UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 6-K
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 or
15d-16 UNDER THE
SECURITIES EXCHANGE ACT OF 1934
For the month of June, 2015.
Commission File Number 001-32399
BANRO CORPORATION
(Translation of registrants name into English)
1 First Canadian Place
100 King Street West, Suite
7070
Toronto, Ontario, Canada
M5X 1E3
(Address of
principal executive offices)
Indicate by check mark whether the registrant files or will
file annual reports under cover Form 20-F or Form 40-F
Form 20-F
[X] Form
40-F [ ]
Indicate by check mark if the registrant is submitting the Form
6-K in paper as permitted by Regulation S-T Rule 101(b)(1): [ ]
Note: Regulation S-T Rule 101(b)(1) only permits the
submission in paper of a Form 6-K if submitted solely to provide an attached
annual report to security holders.
Indicate by check mark if the registrant is submitting the Form
6-K in paper as permitted by Regulation S-T Rule 101(b)(7): [ ]
Note: Regulation S-T Rule 101(b)(7) only permits the
submission in paper of a Form 6-K if submitted to furnish a report or other
document that the registrant foreign private issuer must furnish and make public
under the laws of the jurisdiction in which the registrant is incorporated,
domiciled or legally organized (the registrants home country), or under the
rules of the home country exchange on which the registrants securities are
traded, as long as the report or other document is not a press release, is not
required to be and has not been distributed to the registrants security
holders, and, if discussing a material event, has already been the subject of a
Form 6-K submission or other Commission filing on EDGAR.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
|
|
BANRO CORPORATION |
|
|
|
|
|
/s/ Kevin Jennings |
Date: |
June 5, 2015 |
Kevin Jennings |
|
|
Chief Financial Officer
|
-2-
INDEX TO EXHIBITS
BANRO CORPORATION
MANAGEMENT INFORMATION CIRCULAR
SOLICITATION OF PROXIES
This management information circular (the "Circular"), which
is dated May 27, 2015, is furnished in connection with the solicitation of
proxies by the management of BANRO CORPORATION (the "Corporation" or "Banro")
for use at the annual and special meeting of shareholders of the Corporation
(the "Meeting") to be held at the time and place and for the purposes set forth
in the attached notice of annual and special meeting of shareholders (the
"Notice"). It is expected that the solicitation will be by mail primarily,
but proxies may also be solicited personally by the management of the
Corporation. The cost of such solicitation will be borne by the Corporation.
APPOINTMENT, REVOCATION AND DEPOSIT OF PROXIES
Each person named in the enclosed form of proxy is an officer
of the Corporation.
A SHAREHOLDER HAS THE RIGHT TO APPOINT A PERSON (WHO NEED
NOT BE A SHAREHOLDER) TO ATTEND AND ACT FOR HIM OR HER AND ON HIS OR HER BEHALF
AT THE MEETING OTHER THAN THE PERSONS DESIGNATED IN THE ENCLOSED FORM OF PROXY.
SUCH RIGHT MAY BE EXERCISED BY STRIKING OUT THE NAMES OF THE PERSONS DESIGNATED
IN THE FORM OF PROXY AND BY INSERTING IN THE BLANK SPACE PROVIDED FOR THAT
PURPOSE THE NAME OF THE DESIRED PERSON OR BY COMPLETING ANOTHER PROPER FORM OF
PROXY AND, IN EITHER CASE, DELIVERING THE COMPLETED AND EXECUTED PROXY TO THE
CORPORATION C/O TMX EQUITY TRANSFER SERVICES, SUITE 300, 200 UNIVERSITY AVENUE,
TORONTO, ONTARIO, M5H 4H1, CANADA, AT ANY TIME PRIOR TO 4:00 P.M. (TORONTO TIME)
ON THE 23RD DAY OF JUNE, 2015, OR TO THE CHAIRMAN OF THE MEETING ON THE DAY OF
THE MEETING OR ANY ADJOURNMENT THEREOF PRIOR TO THE TIME FOR VOTING. THE TIME
LIMIT FOR THE DEPOSIT OF PROXIES MAY BE WAIVED OR EXTENDED BY THE CHAIRMAN OF
THE MEETING AT HIS OR HER DISCRETION WITHOUT NOTICE.
A shareholder forwarding the
enclosed form of proxy may indicate the manner in which the appointee is to vote
with respect to any specific item by checking the appropriate space. If the
shareholder giving the proxy wishes to confer a discretionary authority with
respect to any item of business, then the space opposite the item is to be left
blank. The shares represented by the proxy submitted by a shareholder will be
voted in accordance with the directions, if any, given in the proxy.
A shareholder who has given a
proxy may revoke it at any time in so far as it has not been exercised. A proxy
may be revoked, as to any matter on which a vote shall not already have been
cast pursuant to the authority conferred by such proxy, by instrument in writing
executed by the shareholder or by his or her attorney authorized in writing or,
if the shareholder is a body corporate, by an officer or attorney thereof duly
authorized, and deposited at the registered office of the Corporation at any
time prior to 4:00 p.m. (Toronto time) on the last business day preceding the
day of the Meeting (excluding Saturdays, Sundays and holidays), or any adjournment thereof,
or with the Chairman of the Meeting on the day of the Meeting or any adjournment
thereof, and upon either of such deposits the proxy is revoked. A proxy may also
be revoked in any other manner permitted by law. The Corporation's registered
office is located at Suite 7070, 1 First Canadian Place, 100 King Street West,
Toronto, Ontario, M5X 1E3, Canada.
2
MANNER OF VOTING AND EXERCISE OF DISCRETION BY PROXIES
The persons named in the enclosed
form of proxy will vote or withhold from voting the common shares in respect of
which they are appointed in accordance with the direction of the shareholders
appointing them. In the absence of such direction, such common shares will be
voted FOR each of the matters identified in the Notice and described in this
Circular.
The enclosed form of proxy
confers discretionary authority in respect of amendments and variations to
matters identified in the Notice or other matters that may properly come before
the Meeting or any adjournment or postponement thereof, whether or not the
amendment or other matter that comes before the Meeting is or is not routine and
whether or not the amendment or other matter that comes before the Meeting is
contested.
VOTING BY REGISTERED SHAREHOLDERS
Only shareholders whose names
appear on the records of the Corporation as the registered holders of shares or
their duly appointed proxyholders are permitted to vote at the Meeting. All
holders of common shares of the Corporation of record at the close of business
on May 19, 2015 will be entitled either to attend and vote at the Meeting in
person the shares held by them or, provided a completed and executed proxy shall
have been delivered to the Corporation, to attend and vote thereat by proxy the
shares held by them. Registered shareholders can execute their proxies by:
|
|
By completing and returning their form of proxy
to: |
|
|
TMX Equity Transfer Services |
|
|
Attention: Proxy
Department |
|
|
200 University Avenue, Suite 300 |
|
|
Toronto, Ontario, |
|
|
M5H 4H1, Canada |
|
|
By sending their completed form of proxy by fax
to 416-595-9593 |
|
|
In person at the Meeting |
|
|
Internet voting at www.voteproxyonline.com
(enter your 12-digit control number) |
VOTING BY NON-REGISTERED SHAREHOLDERS
Only shareholders whose names
appear on the records of the Corporation as the registered holders of shares or
their duly appointed proxyholders are permitted to vote at the Meeting. Most
shareholders of the Corporation are "non-registered" shareholders because the
shares they own are not registered in their names but instead are registered in
the name of a nominee such as a brokerage firm through which they purchased the
shares; bank, trust company, trustee or administrator of self-administered
RRSPs, RRIFs, RESPs and similar plans; or clearing agency such as The Canadian
Depository for Securities Limited. If you purchased your shares through a
broker, you are likely an unregistered shareholder.
3
In accordance with Canadian
securities legislation, the Meeting materials are being sent to both registered
and non-registered shareholders. In the case of non-registered shareholders,
Meeting materials have either (a) been sent by the Corporation (or its agent)
directly to non-registered shareholders (such non-registered shareholders are
referred to under applicable securities legislation as "non-objecting beneficial
owners"), or (b) been sent by the Corporation (or its agent) to intermediaries
holding on behalf of non-registered shareholders for distribution to such
non-registered shareholders. If you are a non-registered shareholder and the
Corporation (or its agent) has sent the Meeting materials directly to you (which
materials should include the Corporation's voting instruction form (the
"Corporation's VIF")), your name and address and information about your
holdings of securities have been obtained in accordance with applicable
securities regulatory requirements from the intermediary holding on your behalf.
By choosing to send these materials to you directly, the Corporation (and not
the intermediary holding on your behalf) has assumed responsibility for (i)
delivering these materials to you, and (ii) executing your proper voting
instructions. Please return your voting instructions as specified in the next
paragraph.
If you received the Meeting
materials directly from the Corporation (or its agent) and you wish to vote by
proxy at the Meeting, please complete the Corporation's VIF and return it to TMX
Equity Transfer Services (the Corporation's transfer agent) by regular mail in
the return envelope provided or by fax at (416) 595-9593. If you received the
Meeting materials directly from the Corporation (or its agent) and you wish to
vote at the Meeting in person, you should appoint yourself as proxyholder by
writing your name in the blank space provided on the Corporation's VIF (and
striking out the names of the persons designated in such form) and return the
Corporation's VIF to TMX Equity Transfer Services by regular mail in the return
envelope provided or by fax at (416) 595-9593 (do not complete the voting
section of the form as your vote will be taken at the Meeting).
Intermediaries receiving Meeting
materials from the Corporation are required to forward the materials to
non-registered shareholders to seek their voting instructions in advance of the
Meeting. The intermediaries often have their own form of proxy and mailing
procedures and provide their own return instructions. If you received the
Meeting materials from an intermediary and you wish to vote by proxy at the
Meeting, you should carefully follow the instructions from the intermediary in
order that your shares are voted at the Meeting. Your shares can only be voted
in accordance with your instructions. If you wish to vote at the Meeting in
person, you should appoint yourself as proxyholder by writing your name in the
blank space provided on the proxy form provided by the intermediary (and
striking out the names of the persons designated in such form) and return the
form to the intermediary in the envelope provided (do not complete the voting
section of the form as your vote will be taken at the Meeting).
The Corporation is not relying on
the notice-and-access provisions of securities laws for delivery to either
registered or non-registered shareholders. The Corporation has elected to pay
for the delivery of the Meeting materials to objecting non-registered
shareholders by intermediaries.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
As of the date of this Circular,
an aggregate of 252,150,672 common shares of the Corporation were issued and
outstanding. Each common share entitles the holder thereof to one vote on all
matters to be considered and acted upon at the Meeting or any adjournment
thereof.
All holders of common shares of
the Corporation of record at the close of business on May 19, 2015 will be
entitled either to attend and vote at the Meeting in person the shares held by
them or, provided a completed and executed proxy shall have been
delivered to the Corporation as described above, to attend and vote thereat by
proxy the shares held by them.
4
As of the date of this Circular,
to the knowledge of the directors and executive officers of the Corporation, no
person or company beneficially owns, or controls or directs, directly or
indirectly, 10% or more of the outstanding common shares of the Corporation,
other than as set out below.
Based on public filings, the
Corporation believes that affiliates of BlackRock, Inc. (the "BlackRock
Group") control or have investment discretion over, in the aggregate, more
than 10% of the outstanding common shares of the Corporation. The Corporation
does not know the number of common shares of the Corporation which the BlackRock
Group controls or has investment discretion over as at the date of this
Circular. The most recent public filing of which the Corporation is aware
indicates that the BlackRock Group controls or has investment discretion over
26,567,276 (or 10.54%) of the outstanding common shares of the Corporation. See
also the disclosure in this Circular under "Interest of Informed Persons in
Material Transactions".
CURRENCY
As the Corporation's financial
statements are prepared in United States dollars, all dollar amounts referred to
in this Circular are expressed in United States dollars unless otherwise
indicated. References to "$" or "US$" are to United States dollars and
references to "Cdn$" are to Canadian dollars.
ELECTION OF DIRECTORS
The number of directors on the
board of directors of the Corporation must consist of not more than twenty (20)
directors and not less than three (3) directors to be elected annually. The
number of directors to be elected at the Meeting is six (6). The term of office
of each of the present directors expires at the Meeting. The persons named below
will be presented for election at the Meeting as management's nominees.
Shareholders can vote for all of the proposed nominees, vote for some of the
proposed nominees and withhold for others, or withhold for all of the proposed
nominees. Unless otherwise specified, the persons named in the enclosed form
of proxy will vote FOR the election of each of these nominees. Management of
the Corporation does not contemplate that any of the nominees will be unable to
serve as a director, but if that should occur for any reason prior to the
Meeting, the persons named in the enclosed form of proxy reserve the right to
vote for another nominee in their discretion. Each director elected will hold
office until the close of the first annual meeting of shareholders of the
Corporation following his election unless his office is earlier vacated in
accordance with the by-laws of the Corporation.
The following table and the notes
thereto set out the name and municipality of residence of each person proposed
to be nominated for election as a director, his current position and office with
the Corporation, his present principal occupation(s) or employment, the date on
which he was first elected or appointed a director of the Corporation, and the
approximate number of common shares of the Corporation beneficially owned, or
controlled or directed, directly or indirectly, as at the date of this Circular:
5
|
|
|
Shares of the |
|
|
|
Corporation |
Name, Current |
|
|
Beneficially |
Position(s) with |
|
|
Owned, |
the Corporation and |
|
Director |
Controlled or |
Municipality of Residence |
Present Principal Occupation(s)
(1) |
Since |
Directed
(2) |
|
|
|
|
Richard W. Brissenden |
Executive Chairman of the Board of the Corporation. |
December 11, 2013 |
Nil |
Executive Chairman of the |
|
|
|
Board and a director |
|
|
|
Toronto, Ontario, Canada |
|
|
|
|
|
|
|
John A. Clarke (5) |
Chief Executive Officer and President of the Corporation. |
February 3, 2004 |
488,000 |
Chief Executive Officer and |
|
|
|
President, and a director |
|
|
|
Cardiff, United Kingdom |
|
|
|
|
|
|
|
Maurice J. Colson (3) (4) |
Self-employed business consultant |
June 28, 2013 |
Nil |
Lead Independent Director |
(actively involved in providing strategic |
|
|
Toronto, Ontario, Canada |
counsel and assistance with financing to |
|
|
|
emerging private and public companies in |
|
|
|
Canada and to Canadian companies |
|
|
|
operating in China, Africa, and South |
|
|
|
America). |
|
|
|
|
|
|
Peter N. Cowley (3) (4) (5) |
Retired gold mining company executive |
January 13, 2004 |
Nil |
Director |
(after 45 years experience in the minerals |
|
|
Cobham, Surrey, |
industry). Currently provides consulting |
|
|
United Kingdom |
services to gold companies. |
|
|
|
|
|
|
Mick C. Oliver (4) |
Managing Director of Natural Resources |
May 20, 2015 |
Nil |
Director |
Global Capital Partners (an independent |
|
|
Datchet, United Kingdom |
advisory business offering financial and |
|
|
|
technical advice to the global natural |
|
|
|
resource sector). |
|
|
|
|
|
|
Derrick H. Weyrauch (3) |
Chief Financial Officer of Jaguar Mining |
December 11, 2013 |
Nil |
Director |
Inc. (a gold production company). |
|
|
Stouffville, Ontario, Canada |
|
|
|
__________________________________
(1) |
Applicable securities law requires that the Corporation
also disclose the principal occupations of each proposed director during
the last five years, unless the proposed director is now a director and
was elected to his present term of office by a vote of shareholders at a
meeting, the notice of which was accompanied by an information circular.
Based on these requirements, the principal occupations during the last
five years of Mr. Oliver must be disclosed. Mr. Olivers principal
occupations during the last five years are as follows: Managing Director
of Natural Resources Global Capital Partners from January 2015 to present;
prior to September 2014, Managing Director, Global Mining Group of CIBC
World Markets Inc. (an investment bank). |
|
|
(2) |
The information as to shares beneficially owned, or
controlled or directed, directly or indirectly, not being within the
knowledge of the Corporation, has been furnished by the respective
proposed directors individually. |
|
|
(3) |
Member of the audit committee of the board of directors
of the Corporation (the "Audit
Committee"). |
6
(4) |
Member of the compensation and nominating committee of
the board of directors of the Corporation (the "Compensation
Committee"). |
|
|
(5) |
Member of the health, safety, environment and technical
committee of the board of directors of the Corporation (the "Technical
Committee"). |
Majority Voting Policy for Elections of
Directors
Under the Canada Business
Corporations Act (the Corporation's governing corporate legislation),
director elections are based on the plurality system, where shareholders vote
for or withhold their votes for a director. Votes withheld are not counted,
with the result that, technically, a director could be elected to the board with
just one vote in favour. The board of directors of the Corporation (the
"Board") believes that each of its members should have the confidence and
support of the shareholders of the Corporation. On May 31, 2013, the directors
unanimously adopted a majority voting policy (the "Majority Voting
Policy"), a copy of the current version of which is attached as Schedule "A"
to this Circular. Each of managements nominees for election to the Board at the
Meeting has agreed, and all future nominees will be required to agree, to abide
by it. The Majority Voting Policy states that if in an uncontested election a
director nominee has more votes withheld than are voted in favour of him or her,
the nominee will be considered by the Board not to have received the support of
the shareholders, even though duly elected as a matter of corporate law. Such a
nominee will be required forthwith to submit his or her resignation to the
Board, effective upon acceptance by the Board. The Board will refer the
resignation to the Compensation Committee for consideration and a
recommendation. Except in special circumstances that would warrant the continued
service of the director on the Board, the Compensation Committee will be
expected to recommend that the Board accept the resignation. Within 90 days
after the meeting, the Board will make its decision and announce it by press
release.
