DEF 14A 1 d266451ddef14a.htm DEF 14A DEF 14A
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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

(Amendment No.     )

 

 

Filed by the Registrant  ☒

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))

 

Definitive Proxy Statement

 

Definitive Additional Materials

 

Soliciting Material under §240.14a-12

Gran Tierra Energy Inc.

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check all boxes that apply):

 

No fee required.

 

Fee paid previously with preliminary materials.

 

Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11.

 

 

 


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LOGO


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TO OUR STOCKHOLDERS,

We invite you to attend the Annual Meeting of Gran Tierra Energy Inc., (“Gran Tierra” or the “Company”) which will be on May 4, 2022, at 11:00 a.m. Mountain Time. This year’s Annual Meeting will be a virtual meeting of stockholders, which will be conducted via live webcast. You will be able to attend the Annual Meeting of Stockholders online, vote your shares electronically and submit your questions during the meeting by visiting https://web.lumiagm.com/244491258.

The attached Notice of Annual Meeting of Stockholders and Proxy Statement describes the business to be conducted at the Annual Meeting. Whether or not you plan to attend the Annual Meeting of Stockholders, we urge you to submit your vote via the internet or mail.

I encourage you to read our 2021 Annual Report and Sustainability Report for additional information about Gran Tierra’s objectives and results in 2021. After the many challenges in 2020 that the world faced, 2021 was a year of strong recovery for the energy industry and Gran Tierra. Our top tier, low-decline, onshore, conventional asset base continued to prove its high quality as the Company returned to strong growth in 2021 in terms of oil production, reserves, funds flow from operations, free cash flow and after-tax net asset value (“NAV”) per share. We achieved strong oil reserve replacement driven by our successful, on-budget development programs and waterflood initiatives.

During the challenging pandemic, we optimized our cost structure and have maintained those benefits through 2021. Continued reserves growth through optimization and increases in free cashflow (“FCF”) are a testament to our high-quality assets combined with development infrastructure investments made in 2017-2019 that are providing benefits to shareholders. The Company’s 2021 net income of $42 million was the highest achieved since 2018 and funds flow from operations reached $186 million, the highest since 2019, and an increase of 312% from $45 million in 2020. We also generated $37 million of free cash flow, the highest generated since 2012.

We saw tremendous results resuming production with a 2021 average working interest production of 26,507 barrels (“bbl”) of oil per day (“BOPD”), a 17% increase from 2020. The increase in production was the direct result of the development of key assets with successful drilling and workover campaigns in the Acordionero and Costayaco fields, combined with ongoing waterflood optimization throughout the Company’s portfolio. The successful drilling and workover campaigns also resulted in material Proved reserves additions, particularly in the Company’s core assets. The Proved Developed Producing (“PDP”) reserves replacement ratio was 148%, with PDP reserves additions of 14.3 million bbl of oil equivalent (MMBOE), while the Total Proved (“1P”) reserves replacement ratio was 123%, with 1P reserves additions of 11.9 MMBOE. The Company’s strong 1P reserves replacement resulted in 1P reserves of 81 MMBOE (100% oil) as of year-end 2021. Finally, we strengthened our balance sheet by paying down debt which had been used to acquire assets and install infrastructure to efficiently and effectively optimize the value of our assets.

Looking to 2022, we are very excited for our planned development drilling programs in the Middle Magdalena Valley and Putumayo Basins in Colombia, and the restart of our exploration drilling program, which we expect to include our first exploration wells in the Oriente basin in Ecuador. In addition to growth through our existing assets in Colombia and Ecuador, we continue to look at opportunities in other select basins to diversify and enhance the Company’s future potential for the coming decades. These activities, combined with a more constructive oil price environment, are expected to allow Gran Tierra to continue to resume growth through ongoing development of our existing assets and potential exploration discoveries. Furthermore, in the Company’s high case for 2022 guidance, which assumes a Brent oil price of $80/bbl, we forecast that Gran Tierra could generate $100-120 million of 2022 free cash flow, which would allow us to completely pay down our bank credit facility before the end of the first half of 2022.

Finally, our Environmental, Social and Governance (ESG) focus continues which we achieve through our “Beyond Compliance” philosophy. Where Gran Tierra identifies significant opportunities and benefits to the environment and communities, we voluntarily strive to go beyond what is legally required to protect the environment and provide social benefits, because it is the right thing to do. In 2021, for the first time GTE reported Scope 2 greenhouse gas (“GHG”) emissions (indirect operations from external power sources), in addition to Scope 1 GHG emissions, in the Company’s yearly GHG emissions report. Our 2020 results saw an overall GHG emissions reduction in excess of 60% relative to 2019 and were achieved via the Company’s gas-to-power projects and additional operational efficiencies. Gran Tierra is also focused on nature-based solutions to emissions and have planted a total of 1,193,321 trees and have conserved, preserved or reforested 2,805 hectares of land through all our environmental efforts since 2018.

Shareholders who have any questions should contact the Company’s strategic shareholder advisor and proxy solicitation agent, Kingsdale Advisors, at 1-855-476-7987 (toll-free within North America) or 1-416-867-2272 (collect call outside North America) or by e-mail at contactus@kingsdaleadvisors.com.

On behalf of our Board of Directors and the team at Gran Tierra, I want to thank all our stakeholders for their continued support.

Sincerely,

 

LOGO   

/s/ Gary S. Guidry

 

Gary S. Guidry

President and Chief Executive Officer

March 25, 2022

 

            


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Notice of Meeting

Annual Meeting of the Stockholders of Gran Tierra Energy Inc.

 

LOGO

 

Date:

Wednesday, May 4, 2022

        

LOGO

 

Time:

11:00 a.m.
(Mountain Time)

        

LOGO

 

Location:

Virtual-only meeting via live webcast online at
https://web.lumiagm.com/
244491258

The business of the meeting is to:

 

1.

Elect the nine nominees specified in the accompanying proxy statement to serve as directors.

 

2.

Ratify the appointment of KPMG LLP as Gran Tierra’s independent registered public accounting firm for 2022.

 

3.

Approve, on an advisory basis, the compensation of Gran Tierra’s named executive officers as disclosed in the accompanying proxy statement.

 

4.

To indicate, on an advisory basis, the preferred frequency of solicitation of stockholder advisory votes on the compensation of Gran Tierra’s named executive officers.

 

5.

Approve Gran Tierra’s 2007 Equity Incentive Plan, as amended, as more particularly described in the accompanying proxy statement.

 

6.

Conduct any other business properly brought before the meeting.

These items of business are more fully described in the proxy statement accompanying this notice.

This notice and the attached proxy statement are first being mailed to our stockholders beginning on March 25, 2022. Holders of shares on March 8, 2022, the record date, are entitled to notice of, and to vote at, our meeting or any adjournment thereof.

In light of the COVID-19 pandemic and to mitigate the risks to the health and safety of our community, stockholders and employees, Gran Tierra will be holding its annual meeting in a virtual-only format by way of webcast accessed at https://web.lumiagm.com/244491258 and no physical or in-person meeting will be held. A virtual-only meeting will provide all stockholders an equal opportunity to participate at the annual meeting regardless of their geographic location or the particular constraints, circumstances or risks they may be facing as a result of COVID-19. Stockholders will be able to attend the Annual Meeting of Stockholders online and vote their shares electronically and submit questions during the meeting.

If you are a registered stockholder, to attend the Annual Meeting and vote your shares electronically and submit questions during the meeting, you will need control number included on the Notice of Internet Availability of Proxy Materials or proxy card that accompanied your proxy materials. If you are the beneficial owner of shares held in “street name”, you must request and obtain a valid proxy from your broker or other agent in order to attend the Annual Meeting and vote your shares electronically and submit questions during the meeting.

We are using the “Notice and Access” method of providing proxy materials to our stockholders which provides our stockholders with a convenient way to access the proxy materials and vote, while allowing us to lower the costs of printing and distributing the proxy materials and reduce the environmental impact of our meeting. We will mail to most of our stockholders a Notice of Internet Availability of Proxy Materials (the “Notice”) in lieu of a paper copy of our proxy materials. Stockholders receiving the Notice may review the proxy materials online or request a paper copy by following the instructions set forth in the Notice.

Please submit your proxy or voting instructions on the Internet or by telephone promptly by following the instructions about how to view the proxy materials on your Notice of Internet Availability of Proxy Materials so that your shares can be voted, regardless of whether you expect to attend the annual meeting. If you received your proxy materials by mail, you may submit your proxy or voting

 

 

            


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instructions on the Internet or you may submit your proxy by marking, dating, signing and returning the enclosed proxy/confidential voting instruction card. If you attend the annual meeting, you may withdraw your proxy and vote in person.

Shareholders who have any questions should contact the Company’s strategic shareholder advisor and proxy solicitation agent, Kingsdale Advisors, at 1-855-476-7987 (toll-free within North America) or 1-416-867-2272 (collect call outside North America) or by e-mail at contactus@kingsdaleadvisors.com.

