UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the
Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ]
Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional
Materials
[ ] Soliciting Material Pursuant to Section 240.14a
-12
PASSPORT POTASH INC.
(Name of Registrant as Specified in Charter)
Not applicable
(Name of Person(s) Filing Proxy
Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] |
No fee required. |
[ ] |
Fee computed on table below per Exchange Act
Rules 14a-6(i)(1) and 0-11. |
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Title of each class of securities to which transaction
applies: N/A |
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Aggregate number of securities to which transaction
applies: N/A |
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Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0- 11 (set forth the amount on
which the filing fee is calculated and state how it was determined):
N/A |
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Proposed maximum aggregate value of transaction:
N/A |
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Total fee paid: N/A |
[ ] Fee paid
previously with preliminary materials.
[ ] Check box if
any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and
identify the filing for which the offsetting fee was paid previously. Identify
the previous filing by registration statement number, or the Form or Schedule
and the date of its filing.
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Amount Previously Paid: N/A |
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Form, Schedule or Registration Statement No.:
N/A |
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Filing Party: N/A |
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Date Filed: N/A |
__________
PASSPORT POTASH INC.
608 1199 West Pender Street, Vancouver, British Columbia,
Canada V6E 2R1
Telephone: (604) 687-0300 and Facsimile: (604) 687-0151
NOTICE OF ANNUAL GENERAL MEETING OF
SHAREHOLDERS
To Be Held On December 11,
2014
To the Shareholders of Passport Potash Inc.:
We
will hold an annual general meeting of the shareholders of Passport Potash Inc.
(the Company) at the offices of McMillan LLP, Suite 1500, 1055 West
Georgia Street, Vancouver, British Columbia, Canada, on Thursday, December 11,
2014 at 10:00 a.m. Pacific Time (the Annual General Meeting). The
purpose of the Annual General Meeting will be:
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to receive the financial statements of the Company for
the year ended February 28, 2014 together with the report of the auditors
and related management discussion and analysis; |
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to determine the number of directors at five; |
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to elect Joshua Bleak, John Eckersley, David J.
Salisbury, Frank Högel and Ali Rahimtula to our Board of
Directors; |
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to appoint Dale, Matheson, Carr-Hilton, LaBonte, LLP
Chartered Accountants as the Companys independent registered public
accounting firm for the fiscal year ending February 28, 2015 at a
remuneration to be determined by the Directors of the Company; |
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to transact any other business properly brought before
the Annual General Meeting or any adjournment
thereof. |
The
foregoing items of business are more fully described in the Proxy Statement
accompanying this Notice. Only shareholders of record of the Company's common
stock at the close of business on November 3, 2014, are entitled to notice of,
and to vote at, the Annual General Meeting or any adjournment thereof.
It
is important that your shares be represented and voted at the Annual General
Meeting. If you are the registered holder of the Company's common stock, you can
vote your shares by completing and returning the enclosed proxy card, even if
you plan to attend the Annual General Meeting. You may vote your shares of
common stock in person even if you previously returned a proxy card. Please
note, however, that if your shares of common stock are held of record by a
broker, bank or other nominee and you wish to vote in person at the Annual
General Meeting, you must obtain a proxy issued in your name from such broker,
bank or other nominee. Please carefully review the instructions on the proxy
card or the information forwarded by your broker, bank or other nominee
regarding voting instructions.
N-1
If
you are planning to attend the Annual General Meeting in person, you will be
asked to register before entering the Annual General Meeting. All attendees
will be required to present government-issued photo identification (e.g.,
driver's license or passport) to enter the Annual General Meeting. If you are
a shareholder of record, your ownership of the Company's common stock will
be verified against the list of shareholders of record as of November 3, 2014,
prior to being admitted to the Annual General Meeting. If you are not a
shareholder of record and hold your shares of common stock in "street name"
(that is, your shares of common stock are held in a brokerage account or by a
bank or other nominee), you must also provide proof of beneficial ownership as
of November 3, 2014, such as your most recent account statement prior to
November 3, 2014, and a copy of the voting instruction card provided by your
broker, bank or nominee, or similar evidence of ownership.
By Order of the Board of Directors
PASSPORT POTASH INC.
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By: |
/s/ Joshua Bleak |
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Joshua Bleak |
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President and Chief Executive
Officer |
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November 7, 2014
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IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY
MATERIALS FOR
THE ANNUAL GENERAL MEETING OF SHAREHOLDERS TO BE HELD ON
DECEMBER 11, 2014:
The Proxy Statement and form of Proxy, as well as
the
Companys Annual Report on Form 10-K for the year ended February
28, 2014
are available on the Internet at:
http://passportpotash.com/pdf/proxy2014.pdf
__________
N-3
TABLE OF CONTENTS
i
PASSPORT POTASH INC.
608 1199 West Pender Street, Vancouver, British Columbia,
Canada V6E 2R1
Telephone: (604) 687-0300 and Facsimile: (604) 687-0151
PROXY STATEMENT
FOR THE 2014 ANNUAL GENERAL
MEETING OF THE SHAREHOLDERS TO BE
HELD ON DECEMBER 11, 2014
THE ANNUAL GENERAL MEETING
General
This
proxy statement is furnished in connection with the solicitation of proxies by
the board of directors (the Board of Directors) of Passport Potash Inc.
(we, the Company or Passport) for use in connection
with the Companys 2014 Annual General Meeting of shareholders (the Annual
Meeting) to be held on December 11, 2014 at 10:00 a.m. (Pacific Time) at
the offices of McMillan LLP, Suite 1500, 1055 West Georgia Street, Vancouver,
British Columbia, Canada, and at any adjournment or postponement thereof, for
the purposes set forth in the accompanying notice of Annual Meeting.
This
proxy statement, the notice of Annual Meeting and the enclosed form of proxy are
expected to be mailed to our shareholders on or about November 13, 2014. Our
annual report on Form 10-K for the fiscal year ended February 28, 2014,
including financial statements for the fiscal year ended February 28, 2014, will
also be mailed to our shareholders with this proxy statement, but such annual
report does not constitute a part of this proxy statement.
Our
principal executive office is located at 608 1199 West Pender Street,
Vancouver, British Columbia, Canada V6E 2R1.
Manner of Solicitation and Expenses
This
proxy solicitation is made on behalf of our Board of Directors. Solicitation of
proxies may be made by our directors, officers and employees personally, by
telephone, mail, facsimile, e-mail, internet or otherwise, but they will not be
specifically compensated for these services. We will bear the expenses
incurred in connection with the solicitation of proxies for the Annual Meeting.
Upon request, we will also reimburse brokers, dealers, banks or similar entities
acting as nominees for their reasonable expenses incurred in forwarding copies
of the proxy materials to the beneficial owners of the shares of our common
stock as of November 3, 2014 (the Record Date).
Record Date and Voting Shares
Our
Board of Directors has fixed the close of business on November 3, 2014, as the
Record Date for the determination of shareholders entitled to notice of and to
vote at the Annual Meeting. As of the Record Date there were 109,490,859 shares
of our common stock issued, outstanding and entitled to vote at the Annual
Meeting. Holders of common stock are entitled to one vote at the Annual Meeting
for each share of common stock held of record as of the Record Date. There is no
cumulative voting in the election of directors.
1
Quorum
A
quorum is necessary to hold a valid meeting of our shareholders. The required
quorum for the transaction of business at the Annual Meeting is at least one
person who is, or who represents by proxy, one or more shareholders who, in the
aggregate, hold at least 5% of the issued shares as of the Record Date.
In
order to be counted for purposes of determining whether a quorum exists at the
Annual Meeting, shares must be present at the Annual Meeting either in person or
represented by proxy. Shares that will be counted for purposes of determining
whether a quorum exists will include:
- shares represented by properly executed proxies for which voting
instructions have been given, including proxies which are marked "Abstain" or
"Withhold" for any matter;
- shares represented by properly executed proxies for which no voting
instruction has been given; and
- broker non-votes.
Broker
non-votes occur when shares held by a broker for a beneficial owner are not
voted with respect to a particular proposal because the broker has not received
voting instructions from the beneficial owner and the broker does not have
discretionary authority to vote such shares.
Entitlement to Vote
If
you are a registered holder of shares of our common stock on the Record Date,
you may vote those shares of our common stock in person at the Annual Meeting or
by proxy in the manner described below under Voting of Proxies. If you hold
shares of our common stock in street name through a broker or other financial
institution, you must follow the instructions provided by your broker or other
financial institution regarding how to instruct your broker or financial
institution to vote your shares.
Voting of Proxies
Registered Shareholders
Registered
Shareholders may wish to vote by proxy whether or not they are able to attend
the Annual Meeting in person. Registered Shareholders electing to submit a proxy
may do so by:
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completing, dating and signing the enclosed form of proxy
and returning it to the Companys transfer agent, Computershare Investor
Services Inc., by fax within North America at 1-866-249-7775, outside
North America at (416) 263-9524, or by mail to the 8th Floor, 100
University Avenue, Toronto, Ontario, M5J 2Y1, or by hand delivery at
3rd Floor, 510 Burrard Street, Vancouver, British Columbia, V6C
3B9; |
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using a touch-tone phone to transmit voting choices to a
toll free number at 1-866- 732-8683 and following the instructions of the
voice response system by providing the Holder ID and Holder Code located
beside your name on the proxy form on the lower left hand side. If the
Holder ID and Holder Code are not on the proxy, it will be on the back of
the flyer enclosed with this material. Instructions are then conveyed by
use of the touchtone selections over the telephone; or |
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using the internet through the website of Computershare
Investor Services Inc. at www.investorvote.com. Registered Shareholders
must follow the instructions that appear on the screen and refer to
the enclosed proxy form for the Holder ID and Holder Code and the proxy access
number; |
2
in all cases ensuring that the proxy is received at least 48
hours (excluding Saturdays, Sundays and holidays) before the Annual Meeting or
the adjournment thereof at which the proxy is to be used.
Beneficial Shareholders
The
following information is of significant importance to shareholders who do not
hold shares of Companys common stock (Common Shares) in their own name (each
a Beneficial Shareholder). Beneficial Shareholders should note that the
only proxies that can be recognized and acted upon at the Annual Meeting are
those deposited by registered shareholders (those whose names appear on the
records of the Company as the registered holders of Common Shares) or as set out
in the following disclosure.
If
Common Shares are listed in an account statement provided to a shareholder by a
broker, then in almost all cases those Common Shares will not be registered in
the shareholders name on the records of the Company. Such Common Shares will
more likely be registered under the names of intermediaries. In the United
States, the vast majority of such Common Shares are registered under the name of
Cede & Co. as nominee for The Depository Trust Company (which acts as
depositary for many U.S. brokerage firms and custodian banks), and in Canada,
under the name of CDS & Co. (the registration name for The Canadian
Depository for Securities Limited, which acts as nominee for many Canadian
brokerage firms).
Intermediaries
are required to seek voting instructions from Beneficial Shareholders in advance
of meetings of shareholders. Every intermediary has its own mailing procedures
and provides its own return instructions to clients.
There
are two kinds of Beneficial Shareholders - those who object to their name being
made known to the issuers of securities which they own (called OBOs for
Objecting Beneficial Owners) and those who do not object to the issuers of the
securities they own knowing who they are (called NOBOs for
Non-Objecting Beneficial Owners).
The
Company is taking advantage of the provisions of The Canadian Securities
Administrators National Instrument 54-101 Communication with Beneficial Owners
of Securities of a Reporting Issuer that permit it to deliver proxy-related
materials directly to its NOBOs. As a result NOBOs can expect to receive a
scannable Voting Instruction Form (VIF) from our transfer agent,
Computershare Investor Services Inc. (Computershare). The VIF is to be
completed and returned to Computershare as set out in the instructions provided
on the VIF. Computershare will tabulate the results of the VIFs received from
NOBOs and will provide appropriate instructions at the Annual Meeting with
respect to the shares represented by the VIFs they receive.