Advance Notice By-Law
The Corporation adopted in 2013
by-law no. 4 containing advance notice requirements. These requirements set
forth procedures for any shareholder who intends to nominate any person for
election as a director of Banro other than pursuant to shareholder rights
instilled within the Corporation's governing statute or via shareholder
proposal. The requirements stipulate a deadline by which shareholders must
notify the Corporation of their intention to nominate directors and also set out
the information that shareholders must provide regarding each director nominee
and the nominating shareholder in order for the advance notice requirement to be
met. These requirements are intended to provide all shareholders with the
opportunity to evaluate and review the proposed candidates and vote on an
informed and timely manner regarding said nominees. As of the date of this
Circular, the Corporation has not received any nominations via the advance
notice mechanism.
Audit Committee Information
Reference is made to the
following sections of the Corporations annual report on Form 20-F dated April
6, 2015 (the "Annual Report") for additional disclosure relating to the
Audit Committee required to be included in the Annual Report by National
Instrument 52-110 - Audit Committees: the information relating to Messrs.
Colson, Cowley and Weyrauch on pages 63-64 of the Annual Report; the paragraph
under "Audit Committee" on page 72 of the Annual Report; and item 16.C. of the
Annual Report. A copy of the Annual Report can be obtained from SEDAR at
www.sedar.com.
7
Cease Trade Orders
Except as described below, none
of the proposed directors of the Corporation as set forth in the above table is,
as at the date of this Circular, or has been, within 10 years before the date of
this Circular, a director, chief executive officer or chief financial officer of
any company (including the Corporation) that:
(a) |
was subject to a cease trade order, an order similar to a
cease trade order or an order that denied the relevant company access to
any exemption under securities legislation, that was in effect for a
period of more than 30 consecutive days, that was issued while such
proposed director was acting in the capacity as director, chief executive
officer or chief financial officer; or |
|
|
(b) |
was subject to a cease trade order, an order similar to a
cease trade order or an order that denied the relevant company access to
any exemption under securities legislation, that was in effect for a
period of more than 30 consecutive days, that was issued after such
proposed director ceased to be a director, chief executive officer or
chief financial officer and which resulted from an event that occurred
while such proposed director was acting in the capacity as director, chief
executive officer or chief financial officer. |
As a result of not filing its
audited financial statements for the year ended December 31, 2004 by the filing
deadline, Mediterranean Resources Ltd. (which was then named Mediterranean
Minerals Corp.) ("Mediterranean") was made subject to an issuer cease
trade order issued by the British Columbia, Alberta and Ontario Securities
Commissions which was revoked on August 17, 2005 (following the filing of the
required records). Dr. John A. Clarke (a director of the Corporation) is no
longer a director of Mediterranean but was a director of Mediterranean during
the time the said cease trade order was in effect.
Mr. Richard W. Brissenden (a
director of the Corporation) was, until April 2014, a director of Regal
Consolidated Ventures Limited, which is currently subject to a cease trade order
issued on June 12, 2001, by the British Columbia, Alberta and Ontario Securities
Commissions, for failure to file audited financial statements for the year ended
December 31, 2000 and interim financial statements for the three month period
ended March 31, 2001.
Corporate Bankruptcies/Insolvencies
Except as described below, no
proposed director of the Corporation as set forth in the above table (or any
personal holding company of such proposed director), is, as of the date of this
Circular, or has been within 10 years before the date of this Circular, a
director or executive officer of any company (including the Corporation) that,
while such proposed director 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.
In June 2013, Mr. Derrick H.
Weyrauch (a director of the Corporation) was elected to the board of directors
of Jaguar Mining Inc. ("Jaguar"). As part of a corporate turnaround and
restructuring process, Jaguar declared insolvency and commenced a voluntary
proceeding under the Companies Creditors Arrangement Act (Canada) (the
"CCAA") on December 23, 2013 in the Ontario Superior Court of Justice.
This proceeding was commenced to implement a debt restructuring and financing
transaction ("CCAA Plan") that was negotiated prior to the commencement
of the CCAA proceeding. On April 22, 2014, Jaguar implemented the CCAA Plan and
emerged from court protection under the CCAA. On May 2, 2014, the shares of
Jaguar began trading on the TSX Venture Exchange. Following the voluntary proceeding under the CCAA, the Toronto Stock Exchange advised
that it is reviewing the common shares of Jaguar with respect to meeting the
requirements for continued listing pursuant to the Expedited Review Process. The
common shares were subsequently suspended from trading on the Toronto Stock
Exchange. In 2013, NYSE Regulation reached a decision to delist Jaguars common
shares in view of the fact that Jaguars common shares had fallen below the
NYSE's continued listing standard for an average closing price of less than
US$1.00 over a consecutive 30 trading day period. As a result, on June 3, 2013,
NYSE Regulations, Inc. ("NYSE Regulation") commenced proceedings to
delist the common shares of Jaguar from the New York Stock Exchange
("NYSE") and trading in Jaguars common shares was suspended prior to the
opening on Friday, June 7, 2013.
8
No proposed director of the
Corporation as set forth in the above table (or any personal holding company of
such proposed director), has, within the 10 years before the date of this
Circular, 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 the assets of such proposed director.
Penalties or Sanctions
No proposed director of the Corporation as set forth in the
above table (or any personal holding company of such proposed director), has
been subject to:
(a) |
any penalties or sanctions imposed by a court relating to
securities legislation or by a securities regulatory authority or has
entered into a settlement agreement with a securities regulatory
authority; or |
|
|
(b) |
any other penalties or sanctions imposed by a court or
regulatory body that would likely be considered important to a reasonable
securityholder in deciding whether to vote for a proposed
director. |
APPOINTMENT OF AUDITORS
Deloitte LLP, Chartered
Professional Accountants, Chartered Accountants and Licensed Public Accountants,
are the current auditors of the Corporation and were first appointed auditors of
the Corporation effective April 27, 2009. Shareholders of the Corporation will
be asked at the Meeting to reappoint Deloitte LLP as the Corporation's auditors,
to hold office until the close of the next annual meeting of shareholders of the
Corporation at such remuneration as may be approved by the directors of the
Corporation. The resolution shareholders will be asked to approve with respect
to such reappointment must be passed by a majority of the votes cast by
shareholders at the Meeting in respect of this resolution. Unless otherwise
specified, the persons named in the enclosed form of proxy will vote FOR the
said reappointment of Deloitte LLP.
AMENDMENTS TO STOCK OPTION PLAN AND
REAPPROVAL OF STOCK
OPTION PLAN
The Corporation has a stock
option plan (the "Option Plan") for the benefit of directors, officers,
employees and consultants of the Corporation or any subsidiary of the
Corporation. The Board believes that stock options provide an effective tool for
the Corporation to enable the Corporation to attract and retain key personnel in
the face of competition from much larger companies, without having to sharply
increase salary levels.
9
In January 2005, the Toronto
Stock Exchange (the "TSX") amended its security-based compensation rules
(the "TSX Rules") to permit issuers listed on the TSX to adopt "rolling"
stock option plans pursuant to which a fixed percentage of the outstanding
shares of the issuer could be reserved for issuance upon the exercise of stock
options granted under the plan, rather than having a fixed maximum number of
shares reserved for this purpose.
In 2009, on the recommendation of
the Compensation Committee, the Board approved an amendment to the Option Plan
to make the Option Plan a "rolling" stock option plan rather than a fixed number
stock option plan.
The Board, on the recommendation
of the Compensation Committee, has made further amendments (the
"Amendments") to the Option Plan, as follows:
Amendment #1
The Board has amended section 22 of the Option Plan to add the
following as a new paragraph in section 22:
Grant date value of Stock Options granted to any one
non-employee director of the Corporation shall not exceed a total of Cdn$100,000
per year.
Amendment #2
The Board has also amended the last paragraph of section 16 of
the Option Plan, so that it now reads as follows:
For certainty, it is confirmed
that any amendment to this Plan or to Stock Options which does not relate to
items (a) to (f) above, shall require approval of the Corporations
shareholders. Without limiting the generality of the foregoing, any amendment to
this Plan or to Stock Options which relates to the following shall require
approval of the Corporations shareholders:
|
(i) |
an amendment to section 2 of this Plan to increase the
percentage figure set out therein; |
|
|
|
|
(ii) |
reducing the Exercise Price of a Stock Option held by
an Eligible Optionee; |
|
|
|
|
(iii) |
any cancellation and reissue of Stock Options or other
entitlements unless permitted under the rules of the TSX; |
|
|
|
|
(iv) |
extending the Term of any Stock Options held by an
Eligible Optionee; |
|
|
|
|
(v) |
any amendment which would permit Stock Options granted
under this Plan to be transferable or assignable other than for normal
estate settlement purposes; |
|
|
|
|
(vi) |
amendments that increase limits previously imposed on
non-employee director participation as set out in section 22 of this
Plan; |
|
|
|
|
(vii) |
adding to the categories of persons eligible to
participate in this Plan; or |
|
|
|
|
(viii) |
any amendment to section 16 of this Plan so as to
increase the ability of the Board to amend this Plan without shareholder
approval. |
10
A copy of the Option Plan as
amended by the Amendments is attached to this Circular as Schedule "B". As well,
the terms of the Option Plan as amended by the Amendments are summarized in this
Circular under "Terms of Stock Option Plan". As required by the rules of the TSX
and the terms of the Option Plan, shareholders will be asked at the Meeting to
approve the Amendments (see "Shareholder Resolution" below).
Also, the TSX Rules require that
all unallocated options, rights or other entitlements under a "rolling" stock
option plan such as the Option Plan must be approved by a majority of the
issuers directors and by shareholders every three years after institution.
Shareholders of the Corporation most recently approved all unallocated stock
options under the Option Plan at the annual and special meeting of shareholders
held on June 29, 2012. In light of the TSX Rules, the directors of the
Corporation have unanimously reapproved the Option Plan as amended by the
Amendments and all unallocated stock options thereunder, and shareholders of the
Corporation will be asked at the Meeting to do the same. Whether or not the
resolution is approved at the Meeting, all stock options currently outstanding
under the Option Plan will remain in effect in accordance with their terms. If
the resolution is not approved at the Meeting, any currently unallocated stock
options under the Option Plan will no longer be available for grant.
Shareholder Resolution
Shareholders of the Corporation
will be asked at the Meeting to consider and, if thought advisable, to approve
by means of an ordinary resolution (a) the Amendments and the Option Plan as
amended by such Amendments, and (b) all unallocated stock options under the
Option Plan. The resolution shareholders will be asked to approve is as follows:
WHEREAS the board of directors of the
Corporation has amended section 16 and section 22 of the Corporation's stock
option plan (the "Amendments");
AND WHEREAS the Amendments are
described in the Corporation's management information circular dated May 27,
2015 (the "Circular") under the heading "Amendments to Stock Option Plan and
Reapproval of Stock Option";
AND WHEREAS a copy of the Corporation's
stock option plan as amended by the Amendments is attached as Schedule "B" to
the Circular;
AND WHEREAS the rules of the Toronto
Stock Exchange require that all unallocated options, rights or other
entitlements under a "rolling" stock option plan such as the Corporation's stock
option plan must be approved by shareholders every three years after
institution;
AND WHEREAS it has been three years
since the Corporation's stock option plan was last approved by the Corporations
shareholders;
NOW THEREFORE BE IT RESOLVED THAT:
1. |
the Amendments be and are hereby approved, and the
Corporation's stock option plan as amended by the Amendments (the "Amended
Option Plan") be and is hereby approved; |
|
|
2. |
all unallocated stock options under the Amended Option
Plan be and are hereby approved, and the Corporation shall have the
ability to continue granting stock options under the Amended
Option Plan until June 25, 2018, being the date that is three years
from the date of the shareholders meeting at which shareholders were asked to
approve this resolution; and |
11
3. |
any one director or officer of the Corporation be and is
hereby authorized and directed to execute and deliver on behalf of the
Corporation all such documents and instruments and to do all such other
acts and things as in his opinion may be necessary or desirable in
connection with the foregoing. |
To be approved, the above
resolution must be passed by a majority of the votes cast by shareholders at the
Meeting in respect of this resolution. Unless otherwise specified, the
persons named in the enclosed form of proxy will vote FOR the
resolution.
EXECUTIVE COMPENSATION
Compensation Discussion and Analysis
The purpose of this Compensation
Discussion and Analysis ("CD&A") is to provide information about the
Corporation's executive compensation philosophy, objectives, and processes and
to discuss compensation decisions relating to the Corporation's senior officers,
being the six identified named executive officers (the "NEOs"), in 2014.
The NEOs who are the focus of the CD&A and who appear in the compensation
tables of this Circular are: John A. Clarke, President and Chief Executive
Officer of the Corporation (the "CEO"); Donat K. Madilo, Chief Financial
Officer of the Corporation (the "CFO") until September 1, 2014 and
thereafter Senior Vice President, Commercial and DRC Affairs; Kevin Jennings,
Senior Vice President and CFO from September 1, 2014; Arnold T. Kondrat,
Executive Vice President of the Corporation; Geoffrey G. Farr, Vice President,
General Counsel and Corporate Secretary of the Corporation; and Daniel K.
Bansah, Head of Projects and Operations for the Corporation.
The Corporation is a gold
exploration, development and production company, which commenced commercial gold
production at its first mine (at Twangiza) in September 2012 and is planning to
achieve commercial gold production at its second gold mine (at Namoya) in the
third quarter of 2015. Given the current stage in the Corporations development,
together with current market conditions for the gold industry, the Corporation
has had to operate with limited financial resources and control costs to ensure
that funds are available to complete scheduled projects, programs and
activities. As a result, providing long-term incentives through the granting of
stock options has been an important component of the Corporations executive
compensation program. This is consistent with the objective of preserving cash
and also reflects the Corporation's belief that incentive stock options offer an
effective mechanism for incentivizing management and aligning the interests of
the Corporation's executive officers with those of the Corporation's
shareholders.
Compensation Governance
In order to assist the Board in
fulfilling its oversight responsibilities with respect to human resources
policies and executive compensation, the Board has established the Compensation
Committee. The members of the Compensation Committee are as follows: Maurice J.
Colson (who is the Chairman of the Compensation Committee), Peter N. Cowley and
Mick C. Oliver. Each of the said Compensation Committee members is independent
within the meaning of section 1.4 of National Instrument 52-110. The following
is a brief summary of the experience of each of the Compensation Committee
members relevant to his responsibilities in executive compensation.
12
Maurice J. Colson - Mr. Colson has worked in the investment
industry for more than 36 years and was for many years managing director for a
major Canadian investment dealer in the United Kingdom. He is actively involved
in providing strategic counsel and assistance with financing to emerging private
and public companies in Canada and to Canadian companies operating in China,
Africa and South America. He is a director, and a member of the audit committee,
of several Toronto Stock Exchange and TSX Venture Exchange listed companies, and
is the former President and Chief Executive Officer of the TSX Venture-listed
company, Lithium One Resources. Mr. Colson holds a Masters of Business
Administration degree from McGill University in Montreal.
Peter N. Cowley Mr. Cowley is a geologist with 45 years
international experience in the minerals industry, mainly in Africa. From June
2004 until September 2007, Mr. Cowley was Chief Executive Officer of Banro and
from June 2004 until March 2008 he was President of Banro. He was Chief
Executive Officer and President of Loncor Resources Inc. (a gold exploration
company listed on the Toronto Stock Exchange) from October 2009 to February
2015. Mr. Cowley has a B.Sc. (Honours) degree in Geology from Bedford College
(University of London), a M.Sc. in Mineral Exploration from the Royal School of
Mines and a M.B.A. from the Strathclyde Business School. Mr. Cowley is also a
Fellow of the Institute of Materials, Minerals and Mining. From 1989 to 1996,
Mr. Cowley was Technical Director of Cluff Resources and during this period was
directly responsible for the discovery and development of the Ayanfuri mine in
Ghana and the Geita mine in Tanzania. In 1996, with the acquisition of Cluff
Resources PLC by Ashanti Goldfields Company Limited, Mr. Cowley was appointed
Managing Director of Ashanti Exploration, where he managed the exploration
activities of Ashanti Goldfields Company Limited throughout Africa. He was
Managing Director of Ashanti Exploration until the end of May 2004 when he
joined Banro. Mr. Cowley is currently a director of Amara Mining plc and Cluff
Natural Resources plc.
Mick C. Oliver - Mr. Oliver has 38 years experience in the
mining sector. From 1996 to 2014, he held senior positions with CIBC World
Markets Inc., becoming in 2011 Managing Director (Head of Mining Team) in the
global mining investment banking group. Prior to this, he worked for 10 years
with HSBC covering natural resources, where, from 1990 to 1996, he was Partner,
Corporate Finance. Mr. Oliver is currently Managing Director of Natural
Resources Global Capital Partners, an independent advisory business offering
financial and technical advice to the global natural resource sector. Mr. Oliver
began his career as a mining engineer, with eight years of managerial experience
in precious and base metals in Zambia and South Africa. He graduated from
Nottingham University in 1976 with a joint mining/geology degree and from the
University of the Witswatersrand, South Africa in 1985 with an MBA.
