Sébastien de Montessus, the former President and Chief Executive Officer of Endeavour Mining (TSX: EDV), has found himself on the receiving end of a significant financial blow.
As per the disclosure mandated by Section 430(2B) of the Companies Act, the specifics of Montessus’ departure reveal a substantial loss in remuneration. In accordance with his service agreement and the Directors’ Remuneration Policy, Montessus is set to forfeit tens of millions in salary, bonuses, and share awards.
The company officially announced on January 4, 2024, that Montessus’ position was terminated with immediate effect in a double whammy of personal misconduct with colleagues while attempting to misdirect US$5.9 million in company funds.
Under the terms of his termination, Montessus will not receive any further salary, pension, or benefits beyond the date of termination. Furthermore, he will not be entitled to an annual bonus for the financial years 2023 or 2024. The financial implications of this decision are profound, with the immediate lapse of unvested share awards over 717,397 shares, amounting to a total value of US$17.6 million.
This figure includes the expected 2023 annual bonus, valued at approximately US$2 million, and the forfeiture of unvested share awards amounting to US$15.6 million. The loss of these share awards represents a significant setback for Montessus, further compounded by the Remuneration Committee’s decision to apply clawback provisions to additional compensation.
In a move to recoup funds, the Remuneration Committee has chosen to exercise its discretion by applying clawback in full to a US$10 million one-off award granted to Montessus in 2021 and the US$1.5 million cash portion of the bonus received for 2022. Of the US$11.5 million subject to clawback, a portion will be offset against Montessus’ remaining vested 2020 LTIP (Long-Term Incentive Plan) award and the vested portion of his 2021 LTIP award, valued at approximately US$8.8 million based on recent share prices. Montessus will be obligated to repay the remaining balance.
The cumulative effect of these measures amounts to a staggering US$29.1 million in remuneration being forfeited and clawed back. The intricate details of these financial transactions and decisions will be laid bare in the forthcoming Directors’ Remuneration Report within the Company’s Annual Report and Accounts for the year ending December 31, 2023.
Endeavour Mining last traded at $23.91 on the TSX.
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