By order of the Board of Directors

 

/s/ Gary S. Guidry

 

Gary S. Guidry

President and Chief Executive Officer

Calgary, Alberta, Canada

March 25, 2022

 

 

            


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Proxy Statement Table of Contents

 

   

PROXY STATEMENT SUMMARY

     1  
  
   

QUESTIONS AND ANSWERS ABOUT THE PROXY MATERIALS AND 2022 ANNUAL MEETING

     4  
  
   

PROPOSAL 1: ELECTION OF DIRECTORS

     10  

Nominees for Director

     11  

The Board’s Role and Responsibilities

     22  

Board Structure and Processes

     23  

Information Regarding Committees of the Board of Directors

     26  

Director Compensation

     29  
  
   

PROPOSAL 2: RATIFICATION OF APPOINTMENT OF SELECTION OF INDEPENDENT AUDITORS

     32  

Report of the Audit Committee

     32  

Principal Accountant Fees and Services

     33  
  
   

PROPOSAL 3: ADVISORY VOTE TO APPROVE NAMED EXECUTIVE OFFICER COMPENSATION

     35  

Security Ownership of Certain Beneficial Owners and Management

     35  

Executive Officers

     37  
  
   

COMPENSATION DISCUSSION AND ANALYSIS

     39  
  
   

EXECUTIVE COMPENSATION

     50  

Summary Compensation Table

     50  

2021 Grants of Plan-Based Awards

     51  

Outstanding Equity Awards at December 31, 2021

     52  

2021 Option Exercises and Stock Vested

     53  

Estimated Potential Payments

     55  
  
   

PROPOSAL 4: ADVISORY VOTE ON THE FREQUENCY OF SOLICITATION OF ADVISORY VOTE TO APPROVE NAMED EXECUTIVE OFFICER COMPENSATION

     57  
  
   

PROPOSAL 5: APPROVAL OF THE GRAN TIERRA 2007 EQUITY INCENTIVE PLAN, AS AMENDED AND RESTATED

     58  
  
   

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     66  
  
   

STOCKHOLDER PROPOSALS

     66  
  
   

HOUSEHOLDING OF PROXY MATERIALS

     67  
  
   

OTHER MATTERS

     67  
  
   

APPENDIX

     A-1  
 

 

 

 

 

            


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Proxy Statement Summary

This summary highlights information contained elsewhere within this proxy statement. You should read the entire proxy statement carefully and consider all information before voting. Page references are supplied to help you find further information in this proxy statement. This summary does not contain all of the information you should consider, and we encourage you to read the entire proxy statement before voting.

References to “we”, “us”, “our”, “Gran Tierra” or the “Company” are to Gran Tierra Energy Inc.

This proxy statement is first being mailed to our stockholders beginning on March 25, 2022. Holders of shares on March 8, 2022, the record date, are entitled to notice of, and to vote at, our meeting or any adjournment thereof.

Important Notice Regarding the Availability of Materials for the 2022 Annual Meeting of Shareholders to be Held on May 4, 2022: The proxy statement and our Annual Report for the fiscal year ended December 31, 2021 are available free of charge at https://www.grantierra.com/investor-relations/2022-annual-meeting.

2022 Annual Meeting of Stockholders

 

LOGO

 

Date:

May 4, 2022

 

    

 

LOGO

 

Time:

11:00 a.m.
(Mountain Time)

 

    

 

LOGO

 

Location:

Virtual-only meeting via live
webcast online at:

https://web.lumiagm.com/
244491258

 

    

  

LOGO

 

Record Date:

March 8, 2022

Voting Matters and Board Recommendations

 

Voting Matter

  

Board Vote

Recommendation

Proposal 1: Election of Directors (page 10)

 

The Board and the Nominating and Corporate Governance Committee believe that each of the director nominees possesses the necessary qualifications and skills to provide effective oversight of the business and quality advice and counsel to our management team.

   FOR each nominee

Proposal 2: Ratification of Selection of Independent Auditors (page 32)

 

The Board and the Audit Committee believe that the retention of KPMG LLP to serve as our independent registered public accounting firm for the fiscal year ending December 31, 2022 is in the best interests of the Company and its stockholders. As a matter of good corporate governance, stockholders are being asked to ratify the Audit Committee’s selection of the independent registered public accounting firm.

   FOR

Proposal 3: Advisory Vote to Approve Named Executive Officer Compensation  (page 35)

 

The Company seeks a non-binding advisory vote from its stockholders to approve the compensation of its named executive officers as described in the Compensation Discussion and Analysis section beginning on page 39 and the Compensation Tables section beginning on page 50 and ending on page 56. Our executive compensation program reflects our philosophy of aligning executive compensation with the interests of our stockholders and a commitment to pay for performance.

   FOR

Proposal 4: Advisory Vote on the Frequency of Solicitation of Advisory Vote to Approve Named Executive Officer Compensation (page 57)

 

The Company seeks a non-binding advisory vote from its stockholders to indicate the preferred frequency of solicitation of stockholder advisory votes on the compensation of Gran Tierra’s named executive officers. An annual vote will give stockholders an opportunity to provide real-time feedback to the Company on its pay practices.

   EVERY YEAR

 

   
Gran Tierra Energy 2022 Proxy Statement   1


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PROXY STATEMENT SUMMARY

 

 

Voting Matter

  

Board Vote

Recommendation

Proposal 5: Approval of 2007 Equity Incentive Plan, as amended (page 58)

 

In order for Gran Tierra to continue to have the flexibility to grant market-competitive levels of stock options and other equity grants to current employees and future strategic hires, the Company seeks approval to increase the number of shares of Common Stock available for issuance under the Incentive Plan to 23,333,065 shares in respect of stock awards granted on or after January 1, 2022 shares, which will result in: (i) a 5,000,000 share increase in the shares available for issuance from 18,333,065 shares at December 31, 2021; and (ii) an amendment of subsection 4(a) of Gran Tierra’s 2017 Equity Incentive Plan to increase the total number of shares authorized for issuance pursuant to stock awards from 22,223,817 shares in respect of stock awards granted on or after January 1, 2021 to 23,333,065 shares in respect of stock awards granted on or after January 1, 2022.

   FOR                         

Director Nominees

The following table provides summary information about each director nominee. See pages 11 to 19 for more information.

 

Director Nominee

  Director Since      Age      Committees

Robert B. Hodgins

Chairman

    2015        70     

  Audit Committee

  Compensation Committee

  Nominating and Corporate Governance Committee

Gary S. Guidry

President and Chief Executive Officer

    2015        66       

Peter J. Dey

    2015        81     

  Nominating and Corporate Governance Committee

  Compensation Committee

  Health, Safety & Environment Committee

Evan Hazell

    2015        63     

  Audit Committee

  Health, Safety & Environment Committee

  Reserves Committee

Alison Redford

    2021        57     

  Audit Committee

  Nominating and Corporate Governance Committee

  Health, Safety and Environment Committee

Ronald W. Royal

    2015        72     

  Audit Committee

  Health, Safety & Environment Committee

  Reserves Committee

Sondra Scott

    2017        55     

  Nominating and Corporate Governance Committee

  Health, Safety & Environment Committee

  Reserves Committee

David P. Smith

    2015        63     

  Audit Committee

  Compensation Committee

Brooke Wade

    2015        68     

  Compensation Committee

  Nominating and Corporate Governance Committee

  Reserves Committee

 

   
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PROXY STATEMENT SUMMARY

 

 

Corporate Governance

We are committed to good corporate governance practices, which promote the long-term interests of our stockholders and strengthens our Board and management accountability.

Highlights of our corporate governance practices include the following:

 

    Independent Board Chair

 

    8 of 9 director nominees are independent

 

    Annual elections of all directors

 

    Majority voting for directors with resignation policy

 

    100% independent Committee members

 

    Annual self-evaluation of the Board and Committees

 

    Stock ownership guidelines for directors and officers

 

    No Tax Gross-Up provisions in any new executive agreements (currently only applies to Chief Executive Officer in order to be equalized to Canadian colleagues)
  Policy prohibiting speculative trading of the Company’s stock  

 

  Limited trading windows  

 

  Clawback policy  

 

  Stockholders may call special meetings of stockholders  

 

  No stockholder rights (“poison pill”) or similar plan  

 

  Regular executive sessions of independent directors  

 

  Stockholders have the right to fill director vacancies caused by director removal  
 

 

Executive Compensation Highlights

Our compensation philosophy and programs are based on the following core principles:

 

   

attract and retain highly capable individuals and offer competitive compensation opportunities,

 

   

pay for performance, and

 

   

align the interests of management with our stockholders.

Our equity compensation program is designed to be aligned with the interests of our stockholders and focus on pay-for-performance:

 

   

The majority of 2021 executive compensation is considered to be “at risk” because its value is based on specific performance criteria and/or stock price appreciation and payout is not guaranteed.