The significant industry
experience of each of the Compensation Committee members provides them with a
suitable perspective to make decisions on the appropriateness of the
Corporations compensation policies and practices. All members of the
Compensation Committee have been determined to be "financially literate" within
the meaning of National Instrument 52-110, and are knowledgeable about the
Corporation's compensation program.
Under its written charter, the
Compensation Committee's responsibilities are set as follows: (a) review and
recommend for approval to the Board the Corporation's key human resources
policies; (b) review and recommend for approval to the Board the compensation
and benefits policy and plans (including incentive compensation plans) for the
Corporation; (c) review and recommend to the Board the employment agreements of
the executive officers of the Corporation; (d) together with the Chairman of the
Board, evaluate annually the performance of the CEO and recommend to the Board
his annual compensation package and performance objectives; (e) together with
the Chairman of the Board, review annually and recommend to the Board the annual
compensation package and performance objectives of the other executive officers
of the Corporation; (f) review annually and recommend to the Board the annual salaries (or percentage change in salaries) for
non-executive staff of the Corporation; (g) review annually and recommend to the
Board the adequacy and form of the compensation of the directors of the
Corporation and be satisfied the compensation realistically reflects the
responsibilities and risk involved in being such a director; (h) review annually
and recommend for approval to the Board the executive compensation disclosure of
the Corporation in its information circular, and be satisfied that the overall
compensation philosophy and policy for senior officers is adequately disclosed
and describes in sufficient detail the rationale for salary levels, incentive
payments, share options and all other components of executive compensation as
prescribed by applicable securities laws; (i) determine grants of options to
purchase shares of the Corporation under the Option Plan and recommend same to
the Board for approval; (j) engage, at the expense of the Corporation, any
external professional or other advisors which it determines necessary in order
to carry out its duties; and (k) perform any other activities consistent with
this mandate as the Compensation Committee or the Board deems necessary or
appropriate.
13
No formal policies or practices
have been adopted by the Board or the Compensation Committee to determine the
compensation for the Corporations directors or executive officers. A
compensation consultant or advisor has not, at any time since the Corporations
most recently completed financial year, been retained to assist the Board or the
Compensation Committee in determining compensation for any of the Corporations
directors or executive officers.
Compensation Process
Determinations with respect to
the compensation of the Corporation's senior officers (including decisions
regarding bonuses) are made by the Board based on the recommendation of the
Compensation Committee. The Compensation Committee relies on the knowledge and
experience of the members of the Compensation Committee, as well as on
recommendations of the CEO, in making recommendations to the Board regarding
senior officer compensation. Neither the Corporation nor the Compensation
Committee currently has any contractual arrangement with any executive
compensation consultant who has a role in determining or recommending the amount
or form of senior officer or director compensation.
When making recommendations to
the Board regarding senior officer compensation, the Compensation Committee
evaluates the officer's performance, including reviewing the Corporation's
performance as against its business plans and the officer's achievements during
the fiscal year. The criteria upon which these recommendations are based has, to
date, tended to be subjective and has reflected the Compensation Committee's
views as to the nature and value of the contributions made by the executive
officers to the achievement of the Corporation's corporate plans and objectives.
The Compensation Committee uses all data available to it to ensure that the
Corporation is maintaining a level of compensation that is both commensurate
with the size of the Corporation and sufficient to retain personnel it considers
essential to the success of the Corporation. In reviewing comparative data, the
Compensation Committee does not engage in benchmarking for the purpose of
establishing compensation levels relative to any predetermined level. In the
Compensation Committee's view, external data provides insight into external
competitiveness, but it is not an appropriate single basis for establishing
compensation levels. External data is considered, along with an assessment of
individual performance and experience, the Corporation's business strategy, best
practices/trends in human resources, and general economic considerations.
In recommending the NEOs'
compensation packages, the Compensation Committee reviews the various elements
of the NEOs' compensation in the context of the total compensation package
(including salary, bonuses and prior awards under the Option Plan).
Stock options are granted by the
Board under the Option Plan to senior officers upon their commencement of
service. Additional grants are also made periodically under the Option Plan to
senior officers (a) to recognize exemplary performance (including in
connection with a promotion within the Corporation) or a special contribution,
or (b) to provide additional long term incentives. The Board determines the
particulars with respect to stock option grants. The exercise price of each
stock option granted under the Option Plan is set at or above the closing price
of the Common Shares on the TSX on the day preceding the grant. See
"Compensation Program - Compensation Program Design Compensation Mix - Stock
Options" below for additional information regarding the process in respect of
stock option grants to NEOs.
14
Compensation Program
Principles/Objectives of the Compensation Program
The primary goal of the
Corporation's executive compensation program is to ensure that the compensation
provided to the Corporation's senior officers is determined with regard to the
Corporation's business strategy and objectives, such that the financial
interests of the senior officers are matched with the financial interests of the
shareholders. The executive compensation program is designed to attract,
motivate and retain top quality individuals at the executive level. Having
regard to these objectives of attracting, motivating and retaining, the program
takes into account the location of the Corporation's operations in the
Democratic Republic of the Congo and the lack of infrastructure and political,
military and social instability relating to this location. The Corporation
strives to ensure that the Corporation's senior officers are compensated fairly
and commensurately with their contributions to furthering the Corporation's
strategic direction and objectives.
Compensation Program Design
Compensation Risk Management
The Compensation Committee
evaluates the risks, if any, associated with the Corporations compensation
policies and practices. Implicit in the Boards mandate is that the
Corporations policies and practices respecting compensation, including those
applicable to the Corporations NEOs, be designed in a manner which is in the
best interests of the Corporation and its shareholders. Risk evaluation is one
of the considerations for this review.
A portion of the Corporations
executive compensation consists of stock options granted under the Option Plan.
Such compensation is both "long term" and "at risk" and, accordingly, is
directly linked to the achievement of long term value creation. Since the
benefits of such compensation, if any, are generally not realized by the NEO
until a significant period of time has passed, the possibility of NEOs taking
inappropriate or excessive risks with regard to their compensation that are
financially beneficial to them at the expense of the Corporation and its
shareholders is extremely limited.
The other two main elements of
compensation, salary and bonus, are capped to ensure preservation of capital and
to provide upper payout boundaries, thereby reducing risks associated with
unexpectedly high levels of pay. In addition, the Compensation Committee
believes it is unlikely that NEOs would take inappropriate or excessive risks at
the expense of the Corporation and its shareholders that would be beneficial to
them with regard to their short term compensation when their longer term
compensation might be put at risk from their actions.
The Corporations compensation
programs also allow for discretionary assessment of performance by the
Compensation Committee to ensure that pay aligns with both perceived and actual
performance. In addition, all major transactions require approval by the Board.
15
Due to the size of the
Corporation, and the current level of the Corporations activity, the
Compensation Committee is able to closely monitor and consider any risks which
may be associated with the Corporations compensation policies and practices.
Risks, if any, may be identified and mitigated through regular Board meetings
during which financial and other information of the Corporation are reviewed,
and which includes executive compensation. No risks have been identified arising
from the Corporations compensation policies and practices that are reasonably
likely to have a material adverse effect on the Corporation.
The Corporation has a policy
prohibiting directors and officers of the Corporation from purchasing financial
instruments, including, for greater certainty, prepaid variable forward
contracts, equity swaps, collars, or units of exchange funds, that are designed
to hedge or offset a decrease in market value of equity securities granted as
compensation or held, directly or indirectly, by the director or officer.
Compensation Mix
The total compensation mix was
designed on the basis of the Corporation's compensation objectives. Standard
compensation arrangements for the Corporation's senior officers are composed of
the following elements, which are linked to the Corporation's compensation and
corporate objectives as follows:
Compensation Element
|
Link to
Compensation Objectives |
Link to Corporate
Objectives |
Base salary
|
Attract and retain
Reward
|
Competitive pay ensures access
to skilled employees necessary to achieve corporate objectives.
|
Bonuses
|
Motivate and reward
|
Bonuses focus senior officers on
the achievement of corporate objectives and reward exceptional
performance. Competitive pay ensures access to skilled employees
necessary to achieve corporate objectives.
|
Stock options
|
Attract and retain
Motivate and reward
Align interests with shareholders |
Stock option grants motivate
and reward senior officers to increase shareholder value by the achievement
of long-term corporate strategies and objectives. Encourages
long-term tenure and performance. |
Retention allowance (1)
|
Attract and retain
|
Encourages long-term tenure.
Competitive pay ensures access to skilled employees necessary to
achieve corporate objectives.
|
Benefits
|
Attract and retain |
Competitive benefits ensure
access to skilled employees necessary to achieve corporate objectives. |
|
16
__________________________________
(1) |
A senior officer is entitled to receive the retention
allowance (the "Retention Allowance") on termination of his
employment with the Corporation, provided the officer has been with the
Corporation for a minimum of two years and provided that termination is
not due to misconduct (in the case of misconduct, the Retention Allowance
is forfeited). The amount of the Retention Allowance is equal to the
officer's monthly base salary multiplied by the number of years the
officer was with the Corporation (up to a maximum of 10 years), with any
partial year being recognized on a pro rata basis. |
Base Salary
The Corporation provides senior
officers with base salaries which represent their minimum compensation for
services rendered during the fiscal year. NEOs' base salaries depend on the
scope of their experience, responsibilities, leadership skills, performance,
length of service, general industry trends and practices, the Corporation's
existing financial resources and the potential long term compensation provided
by stock options as discussed below. A description of material terms of NEOs'
employment contracts is provided below under "Executive Compensation: Tables and
Narrative - Termination and Change of Control Benefits". In addition to the
above factors, decisions regarding any salary increases are impacted by each
NEOs current salary.
Bonuses
Annual cash incentive awards are
designed to focus executive attention on key strategic and operational measures
and align compensation with corporate performance. Subject to the Corporations
financial situation, the Corporation has had an annual bonus program (the
"Bonus Plan") to be competitive from a total remuneration standpoint and
to recognize outstanding annual performance. Annual bonus, if earned, is
generally paid in cash in December of each year for the prior year's
performance. Bonuses may also be awarded to senior officers during the year
(i.e. outside of the Bonus Plan) to recognize exemplary performance or a special
contribution.
Senior officers are generally
eligible to receive a discretionary annual bonus in an amount up to a specified
percentage of such officer's base salary. However, the annual bonus paid to a
senior officer may increase for specific accomplishments. The actual amount of
bonus is determined following a review of each officer's individual
performance.
Consistent with the flexible
nature of the Bonus Plan, no specific weight is assigned to any particular
performance factor. When making recommendations to the Board, the Compensation
Committee considers not only the Corporation's performance during the year, but
also considers market and economic trends and forces, extraordinary internal and
market-driven events, unanticipated developments and other extenuating
circumstances.
Stock Options
The grant of stock options to
purchase Common Shares pursuant to the Corporation's Option Plan is an integral
component of the compensation packages of the senior officers of the
Corporation. The Compensation Committee believes that the grant of stock options
to senior officers serves to motivate achievement of the Corporation's long-term
strategic objectives and the result will benefit all shareholders. The CEO makes
recommendations to the Compensation Committee for potential grants of stock
options. His decisions are based in part upon the level of responsibility and
contribution of the individuals toward the Corporation's goal and objectives.
Stock options are granted by the Board, pursuant to the Option Plan, based upon
the recommendation of the Compensation Committee. The overall number of stock
options that are outstanding relative to the number of outstanding Common Shares are also considered in determining whether to make any
new grants of stock options and the size of such grants. Since the Corporation
does not grant stock options at a discount to the prevailing market price of the
Common Shares, the stock options granted to senior officers have value only if,
and to the extent that, the market price of the Common Shares increases, thereby
linking equity-based executive compensation to shareholder returns.
17
See "Summary Compensation Table"
and "Incentive Plan Awards" under "Executive Compensation: Tables and Narrative"
below, for information regarding the stock options granted to the NEOs in 2014.
Retention Allowance
The Corporation believes that the
Retention Allowance helps to attract and retain individuals in a competitive
environment and encourages long-term tenure with the Corporation.
Benefits
The NEOs are eligible to
participate in the same benefits as offered to all full-time employees. This
includes participation in a traditional employee benefit plan consisting of
health and dental care and various forms of life and disability insurances. The
Corporation does not view these benefits as a significant element of its
compensation structure, as they constitute only a small percentage of total
compensation, but does believe that benefits be used in conjunction with base
salary to attract and retain individuals in a competitive environment. The
Corporation does not currently have standard senior officer perks, but may
provide such perks as is considered appropriate.
Review of 2014 Compensation
Base Salary
See "Executive Compensation:
Tables and Narrative - Summary Compensation Table" below which sets out the base
salary paid to each of the NEOs in 2014.
Bonuses
Bonuses were not paid to the NEOs
in fiscal 2014 in order to conserve cash, having regard to the Corporations
cash flow situation as the Corporation focused on the completion of development
at the Namoya mine and operational improvements at the Twangiza mine. The
non-payment of annual bonuses for 2014 (as well as for 2013) due to cash
constraints will be a factor when annual bonuses are considered in respect of
fiscal 2015.
Stock Options
During 2014, the Board granted
the following number of stock options to the NEOs under the Corporation's Option
Plan:
18
Name |
No. of Stock
Options |
John A. Clarke |
750,000 |
Donat K. Madilo |
500,000 |
Kevin Jennings |
Nil |
Arnold T. Kondrat |
Nil |
Geoffrey G. Farr |
500,000 |
Daniel K. Bansah |
300,000
|
See "Summary Compensation Table"
and "Incentive Plan Awards" under "Executive Compensation: Tables and Narrative"
below, which set out additional information in respect of the above stock option
grants. The rationale for the stock option grants to the NEOs in 2014 as set out
above (which grants were made in May 2014) was to provide additional long term
incentives and to recognize performance.
Share Performance Graph
The following graph illustrates the Corporation's cumulative
shareholder return (assuming the reinvestment of dividends of which there have
been none) from December 31, 2009 to December 31, 2014, based upon a Cdn$100
investment made on December 31, 2009 in the Common Shares, and compares the
Corporation's cumulative shareholder return to the cumulative total shareholder
return from a similar investment in the Total Return Index Value of the
S&P/TSX Composite Index (referred to in the table below as the "TSX")
over the same period. The price performance of the Common Shares as shown on the
graph does not necessarily indicate future price performance.
December 31, |
2009 |
2010 |
2011 |
2012 |
2013 |
2014 |
Banro |
$100 |
196 |
185 |
136 |
46 |
12 |
TSX |
$100 |
118 |
107 |
115 |
130 |
144 |
As described above, various factors are considered in
determining the compensation of the NEOs. The Common Share performance is one
performance measure that is reviewed but there is no direct correlation between
Common Share performance and executive compensation.
19
The Corporation operates in a
commodity business and the Common Share price is impacted by the market price of
gold, which may fluctuate widely and is affected by numerous factors that are
difficult to predict and beyond the Corporation's control. The Common Share
price is also affected by other factors beyond the Corporation's control,
including general and industry-specific economic and market conditions. The
Compensation Committee and the Board evaluate performance by reference to the
Corporation's business plan rather than by short-term changes in Common Share
price based on their view that the Corporation's long-term operating performance
will be reflected by stock price performance over the long-term, which is
especially important when the stock price may be temporarily depressed by
short-term factors.
The trend shown by the
performance graph above represents a significant increase in 2010 in the
Corporation's cumulative total shareholder return, a modest decrease in 2011
from the previous years price, and then significant decreases in 2012, 2013 and
2014, with an overall decrease from the December 31, 2009 price. Over the same
five year period the compensation (salary and bonus) received by the
Corporation's executive officers, in aggregate, has increased as the Corporation
has developed its business (during which time the Corporation went from an
exploration and development company to a producer with two mines). The
Compensation Committee considers total NEO compensation to be reasonable in the
Corporation's circumstances.
Compensation Committee Approval of CD&A
The Compensation Committee has
reviewed and approved the CD&A and other compensation disclosure contained
in this Circular, including the information contained below under the headings
"Executive Compensation: Tables and Narrative" and "Director Compensation".
Executive Compensation: Tables and Narrative
Summary Compensation Table
The following table provides a
summary of the compensation earned by the NEOs for services rendered in all
capacities during the fiscal years ended December 31, 2014, December 31, 2013
and December 31, 2012, as applicable.