These
securityholder materials are being sent to both registered and non-registered
owners of the securities of the Company. If you are a non-registered owner, and
the Company or its agent has sent these materials directly to you, your name,
address and information about your holdings of securities, were obtained in
accordance with applicable securities regulatory requirements from the
intermediary holding securities on your behalf.
By
choosing to send these materials to you directly, the Company (and not the
intermediary holding securities on your behalf) has assumed responsibility for
(i) delivering these materials to you, and (ii) executing your proper voting
instructions. Please return your VIF as specified in the request for voting
instructions that was sent to you.
Beneficial
Shareholders who are OBOs should follow the instructions of their intermediary
carefully to ensure that their Common Shares are voted at the Annual
Meeting.
3
The
form of proxy supplied to you by your broker will be similar to the proxy
provided to registered shareholders by the Company. However, its purpose is
limited to instructing the intermediary on how to vote your Common Shares on
your behalf. Most brokers delegate responsibility for obtaining instructions
from clients to Broadridge Financial Solutions, Inc. (Broadridge) in
the United States and in Canada. Broadridge mails a VIF in lieu of a proxy
provided by the Company. The VIF will name the same persons as the Companys
Proxy to represent your Common Shares at the Annual Meeting. You have the right
to appoint a person (who need not be a Beneficial Shareholder of the Company),
other than any of the persons designated in the VIF, to represent your Common
Shares at the Annual Meeting and that person may be you. To exercise this right,
insert the name of the desired representative (which may be yourself) in the
blank space provided in the VIF. The completed VIF must then be returned to
Broadridge by mail or facsimile or given to Broadridge by phone or over the
internet, in accordance with Broadridges instructions. Broadridge then
tabulates the results of all instructions received and provides appropriate
instructions respecting the voting of Common Shares to be represented at the
Annual Meeting and the appointment of any shareholders representative. If
you receive a VIF from Broadridge, the VIF must be completed and returned to
Broadridge, in accordance with its instructions, well in advance of the Annual
Meeting in order to have your Common Shares voted or to have an alternate
representative duly appointed to attend the Annual Meeting and vote your Common
Shares at the Annual Meeting.
Revocation of Proxies
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 attorney
authorized in writing or, if the shareholder is a body corporate, by an officer
or attorney thereof duly authorized, and deposited either with the Company or to
Computershare Investor Services Inc., 510 Burrard Street, Vancouver, B.C. V6C
3B9 at any time up to and including 48 hours preceding the Meeting
(excluding Saturdays, Sundays, and holidays), or any adjournment thereof, at
which the proxy is to be used or with the Chairman of such Annual Meeting
preceding the commencement of such Annual 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.
Exercise of Discretion by Proxies
The
persons named in the enclosed form of proxy will vote the Common Shares in
respect of which they are appointed in accordance with the direction of the
shareholders appointing them on any ballot that may be called for. The enclosed
form of proxy confers discretionary authority upon the persons named therein
with respect to:
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each matter or group of matters identified therein for
which a choice is not specified, other than the appointment of an auditor
and the election of directors, |
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any amendment to or variation of any matter identified
therein, and |
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any other matter that properly comes before the Annual
Meeting. |
In
respect of a matter for which a choice is not specified in the proxy, the
management appointee acting as a proxyholder will vote in favour of each matter
identified on the proxy and, if applicable, for the nominees of management for
directors and auditors as identified in the proxy.
4
Votes Required
Proposal
One Number of Directors: The affirmative vote of the holders of a majority
of our common stock represented at the Annual Meeting in person or by proxy is
required for the approval of the number of directors. Shareholders may vote in
favor or against this proposal, or they may abstain. Abstentions and broker
non-votes will be counted for purposes of determining the presence or absence of
a quorum. Abstentions are deemed to be votes cast, and have the same effect as
a vote against this proposal. Broker non-votes are not deemed to be votes cast
and, therefore, have no effect on the vote with respect to this proposal.
Proposal
Two Election of Directors: The affirmative vote of the holders of a
plurality of our shares of common stock represented at the Annual Meeting in
person or by proxy is required for the election of our directors. This means
that the nominees who receive the greatest number of votes for each open seat
will be elected. Votes may be cast in favor of the election of directors or
withheld. A vote is withheld when a properly executed proxy is marked WITHHOLD
for the election of one or more directors. Votes that are withheld and broker
non-votes will be counted for the purposes of determining the presence or
absence of a quorum but will have no other effect on the election of directors.
Further, brokers may not cast discretionary uninstructed votes in any election
of directors.
Proposal
Three Appointment of Accountants: The affirmative vote of the holders of a
majority of our common stock represented at the Annual Meeting in person or by
proxy is required for the ratification of the appointment of our independent
registered public accountants. Shareholders may vote in favor or against this
proposal, or they may abstain. Abstentions and broker non-votes will be counted
for purposes of determining the presence or absence of a quorum. Abstentions are
deemed to be votes cast, and have the same effect as a vote against this
proposal. Broker non-votes are not deemed to be votes cast and, therefore, have
no effect on the vote with respect to this proposal.
Shareholder Proposals
No
proposals have been received from any shareholder to be considered at the Annual
Meeting.
Other Matters
It
is not expected that any matters other than those referred to in this proxy
statement will be brought before the Annual Meeting. If other matters are
properly presented, however, the persons named as proxy appointees will vote in
accordance with their best judgment on such matters. The grant of a proxy also
will confer discretionary authority on the persons named as proxy appointees to
vote in accordance with their best judgment on matters incident to the conduct
of the Annual Meeting.
5
INTEREST OF CERTAIN PERSONS IN MATTERS TO BE ACTED UPON
None
of the following persons has any substantial or material interest, direct or
indirect, by way of beneficial ownership of securities or otherwise, in any
matter to be acted on at the Annual Meeting, except in so far as they may be
elected to office:
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each person who has been one of our directors or executive officers at any
time since the beginning of our last fiscal year;
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each nominee for election as one of our directors; or
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any associate of any of the foregoing persons.
None
of the above persons has received any extra or special benefit in their capacity
as a security holder of the Company.
SECURITY OWNERSHIP OF
CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT
The
following table sets forth information as of November 3, 2014 regarding the
beneficial ownership of our common stock by:
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each person who is known by us to beneficially own more than 5% of our
shares of common stock; and
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each named executive officer, each director, and all of our directors and
executive officers as a group.
The
number of shares beneficially owned and the percentage of shares beneficially
owned are based on 109,490,859 shares of common stock outstanding as of November
3, 2014.
For
the purposes of the information provided below, shares that may be issued upon
the exercise or conversion of options, warrants and other rights to acquire
shares of our common stock that are exercisable or convertible within 60 days
following November 3, 2014, are deemed to be outstanding and beneficially owned
by the holder for the purpose of computing the number of shares and percentage
ownership of that holder, but are not deemed to be outstanding for the purpose
of computing the percentage ownership of any other person.
Title of class
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Name and address of
beneficial owner(1) |
Amount and nature of
beneficial owner(2)
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Percentage of
class(3)
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Common Stock |
Joshua Bleak |
5,245,864 (4) |
4.7% |
Common Stock |
Ali Rahimtula |
845,000 (5) |
(*)% |
Common Stock |
David J. Salisbury |
1,534,859 (6) |
1.4% |
Common Stock |
John Eckersley |
5,298,939 (7) |
4.8% |
Common Stock |
Michael Schlumpberger |
287,500 (8) |
(*)% |
Common Stock |
Frank Högel |
Nil |
N/A |
Common Stock |
Bill Allred |
Nil |
N/A |
Common Stock |
All executive officers and directors as a group
(seven persons) |
13,212,162 (9) |
11.7% |
6
Notes: |
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(*) |
Less than 1%. |
(1) |
The address of our officers and directors is our
Companys address, which is 608 1199 W. Pender St., Vancouver, BC,
Canada, V6E 2R1. |
(2) |
Under Rule 13d-3 of the Exchange Act a beneficial owner
of a security includes any person who, directly or indirectly, through any
contract, arrangement, understanding, relationship or otherwise has or
shares: (i) voting power, which includes the power to vote or to direct
the voting of shares; and (ii) investment power, which includes the power
to dispose or direct the disposition of shares. Certain shares may be
deemed to be beneficially owned by more than one person (if, for example,
persons share the power to vote or the power to dispose of the shares). In
addition, shares are deemed to be beneficially owned by a person if the
person has the right to acquire the shares (for example, upon exercise of
an option) within 60 days of the date as of which the information is
provided. In computing the percentage ownership of any person, the amount
of shares outstanding is deemed to include the amount of shares
beneficially owned by such person (and only such person) by reason of
these acquisition rights. |
(3) |
Based on 109,490,859 shares of our common stock issued
and outstanding as of November 3, 2014. |
(4) |
This figure includes: (i) 2,466,594 shares of common
stock held by Joshua Bleak; (ii) 1,216,145 shares of common stock held of
record by Joshua Bleak Corp. which are deemed to be indirectly owned and
controlled by Joshua Bleak (iii) 300,000 stock options held of record by
Joshua Bleak which are vested and are exercisable into 300,000 shares of
common stock at CAD$0.64 per share expiring on January 10, 2016; (iv)
530,000 stock options held of record by Joshua Bleak which are vested and
are exercisable into 530,000 shares of common stock at CAD$0.40 per share
expiring on February 10, 2016; (v) 167,875 stock options held of record by
Joshua Bleak which are vested and are exercisable into 167,875 shares of
common stock at CAD$0.40 per share expiring on March 3, 2016; (vi) 420,250
stock options held of record by Joshua Bleak which are vested and are
exercisable into 420,250 shares of common stock at CAD$0.84 per share
expiring on September 12, 2016; and (vii) 145,000 stock options held of
record by Joshua Bleak which are vested and are exercisable into 145,000
shares of common stock at CAD$0.36 per share expiring on July 2,
2018. |
(5) |
This figure includes: (i) 500,000 shares of common stock
options held of record by Transnational Enterprises Ltd. which are deemed
to be indirectly owned and controlled by Ali Rahimtula.; (ii) 75,000 stock
options held of record by Ali Rahimtula which are vested and are
exercisable into 75,000 shares of common stock at CAD$1.18 per share
expiring on June 21, 2016; (iii) 125,000 stock options held of record by
Ali Rahimtula which are vested and are exercisable into 125,000 shares of
common stock at CAD$0.76 per share expiring on January 20, 2017; and (iv)
145,000 stock options held of record by Ali Rahimtula which are vested and
are exercisable into 145,000 shares of common stock at CAD$0.36 per share
expiring on July 2, 2018. |
(6) |
This figure includes: (i) 102,750 shares of common stock
held by David Salisbury; (ii) 912,109 shares of common stock held of
record by Double Jointed Solutions LLC, which are deemed to be indirectly
owned and controlled by David Salisbury; (iii) 375,000 stock options held
of record by David Salisbury which are vested and are exercisable into
375,000 shares of common stock at CAD$0.76 per share expiring on January
20, 2017; and (iv) 145,000 stock options held of record by David Salisbury
which are vested and are exercisable into 145,000 shares of common stock
at CAD$0.36 per share expiring on July 2, 2018. |
(7) |
This figure includes: (i) 69,450 shares of common stock
held by John Eckersley; (ii) 2,026,909 shares of common stock held of
record by John H. Eckersley Corp., which are deemed to be indirectly owned
and controlled by John Eckersley; (iii) 2,572,080 shares of common stock
held of record by MJI Resource Management Inc., which are deemed to be
indirectly owned and controlled by John Eckersley; (iv) 135,500 stock
options held of record by John Eckersley which are vested and are
exercisable into 135,500 shares of common stock at CAD$1.18 per share
expiring on June 21, 2016; and (v) 350,000 stock options held of record by
John Eckersley which are vested and are exercisable into 350,000 shares of
common stock at CAD$0.76 per share expiring on January 20, 2017; and (vi)
145,000 stock options held of record by John Eckersley which are vested
and are exercisable into 145,000 shares of common stock at CAD$0.36 per
share expiring on July 2, 2018. |
(8) |
This figure includes: (i) 37,500 shares of common stock
held by Michael Schlumpberger; (ii) 250,000 stock options held of record
by Michael Schlumpberger which are vested and are exercisable into 250,000
shares of common stock at CAD$0.36 per share expiring on July 2,
2018. |
(9) |
This figure includes: (i) 9,903,537 shares of common
stock and (ii) stock options to purchase 3,308,625 shares of our common
stock. |
The
following table sets forth, as of November 3, 2014, certain information
regarding beneficial ownership of our common stock by each person known by us to
be the beneficial owner of more than 5% of our outstanding common stock.