 

   

In 2021, 80% of the value of equity awards granted to the Named Executive Officers (“NEOs”) consisted of performance share units (“PSUs”) and 20% consisted of stock options.

 

   

The target for base salaries is approximately the 50th percentile as compared to the Company’s compensation peer group.

Equity Incentive Plan Amendments

The purpose of this amendment is to ensure that Gran Tierra has a sufficient reserve of common stock available under the Equity Incentive Plan to continue to grant stock options and other awards at market-competitive levels determined appropriate by the Board. In order for Gran Tierra to continue to have the flexibility to grant market-competitive levels of stock options to current employees and future strategic hires, the Board determined that it was prudent to increase the fixed reserve of common stock available under the Incentive Plan by 5,000,000 shares (approximately 1.4% of the Gran Tierra common stock outstanding on March 8, 2022) such that there are 23,333,065 shares available for issuance pursuant to awards granted on or after January 1, 2022 (approximately 6.4% of the Gran Tierra common stock outstanding on March 8, 2022).

 

   
Gran Tierra Energy 2022 Proxy Statement   3


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Questions and Answers About the Proxy Materials and 2022 Annual Meeting

Why am I receiving these materials?

We are sending you these proxy materials because the Board of Directors (the “Board”) of Gran Tierra Energy Inc., a Delaware corporation (“Gran Tierra” or the “Company”), is soliciting your proxy to vote at the 2022 annual meeting of stockholders, including at any adjournments or postponements of the annual meeting. You are invited to attend the annual meeting, which is being held in a virtual-only format by way of webcast accessed at https://web.lumiagm.com/244491258, to vote on the proposals described in this proxy statement. However, you do not need to attend the annual meeting to vote your shares. Instead, if you are a stockholder of record of our common stock, you may simply complete, sign and return the proxy card if you received a paper copy of our proxy materials, or follow the instructions below to submit your proxy over the telephone or through the internet. See “How do I vote” below for further information on how to vote, including if you hold our common stock through a broker in “street name” or hold exchangeable shares.

Pursuant to rules adopted by the Securities and Exchange Commission (the “SEC”), we have elected to provide access to our proxy materials over the internet. We are sending to our stockholders of record the proxy materials, including this proxy statement and an annual report, or a Notice Regarding the Availability of Proxy Materials (the “Notice”). We intend that our stockholders who hold their stock in “street name” will receive a Notice from their broker, bank or other agent in which they hold the stock in “street name,” unless they have specified otherwise. All stockholders will have the ability to access the proxy materials on the website referred to in the Notice or request to receive a printed set of the proxy materials. Instructions on how to access the proxy materials over the internet or to request a printed copy may be found in the Notice.

We intend to mail the proxy materials and Notice beginning on March 25, 2022 to all stockholders of record entitled to vote at the annual meeting. We expect that the Notice will be sent to stockholders who hold their stock in “street name” on or about this same date.

How do I attend the annual meeting?

The annual meeting will be held on Wednesday, May 4, 2022, at 11:00 a.m. (Mountain time) and will be held solely by remote communication, in a virtual-only format.

Instructions to Attend Online Meeting

 

   

Log in online at https://web.lumiagm.com/244491258. The Meeting ID is 244-491-258. We recommend that you log in 15 minutes before the annual meeting starts.

 

   

Enter the control number found on the form of proxy or Notice, as applicable, into the Shareholder login section.

 

   

Enter the password: grantierra22

 

   

If you are a proxyholder, enter the credentials provided by Odyssey Trust Company

 

   

If you are a guest, complete the Guest login information.

Who can vote at the annual meeting?

Only stockholders of record at the close of business on March 8, 2022, will be entitled to vote at the annual meeting. On this record date, there were 367,692,131 shares of common stock outstanding and entitled to vote.

A list of stockholders of record will be made available to participants who join the annual meeting as a “Shareholder” at https://web.lumiagm.com/244491258.

Stockholders of Record: Shares Registered in Your Name

If at the close of business on March 8, 2022, your shares were registered directly in your name with Gran Tierra’s transfer agent, Odyssey Trust Company, then you are a stockholder of record. Registered stockholders will receive a proxy form containing the relevant details concerning the business of the meeting, including a control number required to access the virtual annual meeting.

 

   
4   Gran Tierra Energy 2022 Proxy Statement


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QUESTIONS AND ANSWERS ABOUT THE PROXY MATERIALS AND 2022 ANNUAL MEETING

 

 

Whether or not you plan to attend the annual meeting, we urge you to fill out and return the proxy or vote by proxy by telephone or on the internet as instructed below to ensure your vote is counted.

Beneficial Owner: Shares Registered in the Name of a Broker or Bank

If at the close of business on March 8, 2022, your shares were held, not in your name, but rather in an account at a brokerage firm, bank, dealer, or other similar organization, then you are the beneficial owner of shares held in “street name” and the Notice, and/or these proxy materials if you have received them, are being forwarded to you by that organization. The organization holding your account is considered to be the stockholder of record for purposes of voting at the annual meeting. As a beneficial owner, you have the right to direct your broker or other agent regarding how to vote the shares in your account. You are also invited to attend the annual meeting. However, since you are not the stockholder of record, you may not vote your shares electronically or submit questions at the annual meeting unless you request and obtain a valid proxy from your broker or other agent. See “How Do I Vote? - Beneficial Owner: Shares Registered in the Name of Broker or Bank” below for additional information about attending and participating in the Annual Meeting.

What am I voting on?

There are five matters scheduled for a vote:

 

1.

Election of nine nominees named in the proxy statement to serve on the Board until the next annual meeting and until their respective successors are duly elected and qualified;

 

2.

Ratification of the appointment of KPMG LLP as the independent registered public accounting firm for 2022; and

 

3.

Approval, on an advisory basis, of the compensation of Gran Tierra’s named executive officers, as disclosed in this proxy statement.

 

4.

Approval, on an advisory basis, of the preferred frequency of solicitation of stockholder advisory votes on the compensation of Gran Tierra’s named executive officers.

 

5.

Approval of Gran Tierra’s 2007 Equity Incentive Plan, as amended to increase the aggregate number of shares authorized for issuance under the plan to 23,333,065 shares.

What if another matter is properly brought before the annual meeting?

The Board knows of no other matters that will be presented for consideration at the annual meeting. If any other matters are properly brought before the annual meeting, it is the intention of the persons named in the accompanying proxy to vote on those matters in accordance with their best judgment.

Will I be able to submit questions during the virtual annual meeting?

Stockholders will be able to submit questions through the virtual meeting website. Questions pertinent to meeting matters that comply with the meeting rules of conduct will be answered during the meeting, subject to time constraints. However, we reserve the right to exclude questions that are not pertinent to meeting matters, irrelevant to the business of the Company, derogatory or in bad taste, or relate to pending or threatened litigation, personal grievances or are otherwise inappropriate. Questions that are substantially similar may be grouped and answered once to avoid repetition.

How do I vote?

You may either vote “For” or “Against” or abstain from voting with respect to each nominee to the Board and each of the other matters to be voted on.

Stockholders of Record: Shares Registered in Your Name

If you are a stockholder of record, you may vote electronically at the annual meeting, vote by proxy on the internet or by telephone, or vote by proxy using a proxy card that you may request or that we may elect to deliver at a later time. Whether or not you plan to attend the annual meeting, we urge you to vote by proxy to ensure your vote is counted. You may still attend the annual meeting and vote electronically even if you have already voted by proxy.

 

   
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QUESTIONS AND ANSWERS ABOUT THE PROXY MATERIALS AND 2022 ANNUAL MEETING

 

 

   

To vote electronically during the meeting, once you have logged into the annual meeting, you will be able to vote your shares electronically by clicking on the “Cast Your Vote” link on the meeting center site. It is important that you remain connected to the internet at all times during the annual meeting in order to vote when balloting commences. It is your responsibility to ensure connectivity for the duration of the annual meeting.

 

   

To vote using the proxy card, simply complete, sign and date the proxy card that may be delivered and return it promptly in the envelope provided. If you return your signed proxy card to us by 11:00 a.m. (Mountain time) on May 2, 2022, we will vote your shares as you direct.

To vote on the internet, go to https://login.odysseytrust.com/pxlogin and follow the on-screen instructions. You will need the control number located on the Notice or Form of Proxy to access the voting site. Your internet vote must be received by 11:00 a.m. (Mountain time) on May 2, 2022, to be counted. The Chair of the Meeting reserves the right to accept late proxies and may waive or extend the proxy cut-off, with or without notice, but is under no obligation to accept or reject any particular late proxy.

We provide the option for internet proxy voting to allow you to vote your shares, with procedures designed to ensure the authenticity and correctness of your proxy vote instructions. However, please be aware that you must bear any costs associated with your internet access, such as usage charges from internet access providers.