Name and Principal
Position |
Year |
Salary
($) |
Share-
based awards ($) |
Option-based awards
(2) ($) |
Non-equity
incentive plan compensation - Annual
Incentive Plan ($) |
All other
Compensation (3) ($) |
Total
Compensation ($) |
John A. Clarke CEO (1)
|
2014 2013 2012
|
$550,000
$458,333(1) N/A |
N/A N/A N/A |
$115,474 $85,748
$229,994 |
Nil Nil N/A |
$54,664 (4)
$51,861 (4) $82,000 (4) |
$720,138 $595,943
$311,994 |
Donat K. Madilo CFO and Senior VP
(5) |
2014 2013 2012
|
$370,003 $330,000
$330,000 |
N/A N/A N/A |
$76,982 $64,311
$574,985 |
Nil Nil Nil |
$48,154 $41,570
$45,935 |
$495,139 $435,881
$950,920 |
Kevin Jennings Senior VP and CFO
(5) |
2014 |
$116,668 |
N/A |
Nil |
Nil |
$16,062 |
$132,730 |
|
20
Name and Principal
Position |
Year |
Salary ($)
|
Share- based
awards ($) |
Option-based awards (2)
($) |
Non-equity
incentive plan compensation -
Annual Incentive Plan ($) |
All other
Compensation (3) ($) |
Total
Compensation ($) |
Arnold T. Kondrat
Executive Vice
President |
2014
2013
2012 |
$550,000
$550,000
$550,000 |
N/A
N/A
N/A |
Nil
$85,748
$2,299,938 |
Nil
Nil
$1,500,000
(6) |
$50,998
$51,473
$51,502 |
$600,998
$687,221
$4,401,440 |
Geoffrey G. Farr
Vice President,
General Counsel (7) |
2014
2013
2012 |
$350,000
$308,333
$250,000 |
N/A
N/A
N/A |
$76,982
$64,311
$459,988 |
Nil
Nil
Nil |
$48,783
$36,746
$39,048 |
$475,765
$409,391
$749,036 |
Daniel K. Bansah
Head of Projects and
Operations (8) |
2014
2013
2012 |
$250,000
$237,500
$225,000 |
N/A
N/A
N/A |
$46,190
$35,440
$215,396 |
Nil
Nil
Nil |
$28,460
$27,455
$26,727 |
$324,650
$300,395
$467,123 |
|
__________________________________
(1) |
Dr. Clarke was appointed interim CEO and President of the
Corporation on March 6, 2013. In December 2013, he was appointed to the
role of permanent CEO and President of the Corporation from the interim
role he had been filling since March 6, 2013. Prior to Dr. Clarkes said
appointment as interim CEO and President, he was a non-executive director
of the Corporation. Dr. Clarke remains on the Board as a
director. |
|
|
(2) |
These amounts represent the grant date fair value of the
stock options awarded in the indicated year, calculated in Canadian
dollars and then converted to U.S. dollars using, in the case of the 2014
award, an average exchange rate for 2014 of Cdn$1.00 = US$0.9504, in the
case of the 2013 award, an average exchange rate for 2013 of Cdn$1.00 =
US$0.9711 and, in the case of the 2012 award, an average exchange rate for
2012 of Cdn$1.00 = US$1.0008. |
|
|
|
Grant date fair value of the stock options granted in
2014 to the NEOs was calculated in accordance with the Black- Scholes
model using the Common Share price on the date of grant of Cdn$0.46, with
the key valuation assumptions being stock price volatility of 76.27%, risk
free interest rate of 1.05%, no dividend yield and expected life of 3
years. |
|
|
|
Grant date fair value of the stock options granted in
2013 to NEOs, other than the stock options granted to Mr. Bansah, was
calculated in accordance with the Black-Scholes model using the Common
Share price on the date of grant of Cdn$0.95, with the key valuation
assumptions being stock price volatility of 72.25%, risk free interest
rate of 1.21%, no dividend yield, and expected life of three years. Grant
date fair value of the stock options granted to Mr. Bansah in 2013 was
calculated in accordance with the Black-Scholes model using the Common
Share price on the date of grant of Cdn$0.67, with the key valuation
assumptions being stock price volatility of 70.78%, risk free interest
rate of 1.21%, no dividend yield, and expected life of three
years. |
|
|
|
Grant date fair value of the stock options granted in
2012 to NEOs, other than the stock options granted to Mr. Bansah, was
calculated in accordance with the Black-Scholes model using the Common
Share price on the date of grant of Cdn$4.75, with the key valuation
assumptions being stock price volatility of 73.46%, risk free interest
rate of 1.03%, no dividend yield, and expected life of three years. Grant
date fair value of the stock options granted to Mr. Bansah in 2012 was
calculated in accordance with the Black-Scholes model using the Common
Share price on the date of grant of Cdn$4.72, with the key valuation
assumptions being stock price volatility of 73.30%, risk free interest
rate of 1.03%, no dividend yield, and expected life of three
years. |
|
|
|
The stock options granted by the Corporation to Dr.
Clarke in 2012 were granted in Dr. Clarkes capacity as a non- executive
director of the Corporation (see Note (1) above). |
|
|
(3) |
Each of the amounts shown in this column of the table for
each NEO other than Dr. Clarke represents life insurance premiums paid by
the Corporation and the Retention Allowance accrued in respect of the
NEO. |
|
|
|
The amount of the life insurance premiums paid by the
Corporation in respect of such NEOs in 2014 is as follows: Mr. Madilo:
US$17,320; Mr. Jennings: US$1,478; Mr. Kondrat: US$5,165; Mr. Farr:
US$19,616; Mr. Bansah: US$7,627. The amount of the life insurance premiums
paid by the Corporation in respect of such NEOs in 2013 is as follows: Mr.
Madilo: $14,070; Mr. Kondrat: $5,640; Mr. Farr: $15,913; Mr. Bansah:
$7,664. The amount of the life insurance premiums paid by the Corporation in respect of such NEOs in
2012 is as follows: Mr. Madilo: $18,435; Mr. Kondrat: $5,669; Mr. Farr: $18,215;
Mr. Bansah: $7,977. |
21
The amount of the Retention Allowance
accrued in respect of such NEOs in 2014 is as follows: Mr. Madilo: US$30,834;
Mr. Jennings: US$14,584; Mr. Kondrat: US$45,833; Mr. Farr: US$29,167; Mr.
Bansah: US$20,833. The amount of the Retention Allowance accrued in respect of
such NEOs in 2013 is as follows: Mr. Madilo: $27,500; Mr. Kondrat: $45,833; Mr.
Farr: $20,833; Mr. Bansah: $19,792. The amount of the Retention Allowance
accrued in respect of such NEOs in 2012 is as follows: Mr. Madilo: $27,500; Mr.
Kondrat: $45,833; Mr. Farr: $20,833; Mr. Bansah: $18,750.
(4) |
The amount shown in this column of the table for Dr.
Clarke for 2014 represents life insurance premiums paid by the Corporation
of $8,831 and $45,833 of Retention Allowance accrued in respect of Dr.
Clarke. The amount shown in this column of the table for Dr. Clarke for
2013 represents $38,194 of Retention Allowance accrued in respect of Dr.
Clarke following his appointment as interim CEO and President of the
Corporation on March 6, 2013 and directors fees of $13,667 paid by the
Corporation to Dr. Clarke as a non-executive director of the Corporation
prior to his said appointment as interim CEO and President (see Note (1)
above). The amounts shown in this column of the table for Dr. Clarke for
2012 represent directors fees of $82,000 paid by the Corporation to Dr.
Clarke as a non-executive director of the Corporation. |
|
|
(5) |
Mr. Jennings joined the Corporation as Senior Vice
President and CFO on September 1, 2014. Also effective September 1, 2014,
Mr. Madilo ceased being CFO and was appointed by the Corporation to the
role of Senior Vice President, Commercial and DRC Affairs. The
compensation shown in the above table for Mr. Madilo for 2014 represents
compensation earned up to September 1, 2014 as CFO and compensation earned
thereafter as Senior Vice President, Commercial and DRC Affairs. |
|
|
(6) |
This amount represents a bonus paid to Mr. Kondrat in
April 2012 for his efforts in connection with the Corporation completing
its US$175 million debt financing in March 2012. |
|
|
(7) |
Mr. Farr also holds the position of Corporate Secretary
of the Corporation. |
|
|
(8) |
Mr. Bansah was appointed by the Corporation to the
position of Head of Projects and Operations in July 2013. Prior to this
appointment, he held the position of Vice President, Exploration of the
Corporation. |
The Corporation does not have any
long-term incentive programs other than its Option Plan and does not have any
defined or actuarial plans.
Incentive Plan Awards
The following table provides
details regarding outstanding NEO option and share-based awards as at December
31, 2014:
Outstanding share-based
awards and option-based awards
|
|
Option-based Awards |
Share-based Awards
|
Name |
Option grant
date |
Number of
securities underlying unexercised
options (1)
(#) |
Option exercise
price (2) ($) |
Option
expiration date |
Aggregate
value of unexercised in-the-
money options ($) (3)
|
Number of
shares or units that have not vested
(#) |
Market or
payout value of share- based awards
that have not vested ($) |
John A. Clarke |
May 30, 2014 |
750,000 |
Cdn$0.80 (US$0.69) |
May 30, 2019 |
Nil |
N/A |
N/A |
|
Oct. 25, 2013 |
200,000 |
Cdn$1.00 (US$0.86) |
Oct. 25, 2018 |
Nil |
|
|
|
Feb. 9, 2012 |
100,000 |
Cdn$4.75 (US$4.09) |
Feb. 9, 2017 |
Nil |
|
|
|
Sept. 10, 2010 |
50,000 |
Cdn$2.05 (US$1.77) |
Sept. 10, 2015 |
Nil |
|
|
|
Jan. 6, 2010 |
50,000 |
Cdn$2.31 (US$1.99) |
Jan. 6, 2015 |
Nil |
|
|
22
Outstanding share-based
awards and option-based awards
|
|
Option-based Awards |
Share-based Awards
|
Name |
Option grant
date |
Number of
securities underlying unexercised
options (1)
(#) |
Option exercise
price (2) ($) |
Option
expiration date |
Aggregate
value of unexercised in-the-
money options ($) (3)
|
Number of
shares or units that have not vested
(#) |
Market or
payout value of share- based
awards that have not vested ($)
|
Donat K. Madilo |
May 30, 2014 |
500,000 |
Cdn$0.80 (US$0.69) |
May 30, 2019 |
Nil |
N/A |
N/A |
|
Oct. 25, 2013 |
150,000 |
Cdn$1.00 (US$0.86) |
Oct. 25, 2018 |
Nil |
|
|
|
Feb. 9, 2012 |
250,000 |
Cdn$4.75 (US$4.09) |
Feb. 9, 2017 |
Nil |
|
|
|
Sept. 10, 2010 |
25,000 |
Cdn$2.05 (US$1.77) |
Sept. 10, 2015 |
Nil |
|
|
|
|
|
|
|
|
|
|
Kevin Jennings |
|
Nil |
|
|
|
N/A |
N/A |
|
|
|
|
|
|
|
|
Arnold T. Kondrat |
Oct. 25, 2013 |
200,000 |
Cdn$1.00 (US$0.86) |
Oct. 25, 2018 |
Nil |
N/A |
N/A |
|
Feb. 9, 2012 |
1,000,000 |
Cdn$4.75 (US$4.09) |
Feb. 9, 2017 |
Nil |
|
|
|
Sept. 10, 2010 |
701,511 |
Cdn$2.05 (US$1.77) |
Sept. 10, 2015 |
Nil |
|
|
|
|
|
|
|
|
|
|
Geoffrey G. Farr |
May 30, 2014 |
500,000 |
Cdn$0.80 (US$0.69) |
May 30, 2019 |
Nil |
N/A |
N/A |
|
Oct. 25, 2013 |
150,000 |
Cdn$1.00 (US$0.86) |
Oct. 25, 2018 |
Nil |
|
|
|
Feb. 9, 2012 |
200,000 |
Cdn$4.75 (US$4.09) |
Feb. 9, 2017 |
Nil |
|
|
|
Feb. 11, 2011 |
100,000 |
Cdn$3.25 (US$2.80) |
Feb. 11, 2016 |
Nil |
|
|
|
Jan. 20, 2010 |
50,000 |
Cdn$2.30 (US$1.98) |
Jan. 20, 2015 |
Nil |
|
|
|
|
|
|
|
|
|
|
Daniel K. Bansah |
May 30, 2014 |
300,000 |
Cdn$0.80 (US$0.69) |
May 30, 2019 |
Nil |
N/A |
N/A |
|
Oct. 17, 2013 |
150,000 |
Cdn$1.00 (US$0.86) |
Oct. 17, 2018 |
Nil |
|
|
|
Feb. 13, 2012 |
94,737 |
Cdn$4.75 (US$4.09) |
Feb. 13, 2017 |
Nil |
|
|
|
Sept. 10, 2010 |
12,500 |
Cdn$2.05 (US$1.77) |
Sept. 10, 2015 |
Nil |
|
|
__________________________________
(1) |
3/4 of the stock options granted to each optionee vest on
the 12 month anniversary of the grant date and the balance vest on the 18
month anniversary of the grant date. |
|
|
(2) |
The exercise price of each of the stock options held by
the NEOs is in Canadian dollars. The U.S. dollar figures set out in this
column of the table were calculated using the noon exchange rate on
December 31, 2014 as reported by the Bank of Canada for the conversion of
Canadian dollars into U.S. dollars of Cdn$1.00 = US$0.862. |
|
|
(3) |
This is based on (a) the last closing sale price per
share of the Common Shares as at December 31, 2014 of Cdn$0.15 as reported
by the TSX, and (b) converting that price into a price of US$0.13 using
the noon exchange rate on December 31, 2014 as reported by the Bank of
Canada for the conversion of Canadian dollars into U.S. dollars of
Cdn$1.00 = US$0.862. |
23
See the disclosure below under
"Terms of Stock Option Plan" for a summary of the terms of the Corporation's
Option Plan.
The following table provides
details regarding outstanding NEO option-based awards, share-based awards and
non-equity incentive plan compensation, which vested and/or were earned during
the year ended December 31, 2014:
Incentive plan awards - value vested
or earned during the year |
Name |
Option-based awards -
Value vested during the year (1)
($) |
Share-based awards -
Value vested during the year ($) |
Non-equity incentive
plan compensation - Value earned during the year
($) |
John A. Clarke |
Nil |
N/A |
N/A |
Donat K. Madilo |
Nil |
N/A |
N/A |
Kevin Jennings |
Nil |
N/A |
N/A |
Arnold T. Kondrat |
Nil |
N/A |
N/A |
Geoffrey G. Farr |
Nil |
N/A |
N/A |
Daniel K. Bansah |
Nil |
N/A |
N/A |
__________________________________
(1) |
Identifies the aggregate dollar value that would have
been realized by the NEO if the NEO had exercised all options exercisable
under the option-based award on the vesting date(s)
thereof. |
Pension Plan Benefits and Deferred Compensation Plans
The Corporation does not have a pension plan or a deferred
compensation plan.
Termination and Change of Control Benefits
The Corporation and John A.
Clarke have entered into an employment contract (the "Clarke
Agreement") which sets out the terms upon which Dr. Clarke performs the
services of CEO and President of the Corporation. Dr. Clarkes annual salary
under the Clarke Agreement is $550,000. The Corporation may terminate the Clarke
Agreement at any time for just cause upon written notice to Dr. Clarke.
The Corporation and Donat K.
Madilo have entered into an employment contract (the "Madilo
Agreement") which sets out the terms upon which Mr. Madilo performs for
the Corporation the services of Senior Vice President, Commercial and DRC
Affairs. Mr. Madilos annual salary under the Madilo Agreement is currently
$350,000. The Corporation may terminate the Madilo Agreement at any time for
just cause upon written notice to Mr. Madilo.
The Corporation and Kevin
Jennings have entered into an employment contract (the "Jennings
Agreement") which sets out the terms upon which Mr. Jennings performs the
services of Senior Vice President and CFO of the Corporation. Mr. Jennings
annual salary under the Jennings Agreement is $350,000. The Corporation may
terminate the Jennings Agreement at any time for just cause upon written notice
to Mr. Jennings.
24
The Corporation and Arnold T.
Kondrat have entered into an employment contract (the "Kondrat
Agreement") which sets out the terms upon which Mr. Kondrat performs the
services of Executive Vice President of the Corporation. Mr. Kondrats annual
salary under the Kondrat Agreement is currently $550,000. The Corporation may
terminate the Kondrat Agreement at any time for just cause upon written notice
to Mr. Kondrat.
The Corporation and Geoffrey G.
Farr have entered into an employment contract (the "Farr
Agreement") which sets out the terms upon which Mr. Farr performs the
services of Vice President, General Counsel and Corporate Secretary of the
Corporation. Mr. Farrs annual salary under the Farr Agreement is $350,000. The
Corporation may terminate the Farr Agreement at any time for just cause upon
written notice to Mr. Farr.
The Corporation and Daniel K.
Bansah have entered into an employment contract (the "Bansah
Agreement") which sets out the terms upon which Mr. Bansah performs the
services of Head of Projects and Operations of the Corporation. Mr. Bansahs
annual salary under the Bansah Agreement is currently $250,000. The Corporation
may terminate the Bansah Agreement at any time for just cause upon written
notice to Mr. Bansah.
The Clarke Agreement also
provides as follows: (a) in the event of the constructive dismissal of Dr.
Clarke or in the event, within 18 months of a "change of control" (as such term
is defined in the Clarke Agreement) of the Corporation, Dr. Clarkes employment
is terminated without cause or Dr. Clarke is constructively dismissed, Dr.
Clarke is entitled to be paid by the Corporation an amount (the "Retiring
Allowance") equal to the sum of (i) two times his annual salary and (ii) two
times the "Bonus Amount" (see below for definition of "Bonus Amount"); (b) if
immediately prior to such termination Dr. Clarke holds stock options of the
Corporation, he shall be entitled to exercise all such stock options (vested and
unvested) at any time during the period of time commencing upon such termination
and ending on the expiry date of such stock options; and (c) in the event the
Corporation terminates the Clarke Agreement without cause, Dr. Clarke is
entitled to the stock option exercise rights described above in item (b) and to
be paid by the Corporation the Retiring Allowance.
The Jennings Agreement also
provides as follows: (a) in the event, within 12 months of a "change of control"
(as such term is defined in the Jennings Agreement) of the Corporation, Mr.
