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 of
the Securities Exchange Act of 1934
For the month of May 2024
Commission File Number 001-41489
enCore Energy Corp.
(Translation of registrant’s name into English)
101 N. Shoreline Blvd. Suite 450, Corpus Christi,
TX 78401
(Address of principal executive offices)
Indicate by check mark whether the registrant
files or will file annual reports under cover of Form 20-F or Form 40F:
Form 20-F ☐ Form
40-F ☒
Incorporation by Reference
The following documents are being submitted herewith:
SIGNATURES
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.
| |
enCore Energy Corp. |
| |
(Registrant) |
| |
|
| Date: May 21, 2024 |
By: |
/s/ Robert Willette |
| |
Name: |
Robert Willette |
| |
Title: |
Chief Legal Officer |
Exhibit
99.1
enCore
Energy Corp.
(the
“Company”)
Form
51-102F6
STATEMENT
OF EXECUTIVE COMPENSATION
(for
the financial year ended December 31, 2023)
The
following executive compensation disclosure is prepared in accordance with National Instrument 51-102 Continuous Disclosure Obligations
and Form 51-102F6 Statement of Executive Compensation (“Form 51-102F6”). The purpose of this Statement
of Executive Compensation is to provide disclosure of all compensation earned by directors and certain executive officers in connection
with their position as a director or officer of, or consultant to, the Company.
All
monetary amounts herein are expressed in Canadian dollars ($) unless otherwise stated.
For
the purposes of this Statement of Executive Compensation, a “Named Executive Officer” or “NEO”
means:
| (a) | “CEO”
means an individual who acted as chief executive officer of the company, or acted in a similar
capacity, for any part of the most recently completed financial year; |
| (b) | “CFO”
means an individual who acted as chief financial officer of the company, or acted in a similar
capacity, for any part of the most recently completed financial year; |
| (c) | each
of the three most highly compensated executive officers of the Company, including any of
its subsidiaries, or the three most highly compensated individuals acting in a similar capacity,
other than the CEO and the CFO, at the end of the most recently completed financial year,
whose total compensation was, individually, more than $150,000, as determined in accordance
with subsection 1.3(6) of Form 51-102F6 for the financial year ended December 31, 2023; and |
| (d) | each
individual who would be an NEO under paragraph (c) but for the fact that the individual was
neither an executive officer of the Company or its subsidiaries, nor acting in a similar
capacity, at the end of that financial year. |
In
connection with the most recently completed financial year ended December 31, 2023, the Company had five (5) NEOs as follows:
| NEO
Name | |
Position |
| W. Paul Goranson | |
Chief Executive Officer |
| Dennis Eugene Stover | |
Interim Chief Financial
Officer |
| William Sheriff | |
Executive Chairman |
| Peter Luthiger | |
Chief Operating Officer |
| Carrie Mierkey | |
Former Chief Financial
Officer |
COMPENSATION
DISCUSSION AND ANALYSIS
The
Company’s compensation policies and programs are designed to be competitive with similar mining companies and to recognize and
reward executive performance consistent with the success of the Company’s business. These policies and programs are intended to
attract and retain capable and experienced people while complying with regulatory requirements. The compensation committee’s (the
“Compensation Committee”) role and philosophy, among other things, are to ensure that the Company’s compensation
goals and objectives, as applied to the actual compensation paid to the Company’s CEO and other executive officers, are aligned
with the Company’s overall business objectives and with shareholder interests.
In
addition to industry comparables, the Compensation Committee considers a variety of factors when determining both compensation policies
and programs and individual compensation levels. These factors include the long-range interests of the Company and its Shareholders,
the implications of the risks associated with the Company’s compensation policies and practices in light of the financial performance
of the Company, the overall financial and operating performance of the Company and the Compensation Committee’s assessment of each
executive’s individual performance results and contribution toward meeting corporate objectives. Since last year’s annual
general meeting of shareholders, neither the Board nor the Compensation Committee of the Company has proceeded to a formal evaluation
of the implications of the risks associated with the Company’s compensation policies and practices. Risk management is a consideration
of the Board when implementing its compensation program, and the Board does not believe that the Company’s compensation program
results in unnecessary or inappropriate risk-taking including risks that are likely to have a material adverse effect on the Company.
During the year ended December 31, 2023, the
Board approved an increase in annual director compensation from US$24,000 to US$44,000, and in the case of the Chair of the Audit Committee
from US$36,000 to US$66,000 per year. A director who obtains a National Association of Corporate Directors certification will receive
a further increase of US$26,000 per year.
The
current members of the Compensation Committee are Mark S. Pelizza (Chair), William B. Harris, and Richard M. Cherry. The function of
the Compensation Committee is to assist the Board in fulfilling its responsibilities relating to the compensation practices of the executive
officers of the Company. The Compensation Committee has been empowered to review the compensation levels of the executive officers of
the Company and to report thereon to the Board; to review the strategic objectives of the stock option and other stock-based compensation
plans of the Company; and to consider any other matters which, in the Compensation Committee’s judgment, should be taken into account
in reaching the recommendation to the Board concerning the compensation levels of the Company’s executive officers. The Board has
adopted a charter for the Compensation Committee.