Beneficial Owner: Shares Registered in the Name of Broker or Bank

If you are a beneficial owner of shares registered in the name of your broker, bank, or other agent, you should have received a Notice containing voting instructions, or these proxy materials and an annual report and form of proxy, from that organization rather than from Gran Tierra. Simply follow the voting instructions you receive from your broker, bank, or other agent to ensure that your vote is counted. If you have received these proxy materials and voting instructions therein, simply complete and mail the voting instructions to ensure that your vote is counted. Alternatively, if permitted by your broker or bank, you may vote by telephone or on the internet as instructed by your broker, bank or other agent. To vote electronically during the annual meeting, you must obtain a valid proxy from your broker, bank, or other agent and appoint yourself as a proxyholder. Follow the instructions from your broker, bank, or other agent included with these proxy materials, or contact your broker, bank, or other agent to request a proxy form.

The Corporation may utilize the Broadridge QuickVote™ service to assist Non-Registered (Beneficial) Shareholders with voting over the telephone. Alternatively, Kingsdale Advisors may contact such Beneficial Shareholders to assist them with conveniently voting directly over the phone.

Shareholders who have any questions should contact the Company’s strategic shareholder advisor and proxy solicitation agent, Kingsdale Advisors, at 1-855-476-7987 (toll-free within North America) or 1-416-867-2272 (collect call outside North America) or by e-mail at contactus@kingsdaleadvisors.com.

A shareholder has the right to appoint a person or entity (who need not be a shareholder) to attend and act for him/her on his/her behalf at the meeting other than the persons named in the enclosed instrument of Proxy. Shareholders who wish to appoint a third party proxyholder to represent them at the online meeting must submit their proxy or voting instruction form (if applicable) prior to registering your proxyholder. Registering your proxyholder is an additional step once you have submitted your proxy or voting instruction form. Failure to register the proxyholder will result in the proxyholder not receiving a Username to participate in the meeting. To register a proxyholder, shareholders MUST email Grantierra@odysseytrust.com and provide Odyssey Trust Company with their proxyholder’s contact information, so that Odyssey Trust Company may provide the proxyholder with a Username via email. Requests for registration must be received by Odyssey Trust Company no later than 11:00 a.m. (Mountain Time), on Friday, April 29, 2022. You will receive a confirmation of your registration by email after Odyssey Trust Company receives your registration materials. At the time of the meeting, go to https://web.lumiagm.com/244491258 and enter your control number and the meeting password, grantierra22.

How many votes do I have?

On each matter to be voted upon, you have one vote for each share of common stock you own as of March 8, 2022. Cumulative voting is not permitted.

 

   
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QUESTIONS AND ANSWERS ABOUT THE PROXY MATERIALS AND 2022 ANNUAL MEETING

 

 

What if I return a proxy card or otherwise vote but do not make specific choices?

Stockholder of Record; Shares Registered in Your Name

If you are a holder of record and return a signed and dated proxy card or otherwise vote without marking voting selections, your shares will be voted, as applicable, “For” the election of all nine nominees for director, “For” the ratification of the selection of KPMG LLP as our independent registered public accounting firm for our fiscal year ending December 31, 2022, “For” the advisory vote to approve named executive officer compensation and “For” the approval of Gran Tierra’s 2007 Equity Incentive Plan, as amended. If any other matter is properly presented at the annual meeting, your proxyholder (one of the individuals named on your proxy card) will vote your shares using his or her best judgment.

Beneficial Owner; Shares Registered in the Name of a Broker or Bank

If you are a beneficial owner of shares registered in the name of your broker, bank or other nominee, and you do not provide the broker or other nominee that holds your shares with voting instructions, your broker or other nominee may not vote your shares on any proposal other than the ratification of the selection of KPMG LLP as our independent registered public accounting firm at the annual meeting. See “What are ‘broker non-votes’?” below. We encourage you to provide voting instructions to the organization that holds your shares to ensure that your vote is counted on all five proposals.

What happens if I do not vote?

Stockholder of Record; Shares Registered in Your Name

If you are a stockholder of record and do not vote by completing your proxy card, over the internet or in person at the annual meeting, your shares will not be voted.

Beneficial Owner; Shares Registered in the Name of a Broker or Bank

If you hold your shares in “street name,” you will receive instructions from your broker, bank or other nominee describing how to vote your shares. If you do not instruct your broker, bank or other nominee how to vote your shares, they may vote your shares as they decide as to each matter for which they have discretionary authority under the rules of the NYSE American. This year, the only matter with respect to which they may vote your shares without voting instructions is the proposal to ratify the selection of KPMG LLP as our independent registered public accounting firm (Proposal 2).

There are also non-discretionary matters for which brokers, banks and other nominees do not have discretionary authority to vote unless they receive timely instructions from you. When a broker, bank or other nominee does not have discretion to vote on a particular matter and you have not given timely instructions on how the broker, bank or other nominee should vote your shares, a “broker non-vote” results. Although any broker non-vote would be counted as present at the meeting for purposes of determining a quorum, it would be treated as not entitled to vote with respect to non-discretionary matters.

If your shares are held in “street name” and you do not give voting instructions, pursuant to NYSE American Company Guide Section 723, the record holder will not be permitted to vote your shares with respect to Proposals 1, 3, 4 or 5. If your shares are held in “street name” and you do not give voting instructions, the record holder will nevertheless be entitled to vote your shares with respect to Proposal 2.

Abstentions occur when stockholders are present at the annual meeting but voluntarily abstain on any of the matters upon which the stockholders are voting.

Who is paying for this proxy solicitation?

We have retained Kingsdale Advisors to help us with this process, at an estimated cost of $50,000. We pay the costs associated with soliciting proxies. In addition to these proxy materials, our directors and employees may also solicit proxies in person, by telephone, or by other means of communication. Directors and employees will not be paid any additional compensation for soliciting proxies. We may also reimburse brokerage firms, banks and other agents for the cost of forwarding proxy materials to beneficial owners.

Shareholders who have any questions should contact the Company’s strategic shareholder advisor and proxy solicitation agent, Kingsdale Advisors, at 1-855-476-7987 (toll-free within North America) or 1-416-867-2272 (collect call outside North America) or by e-mail at contactus@kingsdaleadvisors.com.

 

   
Gran Tierra Energy 2022 Proxy Statement   7


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QUESTIONS AND ANSWERS ABOUT THE PROXY MATERIALS AND 2022 ANNUAL MEETING

 

 

What does it mean if I receive more than one Notice or more than one set of proxy materials?

If you receive more than one Notice or more than one set of proxy materials, your shares may be registered in more than one name or in different accounts. Please follow the voting instructions on the Notices or the instructions on the proxy cards in the proxy materials to ensure that all of your shares are voted.

Can I change my vote after submitting my proxy?

Stockholder of Record; Shares Registered in Your Name

Yes. You can revoke your proxy at any time before the final vote at the annual meeting. If you are the record holder of your shares, you may revoke your proxy in any one of the following ways:

 

   

You may submit another properly completed proxy card with a later date, or vote again by telephone or on the internet;

 

   

You may send a timely written notice that you are revoking your proxy to Gran Tierra’s Corporate Secretary at 900, 520 - 3rd Avenue S.W., Calgary, Alberta, Canada T2P 0R3; or

 

   

You may attend the annual meeting and vote in person. Simply attending the annual meeting will not, by itself, revoke your proxy.

Your most current proxy card or telephone or internet proxy is the one that is counted and must be received by 11:00 a.m. (Mountain time) on May 2, 2022, to be counted. The Chair of the Meeting reserves the right to accept late proxies and may waive or extend the proxy cut-off, with or without notice, but is under no obligation to accept or reject any particular late proxy.

Beneficial Owner; Shares Registered in the Name of a Broker or Bank

If your shares are held by your broker or bank as a nominee or agent, you should follow the instructions provided by your broker or bank.

When are stockholder proposals due for next year’s annual meeting?

Stockholders who desire to present proposals at the 2023 annual meeting of stockholders and to have proposals included in our proxy materials pursuant to Rule 14a-8 under the Exchange Act must submit their proposals to us at our principal executive offices (to the Corporate Secretary at 900, 520 - 3rd Avenue S.W., Calgary, Alberta, Canada T2P 0R3), not later than the close of business on November 24, 2022. If the date of the 2023 annual meeting is changed by more than 30 days from the date of the 2022 annual meeting, the deadline for submitting proposals is a reasonable time before we begin to print and mail the proxy materials for our 2023 annual meeting.

Our Bylaws provide that stockholders may nominate persons for election to the Board of Directors or bring any other business before the stockholders at the 2023 annual meeting only by sending to our Corporate Secretary a notice containing the information required by our Bylaws. Notice to us must be made not less than 30 or more than 65 days prior to the date of the annual meeting; provided, however, that if the annual meeting is to be held on a date that is less than 50 days after the date on which the public announcement of the date of the annual meeting was made by Gran Tierra, notice may be made not later than the close of business on the 10th day following the day on which public announcement of the date of the annual meeting is first made by Gran Tierra. Detailed information about how to make stockholder proposals or nominations for our annual meetings of stockholders can be found in our Bylaws.