Jennings employment is terminated without cause or Mr. Jennings is
constructively dismissed, Mr. Jennings is entitled to be paid by the Corporation
an amount equal to the sum of (i) two times his annual salary and (ii) two times
the "Bonus Amount" (see below for definition of "Bonus Amount"); (b) if
immediately prior to such termination Mr. Jennings holds stock options of the
Corporation, he shall be entitled to exercise all such stock options (vested and
unvested) at any time during the period of time commencing upon such termination
and ending on the expiry date of such stock options; and (c) in the event of the
constructive dismissal of Mr. Jennings or the Corporation terminates the
Jennings Agreement without cause and such dismissal or termination is not within
12 months of a "change of control", Mr. Jennings is entitled to be paid by the
Corporation an amount equal to his annual salary and the "Bonus Amount" and, if
immediately prior to such dismissal or termination Mr. Jennings holds stock
options of the Corporation, he shall be entitled to exercise all such stock
options (including those which vest prior to the "Expiry Date" (as defined
below)) at any time during the period of time commencing upon such dismissal or
termination and ending on the date (the "Expiry Date") which is the
earlier of (A) the natural expiry date of the applicable stock option, and (B)
the date which is one year from such dismissal or termination.
Each of the Madilo Agreement,
Kondrat Agreement, Farr Agreement and Bansah Agreement also provide as follows:
(a) in the event of a "change of control" (as such term is defined in each
employment agreement) of the Corporation or the constructive dismissal of the
employee, the employee has the right to terminate his employment agreement and
is entitled to be paid by the Corporation an amount (the "Retiring Allowance") equal to the sum of (i) two times
his annual salary and (ii) two times the "Bonus Amount" (see below for
definition of "Bonus Amount"); (b) if immediately prior to such termination the
employee holds stock options of the Corporation, the employee shall be entitled
to exercise all such stock options (vested and unvested) at any time during the
period of time commencing upon such termination and ending on the expiry date of
such stock options; and (c) in the event the Corporation terminates the
employment agreement without cause, the employee is entitled to the stock option
exercise rights described above in item (b) and to be paid by the Corporation
the Retiring Allowance.
25
"Bonus Amount" is defined
to mean an amount equal to one-half of the aggregate amount of all bonuses paid
or payable to the employee by the Corporation and its subsidiaries in respect of
the two most recent fiscal years.
The following table sets out
estimates of the incremental amounts payable to each of Messrs. Clarke, Madilo,
Jennings, Kondrat, Farr and Bansah upon identified termination events as set out
in their employment agreements, assuming each such event took place on the last
business day of fiscal year 2014. The table does not take into account any value
of outstanding stock options that have previously vested, which awards are set
out under "Incentive Plan Awards" above, but does take into account any value of
unvested stock options that would vest upon the occurrence of the termination
event. See the disclosure below under "Terms of Stock Option Plan" for a
detailed description of the Corporation's Option Plan, including a description
of vesting and expiry of grants on termination.
|
John A.
Clarke |
Donat
K. Madilo |
Kevin
Jennings |
Arnold
T. Kondrat |
Geoffrey
G. Farr |
Daniel
K. Bansah |
Change of Control
(1) Lump sum payment
(2) Stock options |
$1,100,000 Nil
|
$700,000 Nil |
$700,000 Nil |
$2,600,000 Nil
|
$700,000 Nil |
$500,000 Nil
|
Termination Without
Cause/Constructive
Dismissal Lump
sum payment
(2) Stock
options |
$1,100,000 Nil
|
$700,000 Nil |
$350,000 Nil |
$2,600,000 Nil
|
$700,000 Nil |
$500,000 Nil
|
|
__________________________________
(1) |
Dr. Clarkes and Mr. Jennings employment agreement
contains "double-trigger" change of control provisions as summarized
above. The change of control provisions set out in Mr. Bansahs employment
agreement were included in his employment agreement prior to his promotion
to Head of Projects and Operations in 2013 (he was previously Vice
President, Exploration of the Corporation). It is planned that future
employment agreements entered into by the Corporation with executives,
including any renewal of existing NEO employment agreements, will include
"double- trigger" change of control provisions. |
|
|
(2) |
The lump sum payment calculations are based on the
individuals annual salary under his employment agreement as at December
31, 2014 as summarized above and any bonus awards for 2013 and 2012 as set
out above in the table under "Summary Compensation
Table". |
Director Compensation
The director compensation program
is designed to achieve the following goals: (a) compensation should attract and
retain the most qualified people to serve on the Board; (b) compensation should
align directors' interests with the long-term interests of shareholders; (c)
compensation should fairly pay directors for risks and responsibilities related
to being a director of an entity of the Corporation's size and scope: and (d) the structure of the compensation should be
simple, transparent and easy for shareholders to understand.
26
The fees paid by the Corporation
to the non-executive directors of the Corporation during the financial year
ended December 31, 2014 are set out in the table below under "Director Summary
Compensation Table".
Non-executive directors are
entitled to receive stock option grants under the Corporation's Option Plan, as
recommended by the Compensation Committee and determined by the Board. The
exercise price of such stock options is determined by the Board, but shall in no
event be less than the last closing price of the Common Shares on the TSX prior
to the date the stock options are granted. See the disclosure below under "Terms
of Stock Option Plan" for a summary of the terms of the Option Plan.
Non-executive directors of the
Corporation are also reimbursed for all reasonable out-of-pocket expenses
incurred in attending Board or committee meetings and otherwise incurred in
carrying out their duties as directors of the Corporation.
Executive directors of the
Corporation are compensated as employees of the Corporation and are not entitled
to additional compensation for performance of director duties. Executive
directors of the Corporation during 2014 were Dr. Clarke and Mr. Kondrat (Mr.
Kondrat ceased being a director of the Corporation on June 27, 2014).
The Corporation maintains directors' and officers' liability
insurance for the benefit of directors and officers of the Corporation carrying
coverage in the amount of Cdn$10,000,000 as an aggregate limit of liability in
each policy year. The total annual premium payable by the Corporation for the
policy is Cdn$135,500 and there is a deductible in the amount of
Cdn$250,000.
Director Summary Compensation Table
The following compensation table
sets out the compensation paid to each of the Corporation's non-executive
directors in the year ended December 31, 2014. See "Summary Compensation Table"
above for details regarding the compensation paid to the Corporation's executive
directors as executives of the Corporation in respect of services rendered
during 2014 (the executive directors of the Corporation during 2014 were Dr.
Clarke and Mr. Kondrat (Mr. Kondrat ceased being a director of the Corporation
on June 27, 2014; Mr. Brissenden was appointed Executive Chairman of the Board
in 2015).
Name (4) |
Fees earned
(1) ($) |
Share-based awards ($)
|
Option-based
awards(2) ($) |
Non-equity
incentive plan compensation ($) |
All other
Compensation
($) |
Total ($)
|
Richard W. Brissenden |
$67,821 |
N/A |
$23,095 |
N/A |
$225,000 (5) |
$315,916 |
Maurice J. Colson |
$71,250 |
N/A |
$23,095 |
N/A |
Nil |
$94,345 |
Peter N. Cowley |
$71,750 |
N/A |
$23,095 |
N/A |
Nil |
$94,845 |
Peter V. Gundy |
$15,005 |
N/A |
N/A |
N/A |
Nil |
$15,005 |
Richard J. Lachcik |
$25,000 |
N/A |
N/A |
N/A |
Nil
(3) |
$25,000 |
Matthys J. Terblanche |
$11,833 |
N/A |
$23,095 |
N/A |
Nil |
$34,928 |
Bernard R. van Rooyen |
$43,333 |
N/A |
N/A |
N/A |
Nil |
$43,333 |
Derrick H. Weyrauch |
$76,152 |
N/A |
$23,095 |
N/A |
Nil |
$99,247 |
27
__________________________________
(1) |
During 2014, non-executive directors were entitled to
directors' fees of $50,000, members of the Audit Committee were entitled
to additional fees of $12,000, members of the Compensation Committee were
entitled to additional fees of $9,000, members of the Technical Committee
were entitled to additional fees of $9,000, the Chairman of the Audit
Committee was entitled to additional fees of $17,000, the Chairman of the
Compensation Committee was entitled to additional fees of $9,000 and the
Chairman of the Technical Committee was entitled to additional fees of
$9,000. |
|
|
(2) |
These amounts represent the grant date fair value of the
stock options awarded in 2014, calculated in Canadian dollars and then
converted to U.S. dollars using an average exchange rate for 2014 of
Cdn$1.00 = US$0.9504. Grant date fair value of these stock options was
calculated in accordance with the Black-Scholes model using the Common
Share price on the date of grant of Cdn$0.46, with the key valuation
assumptions being stock price volatility of 76.27%, risk free interest
rate of 1.05%, no dividend yield and expected life of 3 years. No stock
options were received by Messrs. Gundy, Lachcik and van Rooyen during
2014. |
|
|
(3) |
During the financial year ended December 31, 2014, the
Corporation incurred legal expenses (and related costs) of $1,308,831 to
Norton Rose Fulbright Canada LLP (which acts as legal counsel to the
Corporation). Mr. Lachcik is a partner of Norton Rose Fulbright Canada
LLP. |
|
|
(4) |
Messrs. Gundy, Lachcik, Terblanche and van Rooyen were
directors of the Corporation for only part of 2014. |
|
|
(5) |
This amount represents consulting fees in respect of
additional services rendered by Mr. Brissenden in connection with the
Corporations financing and other corporate
activities. |
Incentive Plan Awards
The following table provides
details regarding the outstanding option and share based awards held by
non-executive directors of the Corporation as at December 31, 2014. See
"Executive Compensation: Tables and Narrative - Incentive Plan Awards" above for
a details regarding the outstanding stock options held by the Corporation's
executive director (Dr. Clarke) as at December 31, 2014.
Outstanding share-based
awards and option-based awards
|
|
Option-based
Awards |
Share-based
Awards |
Name |
Option grant
date |
Number of
securities underlying unexercised
options (1)
(#) |
Option exercise
price (2) ($) |
Option
expiration date |
Aggregate
value of unexercised in-the-
money options (3) ($) |
Number of
shares or units of shares that
have not vested (#) |
Market or
payout value of share- based awards
that have not vested ($) |
Richard W. Brissenden |
May 30, 2014 |
150,000 |
Cdn$0.80 (US$0.69) |
May 30, 2019 |
Nil |
N/A |
N/A |
|
|
|
|
|
|
|
|
Maurice J. Colson |
May 30, 2014 |
150,000 |
Cdn$0.80 (US$0.69) |
May 30, 2019 |
Nil |
N/A |
N/A |
|
Oct. 25, 2013 |
100,000 |
Cdn$1.00 (US$0.86) |
Oct. 25, 2018 |
Nil |
|
|
|
|
|
|
|
|
|
|
Peter N. Cowley |
May 30, 2014 |
150,000 |
Cdn$0.80 (US$0.69) |
May 30, 2019 |
Nil |
N/A |
N/A |
|
Oct. 25, 2013 |
100,000 |
Cdn$1.00 (US$0.86) |
Oct. 25, 2018 |
Nil |
|
|
|
Feb. 9, 2012 |
100,000 |
Cdn$4.75 (US$4.09) |
Feb. 9, 2017 |
Nil |
|
|
|
Sept. 10, 2010 |
12,500 |
Cdn$2.05 (US$1.77) |
Sept. 10, 2015 |
Nil |
|
|
|
Jan. 6, 2010 |
12,500 |
Cdn$2.31 (US$1.99) |
Jan. 6, 2015 |
Nil |
|
|
28
Outstanding
share-based awards and option-based awards
|
|
Option-based
Awards |
Share-based
Awards |
Name |
Option
grant date |
Number of
securities underlying unexercised
options (1)
(#)
|
Option
exercise price (2) ($) |
Option
expiration date |
Aggregate
value of unexercised in-the-
money options (3) ($) |
Number of
shares or units of shares that
have not vested (#) |
Market or
payout value of share- based awards
that have not vested ($) |
|
|
|
|
|
|
|
|
Derrick H. Weyrauch |
May 30, 2014 |
150,000 |
Cdn$0.80 (US$0.69) |
May 30, 2019 |
Nil |
N/A |
N/A |
__________________________________
(1) |
3/4 of the stock options granted to each optionee vest on
the 12 month anniversary of the grant date and the balance vest on the 18
month anniversary of the grant date. |
|
|
(2) |
The exercise price of each of the stock options held by
the directors is in Canadian dollars. The U.S. dollar figures set out in
this column of the table were calculated using the noon exchange rate on
December 31, 2014 as reported by the Bank of Canada for the conversion of
Canadian dollars into U.S. dollars of Cdn$1.00 = US$0.862. |
|
|
(3) |
This is based on (a) the last closing sale price per
share of the Common Shares as at December 31, 2014 of Cdn$0.15 as reported
by the TSX, and (b) converting that price into a price of US$0.13 using
the noon exchange rate on December 31, 2014 as reported by the Bank of
Canada for the conversion of Canadian dollars into U.S. dollars of
Cdn$1.00 = US$0.862. |
See the disclosure below under
"Terms of Stock Option Plan" for details regarding the terms of the
Corporation's Option Plan.
The following table provides
details regarding outstanding option-based awards, share-based awards and
non-equity incentive plan compensation in respect of the non-executive directors
of the Corporation, which vested and/or were earned during the year ended
December 31, 2014. See "Executive Compensation: Tables and Narrative - Incentive
Plan Awards" above for such details in respect of executive directors of the
Corporation.
Incentive plan awards - value vested
or earned during the year |
Name |
Option-based awards -
Value vested during the year (1)
(US$) |
Share-based awards -
Value vested during the year (US$) |
Non-equity incentive
plan compensation - Value earned during the year
(US$) |
Richard W. Brissenden |
Nil |
N/A |
N/A |
Maurice J. Colson |
Nil |
N/A |
N/A |
Peter N. Cowley |
Nil |
N/A |
N/A |
Peter V. Gundy |
N/A |
N/A |
N/A |
Richard J. Lachcik |
Nil |
N/A |
N/A |
Matthys J. Terblanche |
Nil |
N/A |
N/A |
Bernard R. van Rooyen |
Nil |
N/A |
N/A |
Derrick H. Weyrauch |
Nil |
N/A |
N/A |
29
__________________________________
(1) |
Identifies the aggregate dollar value that would have
been realized by the director if the director had exercised all options
exercisable under the option-based award on the vesting date(s) thereof.
Mr. Gundy did not hold any stock options of the Corporation during
2014. |
SECURITIES ISSUABLE UNDER EQUITY COMPENSATION PLANS
The following table sets forth,
as at December 31, 2014, the number of Common Shares to be issued upon the
exercise of outstanding options, warrants and rights issued pursuant to equity
compensation plans, the weighted average exercise price of such outstanding
options, warrants and rights and the number of Common Shares remaining available
for future issuance under equity compensation plans of the Corporation.
Plan Category |
Number of
Common Shares to be issued upon exercise of
options, warrants and rights outstanding as at Dec.
31, 2014 |
Weighted-average exercise price of
options, warrants and rights outstanding as
at Dec. 31, 2014 |
Number of
Common Shares remaining available for future
issuance under equity compensation plans as at Dec.
31, 2014 (excluding shares reflected in the first
column) |
Equity compensation plans approved by
shareholders (1) |
15,546,595 (2) |
Cdn$2.87 |
8,402,968 (2) |
Equity compensation plans not approved by
shareholders |
n/a |
n/a |
n/a |
Total |
15,546,595 (2) |
Cdn$2.87 |
8,402,968 (2)
|
__________________________________
(1) |
The only equity compensation plan of the Corporation
approved by shareholders is the Corporation's Option Plan. See the
disclosure below under "Terms of Stock Option Plan" for a summary of the
terms of such plan. |
|
|
(2) |
See the disclosure below under "Terms of Stock Option
Plan" for information relating to stock options of the Corporation
outstanding as at the date of this Circular and stock options available
for future grants as at the date of this Circular. |
TERMS OF STOCK OPTION PLAN
The rules of the TSX provide that
listed issuers must disclose on an annual basis, in their information circulars
or other annual disclosure document distributed to all security holders, the
terms of their security based compensation arrangements. The following
summarizes the terms of the Corporation's Option Plan.
(a) |
Stock options may be granted from time to time by the
Board to such directors, officers, employees and consultants of the
Corporation or a subsidiary of the Corporation, and in such numbers, as
are determined by the Board at the time of the granting of the stock
options. |
|
|
(b) |
The total number of Common Shares issuable upon the
exercise of all outstanding stock options granted under the Option Plan
shall not at any time exceed 9.5% of the total number
of outstanding Common Shares. 9.5% of the number of Common Shares
outstanding as of the date of this Circular is equal to 23,954,313 Common
Shares. |
30
Having regard to the said percentage
figure, the Option Plan is considered an "evergreen" plan, since (i) the Common
Shares covered by stock options which have been exercised or cancelled will be
available for subsequent grants under the Option Plan, and (ii) the number of
stock options available to grant increases as the number of outstanding Common
Shares increases.
(c) |
There are currently outstanding under the Option Plan
23,015,784 stock options entitling the holders to purchase an aggregate of
23,015,784 Common Shares (which is equal to 9.13% of the number of Common
Shares which are currently outstanding). The number of new stock options
currently available for future grants under the Option Plan is stock
options to purchase an aggregate of 938,529 Common Shares (which is equal
to 0.37% of the number of Common Shares which are currently outstanding).