In
2023 the Company has adopted a compensation recovery policy (referred to as the “Incentive Compensation Clawback Policy”)
as required by Nasdaq listing standards and pursuant to Rule 10D-1 of the Securities Exchange Act of 1934, as amended. At no time during
or after the fiscal year ended December 31, 2023 (as of the date of this Statement of Executive Compensation), was the Company required
to prepare an accounting restatement that required recovery of erroneously awarded compensation pursuant to the Incentive Compensation
Clawback Policy and, as of December 31, 2023, there was no outstanding balance of erroneously awarded compensation to be recovered from
the application of the Incentive Compensation Clawback Policy to a prior restatement.
Report
on Executive Compensation
The
Board assumes responsibility for reviewing and monitoring the long-range compensation strategy for the senior management of the Company
although the Compensation Committee guides it in this role. The Board determines the type and amount of compensation for the CEO. The
Board also reviews the compensation of the Company’s senior executives.
Philosophy
and Objectives
The
compensation program for the senior management of the Company is designed to ensure that the level and form of compensation achieves
certain objectives, including:
| (a) | attracting
and retaining talented, qualified and effective executives; |
| (b) | motivating
the short and long-term performance of these executives; and |
| (c) | better
aligning the interests of these executives with those of the Company’s Shareholders. |
In
compensating its senior management, the Company has employed a combination of base salary, bonus plan and equity participation through
its stock option plan.
Elements
of the Compensation Program
The
significant elements of compensation awarded to the NEOs (as defined above) are a cash salary, bonus plan based on corporate goals set
by the Board and stock options. With the exception of the stock option plan, the Company does not presently have any other long-term
incentive plan for its NEOs. There is no policy or target regarding allocation between cash and noncash elements of the Company’s
compensation program. The Compensation Committee reviews annually the total compensation package of each of the Company’s executives
on an individual basis, against the backdrop of the compensation goals and objectives described above, and make recommendations to the
Board concerning the individual components of their compensation.
Cash
Salary
As
a general rule, the Company seeks to offer its NEOs a compensation package that is in line with the Company’s fiscal resources
and competitive with other companies in the mineral exploration industry of a similar size at a similar stage of development, and as
an immediate means of rewarding the NEOs for efforts expended on behalf of the Company.
Bonus
Plan
The
Company’s current Executive Chairman, CEO, CFO, Chief Operating Officer, Chief Legal Officer, and Chief Technical Officer (“CTO”)
are eligible to receive a cash bonus, up to a certain percentage of base salary, which will be paid in accordance with the determination
of enCore’s Compensation Committee and recommendation to the Board for approval, based on a number of agreed metrics including:
a) financial condition of enCore; b) predetermined corporate and personal goals established between enCore and the individual; and c)
share price performance.
In
addition, the Company’s current Executive Chairman is eligible to receive a special bonus that will be established by enCore for
exceptional achievements as measured by enCore’s market capitalization, its growth profile in assets or by any other metrics as
reviewed by the Compensation Committee and recommended for approval by the Board. The Company’s current CEO is eligible to receive
a special bonus that will be established by enCore for exceptional achievements as measured by enCore’s successful acquisition
of certain uranium production facilities or assets, as determined by the Board. The Company’s Chief Operating Officer is also eligible
to participate in a special bonus pool that will be established by enCore for exceptional achievements as measured by certain goals agreed
between the COO and the Compensation Committee.
Equity
Participation
The
Company believes that encouraging its executives and employees to become Shareholders is the best way of aligning their interests with
those of its Shareholders. Equity participation is accomplished through the Company’s stock option plan. Stock options are granted
to executive officers taking into account a number of factors, including the amount and term of options previously granted, base salary
and bonuses and the Company’s goals.
Use
of Financial Instruments
The
Company does not have a policy that would prohibit a NEO or director from purchasing financial instruments, including 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 NEO or director. However, Management is not aware
of any NEO or director purchasing such an instrument.
Perquisites
and Other Personal Benefits
The
Company’s NEOs are not generally entitled to significant perquisites or other personal benefits not offered to the Company’s
other employees.
Performance
Graph
The
graph below compares the Company’s total shareholder return on a $100 investment in Common Shares to the total return to the S&P/TSX
Composite Index. Total Return Index Value for the period commencing January 1, 2019 and ending December 31, 2023.
The
S&P/TSX Composite Index was created to address the needs of investment managers requiring a benchmark headline index for the Canadian
equity market. As at the end of the period covered by the performance graph, the Company has exceeded the performance of the benchmark
by 880%. Given the Company’s market capitalization and size of operations of the Company, volatility has been higher than that
of the benchmark.
Share-based
and Option-based Awards
The
Company currently has in effect the Stock Option Plan, the purpose of which is to advance the interests of the Company and its Shareholders
by (a) ensuring that the interests of officers and employees are aligned with the success of the Company; (b) encouraging ownership of
Company shares by such persons; and (c) providing compensation opportunities to attract, retain and motivate such persons. The Stock
Option Plan provides optionees with the opportunity through the exercise of options to acquire an ownership interest in the Company.
