purchase Plan (DRIP & SPP). View the Details here:  LINK   Fee Details here: LINK

Unfortunately, Tim Hortons chose to be unique and be the only Canadian corporation to offer a DRIP & SPP and charge exorbitant fees for enrollment and participation.  Every other Canadian plan is 100% Fee Free for reinvestment and purchases.  Some of the other great Canadian companies that do not charge any fees are Enbridge, Bank of Montreal, BCE and Manulife among others.

Please contact Tim Hortons Investor Relations and tell them as a Canadian you would like to invest directly in a great Canadian success story, but refuse due to these fees.  Simply write, call or email the details below and tell them that you would like to continue being a Tim Hortons customer and investor.  Tell them that if you became an investor in Tim Hortons, you'd be a more regular customer, but these unwarranted fees are a significant deterrent. 

Contact Details:

Tim Hortons Inc.
Scott Bonikowsky, Vice-President, Investor Relations
 874 Sinclair Rd, Oakville, ON, L6K 2Y1

Tel: (905) 845-6511 Fax: (905) 846-0265

Email: investor_relations@timhortons.com



First time investor example in Tim Hortons:
Investor acquired 1 share of Tim Hortons as described in the DRIP Primer.
Now wishes to purchase additional shares with an Optional Cash Purchase of $200.00

$200   
 Cheque Amount
 -$8.25 Enrollment Fee
 -$5.00 Optional Cash Purchase Base Fee
 -$.18  Optional Cash Purchase Per Share fee (6 shares)
 Total: 186.57 ($13.43 in fees)
Actual amount invested, or 6.7% fee on Cheque Amount




Return to the Canadian DRIP Primer

Return to the Canadian DRIP & SPP List





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