Since the Corporation was listed on the TSX in November 2005, a total of
8,664,212 stock options (which is equal to 3.44% of the number of Common
Shares which are currently outstanding) have been exercised under the
Option Plan. |
|
|
(d) |
The exercise price of each stock option shall be
determined in the discretion of the Board at the time of the granting of
the stock option, provided that the exercise price shall not be lower than
the "Market Price". "Market Price" means the last closing price of the
Common Shares on the TSX prior to the date the stock option is
granted. |
|
|
(e) |
All stock options shall be for a term (the "Term")
determined in the discretion of the Board at the time of the granting of
the stock options, provided that no stock option shall have a Term
exceeding ten years and, unless otherwise determined by the Board in its
discretion in accordance with the terms of the Option Plan as referred to
in the next paragraph below, a stock option and all rights to purchase
Common Shares pursuant thereto shall expire and terminate immediately upon
the optionee who holds such stock option ceasing to be at least one of a
director, officer, employee or consultant of the Corporation or a
subsidiary of the Corporation for any reason whatsoever. |
|
|
|
Provided a departing optionee has been with the
Corporation for at least 12 months, the Board may in its discretion
determine that any vested stock options held by such departing optionee
will continue to be exercisable after the departure from the Corporation
of the optionee for a period of time not to exceed the balance of the Term
of such stock options. |
|
|
(f) |
Unless otherwise determined by the Board at the time of
the granting of the stock options, 3/4 of the stock options granted
pursuant to the Option Plan vest on the 12 month anniversary of their
grant date and the remaining 1/4 of such stock options vest on the 18
month anniversary of the grant date. The stock options granted by the
Board in 2015 prior to the date of this Circular have a two year vesting
schedule, as follows: one-third vesting on the grant date, one-third on
the 12 month anniversary of the grant date, and the remaining one-third on
the 24 month anniversary of the grant date. |
|
|
(g) |
Except in limited circumstances in the case of the death
of an optionee, stock options shall not be assignable or
transferable. |
|
|
(h) |
Shareholder approval is required prior to any reduction
in the exercise price of a stock option or any extension of the Term of a
stock option (if the optionee holding such stock option is an insider of
the Corporation, disinterested shareholder approval is
required). |
31
(i) |
The Option Plan contains the following restrictions
relating to the number of stock options that may be granted to insiders or
non-employee directors of the Corporation: |
|
(i) |
The total number of Common Shares issued to insiders of
the Corporation, within any one year period, under all "security based
compensation arrangements" (within the meaning of the rules of the TSX) of
the Corporation shall not exceed 10% of the total number of outstanding
Common Shares. |
|
|
|
|
(ii) |
The total number of Common Shares issuable to insiders of
the Corporation, at any time, under all "security based compensation
arrangements" (within the meaning of the rules of the TSX) of the
Corporation shall not exceed 10% of the total number of outstanding Common
Shares. |
|
|
|
|
(iii) |
The total number of Common Shares issuable to
non-employee directors of the Corporation, at any time, under all
"security based compensation arrangements" (within the meaning of the
rules of the TSX) of the Corporation shall not exceed 1% of the total
number of outstanding Common Shares. |
|
|
|
|
(iv) |
Grant date value of stock options granted to any one
non-employee director of the Corporation shall not exceed a total of
Cdn$100,000 per year (this restriction is still subject to receipt of
shareholder approval at the Meeting, as described in this Circular under
"Amendments to Stock Option Plan and Reapproval of Stock Option
Plan"). |
Subject to the above restrictions on
insiders and non-employee directors of the Corporation, there are no
restrictions in the Option Plan on the number of stock options that may be
granted to any one person or company.
(j) |
In the event a "take-over bid" (as such term is defined
under Ontario securities laws) is made in respect of the Common Shares,
all unvested stock options shall become exercisable (subject to any
necessary regulatory approval) so as to permit the holders of such stock
options to tender the Common Shares received upon exercising such stock
options pursuant to the take-over bid. |
|
|
(k) |
The Corporation may amend from time to time or terminate
the terms and conditions of the Option Plan by resolution of the Board.
Any amendments shall be subject to the prior consent of all applicable
regulatory bodies, including the TSX (to the extent such consent is
required). Amendments and termination shall take effect only with respect
to stock options granted thereafter, provided that they may apply to any
stock options previously granted with the mutual consent of the
Corporation and the optionees holding such stock options. The Board has
the authority to approve amendments relating to the Option Plan or to
stock options, without further approval of the Corporation's shareholders,
to the extent that such amendments relate to: |
|
(i) |
altering the terms of vesting applicable to any stock
options; |
|
|
|
|
(ii) |
changes to the date a stock option terminates upon the
optionee ceasing to be a director, officer, employee or consultant of the
Corporation or any of its subsidiaries (provided that no such change shall
extend the Term of the stock option); |
|
|
|
|
(iii) |
accelerating the expiry date in respect of stock
options; |
|
|
|
|
(iv) |
determining the adjustment provisions pursuant to section
10 of the Option Plan (section 10 of the Option Plan provides, among other
things, that, in the event of any change in
the Corporation's Common Shares through subdivision, consolidation,
amalgamation, merger or otherwise, then in any such case the Board may make such
adjustment in the Option Plan and in the stock options granted under the Option
Plan as the Board may in its sole discretion deem appropriate to prevent
substantial dilution or enlargement of the rights granted to, or available for,
holders of stock options); |
32
|
(v) |
amending the definitions contained in the Option Plan;
or |
|
|
|
|
(vi) |
amendments of a "housekeeping"
nature. |
Any amendment to the Option Plan or to
stock options which does not relate to items (i) to (vi) above, shall require
approval of the Corporations shareholders. Without limiting the generality of
the foregoing, any amendment to the Option Plan or to stock options which
relates to the following shall require approval of the Corporations
shareholders:
|
|
an amendment to section 2 of the Option Plan to
increase the percentage figure set out therein; |
|
|
reducing the exercise price of a stock option
held by any optionee; |
|
|
any cancellation and reissue of stock options
or other entitlements unless permitted under the rules of the TSX; |
|
|
extending the Term of any stock options held by
any optionee; |
|
|
any amendment which would permit stock options granted
under the Option Plan to be transferable or assignable other than for
normal estate settlement purposes; |
|
|
amendments that increase limits previously
imposed on non-employee director participation; |
|
|
adding to the categories of persons eligible to
participate in the Option Plan; and |
|
|
any amendment to section 16 of the Option Plan so as to
increase the ability of the Board to amend the Option Plan without
shareholder approval. |
(l) |
Except if not permitted by the TSX, if any stock options
may not be exercised due to any black- out period (as defined in the
Option Plan) at any time within the three business day period prior to the
normal expiry date of such stock options, the expiry date of such stock
options shall be extended for a period of 10 business days following the
end of the black-out period (or such longer period as permitted by the TSX
and approved by the Board). |
|
|
(m) |
The Board has full and final discretion to interpret the
provisions of the Option Plan, and all decisions and interpretations made
by the Board shall be binding and conclusive upon the Corporation and all
optionees, subject to shareholder approval if required by the
TSX. |
INDEBTEDNESS OF DIRECTORS AND EXECUTIVE OFFICERS
As of the date of this Circular, no current or former executive
officer, director or employee of the Corporation or a subsidiary of the
Corporation is indebted to the Corporation or a subsidiary of the
Corporation.
As of the date of this Circular, no current or former executive
officer, director or employee of the Corporation or a subsidiary of the
Corporation has indebtedness to another entity which is the subject of a
guarantee, support agreement, letter of credit or other similar arrangement or
understanding provided by the Corporation or a subsidiary of the
Corporation.
33
INTEREST OF INFORMED PERSONS IN MATERIAL TRANSACTIONS
Other than as described below, no director or officer of the
Corporation, no person or company that beneficially owns, or controls or
directs, directly or indirectly, more than 10% of the outstanding Common Shares
(a "10% Shareholder"), no director or officer of a 10% Shareholder or of
a subsidiary of the Corporation and no associate or affiliate of any of the
foregoing persons or companies, has or has had any material interest, direct or
indirect, in any transaction since the beginning of the Corporation's financial
year ended December 31, 2014 or in any proposed transaction which, in either
case, has materially affected or will materially affect the Corporation or any
of its subsidiaries.
On April 30, 2015, the Corporation closed the US$70 million
balance of its previously announced financing (the "Financing"), such
balance involving a US$20 million gold forward sale transaction relating to the
Twangiza mine and a US$50 million gold streaming transaction relating to the
Namoya mine. The Corporation entered into amending agreements made as of April
6, 2015 to amend the Corporations note indenture dated March 2, 2012 (the
"Note Indenture") and related collateral trust agreement dated March 2,
2012 (collectively, the "Amendments") in order to secure the gold
delivery obligations under the Financing transactions by way of a Priority
Lien and a Parity Lien, respectively, within the meaning of the Note
Indenture. Based on public filings, the Corporation believes that affiliates of
BlackRock, Inc. control or have investment discretion over, in the aggregate,
more than 10% of the outstanding Common Shares (see "Voting Securities and
Principal Holders Thereof"). The Corporation understands that affiliates of
BlackRock, Inc. control certain 10% senior secured notes due 2017 outstanding
under the Note Indenture (the "Notes"). The Amendments, as they relate to
the Notes controlled by affiliates of BlackRock, Inc. may be considered a
related party transaction. BlackRock was not a party to the Financing. The
address of BlackRock, Inc. is 40 East 52nd Street, New York, New York, 10022,
United States.
FINANCIAL STATEMENTS
The audited consolidated
financial statements of the Corporation as at and for the financial year ended
December 31, 2014 (the "2014 Financial Statements"), together with the
auditors' report thereon, will be placed before the Meeting.
CORPORATE GOVERNANCE DISCLOSURE
The Corporation's Board is
committed to sound corporate governance practices, which are both in the
interest of its shareholders and contribute to effective and efficient decision
making.
National Instrument 58-101 (which
is entitled "Disclosure of Corporate Governance Practices") provides that the
corporate governance disclosure required by Form 58-101F1 must be included in
this Circular. The following addresses the items identified in Form
58-101F1.
Board of Directors
A director is considered
"independent" if he has no direct or indirect material relationship with the
Corporation. A "material relationship" is a relationship which could, in the
view of the Board, be reasonably expected to interfere with the exercise of a
director's independent judgment. There are also certain circumstances which are
deemed to establish a "material relationship" for the purpose of determining
independence under National Instrument 58-101. With respect to the six persons
proposed to be nominated at the Meeting for election as a director (see
"Election of Directors"), four of these nominees have been determined to be
independent within the meaning of National Instrument 58-101 and two have been
determined to not be independent within the meaning of National Instrument
58-101. Maurice J. Colson, Peter N. Cowley, Mick C. Oliver and Derrick H.
Weyrauch have been determined to be independent within the meaning of National
Instrument 58-101. John A. Clarke (who is President and CEO of the Corporation)
and Richard W. Brissenden (who is Executive Chairman of the Board of the
Corporation) have been determined to not be independent within the meaning of
National Instrument 58-101.
34
The Board facilitates its
exercise of independent judgment in carrying out its responsibilities by having
a majority of independent directors on the Board and by having the Audit
Committee and Compensation Committee comprised only of independent directors.
The Board also believes that the fiduciary duties placed on individual directors
by the Canada Business Corporations Act (the Corporation's governing
corporate legislation) and by the common law and the restrictions placed by such
legislation on an individual directors' participation in decisions of the Board
in which the director has an interest ensure that the Board operates
independently of management and in the best interests of the Corporation.
The independent directors of the
Corporation do not hold regularly scheduled meetings at which non-independent
directors and members of management are not in attendance. However, to
facilitate open and frank discussion among its independent directors, the Board
has adopted a practice of setting aside time at each meeting of the Board for
the independent directors to hold discussions without management present. As
well, an in camera session is held, without management present, at each Audit
Committee meeting with the external auditors of the Corporation (when the
auditors are present at the meeting).
The Corporation's Chairman of the
Board, Richard W. Brissenden, is not an independent director. Maurice J. Colson
has been appointed by the Board to act as lead independent director. His
responsibilities as lead independent director include conducting the in camera
sessions held at Board meetings by the independent directors.
Directorships
The following directors of the
Corporation are presently directors of other issuers that are reporting issuers
(or the equivalent):
|
Name of Director |
Names of Other Issuers |
|
|
|
|
Richard W. Brissenden |
Corona Gold Corporation |
|
|
Lexam VG Gold Inc. |
|
|
McEwen Mining Inc. |
|
|
PC Gold Inc. |
|
|
Ryan Gold Corp. |
|
|
|
|
John A. Clarke |
Great Quest Fertilizer Ltd. |
|
|
|
|
Maurice J. Colson (1) |
Stetson Oil & Gas Ltd. |
|
|
Loncor Resources Inc. |
|
|
Delrand Resources Limited |
|
|
Aberdeen International Inc.
|
35
|
Name of Director |
Names of Other Issuers |
|
|
|
|
Peter N. Cowley |
Amara Mining plc |
|
|
Cluff Natural Resources plc |
|
Mick C. Oliver |
Not applicable |
|
Derrick H. Weyrauch |
Not applicable |
__________________________________
(1) |
Mr. Colson has resigned as a director of each of Hornby
Bay Mineral Exploration Ltd. and Richco Investors Inc. Mr. Colson has also
resigned as a director and officer of China Goldcorp
Ltd. |
Meetings of the Board of Directors
The frequency of Board meetings
and the nature of the meeting agendas depend upon the nature of the business and
affairs of the Corporation from time to time. During the financial year ended
December 31, 2014, the Board held 19 meetings. In addition to the business
conducted at such meetings, various other matters were approved by written
resolution signed by all members of the Board. The following table sets out the
Board meeting attendance record during 2014 of the six persons proposed to be
nominated at the Meeting for election as a director (see "Election of
Directors").
Name
|
Percentage of
Board Meetings Attended |
Richard W. Brissenden |
100% |
John A. Clarke |
100% |
Maurice J. Colson |
100% |
Peter N. Cowley |
89.5% |
Mick C. Oliver |
N/A (1) |
Derrick H. Weyrauch |
100% |
__________________________________
(1) |
Mr. Oliver was appointed a director of the Corporation in
2015. |
Board Mandate
The Board does not have a written
mandate. In broad terms, the Board is responsible for the overall stewardship of
the Corporation and, as such, supervises the management of the business and
affairs of the Corporation. More specifically, the Board is responsible for
reviewing the strategic business plans and corporate objectives, and approving
financings and acquisitions, dispositions, investments, capital expenditures and
other transactions and matters that are thought to be material to the
Corporation. The Board is also responsible for approving the appointment of
officers, stock option grants, financial statements and proxy materials.
Position Descriptions
The Board has not developed
written position descriptions for the Chairman of the Board, the chair of each
Board committee or the CEO of the Corporation. The Corporation's President and
CEO is responsible for the day-to-day operations of the Corporation. The
President and CEO and other members of senior management undertake a significant role in the long
range planning and corporate finance activities of the Corporation. The Chairman
of the Board chairs all meetings of the Board and is responsible for managing
the affairs of the Board, including ensuring the Board is organized properly,
functions effectively and meets its obligations and responsibilities.
36
All of the Board's committees
(being the Audit Committee, the Compensation Committee and the Technical
Committee) have charters which set out their respective roles and
responsibilities.
Orientation and Continuing Education
Due to the size of the Board, no
formal program currently exists for the orientation of new directors. Each new
director brings a different skill set and professional background, and with this
information, the Board is able to determine what orientation regarding (a) the
role of the Board, its committees and its directors, and (b) the nature and
operations of the Corporation's business, will be necessary and relevant to each
new director.
No formal continuing education
program currently exists for the Corporation's directors. Each of the
Corporation's directors has the responsibility for ensuring that he maintains
the skill and knowledge necessary to meet his obligations as a director. The
Corporation's legal counsel advises the Board on any changes in laws or
regulations relevant to the duties and responsibilities of directors.
Ethical Business Conduct
The Board has adopted a code of
business conduct and ethics for directors, officers and employees (the
"Code"). A copy of the Code may be obtained from the CFO of the
Corporation at (416) 366-2221 and is also available on SEDAR at www.sedar.com.
Each director, officer and employee of the Corporation is provided with a copy
of the Code and is required to confirm annually that he or she has complied with
the Code. Any observed breaches of the Code must be reported to the
Corporation's CEO.
There have been no material
change reports filed since the beginning of the Corporation's most recently
completed financial year that pertains to any conduct of a director or executive
officer of the Corporation that constitutes a departure from the Code.
In accordance with the Canada
Business Corporations Act (the Corporation's governing corporate
legislation), directors of the Corporation who are a party to, or are a director
or an officer of or have a material interest in a party to, a material contract
or material transaction or a proposed material contract or proposed material
transaction, are required to disclose the nature and extent of their interest
and not to vote on any resolution to approve the contract or transaction. In
addition, in certain cases, an independent committee of the Board may be formed
to deliberate on such matters in the absence of the interested party.
The Board has also adopted a
"whistleblower" policy which provides employees, consultants, officers and
directors with the ability to report, on a confidential and anonymous basis,
violations within the Corporation's organization including, (but not limited
to), questionable accounting practices, disclosure of fraudulent or misleading
financial information and instances of corporate fraud or harassment. The Board
believes that providing a forum for such individuals to raise concerns about
ethical conduct and treating all complaints with the appropriate level of
seriousness fosters a culture of ethical business conduct. The Board has also
adopted an insider trading policy to encourage and further promote a culture of
ethical business conduct.