The
Stock Option Plan is administered by the Board (with certain responsibilities delegated to the Option Grant Committee in regards to considering
grants to employees and consultants who aren’t directors or executive officers of the Company) that determines, from time to time
the eligibility of persons to participate in the Stock Option Plan, when options will be granted, the number of common shares subject
to each option, the exercise price of each option, the expiration date of each option and the vesting period for each option, in each
case in accordance with applicable securities laws and stock exchange requirements.
It
is not the Company’s practice to grant stock options to existing executive officers on an annual basis, but grants of stock options
will be considered as the circumstances of the Company and the contributions of the individual warrant. Previous grants of options are
taken into account when considering new grants as part of the Company’s plan to achieve its objective of retaining quality personnel.
As
at the date of this Statement of Executive Compensation, the Company has options outstanding under the Stock Option Plan to purchase
7,550,836 Common Shares, representing 41.08% of the available options, and 4.11% of the issued and outstanding Common Shares, as at that
date. Accordingly, 10,831,193 options remain available for grant under the Stock Option Plan.
Compensation
Governance
The
Board has established a Compensation Committee comprised of three directors; Mark S. Pelizza (Chair), William B. Harris, and Richard
M. Cherry. All members of the Compensation Committee are considered independent directors of the Board. The function of the Compensation
Committee is to review, on an annual basis, the compensation paid to the Company’s executive officers and to the directors, and
to make recommendations to the Board on the Company’s compensation policies. In addition, the Committee reviews the Company’s
succession plans for the CEO and makes recommendations with respect to severance paid to executives. The Board is responsible for approving
stock option grants and administering the Stock Option Plan (with certain responsibilities delegated to the Option Grant Committee in
regards to considering grants to employees and consultants who aren’t directors or executive officers of the Company). The process
adopted with respect to the review of compensation for the Company’s directors and senior officers is set out under the heading
“Compensation Discussion and Analysis” above.
The
Compensation Committee members’ collective experience in leadership roles, their extensive knowledge of the mining industry and
their experience in operations, financial matters and corporate strategy provide the Compensation Committee with the collective skills,
knowledge and experience necessary to effectively carry out its mandate.
During
the year ended December 31, 2023, the Company engaged Ernst & Young LLP to conduct a compensation study to assess the Company’s
executive level employees against industry peer groups, resulting in a report dated June 2023 (the “Compensation Report”).
The Compensation Committee considered the Compensation Report when reviewing the executive compensation and related employment agreements
for the Company’s Executive Chairman, CEO, and CFO. The Compensation Committee reported to the Board that it considered that the
Company’s long-term executive compensation plan was in line with industry peers.
Executive
Compensation-Related Fees
Other
than $75,000 paid to Ernst & Young LLP to complete the Compensation Report, the Company did not pay any fees to consultants and/or
advisors for services related to determining compensation for any of the Company’s directors and executive officers, during the
year ended December 31, 2023.
All
Other Fees
During
the year ended December 31, 2023, the Company did not pay any fees for any other services provided by consultants and/or advisors.
SUMMARY
COMPENSATION TABLE
The
following table (presented in accordance with Form 51-102F6) sets forth all direct and indirect compensation for, or in connection with,
services provided to the Company and its subsidiaries for the financial years ended December 31, 2023, 2022, and 2021 in respect of the
NEOs of the Company.
| |
|
|
|
|
|
|
|
|
|
|
|
|
Non-equity
incentive plan compensation ($)(f) |
|
|
|
|
|
|
|
|
|
|
Name
and principal position
(a) |
|
Year
(b) |
|
Salary
($)
(c) |
|
|
Share-based
awards
($)
(d) |
|
|
Option-based
awards
($)(1)
(e) |
|
|
Annual
incentive plans
(f1) |
|
|
Long-term
incentive plans
(f2) |
|
|
Pension
Value
($)
(g) |
|
|
All
other compensation
($)
(h) |
|
|
Total
compensation
($)
(i) |
|
W.
Paul Goranson(2)
CEO and Director |
|
2023 |
|
|
462,910 |
|
|
|
N/A |
|
|
|
825,976 |
|
|
|
1,454,860 |
(3) |
|
|
N/A |
|
|
|
N/A |
|
|
|
52,084 |
|
|
|
2,795,830 |
|
| |
2022 |
|
|
365,688 |
|
|
|
N/A |
|
|
|
1,453,941 |
|
|
|
135,440 |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
1,955,069 |
|
| |
2021 |
|
|
338,445 |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
247,742 |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
586,187 |
|
Dennis
Stover(4)
Director and Former Interim CFO |
|
2023 |
|
|
N/A |
|
|
|
N/A |
|
|
|
361,364 |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
197,729 |
|
|
|
559,093 |
(5) |
| |
2022 |
|
|
N/A |
|
|
|
N/A |
|
|
|
838,812 |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
142,841 |
|
|
|
981,653 |
|
| |
2021 |
|
|
N/A |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
132,260 |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
79,356 |
|
|
|
211,616 |
|
William
M. Sheriff
Executive Chairman and Director |
|
2023 |
|
|
396,780 |
|
|
|
N/A |
|
|
|
722,729 |
|
|
|
264,520 |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
40,928 |
|
|
|
1,424,957 |
|
| |
2022 |
|
|
296,926 |
|
|
|
N/A |
|
|
|
1,230,257 |
|
|
|
270,880 |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
1,798,064 |
|
| |
2021 |
|
|
127,857 |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
116,989 |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
244,846 |
|
Peter
Luthiger(6)
Chief Operating Officer |
|
2023 |
|
|
310,811 |
|
|
|
N/A |
|
|
|
206,494 |
|
|
|
66,130 |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
66,290 |
|
|
|
649,725 |
|
| |
2022 |
|
|
205,127 |
|
|
|
N/A |
|
|
|
296,460 |
|
|
|
47,404 |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
548,991 |
|
| |
2021 |
|
|
N/A |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
N/A |
|
Carrie
Mierkey(7)
Former CFO |
|
2023 |
|
|
310,811 |
|
|
|
N/A |
|
|
|
309,741 |
|
|
|
99,195 |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
72,136 |
|
|
|
791,883 |
|
| |
2022 |
|
|
263,848 |
|
|
|
N/A |
|
|
|
559,208 |
|
|
|
67,720 |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
890,776 |
|
| |
2021 |
|
|
201,082 |
|
|
|
N/A |
|
|
|
225,777 |
|
|
|
107,049 |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
533,908 |
|
Notes:
| (1) | This
amount represents the fair value, on the date of grant, of awards made under the Stock Option
Plan for the applicable financial year. The grant date fair value has been calculated using
the Black Scholes option-pricing model. The key assumptions and estimates used for the calculation
of the grant date fair value under this model include the risk-free interest rate and expected
stock price volatility, life and dividend yield. |
| (2) | Mr.