How are votes counted?

Votes will be counted by the inspector of election appointed for the annual meeting, who will separately count, for the proposal to elect directors and the other proposals, votes “For,” “Against,” abstentions and, if applicable, broker non-votes. Broker non-votes have no effect and will not be counted towards the vote total for any proposal.

What are “broker non-votes”?

As discussed above, when a beneficial owner of shares held in “street name” does not give instructions to the broker or nominee holding the shares as to how to vote on matters deemed by the NYSE American to be “non-routine,” the broker or nominee cannot vote the shares on such proposals. A “broker non-vote” occurs with respect to a proposal when a broker or nominee has discretionary authority to vote on one or more “routine” proposals to be voted on at a meeting of stockholders but is not permitted to vote on other “non-routine” proposals without instructions from the beneficial owner and the beneficial owner fails to provide the nominee with such instructions. Under the applicable rules of the NYSE American, each of Proposal 1, Proposal 3, Proposal 4 and Proposal 5 are considered non-routine and a broker will lack the authority to vote shares at his/her discretion on such proposals. Proposal 2 is considered a routine matter and a broker will be permitted to exercise his/her discretion.

 

   
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QUESTIONS AND ANSWERS ABOUT THE PROXY MATERIALS AND 2022 ANNUAL MEETING

 

 

How many votes are needed to approve each proposal?

 

   

Proposal No. 1, the election of directors: our bylaws provide for a majority voting standard for the election of directors in uncontested elections, which is generally defined as an election in which the number of nominees does not exceed the number of directors to be elected at the meeting. Because this is an uncontested election, each director shall be elected by the vote of a majority of the votes cast at a meeting of stockholders at which a quorum is present. A “majority of the votes cast” means that the number of shares voted “For” a director nominee must exceed the number of votes cast “Against” that director nominee. For these purposes, abstentions and broker non-votes will not count as a vote “For” or “Against” a nominee’s election and will have no effect in determining whether a director nominee has received a majority of the votes cast. If an incumbent director is not elected by a majority of the votes cast, the incumbent director must promptly tender his or her resignation to the Board. The Nominating and Corporate Governance Committee will make a recommendation to the Board on whether to accept or reject the director’s resignation or whether other action should be taken. The Board will act on the Nominating and Corporate Governance Committee’s recommendation and publicly disclose its decision within 90 days from the date of the certification of the election results.

 

   

Proposal No. 2, the ratification of the appointment of KPMG LLP as Gran Tierra’s independent registered public accounting firm for 2022, will be approved if it receives the affirmative vote of shares representing a majority of the votes present in person or represented by proxy at the meeting and entitled to vote on the matter. Abstentions will have the same effect as a vote “Against.” We do not expect that there will be any broker non-votes, as this is a routine matter.

 

   

Proposal No. 3, the advisory vote to approve named executive officer compensation, as disclosed in this proxy statement, will be approved if it receives the affirmative vote of shares representing a majority of the votes present in person or represented by proxy at the meeting and entitled to vote on the matter. Abstentions will have the same effect as a vote “Against.” Broker non-votes will have no effect.

 

   

Proposal No. 4, the advisory vote on the frequency of solicitation of an advisory vote to approve named executive officer compensation, will be approved if it receives the affirmative vote of shares representing a majority of the votes present in person or represented by proxy at the meeting and entitled to vote on the matter. Abstentions will have the same effect as a vote “Against.” Broker non-votes will have no effect. Because this proposal has three possible substantive responses (every year, every two years, and every three years), if none of the frequency alternatives receives the vote of shares representing a majority of the votes present in person or represented by proxy at the meeting and entitled to vote on the matter, then we will consider stockholders to have approved the frequency that receives a plurality of the votes present in person or represented by proxy at the meeting and entitled to vote on the matter.

 

   

Proposal No. 5, the approval of Gran Tierra’s Amended and Restated 2007 Equity Incentive Plan, as amended will be approved if it receives the affirmative vote of shares representing a majority of the votes present in person or represented by proxy at the meeting and entitled to vote on the matter. Abstentions will have the same effect as a vote “Against.” Broker non-votes will have no effect.

A quorum of stockholders is necessary to hold a valid meeting. A quorum will be present if stockholders holding outstanding shares of Gran Tierra’s capital stock representing at least one-third of the total number of votes that may be cast at the annual meeting are present at the annual meeting in person or represented by proxy. On the record date, there were 367,692,131 votes that could be cast. Thus, holders of outstanding shares representing at least 122,564,044 votes must be present in person or represented by proxy at the annual meeting to have a quorum.

Your shares will be counted towards the quorum only if you submit a valid proxy (or one is submitted on your behalf by your broker, bank or other nominee) or if you vote in person at the annual meeting. Abstentions and broker non-votes will be counted towards the quorum requirement. If there is no quorum, the Chair of the annual meeting or the holders of a majority of shares present at the annual meeting in person or represented by proxy must adjourn the annual meeting to another date.

How can I find out the results of the voting at the annual meeting?

Preliminary voting results will be announced at the annual meeting. In addition, final voting results will be published in a current report on Form 8-K that we expect to file within four business days after the annual meeting.

What proxy materials are available on the internet?

The notice of meeting, proxy statement and annual report to stockholders are available to view on Gran Tierra’s website at: https://www.grantierra.com/investor-relations/2022-annual-meeting

See “How do I vote?” above for voting instructions.

 

   
Gran Tierra Energy 2022 Proxy Statement   9


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Corporate Governance and Board Matters

PROPOSAL 1: ELECTION OF DIRECTORS

The Board of Directors is nominating the nine individuals identified below for election as directors. Unless you specify differently, proxies received will be voted FOR Robert B. Hodgins, Peter J. Dey, Gary S. Guidry, Evan Hazell, Alison Redford, Ronald W. Royal, Sondra Scott, David P. Smith and Brooke Wade. Each director to be elected and qualified will hold office until the next annual meeting of stockholders and until his or her successor is elected, or, if sooner, until the director’s death, resignation or removal. Each of the nominees listed below is currently a director of Gran Tierra. It is Gran Tierra’s policy to invite nominees for directors to attend the annual meeting and all of the Directors attended the 2022 annual meeting of stockholders.

Shares represented by executed proxies will be voted, if authority to do so is not withheld, for the election of the nine nominees named below. If any nominee becomes unavailable for election as a result of an unexpected occurrence, shares that would have been voted for that nominee will instead be voted for the election of a substitute nominee proposed by Gran Tierra.

 

   
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PROPOSAL 1: ELECTION OF DIRECTORS

 

 

THE BOARD RECOMMENDS A VOTE “FOR” EACH OF THE NOMINEES NAMED BELOW.

NOMINEES FOR DIRECTOR

 

LOGO   

ROBERT B. HODGINS

 

Age: 70

Calgary, Alberta, Canada

Director since May 2015

 

Director and Independent Businessman

 

Shareholder approval rating at the 2021 Gran Tierra annual meeting: 93.9%

 

Mr. Hodgins has been a corporate director and independent businessman since November 2004. Prior thereto, Mr. Hodgins served as the Chief Financial Officer of Pengrowth Energy Trust (a TSX and NYSE-listed energy trust) from 2002 to 2004. Prior to that, Mr. Hodgins held the position of Vice President and Treasurer of Canadian Pacific Limited (a Toronto Stock Exchange (“TSX”) and NYSE-listed diversified energy, transportation and hotels company) from 1998 to 2002 and was Chief Financial Officer of TransCanada PipeLines Limited (a TSX and NYSE-listed energy transportation company) from 1993 to 1998. At present, Mr. Hodgins serves as a director of AltaGas Ltd., EnerPlus Corporation and MEG Energy Corp. Since September 2018, Mr. Hodgins holds the non-executive, part-time position of Senior Advisor, Investment Banking at Canaccord Genuity Corp. Mr. Hodgins received an Honours Bachelor of Arts in Business from the Richard Ivey School of Business at the University of Western Ontario and received a Chartered Professional Accountant designation and was admitted as a member of the Institute of Chartered Accountants of Ontario in 1977 and Alberta in 1991. Mr. Hodgins is a member of the Institute of Corporate Directors.

Qualifications: With 30-plus years in the oil and gas industry as an executive and director and a strong reputation in the Canadian business community, Mr. Hodgins brings valuable industry and leadership experience to the Board. As a Chartered Professional Accountant and experienced executive in senior financial roles with several Canadian companies, Mr. Hodgins qualifies as one of Gran Tierra’s Audit Committee financial experts.