37
Nomination of Directors
The Corporation has a nominating
committee (being the Boards compensation and nominating committee, referred to
in this section and the next two sections of the Circular as the "Nominating
Committee"), which is composed entirely of independent directors. The Nominating
Committee is responsible for assessing the need for new directors and the
preferred experience and qualifications of new directors, taking into
consideration the independence, age, skills and experience required for the
effective conduct of the Corporations business. The Nominating Committee
recommends candidates for initial Board membership and Board members for
re-nomination. The functions of the Nominating Committee also include reviewing
the membership of all of the committees of the Board and making recommendations
to the Board on appointments to the committees, including the appointment of a
Chair for each committee.
Before recommending that an
existing director be nominated for re-election, the Nominating Committee
considers factors such as the director's length of service on the Board,
attendance at regularly scheduled Board and committee meetings and ability to
contribute effectively to the Board. Before recommending a new director
candidate, members of the Nominating Committee or their delegates meet with the
candidate to discuss the candidate's interest and ability to devote time to
Board matters.
Diversity
The Corporation is committed to
providing equal opportunities for individuals who have the necessary
qualifications for employment and advancement within the Corporation. Banros
objectives include providing a work environment that is free of discrimination
and harassment, including based on gender. Banro is fully committed to
increasing diversity on the Board over time.
Banro has not adopted a formal
written policy relating to the identification and nomination of female director
nominees or executive officer candidates at this time. It is important to note,
however, that when identifying new candidates for nomination to the Board, the
Nominating Committee takes into account a broad variety of factors it considers
appropriate, including skills, independence, financial acumen, board dynamics
and personal characteristics, including gender. In addition, diversity in
perspective arising from personal, professional or other attributes and
experiences are considered when identifying potential director candidates.
Banro considers gender diversity
to be important and believes that its current framework for evaluating Board and
executive officer candidates takes into account gender diversity. The
Corporation is an equal opportunity employer. However, the priority of Banro in
recruiting new candidates is ensuring individuals bring value to the Corporation
and its shareholders by possessing a suitable mix of qualifications, experience,
skills and expertise.
The Corporation currently does
not currently have a female director on the Board or a female executive officer.
Banro does not currently intend to adopt targets for female nominee directors or
executive officers as the composition of the Board and the senior executive
group is based on a broad variety of factors Banro considers appropriate and it
is ultimately the skills, experience, characteristics and qualifications of the
individual that are most important in assessing the value the individual could
bring to Banro.
Term Limit and Retirement
The term of Banros directors
expires at the end of the next annual meeting of shareholders or when a
successor is elected or appointed to the Board. Banro does not impose term
limits or mandatory retirement on its directors. The Corporation believes that term
limits or mandatory retirement based on age alone may create arbitrary and
technical impediments to the selection of the most qualified persons. The Board
and the Nominating Committee continually review a directors effectiveness and
the mix of skills and expertise.
38
It has been the Boards
experience that some of the longer-serving directors provide the most value to
Banro. This approach enables Banro to make decisions regarding the composition
of its Board and senior management team based on what is in the best interests
of the Corporation and its shareholders.
Compensation
See the disclosure in this Circular under "Executive
Compensation".
Other Board Committees
The Board does not have any
standing committees other than the audit committee, the compensation and
nominating committee, and the health, safety, environment and technical
committee.
Assessments
The Board monitors but does not
formally assess the effectiveness and contribution of the Board, its committees
and individual Board members. To date, the Board has satisfied itself, through
informal discussions, that the Board, its committees and individual Board
members are performing effectively.
U.S. CORPORATE GOVERNANCE MATTERS
The Common Shares are listed on the NYSE MKT. The NYSE MKT
Company Guide permits NYSE MKT to consider the laws, customs and practices of
foreign issuers in relaxing certain NYSE MKT listing criteria, and to grant
exemptions from NYSE MKT listing criteria based on these considerations. A
company seeking relief under these provisions is required to provide written
certification from independent local counsel that the non-complying practice is
permitted by home country law. A description of the significant ways in which
the Corporation's governance practices differ from those followed by U.S.
domestic companies pursuant to NYSE MKT standards is as follows. To the extent
necessary, the Corporation has obtained exemptions from the NYSE MKT in respect
of these differences.
Shareholder Meeting Quorum Requirement: NYSE MKT minimum
quorum requirement for a shareholder meeting is one-third of the outstanding
shares of common stock. In addition, a company listed on NYSE MKT is required to
state its quorum requirement in its by-law. The Corporation's quorum requirement
is set forth in its by-law no.3, which provides that a quorum for the
transaction of business at any meeting of shareholders shall be two persons
entitled to vote thereat present in person or represented by proxy.
Proxy Delivery Requirement: NYSE MKT requires the
solicitation of proxies and delivery of proxy statements for all shareholder
meetings, and requires that these proxies be solicited pursuant to a proxy
statement that conforms to SEC proxy rules. The Corporation is a "foreign
private issuer" as defined in Rule 3b-4 under the U.S. Securities Exchange Act
of 1934, as amended, and the equity securities of the Corporation are
accordingly exempt from the proxy rules set forth in Sections 14(a), 14(b),
14(c) and 14(f) of such Act. The Corporation solicits proxies in accordance with
applicable rules and regulations in Canada.
39
Shareholder Approval Requirements: NYSE MKT requires a
listed company to obtain the approval of its shareholders for certain types of
securities issuances, including private placements that may result in the
issuance of common shares (or securities convertible into common shares) equal
to 20% or more of presently outstanding shares for less than the greater of book
or market value of the shares. In general, the rules of the TSX are similar, but
there are some differences including the threshold for shareholder approval set
at greater than 25% of outstanding shares. The Corporation will seek a waiver
from NYSE MKT's shareholder approval requirements in circumstances where the
securities issuance does not trigger such a requirement under the rules of the
TSX.
Nominating Process: NYSE MKT requires that director
nominations must be either selected or recommended to the Board by either a
nominating committee or a majority of independent directors. In addition, NYSE
MKT requires a formal written charter or board resolution addressing the
nominations process. The Corporation has a nominating committee which recommends
director nominations to the Board, but has not adopted a formal written charter
or board resolution addressing the nominations process. Under the federal laws
of Canada, the rules of the TSX and Ontario securities laws, the Corporation is
not required to adopt such a charter or board resolution.
ADDITIONAL INFORMATION
Financial information relating to
the Corporation is provided in the 2014 Financial Statements and the
Corporation's management's discussion and analysis relating to such financial
statements (the "2014 MD&A"). Copies of this Circular, the 2014
Financial Statements, the 2014 MD&A, the interim consolidated financial
statements of the Corporation subsequent to the 2014 Financial Statements and
the Corporation's management's discussion and analysis relating to such interim
financial statements, as well as additional information relating to the
Corporation, are available on SEDAR at www.sedar.com. Copies of such documents
may also be obtained without charge by writing to the CFO of the Corporation at
Suite 7070, 1 First Canadian Place, 100 King Street West, Toronto, Ontario, M5X
1E3, Canada.
A proposal for any matter that a
shareholder proposes to raise at the next annual meeting of shareholders of the
Corporation must be submitted to the Corporation at least 90 days before the
anniversary date of the Notice (that is, at least 90 days before the anniversary
date of May 27, 2015) and must comply with the other requirements of the
Canada Business Corporations Act relating to proposals.
DIRECTORS' APPROVAL
The contents of this Circular and
the sending thereof to the shareholders of the Corporation have been approved by
the Board. Unless otherwise indicated, information contained in this Circular is
given as of May 27, 2015.
DATED at Toronto, Ontario, Canada the 27th day of May,
2015.
BY ORDER OF THE BOARD |
|
(signed) "Geoffrey G. Farr" |
|
Geoffrey G. Farr |
Vice President, General Counsel and |
Corporate Secretary |
SCHEDULE "A" |
|
|
MAJORITY VOTING POLICY |
|
BANRO CORPORATION |
(the Corporation) |
|
The Board of Directors of the Corporation (the Board)
believes that each director should have the confidence and support of the
shareholders of the Corporation. To that end, the Board has unanimously adopted
this majority voting policy, and future nominees for election to the Board will
be required to confirm that they will abide by it.
Forms of proxy for the election of directors will permit a
shareholder to vote in favour of, or to withhold from voting, separately for
each director nominee. The Chairman of the Board will ensure that the number of
shares voted in favour or withheld from voting for each director nominee is
recorded at the shareholders meeting and is made public promptly after the
meeting. If the vote was by a show of hands rather than by ballot, the
Corporation will disclose the number of shares voted by proxy in favour or
withheld for each director.
If a director nominee has more votes withheld than are voted in
favour of him or her, the nominee will be considered by the Board not to have
received the support of the shareholders, even though duly elected as a matter
of corporate law. In such a case, the nominee will be required forthwith to
submit his or her resignation to the Board, effective on acceptance by the
Board.
The compensation committee of the Board (or other committee to
which has been delegated the responsibility of administering this policy) will
consider the offer of resignation and make a recommendation to the Board. Except
in special circumstances that would warrant the continued service of the
director on the Board, the committee will be expected to recommend that the
Board accept the resignation. The Board will make its decision and announce it
in a press release within 90 days after the shareholders meeting at which the
candidacy of the director was considered. A copy of this press release will be
provided to the Toronto Stock Exchange. If the Board determines to not accept
the resignation, the press release must fully state the reasons for that
decision.
The director who tendered the resignation will not participate
in the decision-making process, but may be counted for the purpose of
determining whether the Board has quorum.
Subject to any corporate law restrictions, the Board may (i)
leave a vacancy in the Board unfilled until the next annual general meeting of
shareholders, (ii) fill the vacancy by appointing a new director who, in the
opinion of the Board, merits the confidence of the shareholders, or (iii) call a
special meeting of shareholders to consider new Board nominee(s) to fill the
vacant position(s).
This policy applies only to uncontested elections, meaning
elections where the number of nominees for director is equal to the number of
directors to be elected.
APPROVED by the Board on May 31, 2013 and amended
by the Board on May 25, 2015.
SCHEDULE "B"
BANRO CORPORATION
Stock Option Plan
The board of directors of Banro Corporation (the
"Corporation") wishes to establish a stock option plan (the
"Plan") governing the issuance of stock options (the "Stock
Options") to directors, officers, employees and consultants of the
Corporation or a subsidiary of the Corporation. For the purposes of this Plan,
the term "consultant" shall have the meaning ascribed thereto in National
Instrument 45-106 entitled "Prospectus and Registration Exemptions".
The terms and conditions of this Plan for the issuance of Stock
Options are as follows:
The principal purposes of this Plan are:
|
(a) |
to retain and attract qualified directors, officers,
employees and consultants which the Corporation and its subsidiaries
require; |
|
|
|
|
(b) |
to promote a proprietary interest in the Corporation and
its subsidiaries; |
|
|
|
|
(c) |
to provide an incentive element in compensation;
and |
|
|
|
|
(d) |
to promote the development of the Corporation and its
subsidiaries. |
2. |
Limitation on Shares
Issuable |
The total number of common shares in the capital of the
Corporation ("Common Shares") issuable upon the exercise of all
outstanding Stock Options granted under this Plan shall not at any time exceed
9.5% of the total number of outstanding Common Shares.
Stock Options shall be granted only to individuals, firms or
corporations ("Eligible Optionees") who are directors, officers,
employees or consultants of the Corporation or a subsidiary of the Corporation.
Stock Options may also be granted to a corporation which is controlled by an
Eligible Optionee. Unless the context otherwise requires, the term Eligible
Optionee as used herein shall include any such corporation.
4. |
Granting of Stock
Options |
The board of directors of the Corporation (the "Board")
may from time to time grant Stock Options to Eligible Optionees. At the time
Stock Options are granted, the Board shall determine the number of Common Shares
available for purchase under the Stock Options, the date when the Stock Options
are to become effective and, subject to the other provisions of this Plan, all
other terms and conditions of the Stock Options.
B-2
The exercise price (the "Exercise Price") of each Stock
Option shall be determined in the discretion of the Board at the time of the
granting of the Stock Option, provided that the Exercise Price shall not be
lower than the "Market Price". "Market Price" shall mean the last closing
price of the Common Shares on the Toronto Stock Exchange (the "TSX")
prior to the date the Stock Option is granted.
6. |
Term and Exercise
Periods |
|
(a) |
All Stock Options shall be for a term (the "Term")
determined in the discretion of the Board at the time of the granting of
the Stock Options, provided that, except in the case of a "Black-Out
Period" (as defined in clause 6(e) below), no Stock Option shall have a
Term exceeding ten years and, unless otherwise determined by the Board
pursuant to clause 6(b) below, a Stock Option and all rights to purchase
Common Shares pursuant thereto shall expire and terminate immediately upon
the Eligible Optionee who holds such Stock Option ceasing to be at least
one of a director, officer, employee or consultant of the Corporation or a
subsidiary of the Corporation for any reason whatsoever (including as a
result of death). |
|
|
|
|
(b) |
In the event that an Eligible Optionee ceases to be at
least one of a director, officer, employee or consultant of the
Corporation or a subsidiary of the Corporation and provided that such
Eligible Optionee had been a director, officer, employee or consultant of
the Corporation or a subsidiary of the Corporation for not less than 12
months, the Board may in its discretion determine that any vested Stock
Options held by such Eligible Optionee immediately prior to the date of
such cessation shall continue to be exercisable after such date for a
period of time not to exceed the balance of the Term of such Stock
Options. Any such determination must be made by the Board within five
business days of the Board being notified in writing by an officer of the
Corporation that the Eligible Optionee has ceased to be at least one of a
director, officer, employee or consultant of the Corporation or a
subsidiary of the Corporation. |
|
|
|
|
(c) |
Unless otherwise determined by the Board at the time of
the granting of the Stock Options pursuant to clause 6(d)(i) below, 3/4 of
any Stock Options granted pursuant hereto will vest on the 12 month
anniversary of their date of grant (the "Grant Date") and the
remaining 1/4 of the Stock Options will vest on the 18 month anniversary
of the Grant Date. For greater clarity, unless otherwise determined
pursuant to the terms hereof, all Stock Options granted to an Eligible
Optionee will be available to exercise and purchase Common Shares on the
18 month anniversary of the Grant Date. |
|
|
|
|
(d) |
By way of example, without limiting the generality of the
foregoing or the discretion of the Board, the Board may, at the time of
the granting of the Stock Options, determine: |
B-3
|
(i) |
that Stock Options have a different vesting schedule than
that specified in clause 6(c) above; or |
|
|
|
|
(ii) |
that the Stock Options may provide for early exercise
and/or termination or other adjustment in certain circumstances, such as
if the Corporation shall resolve to sell all or substantially all of its
assets, to liquidate or dissolve, or to merge, amalgamate, consolidate or
be absorbed with or into any other
corporation. |
|
(e) |
Except if not permitted by the TSX, if any Stock Options
may not be exercised due to any Black-Out Period (as defined below) at any
time within the three business day period prior to the normal expiry date
of such Stock Options (the "Restricted Options"), the expiry date
of all Restricted Options shall be extended for a period of 10 business
days following the end of the Black-Out Period (or such longer period as
permitted by the TSX and approved by the Board). "Black- Out
Period" means the period of time when, pursuant to any policies of the
Corporation, any securities of the Corporation may not be traded by
certain persons as designated by the Corporation, including any holder of
Stock Options. |
Stock Options shall not be assignable or transferable by an
Eligible Optionee (except for a limited right of assignment to allow the
exercise of Stock Options by an Eligible Optionee's legal representative in the
event of the death of the Eligible Optionee and provided that the terms of the
Stock Options permit such exercise).
8. |
Payment of Exercise
Price |
All Common Shares issued pursuant to the exercise of Stock
Options shall be paid for in full in Canadian funds at the time of exercise of
the Stock Options (subject to the procedure for exercising the Stock Options as
agreed to by the Corporation and the Eligible Optionee) and prior to the issue
of such shares. All Common Shares issued in accordance with the foregoing shall
be issued as fully paid and non-assessable Common Shares.
If any Stock Options granted pursuant to this Plan are not
exercised for any reason whatsoever, upon the expiry of the Stock Options
pursuant to the terms of their grant or the terms hereof, the shares reserved
and authorized for issuance pursuant to such Stock Options shall revert to this
Plan and shall be available for other Stock Options.
10. |
Adjustment in Certain
Circumstances |
In the event:
|
(a) |
of any change in the Common Shares through subdivision,
consolidation, reclassification, amalgamation, merger or otherwise;
or |
B-4
|
(b) |
of any stock dividend to holders of Common Shares (other
than such stock dividends issued at the option of shareholders of the
Corporation in lieu of substantially equivalent cash dividends);
or |
|
|
|
|
(c) |
that any rights are granted to holders of Common Shares
to purchase Common Shares at prices substantially below fair market value;
or |
|
|
|
|
(d) |
that as a result of any recapitalization, merger,
consolidation or otherwise the Common Shares are converted into or
exchangeable for any other securities; |
then in any such case the Board may make such adjustment in
this Plan and in the Stock Options granted under this Plan as the Board may in
its sole discretion deem appropriate to prevent substantial dilution or
enlargement of the rights granted to, or available for, holders of Stock
Options, and such adjustments may be included in the Stock Options.
All expenses in connection with this Plan shall be borne by the
Corporation.
The Corporation shall not be obliged to issue any shares upon
exercise of Stock Options if the issue would violate any law or regulation or
any rule of any governmental authority or stock exchange. The Corporation shall
not be required to issue, register or qualify for resale any shares issuable
upon exercise of Stock Options pursuant to the provisions of a prospectus or
similar document, provided that the Corporation shall notify the TSX and any
other appropriate regulatory bodies of the existence of this Plan and the grant
and exercise of Stock Options under this Plan.