Goranson was appointed as the Company’s CEO on October 1, 2020. |
| (3) | Includes
US$1,000,000 success fee payment paid to Mr. Goranson upon completion of the Company’s
acquisition of the Alta Mesa Uranium Project. |
| (4) | Mr.
Stover was appointed as the Company’s interim CFO on December 23, 2023 until February
14, 2024. The Company’s current CFO, Shona Wilson, was appointed on February 14, 2024. |
| (5) | Mr.
Stover received a one-time bonus payment of US$15,000 for his role as interim CFO of the
Company, and received US$134,500 for his role as a director of the Company. |
| (6) | Mr.
Luthiger was appointed as the Company’s Chief Operating Officer on May 1, 2022. |
| (7) | Ms.
Mierkey was appointed as the Company’s CFO on February 1, 2021 and resigned effective
December 23, 2023. |
Narrative
Discussion of Summary Compensation Table
The
significant factors relating to the compensation for, or in connection with, services provided to the Company and its subsidiaries
for the financial years ended December 31, 2023, 2022, and 2021 in respect of the NEOs of the Company, vary depending on the
circumstances of each award, and may include: the significance of the terms of each NEO’s employment agreement or arrangement;
management discussion and valuation of achievements and performance; and any repricing or other significant changes to the terms of
any share-based or option-based award program during the most recently completed financial year.
INCENTIVE
PLAN AWARDS FOR NEOS
Outstanding
Share-based Awards and Option-based Awards
The
following table (presented in accordance with Form 51-102F6) sets forth for each NEO all awards outstanding at the end of the most recently
completed financial year (ended December 31, 2023).
| |
|
Option-based
Awards |
|
|
Share-based
Awards |
|
Name
(a) |
|
Number
of
securities
underlying
unexercised
options
(#)
(b) |
|
|
Option
exercise
price ($)
(c) |
|
|
Option
expiration
date
(d) |
|
Value
of
unexercised in-the
money
options ($)(1)
(e) |
|
|
Number of
shares or
units of
shares
that have
not
vested (#)
(f) |
|
|
Market or
payout
value of
share-
based
awards
that have
not
vested ($)
(g) |
|
|
Market
or
payout
value of
vested
share-
based
awards not
paid out or
distributed
($)
(h) |
|
W.
Paul Goranson
CEO and Director |
|
|
50,000 |
|
|
|
1.05 |
|
|
Sept.
1, 2025 |
|
|
208,000 |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
N/A |
|
| |
|
475,000 |
|
|
|
1.349 |
|
|
Sept.
10, 2025 |
|
|
1,833,975 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
433,333 |
|
|
|
4.20 |
|
|
Feb.
14, 2027 |
|
|
437,666.33 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
400,000 |
|
|
|
2.79 |
|
|
May
17, 2028 |
|
|
968,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Dennis
Stover
Director and Former Interim CFO |
|
|
233,333 |
|
|
|
0.45 |
|
|
June
3, 2024 |
|
|
1,110,665.08 |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
N/A |
|
| |
|
200,000 |
|
|
|
0.615 |
|
|
May
20, 2025 |
|
|
919,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
250,000 |
|
|
|
4.20 |
|
|
Feb.
14, 2027 |
|
|
252,500 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
175,000 |
|
|
|
2.79 |
|
|
May
17, 2028 |
|
|
423,500 |
|
|
|
|
|
|
|
|
|
|
|
|
|
William
M. Sheriff
Executive Chairman and Director |
|
|
233,333 |
|
|
|
0.45 |
|
|
June
3, 2024 |
|
|
1,110,665.08 |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
N/A |
|
| |
|
200,000 |
|
|
|
0.615 |
|
|
May
20, 2025 |
|
|
919,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
366,667 |
|
|
|
4.20 |
|
|
Feb.