 

Board and Committee Participation

   Position    Meetings    Attendance

Board of Directors

   Chair    7/7    100%

Audit Committee

   Member    4/4    100%

Compensation Committee

   Member    3/3    100%

Nominating and Corporate Governance Committee

   Member    3/3    100%
        

Year

   Common Shares    DSUs    Stock Options

2021

   20,000    848,230    17,220

2020

   20,000    593,745    17,220
        

Other Public Board Directorships

  

Committee Position(s) (1)

AltaGas Ltd. (TSX)

  

  Audit Committee

  Governance Committee

Enerplus Corporation (TSX)

  

  Compensation and Human Resources Committee

  Corporate Governance & Nominating Committee (Chair)

MEG Energy Corp. (TSX)

  

  Audit Committee (Chair)

  Corporate Governance and Nominating Committee

 

(1)

The Board of Directors has determined that Mr. Hodgins’ ability to effectively serve on the Company’s Audit Committee is not impaired by his membership on the Audit Committee of the other public boards listed above.

 

   
Gran Tierra Energy 2022 Proxy Statement   11


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PROPOSAL 1: ELECTION OF DIRECTORS

 

 

LOGO   

GARY S. GUIDRY

 

Age: 66

Calgary, Alberta, Canada

Director since May 2015

 

Non-Independent Director - President and Chief Executive Officer

 

Shareholder approval rating at the 2021 Gran Tierra annual meeting: 92.6%

 

Mr. Guidry is a professional engineer and has more than 40 years of experience developing and maximizing assets in the international oil and gas industry. Mr. Guidry has direct experience managing large, international projects, including assets in Latin America, Africa, the Middle-East and Asia. Prior to joining Gran Tierra, Mr. Guidry was the President and Chief Executive Officer of Caracal Energy Inc., a London Stock Exchange listed oil and gas company with operations in Chad, Africa. He held that position from mid-2011 until the company was acquired by Glencore plc for $1.8 billion in mid-2014. In 2014, Mr. Guidry was awarded the Oil Council Executive of the Year award for his leadership role with Caracal. Prior to Caracal, Mr. Guidry was the President and Chief Executive Officer of Orion Oil and Gas (TSX listed), which operated in western Canada from mid-2009 until mid-2011 when it was merged. From May 2005 until December 2008, he was the President and Chief Executive Officer of Tanganyika Oil Company (TSX listed) which operated in Syria and Egypt. Prior to Tanganyika, Mr. Guidry was Chief Executive Officer of Calpine Natural Gas Trust. Mr. Guidry is an Alberta-registered Professional Engineer and a member of the Association of Professional Engineers and Geoscientists. He received a Bachelor of Science in Petroleum Engineering from Texas A&M University in 1980.

Qualifications: Mr. Guidry, as Chief Executive Officer, is responsible for the operations, financial management and implementation of the Company’s strategy. Mr. Guidry’s extensive experience in the oil and gas industry and international operations developed through his experience as a senior executive at several publicly traded companies brings valuable expertise and perspective to the Board.

 

Board and Committee Participation

   Position    Meetings    Attendance

Board of Directors

   Member    7/7    100%
        

Year

   Common Shares    PSUs    Stock Options

2021

   3,809,692    3,807,591    2,334,239

2020

   3,665,749    2,529,835    1,836,214

 

Other Public Board Directorships

   Committee Position(s)

Africa Oil Corp.

  

  Audit Committee

  Compensation Committee (Chair)

  Reserves Committee (Chair)

PetroTal Corp. (1)

  

  Reserves Committee

  Health, Safety, Environment and Social Committee

 

(1)

PetroTal Corp. was formerly a related company. In November 2021 the Company sold its entire stake in PetroTal Corp.’s common shares. Mr. Guidry and Mr. Ellson were both nominated to the board of PetroTal Corp in 2017.

During the past five years, Mr. Guidry previously served as a Director of Shamaran Petroleum Corp. (until June 2018).

 

   
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PROPOSAL 1: ELECTION OF DIRECTORS

 

 

LOGO   

PETER J. DEY

 

Age: 81

Toronto, Ontario, Canada

Director since May 2015

 

Independent Director

 

Shareholder approval rating at the 2021 Gran Tierra annual meeting: 93.5%

 

Mr. Dey has been the Chairman of Paradigm Capital Inc., an investment dealer, since November 2005. Mr. Dey was a Partner of the Toronto law firm Osler, Hoskin & Harcourt LLP, where he specialized in corporate board issues and mergers and acquisitions, from 2001 to 2005, and prior to that from 1985 to 1994 and from 1973 to 1983. From 1994 to 2001, Mr. Dey was Chairman of Morgan Stanley Canada Limited. From 1993 to 1995, Mr. Dey chaired The Toronto Stock Exchange Committee on Corporate Governance in Canada that released the December 1994 report entitled “Where Were the Directors?”, known as the Dey Report and is the co-author of the recently released report: “360 Degree Governance: Where are the Directors in a World of Crisis”. Mr. Dey has also served as Chairman of the Ontario Securities Commission and was Canada’s representative to the Organisation for Economic Co-operation and Development (“OECD”) Task Force that developed the OECD Principles of Corporate Governance released in May of 1999. Mr. Dey attended Queen’s University, where he earned his Bachelor of Science in 1963 and Dalhousie University, where he earned his Bachelor of Laws degree in 1966. He received his Master of Laws degree from Harvard University in 1967.

Qualifications: With more than 40 years of experience dealing with issues of corporate governance ranging from serving on public boards to private practice as a lawyer, Mr. Dey provides significant value to the board of directors of Gran Tierra.

 

Board and Committee Participation

   Position    Meetings    Attendance

Board of Directors

   Member    7/7    100%

Nominating and Corporate Governance

Committee

   Chair    3/3    100%

Compensation Committee

   Member    3/3    100%

Health, Safety and Environment Committee

   Member    4/4    100%
        

Year

   Common Shares    DSUs    Stock Options

2021

   20,000    932,079    247,639

2020

   20,000    646,956    186,362
        

Other Public Board Directorships

   Committee Position (s)

None

    

During the past five years, Mr. Dey previously served as a Director of the following public companies: Guayana Goldfields Inc. (until June 2019), Goldcorp Inc. (until April 2017) and Granite REIT Inc. (until June 2017).

 

   
Gran Tierra Energy 2022 Proxy Statement   13


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PROPOSAL 1: ELECTION OF DIRECTORS

 

 

LOGO   

EVAN HAZELL

 

Age: 63

Calgary, Alberta, Canada

Director since June 2015

 

Independent Director

 

Shareholder approval rating at the 2021 Gran Tierra annual meeting: 95.1%

 

Mr. Hazell has been an independent businessman since 2011. He has been involved in the global oil and gas industry for approximately 40 years, initially as a petroleum engineer and then as an investment banker. From 1998 to 2011, Mr. Hazell acted as a managing director at several financial institutions including HSBC Global Investment Bank and RBC Capital Markets. At present he serves as a director of Kaisen Energy Corp. Mr. Hazell holds a Bachelor of Applied Science degree from Queen’s University, a Master of Engineering degree from the University of Calgary, and a Master of Business Administration degree from the University of Michigan, and is licensed as a Professional Engineer in Alberta.

Qualifications: Mr. Hazell has extensive experience in the global energy industry as well as in the financial sector. Mr. Hazell also has significant experience at nonprofit organizations. His education in business and engineering provides significant value to Gran Tierra.

 

Board and Committee Participation

   Position    Meetings    Attendance

Board of Directors

   Member    7/7    100%

Health, Safety and Environment Committee

   Chair    4/4    100%

Reserves Committee

   Member    3/3    100%

Audit Committee

   Member    4/4    100%
        

Year

   Common Shares    DSUs    Stock Options

2021

   55,000    774,268    238,281

2020

   55,000    539,479    190,828
        

Other Public Board Directorships

   Committee Position(s)

None

    

During the past five years, Mr. Hazell previously served as a Director of the following public companies: Oryx Petroleum Corporation Limited (until June 2016) and Opera America (until August 2021).

 

   
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PROPOSAL 1: ELECTION OF DIRECTORS

 

 

LOGO   

ALISON M. REDFORD QC

 

Age: 57

Calgary, Alberta, Canada

Director since September 2021

 

Independent Director

 

Ms. Redford serves as an advisor to national governments and ministries in emerging economies on regulatory reform to promote transparency and investor confidence. She provides independent advice on the creation of regulatory regimes related to climate, social and governance sustainability most recently in Pakistan, Afghanistan, South Sudan and Guyana. Separately, Ms. Redford also serves as a strategic advisor to public companies operating in volatile political climates to assess risk and ensure regulatory compliance, particularly as it relates to Extractive Industries Transparency Initiatives and Community Benefits Agreements for affected Indigenous people. Previously, Ms. Redford served as Premier of Alberta from 2011 to 2014 and as Minister of Justice and Attorney General from 2008. She graduated from the College of Law at the University of Saskatchewan (1988) and also obtained a Master of Arts degree from the School of Oriental and African Studies at the University of London (2021). Ms. Redford was appointed Queens Counsel in 2008. Ms. Redford is a holder of the Institute of Corporate Directors Director designation.