7
Title of class
|
Name and address of
beneficial owner |
Amount and nature
of beneficial owner(1)
|
Percentage of
class(2)
|
Common Stock
|
Phillip Frost c/o 4400 Biscayne Blvd., #850
Miami, FL 33137 |
18,340,638 (3)
|
16.3%
|
Common Stock
|
Barry Honig c/o 4400 Biscayne Blvd., #850
Miami, FL 33137 |
9,603,047 (4)
|
8.6%
|
Common Stock
|
Michael Brauser c/o 4400 Biscayne Blvd.,
#850 Miami, FL 33137 |
9,133,431 (5)
|
8.2%
|
Common Stock
|
Concept Capital Management Trust Company
Complex, Ajeltake Road, Ajeltake Islands, Majuro MH 96960,
Marshall Islands |
45,250,000 (6)
|
19.9% (7)
|
Notes
(1) |
Under Rule 13d-3 of the Exchange Act a beneficial owner
of a security includes any person who, directly or indirectly, through any
contract, arrangement, understanding, relationship or otherwise has or
shares: (i) voting power, which includes the power to vote or to direct
the voting of shares; and (ii) investment power, which includes the power
to dispose or direct the disposition of shares. Certain shares may be
deemed to be beneficially owned by more than one person (if, for example,
persons share the power to vote or the power to dispose of the shares). In
addition, shares are deemed to be beneficially owned by a person if the
person has the right to acquire the shares (for example, upon exercise of
an option) within 60 days of the date as of which the information is
provided. In computing the percentage ownership of any person, the amount
of shares outstanding is deemed to include the amount of shares
beneficially owned by such person (and only such person) by reason of
these acquisition rights. |
(2) |
Based on 109,490,859 shares of our common stock issued
and outstanding as of November 3, 2014. |
(3) |
This figure includes: (i) 15,069,805 shares of common
stock held by Frost Gamma Investments Trust, which are deemed to be
indirectly owned and controlled by Phillip Frost; (ii) 250,000 stock
options held of record by Phillip Frost which are vested and are
exercisable into 250,000 shares of common stock at CAD$1.18 per share
expiring on June 21, 2016; (iii) 625,000 warrants held of record by Frost
Gama Investments Trust, which are deemed to be indirectly owned and
controlled by Phillip Frost, and which are exercisable into 625,000 shares
of common stock at $0.12 per share expiring on August 19, 2016; and (v)
9.5% convertible debenture of $287,500 held of record by Frost Gama
Investments Trust, which are deemed to be indirectly owned and controlled
by Phillip Frost, and which are convertible into 2,395,833 shares of
common stock at $0.12 per share before August 19, 2016 without giving
effect to accrued interest. |
(4) |
This figure includes: (i) 3,301,773 shares of common
stock held by Barry Honig; (ii) 1,287,386 shares of common stock held by
GRQ Consultants, Inc. 401K, which are deemed to be indirectly owned and
controlled by Barry Honig; (iii) 3,055,555 shares of common stock held by
GRQ Consultants, Inc. Roth 401K FBO Barry Honig, which are deemed to be
indirectly owned and controlled by Barry Honig; (iv) 300,000 stock options
held of record by Barry Honig which are vested and are exercisable into
300,000 shares of common stock at CAD$0.64 per share expiring on January
10, 2016; (v) 450,000 stock options held of record by Barry Honig which
are vested and are exercisable into 450,000 shares of common stock at
CAD$0.40 per share expiring on February 10, 2016; (vi) 250,000 warrants
held of record by Barry Honig which are vested and exercisable into
250,000 shares of common stock at $0.12 per share expiring on August 19,
2016; and (vii) 9.5% convertible debenture of $115,000 held of record by
Barry Honig convertible into 958,333 shares of common stock at $0.12 per
shares before August 19, 2016 without giving effect to accrued
interest. |
(5) |
This figure includes (i) 5,107,048 shares of common stock
held by Michael Brauser; (ii) 96,250 shares of common stock jointly held
with wife; (iii) 2,102,800 shares of common stock held by Birchtree
Capital, LLC, which are deemed to be indirectly owned and controlled by
Michael Brauser; (iv) 69,000 shares of common stock held by Grander
Holdings, Inc. 401K Profit Sharing Plan, which are deemed to be
indirectly owned and controlled by Michael Brauser; (v) 550,000
stock options held of record by Michael Brauser which are vested and are
exercisable into 550,000 shares of common stock at CAD$0.40 per share
expiring on February 10, 2016; (vi) 250,000 warrants held of record by
Michael Brauser which are vested and exercisable into 250,000 shares of
common stock at $0.12 per share expiring on August 19, 2016; and (vii)
9.5% convertible debenture of $115,000 held of record by Michael Brauser
convertible into 958,333 shares of common stock at $0.12 per shares before
August 19, 2016 without giving effect to accrued interest. |
8
(6) |
This figure includes (1) 9.5% convertible debenture of
$3,910,000 held of record by Concept Capital Management, which is deemed
to be indirectly owned and controlled by Bernd Hogel, convertible into
32,583,333 shares of common stock at $0.12 per share before August 19,
2016 without giving effect to accrued interest; (ii) 8,500,000 warrants
held of record by Concept Capital Management, which are deemed to be
indirectly owned and controlled by Bernd Hogel, which are vested and
exercisable into 8,500,000 shares of common stock at $0.12 per share
expiring on August 19, 2016; (iii) 9.5% convertible debenture of $500,000
held of record by Concept Capital Management, which is deemed to be
indirectly owned and controlled by Bernd Hogel, convertible into 4,166,667
units at $0.12 per unit, with each unit comprised of one share of common
stock and one warrant, which warrants are exercisable into 4,166,667
shares of common stock at $0.12 per share before May 29, 2018, without
giving effect to accrued interest. |
(7) |
Concept Capital Management is restricted pursuant to a
contractual obligation in each of the $3,910,000 and the $500,000
convertible debentures from converting such debentures if, after giving
effect to such conversion, the holder together with any person or company
acting jointly or in concert with Concept Capital Management, would in the
aggregate beneficially own, or exercise control or direction over that
number of our voting securities which is 20% or greater of our total
issued and outstanding voting securities, immediately after giving effect
to such conversion. |
We
have no knowledge of any arrangements, including any pledge by any person of our
securities, the operation of which may at a subsequent date result in a change
in our control.
We
are not, to the best of our knowledge, directly or indirectly owned or
controlled by another corporation or foreign government.
9
PROPOSAL NUMBER ONE:
NUMBER OF DIRECTORS
Number of Directors
The
Board is presently comprised of five members. Shareholders will be requested to
approve an ordinary resolution that the number of directors elected be fixed at
five.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU
VOTE
FOR FIXING THE NUMBER OF DIRECTORS AT FIVE
PROPOSAL NUMBER TWO:
ELECTION OF DIRECTORS TO OUR BOARD OF DIRECTORS
Election of Directors
We
propose to elect five directors, each to hold office until each directors
successor is elected and qualified at our next Annual Meeting.
The
persons named in the enclosed proxy will vote for the election of the nominees
listed under Nominees for Election of Directors below unless you instruct them
otherwise, or unless a nominee is unwilling to serve as a director of our
Company. Our Board of Directors has no reason to believe that any nominee will
be unwilling to serve, but if a nominee should determine not to serve, the
persons named in the proxy may vote for another candidate nominated by our Board
of Directors.
The
affirmative vote of a plurality of the votes present in person or by proxy at
the Annual Meeting and entitled to vote on the election of directors is required
for the election of each nominee as a director.
Advance Notice Provision
On September 12, 2013, the shareholders of the Company approved
the alteration of the Companys articles for the purpose of adopting advance
notice provisions (the "Advance Notice Provision"). The Advance Notice Provision
provides for advance notice to the Company in circumstances where nominations of
persons for election to the Board of directors of the Company (the "Board") are
made by shareholders of the Company other than pursuant to (i) a requisition of
a meeting made pursuant to the provisions of the BCA or (ii) a shareholder
proposal made pursuant to the provisions of the BCA.
The purpose of the Advance Notice Provision is to foster a
variety of interests of the shareholders and the Company by ensuring that all
shareholders - including those participating in a meeting by proxy rather than
in person - receive adequate notice of the nominations to be considered at a
meeting and can thereby exercise their voting rights in an informed manner.
Among other things, the Advance Notice Provision fixes a deadline by which
holders of Common Shares must submit director nominations to the Company prior
to any annual or special meeting of shareholders and sets forth the minimum
information that a shareholder must include in the notice to the Company for the
notice to be in proper written form.
10
The Advance Notice Provision also requires all proposed
director nominees to deliver a written representation and agreement that such
candidate for nomination, if elected as a director of the Company, will comply
with all applicable corporate governance, conflict of interest, confidentiality,
share ownership, majority voting and insider trading policies and other policies
and guidelines of the Company applicable to directors and in effect during such
persons term in office as a director.
The
foregoing is merely a summary of the Advance Notice Provision, is not
comprehensive and is qualified by the full text of such provision which is
available in Schedule "C" of the Companys Information Circular filed on August
14, 2013 under the Companys profile on SEDAR at www.sedar.com.
The
Company has not received notice of a nomination in compliance with the Advance
Notice Provision and, as such, any nominations other than nominations by or at
the direction of the Board of Directors or an authorized officer of the Company
will be disregarded at the Annual Meeting.
Nominees for Election as Directors
Joshua
Bleak, Ali Rahimtula, David J. Salisbury, John Eckersley and Frank Högel, each
of whom is a current director, have been nominated by our Board of Directors for
election. It is the intention of the persons named in the accompanying form of
proxy to vote proxies for the election of these individuals and each of the
nominees has consented to being named in this proxy statement and to serve, if
elected. In the event that any or all of these individuals should for some
reason, presently unknown, become unavailable for election, the persons named in
the form of proxy intend to vote for substitute nominees.
Directors and Executive Officers
The
following table provides information regarding our directors (each of whom is a
nominee for re-election to our Board of Directors) and executive officers:
Name and Municipality of |
|
|
|
Residence
|
Age |
Current Office with Passport Potash Inc. |
Director Since |
Joshua Bleak Apache Junction, Arizona
|
33
|
President, Chief
Executive Officer and Director
|
April 12, 2010
|
|
|
|
|
Bill Allred Prima, Arizona |
77
|
Chief Financial
Officer
|
March 1,
2014(1)
|
|
|
|
|
Ali Rahimtula Surrey, BC, Canada |
67
|
Director
|
October 28,
2011
|
|
|
|
|
David J. Salisbury Newton, Utah |
61
|
Chairman of the
Board (non-executive) and Director |
January 16,
2012
|
|
|
|
|
John Eckersley Apache Junction, Arizona
|
54
|
Executive
Vice-President, Corporate Secretary and Director |
July 15, 2011
|
|
|
|
|
Frank Högel Guaira, Paraguay |
41
|
Vice Chairman
(non-executive) and Director
|
February 19,
2014
|
|
|
|
|
Michael Schlumpberger Lima, Ohio |
50
|
Chief Operating
Officer
|
June 3,
2013(2)
|
11
(1) Mr. Allred was a
director from September 12, 2013 to February 19, 2014 when he resigned. Mr.