13. |
Disinterested Shareholder
Approval |
Disinterested shareholder approval shall be obtained by the
Corporation prior to any reduction in the Exercise Price of a Stock Option or
any extension of the Term of a Stock Option if the Eligible Optionee holding
such Stock Option is an "insider" (as such term is defined under the Ontario
Securities Act) of the Corporation.
14. |
Stock Option Agreement and Exercise
Procedure |
All Stock Options granted under this Plan shall be evidenced by
an agreement (the "Stock Option Agreement") between the Corporation and
the Eligible Optionee which meets the general requirements and conditions set
forth in this Plan and the requirements of the TSX. The procedure for exercising
Stock Options shall be such procedure as is agreed to by the Corporation and the
Eligible Optionee in the Stock Option Agreement or as otherwise agreed to by the
Corporation and the Eligible Optionee.
B-5
15. |
General Offer for Common
Shares |
If a bona fide offer (the
"Offer") for the Common Shares is made to shareholders generally, which
Offer, if accepted in whole or in part, would result in the offeror exercising
control over the Corporation within the meaning of subsection 1(3) of the
Securities Act (Ontario), then the Corporation shall, immediately upon
receipt of notice of the Offer, notify each Eligible Optionee then holding Stock
Options of the Offer, with full particulars thereof, whereupon, notwithstanding
clause 6(c) hereof but subject to any necessary regulatory approval, such Stock
Options may be exercised in whole or in part by the Eligible Optionee so as to
permit the Eligible Optionee to tender the Common Shares received upon such
exercise (the "Optioned Shares") pursuant to the Offer. If:
|
(a) |
the Offer is not completed within the time specified
therein; or |
|
|
|
|
(b) |
the Eligible Optionee does not tender the Optioned Shares
pursuant to the Offer; or |
|
|
|
|
(c) |
all of the Optioned Shares tendered by the Eligible
Optionee pursuant to the Offer are not taken up and paid for by the
offeror in respect thereof, |
then the Optioned Shares or, in the case of clause (c) above,
the Optioned Shares that are not taken up and paid for, shall be returned by the
Eligible Optionee to the Corporation and reinstated as authorized but unissued
Common Shares and the terms of the Stock Options as set forth in clause 6(c)
hereof shall again apply to the Stock Options. If any Optioned Shares are
returned to the Corporation under this Section 15, the Corporation shall refund
the Exercise Price to the Eligible Optionee for such Optioned Shares. In no
event shall the Eligible Optionee be entitled to sell the Optioned Shares
otherwise than pursuant to the Offer.
16. |
Amendments and Termination of
Plan |
The Corporation shall retain the right to amend from time to
time or to terminate the terms and conditions of this Plan by resolution of the
Board. Any amendments shall be subject to the prior consent of all applicable
regulatory bodies, including the TSX. Amendments and termination shall take
effect only with respect to Stock Options granted thereafter, provided that they
may apply to any Stock Options previously granted with the mutual consent of the
Corporation and the Eligible Optionees holding such Stock Options. The Board
shall have the power and authority to approve amendments relating to this Plan
or to Stock Options, without further approval of the Corporation's shareholders,
to the extent that such amendments relate to:
|
(a) |
altering the terms of vesting applicable to any Stock
Options; |
|
|
|
|
(b) |
changes to the date a Stock Option terminates upon the
Eligible Optionee ceasing to be a director, officer, employee or
consultant of the Corporation or any of its subsidiaries; |
|
|
|
|
(c) |
accelerating the expiry date in respect of Stock
Options; |
|
|
|
|
(d) |
determining the adjustment provisions pursuant to Section
10 hereof; |
B-6
|
(e) |
amending the definitions contained in this Plan;
or |
|
|
|
|
(f) |
amendments of a "housekeeping"
nature. |
For certainty, it is confirmed
that any amendment to this Plan or to Stock Options which does not relate to
items (a) to (f) above, shall require approval of the Corporations
shareholders. Without limiting the generality of the foregoing, any amendment to
this Plan or to Stock Options which relates to the following shall require
approval of the Corporations shareholders:
|
(i) |
an amendment to section 2 of this Plan to increase the
percentage figure set out therein; |
|
|
|
|
(ii) |
reducing the Exercise Price of a Stock Option held by an
Eligible Optionee; |
|
|
|
|
(iii) |
any cancellation and reissue of Stock Options or other
entitlements unless permitted under the rules of the TSX; |
|
|
|
|
(iv) |
extending the Term of any Stock Options held by an
Eligible Optionee; |
|
|
|
|
(v) |
any amendment which would permit Stock Options granted
under this Plan to be transferable or assignable other than for normal
estate settlement purposes; |
|
|
|
|
(vi) |
amendments that increase limits previously imposed on
non-employee director participation as set out in section 22 of this
Plan; |
|
|
|
|
(vii) |
adding to the categories of persons eligible to
participate in this Plan; or |
|
|
|
|
(viii) |
any amendment to section 16 of this Plan so as to
increase the ability of the Board to amend this Plan without shareholder
approval. |
This Plan shall be administered
by the Board. The Board shall have full and final discretion to interpret the
provisions of this Plan and to prescribe, amend, rescind and waive rules and
regulations to govern the administration and operation of this Plan. All
decisions and interpretations made by the Board shall be binding and conclusive
upon the Corporation and on all persons eligible to participate in this Plan,
subject to shareholder approval if required by the TSX.
18. |
Delegation of Administration of the
Plan |
Subject to the Canada Business Corporations Act or any
other legislation governing the Corporation, the Board may delegate to one or
more directors of the Corporation, on such terms as it considers appropriate,
all or any part of the powers, duties and functions relating to the granting of
Stock Options and the administration of this Plan.
B-7
This Plan shall be governed by and construed in accordance with
the laws in force in the Province of Ontario.
To the extent applicable, the issuance of any shares of the
Corporation pursuant to Stock Options granted under this Plan is subject to the
approval of the Plan by the TSX, and the Plan shall be subject to the ongoing
requirements of the TSX.
21. |
Limitation on Shares Issuable to
Insiders |
|
(a) |
The total number of Common Shares issued to "insiders"
(as such term is defined under the Ontario Securities Act) of the
Corporation, within any one year period, under all "security based
compensation arrangements" (within the meaning of the rules of the TSX) of
the Corporation shall not exceed 10% of the total number of outstanding
Common Shares. |
|
|
|
|
(b) |
The total number of Common Shares issuable to "insiders"
(as such term is defined under the Ontario Securities Act) of the
Corporation, at any time, under all "security based compensation
arrangements" (within the meaning of the rules of the TSX) of the
Corporation shall not exceed 10% of the total number of outstanding Common
Shares. |
22. |
Limitation on Shares Issuable to Non-Employee
Directors |
|
(a) |
The total number of Common Shares issuable to
non-employee directors of the Corporation, at any time, under all
"security based compensation arrangements" (within the meaning of the
rules of the TSX) of the Corporation shall not exceed 1% of the total
number of outstanding Common Shares. |
|
|
|
|
(b) |
Grant date value of Stock Options granted to any one
non-employee director of the Corporation shall not exceed a total of
Cdn$100,000 per year. |
BANRO CORPORATION |
Suite 7070, 1 First Canadian Place |
100 King Street West |
Toronto, Ontario, M5X 1E3, Canada |
NOTICE OF ANNUAL AND SPECIAL MEETING OF SHAREHOLDERS
NOTICE IS HEREBY GIVEN THAT
an annual and special meeting (the "Meeting") of shareholders of
Banro Corporation (the "Corporation") will be held at the offices of
Norton Rose Fulbright Canada LLP, Royal Bank Plaza, South Tower, Suite 3800, 200
Bay Street, Toronto, Ontario, Canada on Thursday, the 25th day of June, 2015 at
the hour of 11:00 a.m. (Toronto time), for the following purposes:
(1) |
To receive and consider the audited consolidated
financial statements of the Corporation as at and for the financial year
ended December 31, 2014, together with the auditors' report
thereon; |
|
|
(2) |
To elect directors of the Corporation; |
|
|
(3) |
To reappoint Deloitte LLP, Chartered Professional
Accountants, Chartered Accountants and Licensed Public Accountants, as the
auditors of the Corporation, to hold office until the close of the next
annual meeting of shareholders of the Corporation at such remuneration as
may be approved by the directors of the Corporation; |
|
|
(4) |
To consider and, if thought advisable, to approve by
means of an ordinary resolution (a) certain amendments to the
Corporation's stock option plan (the "Plan") (as such amendments
are described in the management information circular of the Corporation
(the "Circular") accompanying and forming part of this Notice) and
the Plan as amended by such amendments, and (b) all unallocated stock
options under the Plan; and |
|
|
(5) |
To transact such other business as properly may be
brought before the Meeting or any adjournment or adjournments
thereof. |
The specific details of the
matters to be put before the Meeting as identified above are set forth in the
accompanying Circular. This Notice and the accompanying Circular have been sent
to each director of the Corporation, each shareholder of the Corporation whose
proxy has been solicited and the auditors of the Corporation.
Shareholders who are unable to
attend the Meeting in person are requested to sign and return the enclosed form
of proxy to the Corporation c/o TMX Equity Transfer Services, Suite 300, 200
University Avenue, Toronto, Ontario, M5H 4H1, Canada.
DATED at Toronto, Ontario, Canada the 27th day of May,
2015.
BY ORDER OF THE BOARD |
|
(signed) "Geoffrey G. Farr" |
|
Geoffrey G. Farr |
Vice President, General Counsel and |
Corporate Secretary |
NOTE: |
The directors have fixed the hour of 4:00 p.m. (Toronto
time) on the 23rd day of June, 2015 before which time the instrument of
proxy to be used at the Meeting must be deposited with the Corporation c/o
TMX Equity Transfer Services, Suite 300, 200 University Avenue, Toronto,
Ontario, M5H 4H1, Canada, provided that a proxy may be delivered to the
Chairman of the Meeting on the day of the Meeting or any adjournment
thereof prior to the time for voting. |
BANRO CORPORATION |
Suite 7070, 1 First Canadian Place, 100 King Street West
|
Toronto, Ontario, M5X 1E3 Canada |
|
FORM OF PROXY SOLICITED BY THE MANAGEMENT OF
|
BANRO CORPORATION FOR USE AT THE ANNUAL AND SPECIAL
|
MEETING OF SHAREHOLDERS TO BE HELD ON JUNE 25, 2015
|
The undersigned shareholder(s) of
BANRO CORPORATION (the "Corporation") hereby appoint(s) in respect of all
of his or her shares of the Corporation, Richard W. Brissenden, Executive
Chairman of the Board of the Corporation, or failing him, Kevin Jennings, Senior
Vice President and Chief Financial Officer of the Corporation, or in lieu of the
foregoing __________________________________ as nominee of the undersigned, with
power of substitution, to attend, act and vote for the undersigned at the annual
and special meeting (the "Meeting") of shareholders of the Corporation to
be held on the 25th day of June, 2015, and any adjournment or adjournments
thereof, and direct(s) the nominee to vote the shares of the undersigned in the
manner indicated below:
1. |
On the election of the following nominees as directors of
the Corporation, as described in the Corporations management information
circular dated May 27, 2015 (the
"Circular"). |
|
|
VOTE FOR |
WITHHOLD VOTE |
|
Richard W. Brissenden |
[ ] |
[ ] |
|
John A. Clarke |
[ ] |
[ ] |
|
Maurice J. Colson |
[ ] |
[ ] |
|
Peter N. Cowley |
[ ] |
[ ] |
|
Mick C. Oliver |
[ ] |
[ ] |
|
Derrick H. Weyrauch |
[ ] |
[ ] |
2. |
VOTE FOR [ ] WITHHOLD VOTE [ ] on
reappointing Deloitte LLP, Chartered Professional Accountants, Chartered
Accountants and Licensed Public Accountants, as the auditors of the
Corporation, to hold office until the close of the next annual meeting of
shareholders of the Corporation at such remuneration as may be approved by
the directors of the Corporation. |
|
|
3. |
VOTE FOR [ ] AGAINST [ ] the
resolution approving (a) certain amendments to the Corporation's stock
option plan (the "Plan") (as such amendments are described in the
Circular) and the Plan as amended by such amendments, and (b) all
unallocated stock options under the Plan. |
This proxy confers discretionary
authority in respect of amendments and variations to matters identified in the
Notice of Meeting or other matters that may properly come before the Meeting or
any adjournment or postponement thereof, whether or not the amendment or other
matter that comes before the Meeting is or is not routine and whether or not the
amendment or other matter that comes before the Meeting is contested.
The undersigned revokes any
proxies previously given to vote the shares of the Corporation covered by this
proxy.
DATED the day
of
, 2015.
Signature of
Shareholder(s) |
|
|
|
Print Name |
(see notes on the back of this page)
|
NOTES:
|
(1) |
The form of proxy must be dated and signed by the appointor or his or her attorney authorized in writing or, if the appointor is a body corporate, the form of proxy must be executed by an officer or attorney thereof duly
authorized. If the proxy is not dated, it will be deemed to bear the date of the proxy deadline. The proxy ceases to be valid one year from its date. If the securities are registered in the name of more than one owner (for example, joint ownership,
trustees, executors, etc.), then all those registered should sign this proxy. If you are voting on behalf of a corporation or another individual you must sign this proxy with signing capacity stated, and you may be required to provide documentation
evidencing your power to sign this proxy that is acceptable to the Chairman of the Meeting.
|
| | |
|
(2) |
This proxy must be dated and the signature hereon should be exactly the same as the name in which the shares are registered.
|
| | |
|
(3) |
Where a choice with respect to any matter to be acted upon at the Meeting has been specified in the form of proxy, the shares represented by the form of proxy will be voted or withheld from voting in accordance with the
specifications so made. The shares represented by the form of proxy will be voted or withheld from voting in accordance with the instructions of the shareholder on any ballot that may be called for.
|
| | |
|
(4) |
A SHAREHOLDER HAS THE RIGHT TO APPOINT A PERSON (WHO NEED NOT BE A SHAREHOLDER) TO ATTEND AND ACT FOR HIM OR HER AND ON HIS OR HER BEHALF AT THE MEETING OTHER THAN THE PERSONS DESIGNATED IN THE FORM OF PROXY. SUCH RIGHT MAY BE
EXERCISED BY STRIKING OUT THE NAMES OF THE PERSONS DESIGNATED IN THE FORM OF PROXY AND BY INSERTING IN THE BLANK SPACE PROVIDED FOR THAT PURPOSE THE NAME OF THE DESIRED PERSON OR BY COMPLETING ANOTHER FORM OF PROXY AND, IN EITHER CASE, DELIVERING
THE COMPLETED AND EXECUTED PROXY TO THE CORPORATION C/O TMX EQUITY TRANSFER SERVICES, SUITE 300, 200 UNIVERSITY AVENUE, TORONTO, ONTARIO, M5H 4H1, CANADA, AT ANY TIME PRIOR TO 4:00 P.M. (TORONTO TIME) ON THE 23RD DAY OF JUNE, 2015, OR TO THE
CHAIRMAN OF THE MEETING ON THE DAY OF THE MEETING OR ANY ADJOURNMENT THEREOF PRIOR TO THE TIME FOR VOTING.
|
| | |
|
(5) |
IN THE ABSENCE OF INSTRUCTIONS TO THE CONTRARY, THE PERSONS NAMED IN THE PROXY WILL VOTE FOR EACH OF THE MATTERS IDENTIFIED IN THE PROXY.
|
| | |
|
(6) |
If your address as shown is incorrect, please give your correct address when returning the proxy.
|
BANRO CORPORATION
(the "Corporation")
FINANCIAL STATEMENT AND MD&A REQUEST FORM
In accordance with securities legislation, shareholders of the
Corporation may elect annually to receive a copy of the Corporation's quarterly
interim consolidated financial statements and related management's discussion
and analysis ("MD&A"), the Corporation's annual consolidated
financial statements and related MD&A, or both.
If you wish to receive copies of these documents, please
complete this form and return it to the following address (shareholders must
renew their requests to receive these documents each year):
TMX Equity Transfer Services
Suite 300, 200 University
Avenue
Toronto, Ontario, M5H 4H1
Canada
[ ] |
Please send me ONLY the quarterly interim
consolidated financial statements and related MD&A. |
[ ] |
Please send me ONLY the annual consolidated
financial statements and related MD&A. |
[ ] |
Please send me BOTH the quarterly interim
consolidated financial statements and the annual consolidated financial statements, and the
respective MD&A for such statements. |
Copies of the Corporation's annual and quarterly consolidated
financial statements and related MD&A are also available on the SEDAR
website at www.sedar.com.
DATED: __________________________________, 2015. |
|
|
Signature |
|
I confirm that I am a shareholder of the
Corporation. |
|
|
|
|
|
|
|
|
|
Name of Shareholder - Please Print |
|
|
|
|
|
|
|
Address |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name and title of person signing if different
from the name above. |
The Corporation will use the information collected solely for
the purpose of mailing the financial statements and MD&A to you and will
treat your signature on this form as your consent to the above.
BAA (AMEX:BAA)
Historical Stock Chart
From Aug 2024 to Sep 2024
BAA (AMEX:BAA)
Historical Stock Chart
From Sep 2023 to Sep 2024