Qualifications: Ms. Redford brings to the Board more than 25 years of experience from most recently serving as an advisor to national governments and ministries in emerging economies on regulatory reform to promote transparency and investor confidence. As well as serving as Premier of Alberta, Minister of Justice and Attorney General to private practice as a lawyer, Ms. Redford provides significant value to the board of directors of Gran Tierra.

 

Board and Committee Participation

   Position    Meetings    Attendance

Board of Directors

   Member    2/2    100%

Audit Committee

   Member    0    —  

Nominating and Corporate Governance Committee

   Member    0    —  

Health, Safety & Environment Committee

   Chair    0    —  
        

Year

   Common Shares    DSUs    Stock Options

2021

   0    41,861    85,000

 

 

   
Gran Tierra Energy 2022 Proxy Statement   15


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PROPOSAL 1: ELECTION OF DIRECTORS

 

 

LOGO   

RONALD W. ROYAL

 

Age: 72

Abbotsford, British Columbia, Canada

Director since May 2015

 

Independent Director

 

Shareholder approval rating at the 2021 Gran Tierra annual meeting: 95.1%

 

Mr. Royal has been an independent businessman since April 2007. Mr. Royal has more than 35 years of experience with Imperial Oil Ltd. and ExxonMobil’s international upstream affiliates. From 2011 to 2014, he served on the board of directors of Caracal Energy Inc., and prior to 2010, several other boards of private oil companies. Prior to retiring in 2007, Mr. Royal was President and Production Manager of Esso Exploration and Production Chad Inc. and resided in N’Djamena, Chad from 2002 to 2007. In 2003, he was awarded the title “Chevalier de l’Ordre National du Chad” for his contribution to the economic development of Chad. Mr. Royal received his Bachelor of Applied Science from the University of British Columbia in 1972 and completed the Executive Development Program at Cornell University in 1986. He has been a member of the Association of Professional Engineers and Geoscientists of Alberta since 1972.

Qualifications: Mr. Royal brings to the Board over 35 years of experience in senior executive roles in the oil and gas industry, having previously held a variety of management positions both domestically and internationally.

 

Board and Committee Participation

   Position    Meetings    Attendance

Board of Directors

   Member    7/7    100%

Audit Committee

   Member    4/4    100%

Health, Safety & Environment Committee

   Member    4/4    100%

Reserves Committee

   Chair    3/3    100%
        

Year

   Common Shares    DSUs    Stock Options

2021

   254,667    965,286    247,639

2020

   254,667    680,163    186,362
        

Other Public Board Directorships

   Committee Position(s)

Valeura Energy Inc.

  

  Audit Committee

  Reserves & Health, Safety and Environment Committee

 

   
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PROPOSAL 1: ELECTION OF DIRECTORS

 

 

LOGO   

SONDRA SCOTT

 

Age: 55

New York, New York

Director since September 2017

 

Independent Director

 

Shareholder approval rating at the 2021 Gran Tierra annual meeting: 94.2%

 

Ms. Scott is an independent businesswoman with more than 25 years of experience as an energy and risk analytics business leader. Ms. Scott was formerly Chief Executive Officer for U.S. and Europe of ADEC Innovations, a leading ESG information and consulting firm where she led a team of professionals providing ESG, environmental and sustainability technical, software and strategy solutions. Prior to this, Ms. Scott was Chief Operating Officer of Verisk Financial where she was responsible for leading the company’s global operations team in support their range of portfolio, bankruptcy, fraud and spend solutions. Before joining Verisk Financial in 2020, Ms. Scott was President of Verisk Maplecroft, a leading risk analytics company. Prior to this, Ms. Scott filled a number of roles at Wood Mackenzie over a 13-year period. Her most recent position was head of Global Markets where she led a team focusing on macro energy economics and risk. Previously, Ms. Scott led Wood Mackenzie’s energy consultancy practice. Ms. Scott holds a Master of Science, Petroleum Engineering and Economics degree from a joint program with the University of Pennsylvania and the Institut Francais du Petrole (IFP) and received a Bachelor of Arts, Economics and Earth Sciences degree from Wesleyan University.

Qualifications: Ms. Scott has more than 25 years of experience as an energy and risk analytics business leader. She has significant leadership experience having led multi-sized global research and consultancy teams. Ms. Scott has worked in the United States, the United Kingdom, and Latin America, globalizing businesses and building local practices.

 

Board and Committee Participation

   Position    Meetings    Attendance

Board of Directors

   Member    7/7    100%

Health, Safety & Environment Committee

   Member    4/4    100%

Nominating and Corporate Governance Committee

   Member    3/3    100%

Reserves Committee

   Member    2/2    100%
        

Year

   Common Shares    DSUs    Stock Options

2021

   0    755,787    85,000

2020

   0    630,516    85,000
        

Other Public Board Directorships

   Committee Position(s)

None

    

 

   
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LOGO   

DAVID P. SMITH

 

Age: 63

Parry Sound, Ontario, Canada

Director since May 2015

 

Independent Director

 

Shareholder approval rating at the 2021 Gran Tierra annual meeting: 95.3%

 

Mr. Smith is a corporate director with extensive experience in the investment banking, investment research and management industry. He has been the Chairman of the Board of Directors of Superior Plus Corp., a diversified energy and specialty chemicals company, since August 2014. From March 2004 to August 2015, Mr. Smith served as Chair of the Audit Committee of Superior Plus Corp. Previously, Mr. Smith was Managing Partner of Enterprise Capital Management Inc. from 1997 to 2011. Mr. Smith is a Chartered Financial Analyst and graduated with honors from the University of Western Ontario with a degree in Business Administration in 1981.

Qualifications: Mr. Smith brings to the Board significant financial expertise, having spent his professional career in investment banking, investment research and management. His experience as the Chairman at Superior Plus Corp. and his previous experience as a director and member of the audit committee of other public companies provide valuable perspective to Gran Tierra’s Board. Mr. Smith’s education and experience qualifies him as one of Gran Tierra’s Audit Committee financial experts.

 

Board and Committee Participation

   Position    Meetings    Attendance

Board of Directors

   Member    7/7    100%

Audit Committee

   Chair    4/4    100%

Compensation Committee

   Member    3/3    100%
        

Year

   Common Shares    DSUs    Stock Options

2021

   555,000    427,967    252,105

2020

   555,000    296,875    190,828
        

Other Public Board Directorships

   Committee Position(s)

Superior Plus Corp.

  

  Chairman

  Governance and Nominating Committee

  Compensation Committee

 

   
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LOGO   

BROOKE WADE

 

Age: 68

Vancouver, British Columbia, Canada

Director since June 2015

 

Independent Director

 

Shareholder approval rating at the 2021 Gran Tierra annual meeting: 94.0%

 

Mr. Wade is the President of Wade Capital Corporation, a private investment company active in private equity, oil and gas, real estate and industrial businesses. From 1994 until 2005, Mr. Wade was the co-founder and Chairman and Chief Executive Officer of Acetex Corporation, a publicly traded chemical company specializing in acetyls, specialty polymers, and films. In July 2005, Acetex was acquired by Blackstone. Prior to founding Acetex Corporation, Mr. Wade was founding President and Chief Executive Officer of Methanex Corporation. In 1991, Ocelot Industries spun out its oil and gas assets and began a plan of growth through acquisition into what is today Methanex Corporation—the world’s largest methanol producer. Prior to joining Ocelot, he was involved in a number of independent business ventures. Mr. Wade serves on the boards of several private companies including Novinium, Inc., Belkin Enterprises Ltd., Chairman of Atlas Power Technologies Inc. and is a member of the Advisory Board of Northbridge Capital Partners and is a participant of AEA Investors groups of funds. In addition, Mr. Wade is a member of the Dean’s Advisory Council of the John F. Kennedy School of Government at Harvard University. Mr. Wade earned a Bachelor of Commerce Degree from the University of Calgary in 1974 and received his Chartered Accountant designation in 1977. In 2012, Mr. Wade became a Fellow of the Institute of Chartered Accountants of British Columbia.

Qualifications: Mr. Wade’s extensive executive experience provides the Board with strong leadership and decision-making capabilities. His service on other public company boards provides Gran Tierra with public company senior executive and board member perspectives and judgment important to guiding our company.

 

Board and Committee Participation

   Position    Meetings    Attendance

Board of Directors

   Member    7/7    100%

Compensation Committee

   Chair    3/3    100%

Nominating and Corporate Governance Committee

   Member    3/3    100%

Reserves Committee

   Member    3/3    100%

 

Year

   Common Shares    DSUs    Stock Options

2021

   2,133,600    965,286    247,639

2020

   2,133,600    680,163    186,362
        

Other Public Board Directorships

   Committee Position(s)

None

    

During the past five years, Mr. Wade previously served as a Director of PKM Canada Limited, formerly, Kinder Morgan Canada Limited (until November 2019).