14, 2027 |
|
|
370,333.67 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
350,000 |
|
|
|
2.79 |
|
|
May
17, 2028 |
|
|
847,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Peter
Luthiger
Chief Operating Officer |
|
|
83,333 |
|
|
|
4.32 |
|
|
May
2, 2027 |
|
|
74,166.37 |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
N/A |
|
| |
|
100,000 |
|
|
|
2.79 |
|
|
May
17, 2028 |
|
|
242,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Carrie
Mierkey
Former CFO |
|
|
Nil |
(2) |
|
|
N/A |
|
|
N/A |
|
|
N/A |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
N/A |
|
Notes:
| (1) | Calculated
as the number of unexercised options multiplied by the difference between the share price as of December 29, 2023,
the last trading day of the fiscal 2023 year ($5.21), and the exercise price. |
| (2) | In
connection with Ms. Mierkey’s resignation, all outstanding 400,000 options were cancelled
effective December 23, 2023. |
Incentive
Plan Awards – Value Vested or Earned During the Year
The
following table (presented in accordance with Form 51-102F6) sets forth details of the value vested or earned during the most recently
completed financial year (ended December 31, 2023) for each incentive plan award to NEOs.
| Name |
|
Option-based Awards –
Value vested during the
year(1) ($) |
|
|
Share-based awards –
Value vested during the
year ($) |
|
|
Non-equity incentive plan
compensation – Value
earned during the
year ($) |
|
W. Paul Goranson
CEO and Director |
|
|
245,000.00 |
(2) |
|
|
N/A |
|
|
|
1,454,860 |
|
Dennis Stover(3)
Director and Former Interim CFO |
|
|
107,187.50 |
(4) |
|
|
N/A |
|
|
|
N/A |
|
William M. Sheriff
Executive Chairman and Director |
|
|
214,375.00 |
(5) |
|
|
N/A |
|
|
|
264,520 |
|
Peter Luthiger
Chief Operating Officer |
|
|
66,249.98 |
(6) |
|
|
N/A |
|
|
|
66,130 |
|
Carrie Mierkey(7)
Former CFO |
|
|
91,875.00 |
(8) |
|
|
N/A |
|
|
|
99,195 |
|
Notes:
| (1) | Calculated
as the number of options vested during the year multiplied by the difference between the
market price on the vesting date and the related exercise price. |
| (2) | On
February 14, 2023, 108,333 Options vested at an exercise price of $4.20; on August 14, 2023,
108,333 Options vested at an exercise price of $4.20; and on November 17, 2023, 100,000 Options
vested at an exercise price of $2.79. The closing market price of the Company’s Common
Shares on the Exchange was $3.20 on February 14, 2023, $3.30 on August 14, 2023, and $5.24
on November 17, 2023. |
| (3) | Mr.
Stover was appointed as the Company’s interim CFO on December 23, 2023 until February
14, 2024. The Company’s current CFO, Shona Wilson, was appointed on February 14, 2024. |
| (4) | On
February 14, 2023, 62,500 Options vested at an exercise price of $4.20; on August 14, 2023,
62,500 Options vested at an exercise price of $4.20; and on November 17, 2023, 43,750 Options
vested at an exercise price of $2.79. The closing market price of the Company’s Common
Shares on the Exchange was $3.20 on February 14, 2023, $3.30 on August 14, 2023, and $5.24
on November 17, 2023. |
| (5) | On
February 14, 2023, 91,667 Options vested at an exercise price of $4.20; on August 14, 2023,
91,667 Options vested at an exercise price of $4.20; and on November 17, 2023, 87,500 Options
vested at an exercise price of $2.79. The closing market price of the Company’s Common
Shares on the Exchange was $3.20 on February 14, 2023, $3.30 on August 14, 2023, and $5.24
on November 17, 2023. |
| (6) | On
May 2, 2023, 20,833 Options vested at an exercise price of $4.32, on November 2, 2023, 20,833
Options vested at an exercise price of $4.32, and on November 17, 2023, 25,000 Options vested
at an exercise price of $2.79. The closing market price of the Company’s Common Shares
on the Exchange was $2.77 on May 2, 2023, $4.56 on November 2, 2023, and $5.24 on November
17, 2023. |
| (7) | Ms.
Mierkey resigned as the Company’s CFO effective December 23, 2023. |
| (8) | On
February 14, 2023, 41,667 Options vested at an exercise price of $4.20; on August 14, 2023,
41,667 Options vested at an exercise price of $4.20; and on November 17, 2023, 37,500 Options
vested at an exercise price of $2.79. The closing market price of the Company’s Common
Shares on the Exchange was $3.20 on February 14, 2023, $3.30 on August 14, 2023, and $5.24
on November 17, 2023. |
Narrative
Discussion of Incentive Plan Awards
The
significant terms of all plan-based awards, including non-equity incentive plan awards, issued or vested, or under which options have
been exercised, during the year, or outstanding at year end, are set out above in the Compensation Discussion and Analysis. These terms
include:
| ● | the
number of securities underlying each award or received on vesting or exercise; |
| ● | exercise
prices and expiry dates; |
| ● | whether
awards are vested or unvested; |
| ● | performance
goals or similar conditions, or other significant conditions; and |
| ● | the
closing market price on the grant date. |
PENSION
PLAN BENEFITS
The
Company does not provide a defined benefit plan or a defined contribution plan for any of its executive officers or employees, nor does
it have a deferred compensation plan for any of its executive officers.