Allred was appointed as our CFO on March 1, 2014.
(2) Mr. Schlumpberger is not a
director and was appointed as our COO on June 3, 2013.
The
following is a description of the business background of the directors and
director nominees of our Company:
Joshua
Bleak. Mr. Bleak has been our President, Chief Executive Officer
since January 11, 2011 and a director of our Company since April 12, 2010. Mr.
Bleak is experienced in the mining and exploration industry as well as being
fourth generation in a family with a rich mining and exploration background.
From December 24, 2009 to current, Mr. Bleak serves as President, CEO, Treasurer
and a director of Continental Resources Group, Inc. (OTCBB: CRGC) which is
involved in exploring and developing uranium prospects. Since January 26, 2012,
Mr. Bleak has served as a director of American Strategic Minerals Corporation
(OTCBB: ASMC) which is engaged in the acquisition and exploration of properties
that may contain uranium mineralization. Since October 2008, Mr. Bleak has
served as the President and a director of North American Environmental Corp., a
consulting company specializing in mining project management, permitting,
lobbying and land tenure. From February 2007 to September 2008, he served as
Manager of NPX Metals, Inc., an exploration and mining company. Since January
2005 he has served as Secretary and a director of Pinal Realty Investments Inc.,
a real estate development company. Mr. Bleaks qualification to serve on our
Board of Directors is based on his experience in the mining industry in general.
Ali
Rahimtula. Mr. Rahimtula has served as a director of our Company since
October 28, 2011. Since 1979, Mr. Rahimtula has served as the President and
founder of Transnational Enterprises LTD., d/b/a Transfert America.
Transnational Enterprises LTD. is a member of the Rahimtula Group. The Rahimtula
Group was a pioneer of the fertilizer business in India, and has been a domestic
industry leader since the 1960s. They are a global company, recognized for
their extensive business networks to supply international fertilizer
manufacturers for their critical raw materials such as sulphur, rock phosphate,
ammonia, phosphoric acid and potash. The Rahimtula group has operated in the
traditional markets of India and Pakistan but has also expanded its area of
operations into other countries such as Brazil, Vietnam, China, Thailand,
Philippines, and South Africa. They are also experienced in executing
joint-venture fertilizer production and marketing contracts in the Middle East,
Asia, and Africa as well as in Europe and the CIS. Mr. Rahimtulas
qualifications to serve on our Board of Directors is based on his experience and
expertise in the fertilizer industry. He has and can contribute by securing
large customers of international repute for the Company as joint venture
partners who can buy potash on long term off take agreements. Also, Mr.
Rahimtula brings to the Company his experience in logistics, such as port
infrastructure developments and organizing export shipping in containers and
bulk vessel chartering.
David
J. Salisbury. Mr. Salisbury has served as our Chairman of the board and a
director of our Company since January 16, 2012. Mr. Salisbury has had an
extensive career in the mining industry, spanning four decades, including
seventeen years with Rio Tinto PLC. During his career he has had experience in
almost all phases of mine development and operation, including: operating and
capital budget development, operating cost control, product quality, profit/loss
analysis, engineering, safety, field operations and maintenance, strategic
planning, environmental compliance, market development, merger and acquisition
analysis, employee relations, community relations, public relations and
government relations at both the state and federal levels.
12
Mr.
Salisbury was President and CEO of Resolution Copper Mining (Resolution
Copper) (Resolution Copper Mining is a joint venture between Rio Tinto and BHP
and is not publicly traded), from 2008 to his retirement on January 31, 2011. At
Resolution Copper he was responsible for the development of a deep underground
copper mine in Superior, Arizona. One of his primary responsibilities was a
legislative land exchange involving 3,025 acres of federal land in exchange for
5,500 acres of ecologically important private land. His role at Resolution
Copper required significant interaction and engagement with members of the U.S.
Congress, federal agencies, the Governor of the State of Arizona and State
legislators. He was also responsible for leading the activities of integrating
all engineering studies and design with environmental permitting, progressive
development of the future operations culture and working environment, health and
safety, project budget controls and community relations.
From
2006 through 2008, Mr. Salisbury was President and CEO of Kennecott Minerals
Company (Kennecott Minerals is a wholly-owned subsidiary of Rio Tinto and is not
publicly traded), where he was responsible for the comprehensive management of
underground operations in Juneau, Alaska; open cut/heap leach gold in Nevada;
and the development and construction of an underground nickel operation in
Michigan.
Mr.
Salisbury was a leader for the Rio Tinto global improvement program, Improving
Performance Together, from 2004 through 2006. He led one of four major streams
of work aimed at bringing about radical change in the way Rio Tinto conducts
business. This responsibility covered the engineering and operation of
processing operations at all Rio Tinto operations and involved leading a team of
eight general managers and managers in diagnosing current state, formulating
solutions, implementing pilot trials and ultimately rolling out change across
the global group.
Mr.
Salisbury was Managing Director and CEO of Rössing Uranium Ltd. (Rossing Uranium
is majority owned by Rio Tinto and is not publicly traded) from 2001 through
2004. The Rössing mine employed 1,200 people and produces U3O8 for the global
nuclear fuel industry, representing 8% of the global primary supply. During his
tenure the mine achieved its historical best safety performance while increasing
production and decreasing staff by 33%.
While
with Rio Tinto, Mr. Salisbury also held Senior Executive positions with
Kennecott Ridgeway Mining Company and Kennecott Energy Company.
Prior
to joining Rio Tinto Mr. Salisbury was the President of Cordero Mining
Company/Sun Coal Company (1992 to 1993) and responsible for the operation of the
Cordero Mine, the seventh largest coal mine in the United States. At Cordero he
completed a major organizational restructuring to reduce cost and improve
efficiency, dropping operating costs by 10%.
Mr.
Salisbury served as President and COO of the Al Hamilton Operating
Company/Bradford Coal Company (1990 to 1992) where he was responsible for the
operation of 9 active mines in a 30 mile radius of Clearfield, PA. During his
tenure he improved the financial performance of this operation and was able to
bring it into profitability.
From
1989 to 1990, Mr. Salisbury served as President of The Coteau Properties
Company/North American Coal Corporation where he was responsible for the
construction, management and operation of a 12 million tons per year surface
lignite mine near Beulah, North Dakota. The Coteau Properties Company/North
American Coal Corporation had annual sales of $86 million US dollars to the only
commercial coal gasification plant in the United States. Mr. Salisbury administered a 20 year contract with the sole coal
customer, and negotiated a new contract extension adding a new coal field and
additional production up to 16 million tons per year.
13
Mr.
Salisbury served in various management positions with The Coteau Properties
Company/North American Coal Corporation from 1978 through 1989. He was the
project manager responsible for the oversight of design, contract administration
and construction management of the Freedom Mine, a greenfield mine facility
valued at $186 million. The project was completed on time and under budget.
Mr.
Salisburys qualification to serve on our Board of Directors is based on his
extensive experience in the mining industry in general.
John
Eckersley. Mr. Eckersley has served as our Vice President, Legal and
Corporate Affairs since December 2010 and has served as a director of our
Company since July 15, 2011. Mr. Eckersley has practiced law as a solo
practitioner since 1999. His practice focuses on securities compliance,
corporate governance and estate planning. Mr. Eckersley served as the Executive
Vice President, Secretary and Treasurer of Digital Business Resource, Inc., a
telecommunications company, from 1996 to 1999, where he was a founder, and was
responsible for developing systems for office management, accounting, client
services, vendor coordination and marketing. Mr. Eckersley served as the General
Counsel of TIMI, a public finance advisory company, where he advised the company
on corporate strategy and was responsible for the companys compliance filings.
Mr. Eckersley has served as a director of Silver Horn Mining Ltd. (OTCBB: SILV)
since July 21, 2011, which is involved in the acquisition and exploration of
properties that may contain mineral resources, principally silver. Mr. Eckersley
received his Bachelor of Science, cum laude, and his Juris Doctorate from the
University of Utah. Mr. Eckersleys qualifications to serve on our Board of
Directors is based on his corporate experience and knowledge of the resources
industry.
Frank Högel. Mr. Högel has served as Executive Chairman
and as a director of our Company since February 19, 2014. Mr. Högel currently
serves as President and Chief Executive Officer of Peter Beck Performance Fonds
and Peter Beck and Partner Asset Management Company Limited and has been in such
positions since January 2002. In addition, from September 2007 to present, Mr.
Högel has been a director of Concept Capital Management, an asset management
company focused on evaluating Canadian resource companies for convertible
debenture financings as well as structuring gold and silver loans. Mr. Högel has
a Master of Business Administration (FH) degree from the University of
Nürtingen, Germany, which he received in June 1999, with a focus on financial
management, banking and international business & management. Mr. Högels
qualifications to serve on our Board of Directors is based on his corporate
experience, financial experience and knowledge of the resources industry.
Significant Employees
We
have no significant employees and our officers and directors provide their
services on a consulting basis.
Family Relationships
There
are currently no family relationships between any of the members of our Board of
Directors or our executive officers.
14
Involvement in Certain Legal Proceedings
Except
as disclosed in this proxy statement, during the past ten years none of the
following events have occurred with respect to any of our proposed nominees for
election as a director or was a director or executive officer of any company
(including our Company):
|
1. |
A petition under any legislation relating to bankruptcy
laws or insolvency laws was filed by or against, or a receiver, fiscal
agent or similar officer was appointed by a court for the business or
property of such person, or any partnership in which he was a general
partner at or within two years before the time of such filing, or any
corporation or business association of which he was an executive officer
at or within two years before the time of such filing; become bankrupt, or
subject to or instituted any proceedings, arrangements or compromise with
creditors; |
|
|
|
|
2. |
Such person was convicted in a criminal proceeding or is
a named subject of a pending criminal proceeding (excluding traffic
violations and other minor offenses); |
|
|
|
|
3. |
Such person was the subject of any order, judgment, or
decree, not subsequently reversed, suspended or vacated, of any court of
competent jurisdiction, permanently or temporarily enjoining him from, or
otherwise limiting, the following activities: |
|
i. |
Acting as a futures commission merchant, introducing
broker, commodity trading advisor, commodity pool operator, floor broker,
leverage transaction merchant, any other person regulated by the Commodity
Futures Trading Commission, or an associated person of any of the
foregoing, or as an investment adviser, underwriter, broker or dealer in
securities, or as an affiliated person, director or employee of any
investment company, bank, savings and loan association or insurance
company, or engaging in or continuing any conduct or practice in
connection with such activity; |
|
|
|
|
ii. |
Engaging in any type of business practice; or |
|
|
|
|
iii. |
Engaging in any activity in connection with the purchase
or sale of any security or commodity or in connection with any violation
of applicable securities legislation, whether federal, state or provincial
or any applicable commodities legislation; |
|
4. |
Such person was the subject of any order, judgment or
decree, not subsequently reversed, suspended or vacated, of any Federal or
State authority barring, suspending or otherwise limiting for more than 60
days the right of such person to engage in any activity described in
paragraph (3)(i) above, or to be associated with persons engaged in any
such activity; |
|
|
|
|
5. |
Such person was subject to a cease trade or similar order
or an order denying the relevant company access to any exemptions under
securities legislation, for more than 30 consecutive days; |
|
|
|
|
6. |
Such person was subject to an event that resulted, after
the director or executive officer ceased to be a director or executive
officer, in the company being the subject of a cease trade or similar
order or an order that denied the relevant company access to any exemption
under the securities legislation, for a period of more than 30 consecutive
days; |
|
|
|
|
7. |
Such person was found by a court of competent
jurisdiction in a civil action or by the Commission to have violated any
Federal or State securities law, and the judgment in such civil action or
finding by the Commission has not been subsequently reversed, suspended,
or vacated; |
15
|
8. |
Such person was subject to any penalties or sanctions
imposed by a court of competent jurisdiction relating to securities
legislation or by a securities regulatory authority or has entered into a
settlement agreement with a securities regulatory authority; |
|
|
|
|
9. |
Such person was found by a court of competent
jurisdiction in a civil action or by the Commodity Futures Trading
Commission to have violated any Federal commodities law, and the judgment
in such civil action or finding by the Commodity Futures Trading
Commission has not been subsequently reversed, suspended or
vacated; |
|
|
|
|
10. |
Such person was the subject of, or a party to, any
Federal or State judicial or administrative order, judgment, decree, or
finding, not subsequently reversed, suspended or vacated, relating to an
alleged violation of: |
|
i. |
Any Federal or State securities or commodities law or
regulation; or |
|
|
|
|
ii. |
Any law or regulation respecting financial institutions
or insurance companies including, but not limited to, a temporary or
permanent injunction, order of disgorgement or restitution, civil money
penalty or temporary or permanent cease- and-desist order, or removal or
prohibition order; or |
|
|
|
|
iii. |
Any law or regulation prohibiting mail or wire fraud or
fraud in connection with any business entity;
or |
|
11. |
Such person was the subject of, or a party to, any
sanction or order, not subsequently reversed, suspended or vacated, of any
self-regulatory organization (as defined in Section 3(a)(26) of the U.S.