TERMINATION
AND CHANGE OF CONTROL BENEFITS
Employment
agreements are in place for the NEOs which set out the details relating to the provision of severance payments upon termination of employment
and the consequent obligations of non-competition and non-solicitation.
W.
Paul Goranson
Pursuant
to the employment agreement dated April 1, 2023 between enCore and Mr. Goranson, if there is a Change of Control, then all of the stock
options previously granted to Mr. Goranson that have neither vested nor expired will automatically vest and become immediately exercisable.
Mr. Goranson will have 90 days from the effective date of the termination of his employment to exercise any stock options which had vested
as of the effective date of termination and thereafter, his stock options will expire and he will have no further right to exercise the
stock options. Mr. Goranson may terminate his employment agreement with 30 days’ written notice to the Company. The Company may
terminate his agreement for just cause at any time with no further obligations to Mr. Goranson, other than payment of all accrued obligations
up to and including the date of termination. Mr. Goranson will also be entitled to exercise any rights with respect to stock options
on termination of employment in accordance with the Company’s stock option plan and the terms and conditions of each grant. If
the Company terminates his employment agreement without just cause, Mr. Goranson will be entitled to an amount in cash equal to two times
(the “Severance Factor”) the sum of his base salary and the full annual target cash bonus for the calendar year in
which the date of termination occurs. The Company will also pay Mr. Goranson the full cost of his COBRA continuation rate charged by
the Company for employees on a monthly basis for a period of months equal to twelve times the applicable Severance Factor, beyond his
termination month. Mr. Goranson, and if applicable his dependents may, at their choosing and if eligible, enroll in COBRA continuation
under the group health insurance plan through the Company (generally for the first eighteen months following his termination month) or,
if they choose, they may enroll in a separate plan of their choosing, by using these payments to enroll in medical and prescription insurance
of their choosing. The Company will also pay Mr. Goranson the full cost of his COBRA continuation rate, on terms as described above,
in the case Mr. Goranson terminates his employment for Good Reason.
William
M. Sheriff
Pursuant
to the employment agreement dated April 1, 2023 between enCore and Mr. Sheriff, if there is a Change of Control, then all of the stock
options previously granted to Mr. Sheriff that have neither vested nor expired will automatically vest and become immediately exercisable.
Mr. Sheriff will have 90 days from the effective date of the termination of his employment to exercise any stock options which had vested
as of the effective date of termination and thereafter, his stock options will expire and he will have no further right to exercise the
stock options. Mr. Sheriff may terminate his employment agreement with 30 days’ written notice to the Company. The Company may
terminate his agreement for cause at any time with no further obligations to Mr. Sheriff, other than payment of all accrued obligations
up to and including the date of termination. Mr. Sheriff will also be entitled to exercise any rights with respect to stock options on
termination of employment in accordance with the Company’s stock option plan and the terms and conditions of each grant. If the
Company terminates his employment agreement without just cause or upon a Change of Control, Mr. Sheriff will be entitled to an amount
in cash equal to two times the sum of his base salary and one full annual year target cash bonus, adjusted for inflation from the date
of the agreement as reported by the US CPI, after Mr. Sheriff signs the release contemplated by the agreement. The Company will also
pay Mr. Sheriff the full cost of his COBRA continuation rate charged by the Company for employees on a monthly basis for a period of
months equal to twelve times the applicable Severance Factor, beyond his termination month. Mr. Sheriff, and if applicable his dependents
may, at their choosing and if eligible, enroll in COBRA continuation under the group health insurance plan through the Company (generally
for the first eighteen months following his termination month) or, if they choose, they may enroll in a separate plan of their choosing,
by using these payments to enroll in medical and prescription insurance of their choosing. The Company will also pay Mr. Sheriff the
full cost of his COBRA continuation rate, on terms as described above, in the case Mr. Sheriff terminates his employment for Good Reason.
Peter
Luthiger
Pursuant
to the employment agreement dated effective April 1, 2024 between enCore and Mr. Luthiger, if there is a Change of Control and Mr. Luthiger’s
employment is not continued by the Company, then all of the stock options previously granted to Mr. Luthiger that have neither vested
nor expired will automatically vest and become immediately exercisable. Mr. Luthiger will have 90 days from the effective date of the
termination of his employment to exercise any stock options which had vested as of the effective date of termination and thereafter,
his stock options will expire and he will have no further right to exercise the stock options. Mr. Luthiger may terminate his employment
agreement with 30 days’ written notice to the Company. The Company may terminate his agreement for cause at any time with no further
obligations to Mr. Luthiger, other than payment of all accrued obligations up to and including the date of termination. Mr. Luthiger
will also be entitled to exercise any rights with respect to stock options on termination of employment in accordance with the Company’s
stock option plan and the terms and conditions of each grant. If the Company terminates his employment agreement without just cause or
upon a Change of Control, Mr. Luthiger will be entitled to an amount in cash equal to two times the sum of the employee’s base
salary and the full annual target cash bonus for the calendar year in which the date of termination occurs. The Company will also pay
Mr. Luthiger the full cost of his COBRA continuation rate charged by the Company for employees on a monthly basis for a period of months
equal to twelve times the applicable Severance Factor, beyond his termination month. Mr. Luthiger, and if applicable his dependents may,
at their choosing and if eligible, enroll in COBRA continuation under the group health insurance plan through the Company (generally
for the first eighteen months following his termination month) or, if they choose, they may enroll in a separate plan of their choosing,
by using these payments to enroll in medical and prescription insurance of their choosing. The Company will also pay Mr. Luthiger the
full cost of his COBRA continuation rate, on the same terms, in the case Mr. Luthiger terminates his employment for Good Reason.