Securities Exchange Act), any registered entity (as defined in Section
1(a)(29) of the Commodity Exchange Act), or any equivalent exchange,
association, entity or organization that has disciplinary authority over
its members or persons associated with a member. |
There
are currently no legal proceedings to which any of our directors or officers is
a party adverse to us or in which any of our directors or officers has a
material interest adverse to us.
Meetings of Directors During the Last Fiscal Year
The
Companys Board of Directors held four meetings during the fiscal year ended
February 28, 2014. Each director attended at least 75% of the aggregate of: (i)
the total number of board meetings held while he or she was a director; and (ii)
the total number of meetings held by committees on which he or she served during
the periods that he or she served.
The
Company does not have a formal policy with respect to director attendance at
annual shareholders meetings, however, all directors are encouraged to attend. A
total of one director from the Board of Directors as it was comprised at the
time attended the annual shareholders meeting last year.
Committees of the Board of Directors
Our
Board of Directors currently only has an audit committee. The audit committee
was established in August, 2007.
The
following provides information regarding the Companys audit committee and
summarizes the functions of such committee.
16
Audit Committee
National
Instrument 52-110 of the Canadian Securities Administrators (NI 52-110)
requires the Company, as a venture issuer, to disclose annually in its
information circular (proxy statement) certain information concerning the
constitution of its audit committee and its relationship with its independent
auditor, as set forth in the following.
The
Companys audit committee is governed by an audit committee charter, the text of
which is attached as Schedule A to this Proxy Statement.
The Companys audit committee is currently comprised of three directors, David
Salisbury, Frank Högel and John Eckersley. Mr. Eckersley is not independent as
he is the Vice President of the Company. All of the audit committee members are
financially literate. The Company is relying upon the exemption in section 6.1
of NI 52-110 in respect of the composition of its audit committee and in respect
of its reporting obligations under NI 52-110 for the year ended February 28,
2014. This exemption exempts a venture issuer from the requirement to have
100% of the members of its audit committee independent, as would otherwise be
required by NI 52-110. Our Board has determined that David Salisbury qualifies
as an audit committee financial expert as defined under applicable SEC rules
and also meets the additional criteria for independence of audit committee
members set forth in Rule 10A-3(b)(l) under the Exchange Act.
See
heading Election of Directors for disclosure on relevant experience for each
member of the audit committee. Each member of the audit committee has
-
an understanding of the accounting principles used by the issuer to prepare
its financial statements, and the ability to assess the general application of
those principles in connection with estimates, accruals and reserves;
-
experience preparing, auditing, analyzing or evaluating financial
statements that present a breadth and level of complexity of accounting issues
that are generally comparable to the breadth and complexity of issues that can
reasonably be expected to be raised by the issuers financial statements, or
experience actively supervising individuals engaged in such activities; and
-
an understanding of internal controls and procedures for financial
reporting.
Since
the commencement of the Companys most recently completed financial year, the
Companys Board has not failed to adopt a recommendation of the audit committee
to nominate or compensate an external auditor.
The
Company has not relied on the exemptions contained in sections 2.4 or 8 of NI
52-110. Section 2.4 which provides an exemption from the requirement that the
audit committee must pre-approve all non-audit services to be provided by the
auditor, where the total amount of fees related to the non-audit services are
not expected to exceed 5% of the total fees payable to the auditor in the fiscal
year in which the non-audit services were provided. Section 8 permits a company
to apply to a securities regulatory authority for an exemption from the
requirements of NI 52-110, in whole or in part.
The
audit committee has not adopted specific policies and procedures for the
engagement of non-audit services. Subject to the requirements of NI 52-110, the
engagement of non-audit services is considered by the Companys Board of
Directors, and where applicable the audit committee, on a case-by-case basis.
The
audit committee discharged its mandate in respect of the financial year ended
February 28, 2014, including the review and recommendation to the Board of
Directors in respect of all financial disclosure contained in our Companys
public documents.
17
The
audit committee held one meetings during the year ended February 28, 2014, and
also acted through the adoption of written consent resolutions.
Report of the Audit Committee
The
audit committee has reviewed and discussed the audited consolidated financial
statements for the year ended February 28, 2014 with the Companys management.
In addition, the audit committee has discussed with the Companys independent
registered public accounting firm, Dale Matheson Carr-Hilton Labonte, LLP, the
matters required by Statement on Auditing Standards No. 61, Communication
with Audit Committees. The audit committee has received the written
disclosures and the letter from Dale Matheson Carr-Hilton Labonte, LLP required
by Public Accounting Oversight Board Rule No. 3526, Communications with Audit
Committees Concerning Independence, and has discussed, with Dale Matheson
Carr-Hilton Labonte, LLP, their independence. The audit committee considered the
compatibility of non-audit services with the auditors independence. Based on
the discussions and reviews referenced above, the audit committee recommended to
the Companys Board of Directors that the audited consolidated financial
statements for the year ended February 28, 2014 be included in the Companys
Annual Report on Form 10-K. The audit committee has selected Dale Matheson
Carr-Hilton Labonte, LLP to serve as the Companys Independent Registered Public
Accounting Firm for the year 2014.
The audit committee of the Board of Directors of Passport Potash Inc.:
Frank Högel
David Salisbury
John Eckersley
Nomination of Directors
The
Board considers its size each year when it considers the number of directors to
recommend to the shareholders for election at the annual meeting of
shareholders, taking into account the number required to carry out the Boards
duties effectively and to maintain a diversity of views and experience.
The
Board does not have a nominating committee, and these functions are currently
performed by the Board as a whole. However, if there is a change in the number
of directors required by the Company, this policy will be reviewed.
Compensation
The Board, as a whole, determines compensation for the directors and executive
officers.
Shareholder Communications
Shareholders
may contact the Board of Directors of the Company either by: (a) writing to
Passport Potash Inc., 608-1199 West Pender Street, Vancouver, British Columbia
V6E 2R1, Attn: Board of Directors; or (b) sending an e-mail message to
info@passportpotash.com.
Our
Corporate Secretary will conduct an initial review of all such shareholder
communications and will forward the communications to the appropriate person, to
the appropriate committee of the Board of Directors, or the entire Board of
Directors depending on the nature of the communication. Such communications will
be assessed by the recipients as soon as reasonably practical taking into
consideration the nature of the communication and whether expedited review is
appropriate.
18
Certain Relationships and Related Transactions
Except
as described herein, none of the following parties (each a Related
Party) has, in our fiscal years ended February 28, 2014 and February 28,
2013, had any material interest, direct or indirect, in any transaction with us
or in any presently proposed transaction that has or will materially affect us:
- any of our directors or officers;
- any person proposed as a nominee for election as a director;
- any person who beneficially owns, directly or indirectly, shares carrying
more than 10% of the voting rights attached to our outstanding shares of
common stock; or
- any member of the immediate family (including spouse, parents, children,
siblings and in- laws) of any of the above persons.
During
the year ended February 28, 2014, we paid $60,000 to David Salisbury, our
director, for consulting fees. Mr. Salisbury receives $10,000 per month for
consulting services pursuant to a Consulting Agreement, dated January 16, 2012.
We owed Mr. Salisbury $4,046 as at February 28, 2014.
During
the year ended February 28, 2014, we paid $180,000 to Joshua Bleak, our director
and officer, for management fees. In addition, during the year ended February
28, 2014, we paid $Nil to North American Environmental Corp. (NAEC), a
company controlled by Joshua Bleak, for exploration services (site preparation,
drilling, site reclamation and materials transportation) and owed this company
$382 as at February 28, 2014. During the year ended February 28, 2013, we paid a
total of $49,500 to NAEC and owed this company CAD$382 as at February 28, 2013.
There is no written contract between us and NAEC, and NAEC issues invoices when
work is performed based on the activity and/or the equipment used to perform the
work.
During
the year ended February 28, 2014, we paid $60,000 to Dennis Ickes, former
director, for professional services. Mr. Ickes received $5,000 per month
pursuant to a Professional Services Agreement, dated December 14, 2011. We owed
Mr. Ickes $Nil as at February 28, 2014.
During
the year ended February 28, 2014, we paid $150,000 to John Eckersley, our
director and officer, for consulting fees.
During
the year ended February 28, 2014, we paid $300,000 to MJI Resource Management
Corp., a company of which Mr. Eckersley is a director, for management fees as
well as $324,000 for mineral exploration expenses. As of February 28, 2014, we
owed MJI Resource Management Corp. $275,518.
During
the year ended February 28, 2014, we paid $135,000 to Michael X. Schlumpberger,
our officer, for consulting fees. We owed Mr. Schlumpberger $103,665.46 as at
February 28, 2014. Mr. Schlumpberger receives $11,250 per month through a
consulting agreement between Schlumpberger Inc. and us dated June 3, 2013.
19
During
the year ended February 28, 2014, we paid $11,980 to Laara Shaffer, our former
director and former Chief Financial Officer and Secretary, for administration
fees.
During
the year ended February 28, 2014, we paid $49,074 to Transnational Enterprises
Ltd., a company controlled by Ali Rahimtula, for consulting fees, and we owed
Transnational Enterprises Ltd. $Nil as at February 28, 2014. Mr. Rahimtula
receives CAD$5,000 per month through a Consulting Agreement between
Transnational Enterprises Ltd. and us, dated January 1, 2012 .
During
the year ended February 28, 2014, we paid $67,379 to Joan Purdy for consulting
fees.
During
the year ended February 28, 2014, we accrued $60,000 to Jerry Aiken, former
director of the Company, for consulting fees and we owed Mr. Aiken $2,500 as at
February 28, 2014.
During
the year ended February 28, 2014, we paid aggregate fees of $172,424 (2013
-$187,963) to Tarmac Management Ltd. ("Tarmac"), a private British Columbia
company. Of these fees, $10,000 (2013 - $8,000) was paid for administration
services rendered by Tarmac and its employees, and the balance represented
reimbursements for rent and other expenses incurred by Tarmac on behalf of the
Company.
Our
Board of Directors reviews any proposed transactions involving Related Parties
and considerers whether such transactions are fair and reasonable and in our
best interests.
Compensatory Arrangements
Other
than compensatory arrangements described above under Certain Relationships and
Related Transactions and below under Executive Compensation, the Company has
no other transactions, directly or indirectly, with its promoters, directors,
senior officers or principal shareholders, which have materially affected or
will materially affect the Company.
Conflicts of Interest
To
our knowledge, and other than as disclosed in this proxy statement, there are no
known existing or potential conflicts of interest among the Company, its
promoters, directors and officers, or other members of management, or any
proposed director, officer or other member of management as a result of their
outside business interests except that certain of the directors and officers
serve as directors and officers of other companies, and therefore it is possible
that a conflict may arise between their duties to the Company and their duties
as a director or officer of such other companies.