Dennis
Stover
Pursuant
to a management services agreement dated effective September 1, 2023 between enCore and Mr. Stover in connection with his role as Chief
Technical Officer of the Company, if the agreement is terminated within three months of a Change of Control, Mr. Stover will be entitled
to payment in an amount equal to 12 multiplied by the monthly fee as set out in the agreement. The initial term of the agreement is 12
months from the effective date, and other than by mutual consent regarding non-renewal of the agreement, the Company or Mr. Stover may
terminate the agreement with 30 days’ notice. Upon termination of the agreement, the Company will pay all amounts due and owing
to Mr. Stover for services performed to the date of termination, as well as any required reimbursement for expenses. If Mr. Stover fails
to perform any of his obligations under the agreement, the Company may terminate the agreement without penalty provided that the Company
must provide notice of such breach in writing to Mr. Stover, who will have 30 days to rectify the breach. In the event that the breach
is rectified during the grace period, the agreement will not be terminated.
For
the purpose of the above employment agreements, “Good Reason” means a constructive dismissal, such as a material reduction
in the level of responsibility or base salary of the employee.
Other
than the agreements described herein, the Company and its subsidiaries are not parties to any contracts, and have not entered into any
plans or arrangements which require compensation to be paid to any of the NEOs in the event of:
| (a) | resignation,
retirement or any other termination of employment with the Company or one of its subsidiaries; |
| (b) | a
change of control of the Company or one of its subsidiaries; or |
| (c) | a
change in the director, officer or employee’s responsibilities following a change of
control of the Company. |
DIRECTOR
COMPENSATION
Director
Compensation Table
The
following table (presented in accordance with Form 51-102F6) sets forth all amounts of compensation earned by the non-executive directors
for the Company’s most recently completed financial year (ended December 31, 2023).
Name
(a) |
|
Fees
earned
($)
(b) |
|
|
Share-
based
awards
($)
(c) |
|
Option-
based
awards
($)(1)
(d) |
|
|
Non-equity
incentive
plan
compensation
($)
(e) |
|
Pension
value
($)
(f) |
|
|
All
other
compensation
($)
(g) |
|
Total
($)
(h) |
|
| William B. Harris |
|
|
91,370 |
|
|
N/A |
|
|
464,611 |
|
|
N/A |
|
|
N/A |
|
|
N/A |
|
|
555,981 |
|
| Mark S. Pelizza |
|
|
42,764 |
|
|
N/A |
|
|
361,364 |
|
|
N/A |
|
|
N/A |
|
|
N/A |
|
|
430,580 |
|
| Richard M. Cherry |
|
|
59,958 |
|
|
N/A |
|
|
361,364 |
|
|
N/A |
|
|
N/A |
|
|
N/A |
|
|
455,710 |
|
| Susan Hoxie-Key |
|
|
51,361 |
|
|
N/A |
|
|
361,364 |
|
|
N/A |
|
|
N/A |
|
|
N/A |
|
|
439,177 |
|
Note:
| (1) | This
amount represents the fair value, on the date of grant, of awards made under the Stock Option
Plan for the applicable financial year. The grant date fair value has been calculated using
the Black Scholes option-pricing model. The key assumptions and estimates used for the calculation
of the grant date fair value under this model include the risk-free interest rate and expected
stock price volatility, life and dividend yield. |
Narrative
Discussion of Director Compensation Table
Other
than as disclosed herein, the Company has no standard arrangement pursuant to which directors are compensated by the Company for their
services in their capacity as directors except for the granting from time to time of incentive stock options.
INCENTIVE
PLAN AWARDS FOR DIRECTORS
Outstanding
Share-based Awards and Option-based Awards
The
following table sets forth for each director all awards outstanding at the end of the most recently completed financial year (ended December
31, 2023).
| |
|
Option-based
Awards |
|
|
Share-based
Awards |
|
| Name |
|
Number
of
securities
underlying
unexercised
options
(#) |
|
|
Option
exercise
price ($) |
|
|
Option
expiration date |
|
Value
of
unexercised
in-the money
options
($)(1) |
|
|
Number of
shares or
units of
shares
that
have not
vested (#) |
|
|
Market or
payout
value of
share-based awards
that
have not
vested
($) |
|
|
Market
or
payout
value of
vested
share-
based
awards
not paid
out or
distributed
($) |
|
| (a) |
|
(b) |
|
|
(c) |
|
|
(d) |
|
(e) |
|
|
(f) |
|
|
(g) |
|
|
(h) |
|
| William
B. Harris |
|
|
150,000 |
|
|
|
0.45 |
|
|
June
3, 2024 |
|
|
714,000 |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
N/A |
|
| |
|
116,667 |
|
|
|
0.615 |
|
|
May
20, 2025 |
|
|
536,084.87 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
266,667 |
|
|
|
4.20 |
|
|
Feb.