Compliance with Section 16(a) of the Securities Exchange Act
Section 16(a) of the Securities Exchange Act of 1934, as
amended, requires the Companys executive officers and directors, and persons
who beneficially own more than ten percent of the Companys equity securities,
to file initial reports of ownership and reports of changes in ownership of the
Companys common stock and its other equity securities with the SEC. Copies of
all filed reports are required to be furnished to the Company pursuant to Rule
16a-3 promulgated under the Exchange Act. Based solely on the reports received
by the Company and on the representations of the reporting persons, the Company
believes that these persons have complied with all applicable filing requirements during the
fiscal year ended February 28, 2014, except as follows:
20
Name |
Position Held |
Late or Unfiled Report |
Joshua Bleak |
President, CEO and Director |
Two Form 4s filed late |
John Eckersley |
Executive Vice President and Director |
Two Form 4s filed late |
David Salisbury |
Director |
Two Form 4s filed late |
Ali Rahimtula |
Director |
Two Form 4s filed late |
Bill Allred |
Chief Financial Officer |
Form 3 filed late |
Michael X. Schlumpberger |
Chief Operating Officer |
Form 4 filed late |
Frank Högel |
Vice Chairman and Director |
Form 3 unfiled |
Laara Shaffer |
Former CFO, Secretary and Director |
Form 4 filed late |
Dennis Ickes |
Former Director |
Form 4 filed late |
Jerry Aiken |
Former Director |
Form 4 filed late |
Concept Capital Management
|
Beneficial owner of more than
10% |
Form 3 unfiled and two Form 4s
unfiled |
EXECUTIVE COMPENSATION
Compensation Discussion and Analysis
The
Board has not appointed a compensation committee and the responsibilities
relating to executive and director compensation, including reviewing and
recommending director compensation, overseeing the Companys base compensation
structure and equity-based compensation program, recommending compensation of
the Companys officers and employees, and evaluating the performance of officers
generally and in light of annual goals and objectives, is performed by the Board
as a whole.
The
Board also assumes responsibility for reviewing and monitoring the long-range
compensation strategy for the Companys senior management. The Board reviews the
compensation of senior management on a semi-annual basis taking into account
compensation paid by other issuers of similar size and activity.
Compensation Philosophy and Objectives
The
Company is a smaller reporting company as defined by Rule 12b-2 of the U.S.
Securities Exchange Act of 1934, as amended, is a junior resource company and
has limited resources. The compensation program for the senior management of the
Company is designed within this context with a view that the level and form of
compensation achieves certain objectives, including:
|
(a) |
attracting and retaining qualified executives; |
|
(b) |
motivating the short and long-term performance of these
executives; and |
|
(c) |
better aligning their interests with those of the
Companys shareholders. |
In
compensating its senior management, the Company has arranged for equity
participation through its stock option plan.
21
Bonus Incentive Compensation
The
Companys objective is to achieve certain strategic objectives and milestones.
The Board will consider executive bonus compensation dependent upon the Company
meeting those strategic objectives and milestones and sufficient cash resources
being available for the granting of bonuses. The Board approves executive bonus
compensation dependent upon compensation levels based on recommendations of the
Chief Executive Officer. Such recommendations are generally based on information
provided by issuers that are similar in size and scope to the Companys
operations.
Equity Participation Option-Based Awards
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 Companys stock
option plan. Stock options are granted to executives and employees taking into
account a number of factors, including the amount and term of options previously
granted, base salary and bonuses and competitive factors. The amounts and terms
of options granted are determined by the Board of Directors based on
recommendations put forward by the Chief Executive Officer. Due to the Companys
limited financial resources, the Company emphasizes the provisions of option
grants to maintain executive motivation.
Approach to Risk
The
Company is aware that compensation practices can have unintended risk
consequences. At the present time, the Board is satisfied that the current
executive compensation program does not encourage the executives to expose the
business to inappropriate risk.
Hedging Policy
Although
the Company has not adopted a policy disallowing insiders from purchasing
financial instruments designed to hedge or offset any decrease in market value
of Common Shares or any other securities of the Company, the Company is not
aware of any insiders having adopted such practice.
Actions, Decisions or Policies Made After February 28, 2014
Given
the evolving nature of the Companys business, the Board continues to review and
redesign the overall compensation plan for senior management so as to continue
to address the objectives identified above.
Effective
March 1, 2014, Mr. Allred replaced Ms. Shaffer as Chief Financial Officer. (Ms.
Schaffer resigned as Chief Financial Officer and Secretary on February 19,
2014).
Summary Compensation Table
Particulars
of compensation awarded to, earned by or paid during the last two fiscal years
to:
|
(a) |
the person(s) serving as our companys principal
executive officer during the year ended February 28, 2014; |
|
(b) |
each of our Companys two most highly compensated
executive officers, other than the principal executive officer, who were
serving as executive officers at the end of the year ended February 28,
2014, and whose total compensation exceeds $100,000 per year;
and |
|
(c) |
individuals for whom disclosure would have been provided
under (b) but for the fact that the individual was not serving as an
executive officer of our Company at the end of the year ended February 28,
2014; |
(individually a named executive officer and collectively, the
named executive officers) are set out in the summary compensation table below.
22
Name and
Principal Position |
Year
Ended Febru- ary 28 (29), |
Salary
($) |
Bonus
($) |
Stock
Awards ($) |
Option Awards
(1) ($) |
Non-
Equity
Incentive Plan Compen- sation
($) |
Non-
Qualified
Deferred Compen- sation
Earnings ($) |
All Other
Compen- sation ($) |
Total
($) |
Joshua Bleak, President and
CEO(2)
|
2014 |
180,000 |
Nil |
Nil |
42,286 |
Nil |
Nil |
Nil |
222,286 |
2013 |
180,000 |
Nil |
Nil |
Nil |
Nil |
Nil |
Nil |
180,000 |
John Eckersley, Executive Vice
President (3)
|
2014 |
150,000 |
Nil |
Nil |
42,286 |
Nil |
Nil |
Nil |
192,286 |
2013 |
150,000 |
Nil |
Nil |
Nil |
Nil |
Nil |
Nil |
150,000 |
Bill Allred, Chief Financial Officer
(4) |
2014 |
N/A |
N/A |
N/A |
N/A |
N/A |
N/A |
N/A |
N/A |
Michael X. Schlumpberger Chief
Operating Officer (5) |
2014 |
135,000 |
Nil |
Nil |
72,906 |
Nil |
Nil |
Nil |
207,906 |
Laara Shaffer, Former Chief
Financial Officer and Secretary(6) |
2014 |
11,980 |
Nil |
Nil |
42,286 |
Nil |
Nil |
Nil |
54,266 |
2013 |
18,460 |
Nil |
Nil |
41,182 |
Nil |
Nil |
Nil |
59,642
|
(1) |
This amount represents the fair value of these stock
options at the date of grant which was estimated using the Black-Scholes
option pricing model. |
(2) |
Mr. Bleak has served as our President and CEO since April
26, 2011. |
(3) |
Mr. Eckersley has served as our Executive Vice-President
since December 2010. |
(4) |
Mr. Allred has served as our Chief Financial Officer
since March 1, 2014. |
(5) |
Mr. Schlumpberger has served as our Chief Operating
Officer since June 3, 2013. |
(6) |
Ms. Shaffer resigned as our Chief Financial Officer and
Secretary on February 19, 2014. |
23
Outstanding Equity Awards as of February 28, 2014
The
following table summarizes the outstanding equity awards as of February 28, 2014
for each of our named executive officers:
|
Option Awards |
Stock Awards |
Name
|
Number
of secur- ities under- lying
unexer- cised options
exercise- able (#) |
Number
of secur- ities under- lying
unexer- cised options unexer-
cisable (#) |
Equity
incentive plan awards: number
of securi- ties under-
lying unexer- cised un- earned
options (#) |
Option
exercise price ($) |
Option
expira- tion date |
Number
of shares or units of stock that
have not vested (#) |
Market value
of shares or units of stock
that have not vested ($) |
Equity incen-
tive plan awards: number of
un- earned shares, units or
other rights that have
not vested (#) |
Equity
incen- tive
plan awards: market or
payout value of un- earned
shares, units or other rights
that have not vested
($) |
Joshua Bleak
|
145,000 420,250
167,875 300,000 530,000 |
Nil Nil Nil Nil
Nil |
Nil Nil Nil Nil
Nil |
$0.36 $0.84 $0.40
$0.64 $0.40 |
July 2/18 Sep. 12/16
Mar. 3/16 Jan. 10/16 Feb. 10/16 |
Nil |
Nil |
Nil |
Nil |
|
|
|
|
|
|
|
|
|
|
John Eckersley |
145,000 350,000
135,500 |
Nil Nil Nil |
Nil Nil Nil |
$0.36 $0.76 $1.18 |
July 2/18 Jan. 20/17
Jun. 21/16 |
Nil |
Nil |
Nil |
Nil |
|
|
|
|
|
|
|
|
|
|
Laara Shaffer(1)
|
145,000 104,500
100,000 32,500 131,750 |
Nil Nil Nil Nil
Nil |
Nil Nil Nil Nil
Nil |
$0.36 $0.42 $0.76
$1.18 $0.40 |
July 2/18 Feb. 19/18
Jan. 20/17 Jun. 21/16 Feb. 10/16 |
Nil |
Nil |
Nil |
Nil |
Note: Represents post 2:1 share consolidation figures.
Equity Compensation Plans
2014 Fixed Share Option Plan
On
October 31, 2014, our Board of Directors approved the adoption of a new fixed
share option plan (the 2014 Plan), which complies with the current
policies of the TSXV and the amendments to the Income Tax Act (Canada) which
impose withholding obligations on taxable benefits arising at the time options
are exercised, since our shareholders voted against our previous 2011 rolling
stock option plan and the TSXV requires that all listed issuers must implement a
stock option plan. The 2014 Plan is subject to approval of the TSXV, however,
such plan is not subject to approval of our shareholders as the 2014 Plan will
not result at any time in the number of shares reserved for issuance under stock
options exceeding 10% of our issued shares. On November 5, 2014, the TSXV
approved the 2014 Plan.
The
purpose of the 2014 Plan is to provide incentive to qualified parties to
increase their proprietary interest in the Company and thereby encourage their
continuing association with the Company. The 2014 Plan is administered by the
Board of Directors. The 2014 Plan provides that options may be issued to
directors, officers, employees or consultants of the Company or a subsidiary of the Company. The 2014 Plan also provides that the
maximum aggregate number of Common Shares that may be reserved for issuance
under the 2014 Plan at any point in time is 9,180,969, which represents 10% of
the Companys issued and outstanding Common Shares as at the date of the
Companys last shareholders meeting on September 12, 2013 (considered to be a
fixed stock option plan). Pursuant to the 2014 Plan all options expire on a
date not later than 10 years after the date of grant of an option. All options
outstanding under the previous 2011 rolling stock option plan were rolled into
the 2014 Plan.