14, 2027 |
|
|
269,333.67 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
225,000 |
|
|
|
2.79 |
|
|
May
17, 2028 |
|
|
544,500 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Mark
S. Pelizza |
|
|
133,333 |
|
|
|
0.45 |
|
|
June
3, 2024 |
|
|
634,665.08 |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
N/A |
|
| |
|
100,000 |
|
|
|
0.615 |
|
|
May
20, 2025 |
|
|
459,500 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
233,333 |
|
|
|
4.20 |
|
|
Feb.
14, 2027 |
|
|
235,666.33 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
175,000 |
|
|
|
2.79 |
|
|
May
17, 2028 |
|
|
423,500 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Richard
M. Cherry |
|
|
93,333 |
|
|
|
0.45 |
|
|
June
3, 2024 |
|
|
444,265.08 |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
N/A |
|
| |
|
100,000 |
|
|
|
0.615 |
|
|
May
20, 2025 |
|
|
459,500 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
233,333 |
|
|
|
4.20 |
|
|
Feb.
14, 2027 |
|
|
235,666.33 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
175,000 |
|
|
|
2.79 |
|
|
May
17, 2028 |
|
|
423,500 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Susan
Hoxie-Key |
|
|
166,667 |
|
|
|
3.75 |
|
|
June
1, 2027 |
|
|
243,333.82 |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
N/A |
|
| |
|
175,000 |
|
|
|
2.79 |
|
|
May
17, 2028 |
|
|
423,500 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Notes:
| (1) | Calculated as the number of unexercised options multiplied by the difference between the share price as of December 29, 2023, the last trading day
of the fiscal 2023 year ($5.21), and the exercise price. |
Incentive
Plan Awards – Value Vested or Earned During the Year
The
following table sets forth details of the value vested or earned during the most recently completed financial year (ended December 31,
2023) for each incentive plan award to directors.
| Name | |
Option-based
Awards –
Value vested during the
year ($)(1) | | |
Share-based
awards –
Value vested during the
year | |
Non-equity
incentive plan
compensation – Value
earned during the
year |
| William B. Harris | |
| 137,812.50 | (2) | |
N/A | |
N/A |
| Mark S. Pelizza | |
| 107,187.50 | (3) | |
N/A | |
N/A |
| Richard M. Cherry | |
| 107,187.50 | (4) | |
N/A | |
N/A |
| Susan Hoxie-Key | |
| 170,520.96 | (5) | |
N/A | |
N/A |
Notes:
| (1) | Calculated
as the number of options vested during the year multiplied by the difference between the
market price on the vesting date and the related exercise price. |
| (2) | On
February 14, 2023, 66,667 Options vested at an exercise price of $4.20; on August 14, 2023,
66,667 Options vested at an exercise price of $4.20; and on November 17, 2023, 56,250 Options
vested at an exercise price of $2.79. The closing market price of the Company’s Common
Shares on the Exchange was $3.20 on February 14, 2023, $3.30 on August 14, 2023, and $5.24
on November 17, 2023. |
| (3) | On
February 14, 2023, 58,333 Options vested at an exercise price of $4.20; on August 14, 2023,
58,333 Options vested at an exercise price of $4.20; and on November 17, 2023, 43,750 Options
vested at an exercise price of $2.79. The closing market price of the Company’s Common
Shares on the Exchange was $3.20 on February 14, 2023, $3.30 on August 14, 2023, and $5.24
on November 17, 2023. |
| (4) | On
February 14, 2023, 58,333 Options vested at an exercise price of $4.20; on August 14, 2023,
58,333 Options vested at an exercise price of $4.20; and on November 17, 2023, 43,750 Options
vested at an exercise price of $2.79. The closing market price of the Company’s Common
Shares on the Exchange was $3.20 on February 14, 2023, $3.30 on August 14, 2023, and $5.24
on November 17, 2023. |
| (5) | On
June 1, 2023, 41,667 Options vested at an exercise price of $3.75; on December 1, 2023, 41.667
Options vested at an exercise price of $3.75; and on November 17, 2023, 43,750 Options vested
at an exercise price of $2.79. The closing market price of the Company’s Common Shares
on the Exchange was $3.10 on June 1, 2023, $5.27 on December 1, 2023, and $5.24 on November
17, 2023. |
Narrative
Discussion of Incentive Plan Awards
The
significant terms of all plan-based awards, including non-equity incentive plan awards, issued or vested, or under which options have
been exercised, during the year, or outstanding at year end, are set out above in the Compensation Discussion and Analysis.
ADDITIONAL
INFORMATION
Additional
information relating to the Company is available on the System for Electronic Document Analysis and Retrieval (SEDAR+) website at www.sedarplus.ca.
DATED
this 21st day of May, 2024.
| BY ORDER OF THE BOARD OF DIRECTORS |
|
| |
|
| “W.
Paul Goranson” |
|
| W. Paul Goranson |
|
| Chief Executive Officer |
|
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