24
The 2014 Plan is subject to the following restrictions:
|
(a) |
The Company must not grant an option to a director,
employee, consultant, or consultant company (the Service
Provider) in any 12 month period that exceeds 5% of the outstanding
shares, unless the Company has obtained approval by a majority of the
votes cast by the shareholders of the Company eligible to vote at a
shareholders meeting, excluding votes attaching to shares beneficially
owned by insiders and their associates (Disinterested Shareholder
Approval); |
|
(b) |
The aggregate number of options granted to a Service
Provider conducting investor relations activities in any 12 month period
must not exceed 2% of the outstanding shares calculated at the date of the
grant, without the prior consent of the TSXV; |
|
(d) |
The Company must not grant an option to a consultant in
any 12 month period that exceeds 2% of the outstanding shares calculated
at the date of the grant of the option; |
|
(e) |
The number of optioned shares issued to insiders in any
12 month period must not exceed 10% of the outstanding shares (in the
event that the 2014 Plan is amended to reserve for issuance more than 10%
of the outstanding shares) unless the Company has obtained Disinterested
Shareholder Approval to do so; |
|
(f) |
The exercise price of an option previously granted to an
insider must not be reduced, unless the Company has obtained Disinterested
Shareholder Approval to do so. |
The following is a summary of the material terms of the 2014 Plan:
|
(a) |
Persons who are Service Providers to the Company or its
affiliates, or who are providing services to the Company or its
affiliates, are eligible to receive grants of options under the 2014
Plan; |
|
(b) |
Options granted under the 2014 Plan are non-assignable
and non-transferable and are issuable for a period of up to 10
years; |
|
(c) |
For options granted to Service Providers, the Company
must ensure that the proposed optionee is a bona fide Service Provider of
the Company or its affiliates; |
|
(d) |
An option granted to any Service Provider will expire
within 90 days (or such other time, not to exceed one year, as shall be
determined by the Board as at the date of grant or agreed to by the Board
and the optionee at any time prior to expiry of the option), after the
date the optionee ceases to be employed by or provide services to the
Company, but only to the extent that such option was vested at the date
the optionee ceased to be so employed by or to provide services to the
Company; |
|
(e) |
If an optionee dies, any vested option held by him or her
at the date of death will become exercisable by the optionees lawful
personal representatives, heirs or executors until the earlier of one year
after the date of death of such optionee and the date of expiration of the
term otherwise applicable to such option; |
25
|
(f) |
In the case of an optionee being dismissed from
employment or service for cause, such optionees options, whether or not
vested at the date of dismissal, will immediately terminate without right
to exercise same; |
|
(g) |
The exercise price of each option will be set by the
Board on the effective date of the option and will not be less than the
Discounted Market Price (as defined in the 2014 Plan); |
|
(h) |
Vesting of options shall be at the discretion of the
Board, and will generally be subject to: (i) the Service Provider
remaining employed by or continuing to provide services to the Company or
its affiliates, as well as, at the discretion of the Board, achieving
certain milestones which may be defined by the Board from time to time or
receiving a satisfactory performance review by the Company or its
affiliates during the vesting period; or (ii) the Service Provider
remaining as a Director of the Company or its affiliates during the
vesting period; and |
|
(i) |
The Board reserves the right in its absolute discretion
to amend, suspend, terminate or discontinue the 2014 Plan with respect to
all 2014 Plan shares in respect of options which have not yet been granted
under the 2014 Plan. |
The
Board has determined that, in order to reasonably protect the rights of
participants, as a matter of administration, it is necessary to clarify when
amendments to the 2014 Plan may be made by the Board without shareholder
approval. Accordingly, the Board may, without shareholder approval:
|
(i) |
amend the 2014 Plan to correct typographical, grammatical
or clerical errors; |
|
(ii) |
change the vesting provisions of an option granted under
the 2014 Plan, subject to prior written approval of the TSXV, if
applicable; |
|
(iii) |
change the termination provision of an option granted
under the 2014 Plan if it does not entail an extension beyond the original
expiry date of such option; |
|
(iv) |
make such amendments to the 2014 Plan as are necessary or
desirable to reflect changes to securities laws applicable to the
Company; |
|
(v) |
if the Company becomes listed or quoted on a stock
exchange or stock market senior to the TSXV, make such amendments as may
be required by the policies of such senior stock exchange or stock market;
and |
|
(vi) |
amend the 2014 Plan to reduce the benefits that may be
granted to Service Providers. |
Grants
of option awards under the 2014 Plan are at the discretion of the Board of
Directors. Accordingly, allocation of future benefits under the 2014 Plan among
individual Service Providers, or among groups of Service Providers (such as
executive officers, non-executive directors and non-executive employees), is not
determinable at this time. The Service Providers who will be eligible to receive
option awards under the 2014 Plan include: (a) our Chief Executive Officer; (b)
our Chief Financial Officer; (c) our Executive Vice President; (d) our Chief
Operating Officer; (e) our directors (including our three non-executive
directors); and (f) our employees and consultants (we currently have one
employee, and we engage various individuals from time to time to perform
non-executive functions on a consulting basis; each is eligible to receive
option awards under the 2014 Plan at the discretion of our Board of Directors).
26
Stock Options Outstanding as at February 28, 2014
The
following table provides a summary of the number of stock options and deferred
stock units under equity compensation plans outstanding as at February 28,
2014.
Plan Category
|
Number of securities to
be issued upon exercise of outstanding options,
warrants and rights (a) |
Weighted-average
exercise price of outstanding options,
warrants and rights (b) |
Number of securities
remaining
available for future issuance under equity
compensation plans (excluding securities reflected
in column (a)) (c) |
Equity compensation plans approved by security holders |
9,166,812 |
CAD$0.50 |
Nil* |
Equity compensation plans not approved by security holders
|
Nil |
Nil |
Nil |
Total |
9,166,812 |
CAD$0.50 |
Nil* |
Notes:
*
At our last annual general meeting held on September 12, 2013, our shareholders
voted against the continuation of our 2011 rolling share option plan. However,
on October 31, 2014, our Board of Directors approved the adoption of a new 2014
Fixed Share Option Plan which reserves for issuance a maximum of 9,180,969
shares, which includes the currently outstanding 9,166,812 stock options
previous granted under our 2011 rolling stock option plan resulting in only
14,157 shares available for future issuance under the 2014 Fixed Share Option
Plan.
Compensation of Directors
The
following table summarizes the compensation of our Companys directors who were
not NEOs for the year ended February 28, 2014:
Name
|
Fees earned or
paid in cash ($) |
Stock
awards ($) |
Option
awards ($) |
Non-
equity
incentive plan compen- sation
($) |
Non-
qualified
deferred compen- sation
earnings ($) |
All other
compen- sation ($) |
Total
($) |
Ali Rahimtula(1) |
49,074 |
Nil |
42,286 |
Nil |
Nil |
Nil |
91,360 |
Dennis Ickes(2) |
60,000 |
Nil |
42,286 |
Nil |
Nil |
Nil |
102,286 |
David Salisbury(3) |
60,000 |
Nil |
42,286 |
Nil |
Nil |
Nil |
102,286 |
Jerry Aiken(4) |
110,000 |
Nil |
42,286 |
Nil |
Nil |
Nil |
152,286 |
Bill Allred(5) |
Nil |
Nil |
Nil |
Nil |
Nil |
Nil |
Nil |
Notes:
(1) |
Mr. Rahimtula was appointed as a director on October 28,
2011. |
(2) |
Mr. Ickes was appointed as a director on December 14,
2011 and he resigned on February 19, 2014. |
(3) |
Mr. Salisbury was appointed as a director on Jan. 16,
2012. |
(4) |
Mr. Aiken was appointed as a director on May 15, 2012 and
he resigned on February 19, 2014. |
(5) |
Mr. Allred was appointed as a director on September 12,
2013 and resigned on February 19, 2014. |
The
Companys directors do not have specific compensation arrangements based on
attendance at board or committee meetings or serving as a committee chair. From
time to time directors may receive bonus payments or options, which are granted
on a discretionary basis. The amount of any bonus payments or the number of
options granted is based on the experience of the director, time spent on
Company matters and the compensation paid to other directors of companies in the
industry.
27
Employment Contracts and Termination of Employment and
ChangeInControl Arrangements
The
Company has not entered into any employment contracts with its executive
officers. There is no contract, agreement, plan or arrangement, whether written
or unwritten, that provides for payment to a named executive officer at,
following, or in connection with the resignation, retirement or other
termination of a named executive officer, or a change in control of the Company
or a change in the named executive officers responsibilities following a change
in control, with respect to each named executive officer.
Management Contracts
During the year ended February 28, 2014, we paid aggregate fees
of $172,424 (2013 -$187,963) to Tarmac Management Ltd. (Tarmac), a private
British Columbia company. Of these fees, $10,000 (2013 - $8,000) was paid for
administration services rendered by Tarmac and its employees, and the balance
represented reimbursements for rent and other expenses incurred by Tarmac on
behalf of us. Payment of these fees to Tarmac has been reflected in the notes to
our audited financial statements for the year ended February 28, 2014 as
Related Party Transactions, as Tarmac provides a high level of involvement in
the daily management of our affairs.
During the year ended February 28, 2014, we paid aggregate fees
of $624,000 (2013 -$560,200) to MJI Resource Management Corp. (MJI), a private
Arizona company. Of these fees, $300,000 (2013 - $300,000) was paid for
management fees and the balance represented Geological consulting expenses
incurred by MJI on behalf of us. Payment of these fees to MJI has been reflected
in the notes to our audited financial statements for the year ended February 28,
2014 as Related Party Transactions, as MJI provides a high level of
involvement in the daily management of our affairs.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR
THE ELECTION OF THE DIRECTOR NOMINEES SET FORTH ABOVE
PROPOSAL NUMBER THREE:
RATIFICATION OF APPOINTMENT OF
INDEPENDENT
REGISTERED PUBLIC ACCOUNTANTS
Dale
Matheson Carr-Hilton Labonte LLP has been appointed as our independent
registered public accountants for the year ending February 28, 2014. Dale
Matheson Carr-Hilton Labonte LLP audited the Companys financial statements for
the years ended February 28, 2014 and February 28, 2013.
The
Company anticipates that a representative of Dale Matheson Carr-Hilton Labonte
LLP will be present at the Annual Meeting. The representative will have the
opportunity to make a statement if they desire to do so. It is expected the
representative will not be available to respond to questions.
In
the event ratification by the shareholders of the appointment of Dale Matheson
Carr-Hilton Labonte LLP as the Companys independent registered public
accountants is not obtained, our Board of Directors will reconsider such
appointment.
28
Principal Accountant Fees and Services
Dale
Matheson Carr-Hilton Labonte LLP performed the services listed below and was
paid the fees listed below for the fiscal years ended February 28, 2014 and
February 28, 2013:
Audit Fees
2014 |
2013
|
$44,584 |
$40,000
|
Audit
Fees, of which 100% thereof were approved by the Companys audit committee,
consist of fees billed for professional services rendered by our independent
auditors for the audit of our annual financial statements, the review of the
financial statements included in each of our quarterly reports and services
provided in connection with statutory and regulatory filings or
engagements.
Audit Related Fees
2014 |
2013
|
$27,300 |
$26,500
|
Audit
related fees are the aggregate fees billed by our independent auditors for
assurance and related services that are reasonably related to the performance of
the audit or review of our financial statements and are not described in the
preceding category.
Tax Fees
Tax
Fees consist of fees billed for professional services for tax compliance, tax
advice and tax planning. These services include assistance regarding federal,
state and local tax compliance and consultation in connection with various
transactions and acquisitions.
All Other Fees
All
other fees include fees billed by our independent auditors for products or
services other than as described in the immediately preceding three categories.
Audit Committee PreApproval of Audit and Permissible
NonAudit Services of Independent Auditors
Effective
May 6, 2003, the Securities and Exchange Commission adopted rules that require
that before an independent registered public accounting firm is engaged by a
company to render any auditing or permitted nonaudit related service, the
engagement be:
29
-
approved by the audit committee; or
-
entered into pursuant to preapproval policies and procedures established
by the audit committee, provided the policies and procedures are detailed as
to the particular service, the audit committee is informed of each service,
and such policies and procedures do not include delegation of the audit
committees responsibilities to management.
The
Companys audit committee was formed in August 2007, and has assumed
responsibility for the preapproval of audit and permitted nonaudit services to
be performed by the Companys independent auditor. The audit committee will, on
an annual basis, consider and, if appropriate, approve the provision of audit
and nonaudit services by Dale Matheson Carr-Hilton Labonte LLP. Thereafter, the
audit committee will, as necessary, consider and, if appropriate, approve the
provision of additional audit and nonaudit services by Dale Matheson
Carr-Hilton Labonte LLP which are not encompassed by the audit committees
annual preapproval and are not prohibited by law.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THIS PROPOSAL
TO
RATIFY THE APPOINTMENT OF DALE MATHESON CARR-HILTON LABONTE
LLP AS THE INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS OF THE
COMPANY FOR THE YEAR ENDING FEBRUARY 28, 2014
FORWARDLOOKING STATEMENTS
Certain
statements contained in this proxy statement that are not historical facts
constitute forward-looking statements. These statements are based, among other
things, on the Companys current plans and expectations relating to expectations
of anticipated growth in the future and future success under various
circumstances. As such, these forward-looking statements involve uncertainty and
risk.
Other
factors and assumptions not identified above could also cause the actual results
to differ materially from those set forth in any forward-looking statement. Our
Company does not undertake any obligation to update the forward-looking
statements contained in this proxy statement to reflect actual results, changes
in assumptions, or changes in other factors affecting these forward-looking
statements.
FUTURE SHAREHOLDER PROPOSALS
Any
shareholder who intends to present a proposal at the 2015 Annual Meeting of
shareholders (anticipated to be held in December 2015) for inclusion in our
proxy statement and proxy form relating to such Annual Meeting must submit such
proposal to us at our principal executive offices no later than August 1, 2015.
Our Company reserves the right to reject, rule out of order, or take other
appropriate action with respect to any proposal that does not comply with Rule
14a-8 under the Securities Exchange Act of 1934, as amended, and all other
applicable requirements.
In
addition, in the event a shareholder proposal is not received by the Company by
August 1, 2015, the proxy to be solicited by the Board of Directors for the 2015
Annual Meeting will confer discretionary authority on the holders of the proxy
to vote the shares if the proposal is presented at the 2015 Annual Meeting
without any discussion of the proposal in the proxy statement for such meeting.
30
SEC
rules and regulations provide that if the date of the Companys 2015 Annual
Meeting is advanced or delayed more than 30 days from first anniversary of the
2014 Annual Meeting, shareholder proposals intended to be included in the proxy
materials for the 2015 Annual Meeting must be received by the Company within a
reasonable time before it begins to print and mail the proxy materials for the
2015 Annual Meeting.
Proposals
or notices of intention to present proposals should be addressed to: John
Eckersley, Executive Vice President, Passport Potash Inc., 608-1199 West Pender
Street, Vancouver, British Columbia, V6E 2R1.
WHERE YOU CAN FIND MORE INFORMATION
The
Company is subject to the informational requirements of the Securities Exchange
Act of 1934. We file reports, proxy statements and other information with the
SEC. You may read and copy these reports, proxy statements and other information
at the SECs Public Reference Section at One Station Place, 100 F Street, NE,
Washington, DC 20549. You may obtain information on the operation of the Public
Reference Room by calling the SEC at 1-800-SEC-0330. The SEC also maintains an
Internet website, located at www.sec.gov that contains reports, proxy statements
and other information regarding our company.
Financial
information is provided in the audited financial statements of the Company for
the year ended February 28, 2014 and in the related management discussion and
analysis and filed on www.Sedar.com.
Additional information relating to the Company is
filed on www.Sedar.com and upon request from John Eckersley, Executive Vice
President of the Company at telephone no.: (604) 687-0300 or fax no.: (604)
687-0151. Copies of documents will be provided free of charge to security
holders of the Company. The Company may require the payment of a reasonable
charge from any person or company who is not a security holder of the Company,
who requests a copy of any such document.
|
By Order of the Board of Directors of
|
|
Passport Potash Inc. |
|
|
|
/s/
Joshua Bleak |
|
Joshua Bleak |
|
President and Chief Executive Officer |
|
|
|
November 7, 2014 |
|
___________________ |
31
Schedule A
PASSPORT POTASH INC. (the Company)
AUDIT COMMITTEE CHARTER
PURPOSE OF THE COMMITTEE
The purpose of the Audit Committee (the Committee) of the
Board of Directors (the Board) of the Company is to provide an open avenue of
communication between management, the Companys independent auditor and the
Board and to assist the Board in its oversight of:
-
the integrity, adequacy and timeliness of the Companys financial reporting
and disclosure practices;
-
the Companys compliance with legal and regulatory requirements related to
financial reporting; and
-
the independence and performance of the Companys independent auditor.
The Committee shall also perform any other activities
consistent with this Charter, the Companys articles and governing laws as the
Committee or Board deems necessary or appropriate.
The Committee shall consist of at least three directors.
Members of the Committee shall be appointed by the Board and may be removed by
the Board in its discretion. The members of the Committee shall elect a Chairman
from among their number. A majority of the members of the Committee must not be
officers or employees of the Company or of an affiliate of the Company. The
quorum for a meeting of the Committee is a majority of the members who are not
officers or employees of the Company or of an affiliate of the Company. With the
exception of the foregoing quorum requirement, the Committee may determine its
own procedures.
The Committees role is one of oversight. Management is
responsible for preparing the Companys financial statements and other financial
information and for the fair presentation of the information set forth in the
financial statements in accordance with generally accepted accounting principles
(GAAP). Management is also responsible for establishing internal controls and
procedures and for maintaining the appropriate accounting and financial
reporting principles and policies designed to assure compliance with accounting
standards and all applicable laws and regulations.
The independent auditors responsibility is to audit the
Companys financial statements and provide its opinion, based on its audit
conducted in accordance with generally accepted auditing standards, that the
financial statements present fairly, in all material respects, the financial
position, results of operations and cash flows of the Company in accordance with
GAAP.
The Committee is responsible for recommending to the Board the
independent auditor to be nominated for the purpose of auditing the Companys
financial statements, preparing or issuing an auditors report or performing
other audit, review or attest services for the Company, and for reviewing and
recommending the compensation of the independent auditor. The Committee is also
directly responsible for the evaluation of and oversight of the work of the
independent auditor. The independent auditor shall report directly to the
Committee.
32
AUTHORITY AND RESPONSIBILITIES
In addition to the foregoing, in performing its oversight
responsibilities the Committee shall:
1. |
Monitor the adequacy of this Charter and recommend any
proposed changes to the Board. |
|
|
2. |
Review the appointments of the Companys Chief Financial
Officer and any other key financial executives involved in the financial
reporting process. |
|
|
3. |
Review with management and the independent auditor the
adequacy and effectiveness of the Companys accounting and financial
controls and the adequacy and timeliness of its financial reporting
processes. |
|
|
4. |
Review with management and the independent auditor the
annual financial statements and related documents and review with
management the unaudited quarterly financial statements and related
documents, prior to filing or distribution, including matters required to
be reviewed under applicable legal or regulatory requirements. |
|
|
5. |
Where appropriate and prior to release, review with
management any news releases that disclose annual or interim financial
results or contain other significant financial information that has not
previously been released to the public. |
|
|
6. |
Review the Companys financial reporting and accounting
standards and principles and significant changes in such standards or
principles or in their application, including key accounting decisions
affecting the financial statements, alternatives thereto and the rationale
for decisions made. |
|
|
7. |
Review the quality and appropriateness of the accounting
policies and the clarity of financial information and disclosure practices
adopted by the Company, including consideration of the independent
auditors judgment about the quality and appropriateness of the Companys
accounting policies. This review may include discussions with the
independent auditor without the presence of management. |
|
|
8. |
Review with management and the independent auditor
significant related party transactions and potential conflicts of
interest. |
|
|
9. |
Pre-approve all non-audit services to be provided to the
Company by the independent auditor. |
|
|
10. |
Monitor the independence of the independent auditor by
reviewing all relationships between the independent auditor and the
Company and all non-audit work performed for the Company by the
independent auditor. |
|
|
11. |
Establish and review the Companys procedures for
the: |
|
|
receipt, retention and treatment of complaints regarding
accounting, financial disclosure, internal controls or auditing matters;
and |
|
|
|
|
|
confidential, anonymous submission by employees regarding
questionable accounting, auditing and financial reporting and disclosure
matters. |
12. |
Conduct or authorize investigations into any matters that
the Committee believes is within the scope of its responsibilities. The
Committee has the authority to retain independent counsel, accountants or
other advisors to assist it, as it considers necessary, to carry out its
duties, and to set and pay the compensation of such advisors at the
expense of the Company. |
33
13. |
Perform such other functions and exercise such other
powers as are prescribed from time to time for the audit committee of a
reporting company in Parts 2 and 4 of Multilateral Instrument 52-110 of the Canadian
Securities Administrators, the Business Corporations Act (British
Columbia) and the articles of the Company. |
34
PASSPORT POTASH INC. |
608 1199 West Pender Street
|
Vancouver, British Columbia, Canada V6E
2R1 |
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Joshua Bleak (President and
Chief Executive Officer of the Company) and Michael Shannon, of McMillan LLP
(legal counsel to the Company), as proxies, each with full power of
substitution, to represent and vote as designated on the reverse side, all the
shares of common stock of Passport Potash Inc. held of record by the undersigned
on November 3, 2014, at the Annual General Meeting of Shareholders to be held at
Suite 1500, 1055 West Georgia Street, Vancouver, British Columbia, Canada, on
Thursday, December 11, 2014 at 10:00 a.m. (Vancouver Time) or any adjournment or
postponement thereof.
Important Notice Regarding the Availability of Proxy
Materials for the Shareholder
Meeting to Be Held on December 11,
2014.
The Proxy Statement and form of Proxy, as well as the
Companys Annual Report on Form 10-K
for the year ended
February 28, 2014
are available on the Internet at:
http://passportpotash.com/pdf/proxy2014.pdf
(Continued and to be signed on the reverse side.)
35
ANNUAL GENERAL MEETING OF SHAREHOLDERS OF
PASSPORT
POTASH INC.
December 11, 2014
Please date, sign and mail your proxy card in the envelope
provided as soon as possible.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE ELECTION
OF DIRECTORS AND FOR PROPOSALS 1 and 3. |
|
PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED
ENVELOPE. PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN
HERE [X] |
|
|
|
|
For |
Against |
Abstain |
1.
|
|
Number of Directors |
|
[ ] |
[ ] |
[ ] |
2. |
|
Election of Directors. |
|
Nominees: |
|
|
|
[ ] |
FOR ALL NOMINEES |
[ ] |
Joshua Bleak |
|
|
|
[ ] |
WITHHOLD AUTHORITY FOR ALL
NOMINEES |
[ ] |
Ali Rahimtula |
|
|
|
[ ] |
FOR ALL EXCEPT (see instruction
below) |
[ ] |
David Salisbury |
|
|
|
|
|
[ ] |
John Eckersley |
|
|
|
|
|
[ ] |
Frank Högel |
|
|
Instruction: To withhold authority to vote for any
individual nominee(s), mark FOR ALL EXCEPT and fill in the box next to
each nominee you wish to withhold as shown here: |
|
|
|
|
For |
Against |
Abstain |
|
|
|
|
|
3. |
To ratify the appointment of Dale Matheson
Carr-Hilton Labonte LLP as the Companys independent registered public
accounting firm. |
[ ] |
[ ] |
[ ] |
Unless otherwise instructed, this proxy will be voted FOR
Proposal 1 and FOR all nominees listed in Proposal 2. This proxy will also be
voted in the discretion of the holders hereof in favor of any proposal to
adjourn or postpone the Meeting, and upon such other matters as may properly
come before the Meeting or any adjournments or postponements thereof.
|
To change the address on your account, please check the box at
right and indicate your new address in the address space above. Please
note that changes to the registered name(s) on the account may not be
submitted via this method. |
[ ]
|
|
|
|
Signature of
Shareholder: |
|
Signature of Shareholder: |
Name: |
|
Name:
|
Date: |
|
Date: |
Note: Please sign exactly as your name or names
appear on this Proxy. When shares are held jointly, each holder should
sign. When signing as executor, administrator, attorney, trustee or
guardian, please give full title as such. If the signer is a corporation,
please sign full corporate name by duly authorized officer, giving full
title as such. If signer is a partnership, please sign in partnership name
by authorized person. |
36
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