Majority Voting Standard

Our Bylaws provide for a majority voting standard for the election of directors in uncontested elections, which is generally defined as an election in which the number of nominees does not exceed the number of directors to be elected at the meeting. Because this is an uncontested election, each director shall be elected by the vote of a majority of the votes cast at a meeting of stockholders at which a quorum is present. A “majority of the votes cast” means that the number of shares voted “For” a director nominee must exceed the number of votes cast “Against” that director nominee. For these purposes, abstentions and broker non-votes will not count as a vote “For” or “Against” a nominee’s election and will have no effect in determining whether a director nominee has received a majority of the votes cast. If an incumbent director is not elected by a majority of the votes cast, the incumbent director must promptly tender his or her or her resignation to the Board. The Nominating and Corporate Governance Committee will make a recommendation to the Board on whether to accept or reject the director’s resignation or whether other action should be taken. The Nominating and Corporate Governance Committee shall recommend, and the Board of Directors’ decision shall be, to accept the resignation absent exceptional circumstances. The Board will act on the Nominating and Corporate Governance Committee’s

 

   
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recommendation within 90 days from the date of the meeting of stockholders and publicly disclose its decision If the Board of Directors determines not to accept a resignation, the public disclosure shall fully state the reasons for such decision. A director who tenders his or her or her resignation after failing to receive a majority of the votes cast will not participate in the Nominating and Corporate Governance Committee’s or the Board’s recommendation or decision or any deliberations related thereto.

Other Information Regarding Our Directors

Our above-listed directors have neither been convicted in any criminal proceeding during the past ten years nor been parties to any judicial or administrative proceeding during the past ten years that resulted in a judgment, decree or final order enjoining them from future violations of, or prohibiting activities subject to, federal or state securities laws or a finding of any violation of federal or state securities law or commodities law. Similarly, no bankruptcy petitions have been filed by or against any business or property of any of our directors or officers, nor has any bankruptcy petition been filed against a partnership or business association in which these persons were general partners or executive officers.

Skills Matrix

Below is a listing of each director’s key skills, together with a description of those key skills and experience desirable to support the strategic direction of Gran Tierra. Not every director is expected to be skilled in every area, however, we aim for the Board to have a balance of skills and experience. We believe the combination of the skills and qualifications shown below demonstrates how our board is well-positioned to provide effective oversight and strategic advice to our management.

 

                 

Skills And Experience

  Peter J.
Dey
    Gary S. Guidry
(President &
Chief Executive
Officer)
    Evan
Hazell
    Robert B.
Hodgins
(Chair)
    Alison
Redford
    Ronald W.
Royal
    Sondra
Scott
    David P.
Smith
    Brooke
Wade
 

Relevant Industry Skills

                                                                       
                 

Energy Industry Executive Experience

                                                         
                 

Health, Safety and Environment Issues

                                                         
                 

Engineering / Geology / Geophysics

                                                               
                 

Hydrocarbon Transportation and Marketing

                                                           

General Business Skills

                                                                       
                 

Leadership

                                                       
                 

Board Experience

                                                         
                 

Finance / Capital Markets

                                                           
                 

Mergers and Acquisitions

                                                       
                 

Legal and Governance

                                                       
                 

Government and Public Affairs

                                                         
                 

International Experience

                                                       
                 

Human Resources and Compensation

                                                         
                 

Information Technology

                                                                 
                 

Risk Management

                                                         
                 

Strategic Planning

                                                     
                 

Accounting /Audit

                                                         

Independence of the Board of Directors

The Company believes in the importance of directors’ independence and follows rules of the NYSE American. As required under the NYSE American listing standards, a majority of the members of a listed company’s board of directors must qualify as “independent,” as affirmatively determined by the Board.

The Board conducts an annual review regarding the independence from the Company’s management of each of its members. After review of all relevant identified transactions or relationships between each director, or any of his or her family members, and Gran Tierra, its senior management and its independent auditors, the Board has affirmatively determined that, other than Mr. Guidry, each of our directors and nominees for director (Peter J. Dey, Evan Hazell, Robert B. Hodgins, Alison Redford, Ronald W. Royal, Sondra Scott, David P. Smith and Brooke Wade), are independent directors within the meaning of the applicable NYSE American listing standards. In making this determination, the Board found that none of these directors or nominees for director had a material

 

   
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or other disqualifying relationship with Gran Tierra. Mr. Guidry, Gran Tierra’s President and Chief Executive Officer, is not an independent director by virtue of his employment with Gran Tierra. The Board considered and confirmed that Mr. Hodgins’ position as Senior Advisor, Investment Banking at Canaccord Genuity Corp. did not impede his independence as a Director of the Company.

In connection with its assessment of the independence of each non-employee director, the Board of Directors also determined that (i) Messrs. Smith, Hazell, Hodgins and Royal and Ms. Redford, are independent as defined in Section 10A of the Exchange Act and under the standards set forth by the NYSE American applicable to members of the Audit Committee (ii) Messrs. Wade, Dey, Hodgins and Smith, are independent under the standards set forth by the NYSE American applicable to members of the Compensation Committee and (iii) Ms. Redford, Ms. Scott and Messrs. Dey, Hodgins and Wade, are independent under the standards set forth by the NYSE American applicable to members of the Nominating and Corporate Governance Committee.

Stockholder Recommendations and Nominations to the Board

The Nominating and Corporate Governance Committee will consider director candidates recommended by stockholders. The Nominating and Corporate Governance Committee does not intend to alter the manner in which it evaluates candidates, including the minimum criteria set forth on page 23 in the section Considerations in Evaluating Director Nominees based on whether or not the candidate was recommended by a stockholder. Stockholders who wish to recommend individuals for consideration by the Nominating and Corporate Governance Committee to become nominees for election to the Board may do so by delivering a written recommendation to the Nominating and Corporate Governance Committee at the following address: Gran Tierra Energy Inc., 900, 520 - 3 Avenue S.W., Calgary, Alberta, Canada T2P 0R3, Attention: Director Nominations. This written recommendation must be delivered at least 120 days prior to the anniversary of the mailing of Gran Tierra’s proxy statement for the last annual meeting of stockholders. Submissions must include the full name of the proposed nominee, a description of the proposed nominee’s business experience for at least the previous five years, complete biographical information, a description of the proposed nominee’s qualifications as a director and a representation that the nominating stockholder is a beneficial or record holder of Gran Tierra’s stock. Any such submission must be accompanied by the written consent of the proposed nominee to be named as a nominee and to serve as a director if elected.

Code of Ethics

Gran Tierra has adopted a Code of Business Conduct and Ethics which is available in English and Spanish and applies to every employee, officer and director. Employees, officers and directors are expected to understand the Code and its application to the performance of his or her business responsibilities. The Code of Business Conduct and Ethics is available on the Company’s website at www.grantierra.com/governance. If Gran Tierra makes any substantive amendments to the Code of Business Conduct and Ethics or grants any waiver from a provision of the Code of Business Conduct and Ethics to any executive officer or director, Gran Tierra will promptly disclose the nature of the amendment or waiver on its website if required. The Board did not grant any waiver of the Code in favor of a director or executive officer in 2021.

Diversity

Gran Tierra believes in the importance of diversity at all levels throughout the Company. In addition to the traditional concepts of diversity (i.e., gender, culture and geographic region), we believe it is important for the Board to achieve a diversity of knowledge, experience and capabilities that support the Company’s strategic direction. Currently, Gran Tierra does not have a formal policy concerning the diversity of director nominees. However, when considering director candidates, the Board seeks individuals with backgrounds and qualities that, when combined with those of incumbent directors, provide a blend of skills and experience to further enhance the Board’s effectiveness. As part of its annual self-evaluation, the Board assesses whether the directors, both individually and collectively, provide the integrity, experience, judgment, commitment, skills and expertise appropriate for the Company.

Gran Tierra recognizes the benefits of increasing the diversity of its board of directors. In February 2021, the Board updated its Corporate Governance Guidelines to state that as part of the search process for each new director, the Nominating and Corporate Governance Committee will actively seek out women and minority candidates to include in the pool from which Board nominees are chosen. In September 2021 Alison Redford joined the Board of Directors of Gran Tierra. Please see page 15 for Ms. Redford’s Bio and page 20 for a breakdown of her skills.

 

   
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THE BOARD’S ROLE AND RESPONSIBILITIES

Role of the Board of Directors

The Board is selected by the stockholders to provide oversight of and strategic guidance to senior management. The core responsibility of a Board member is to fulfill his or her or her fiduciary duties of care and loyalty and otherwise to exercise his or her business judgment in the best interests of the Company and its stockholders. The Board has responsibilities to review, approve and monitor fundamental financial and business strategies and major corporate actions, assess major risks facing the Company and consider ways to address those risks, select and oversee management and determine its composition and oversee the establishment and maintenance of processes and conditions to maintain the integrity of the Company. Directors must act with integrity and are expected to demonstrate a commitment to the company, its values and its business and to long-term stockholder value. The duties and responsibilities of the Board and significant issues of corporate governance are set out in the Company’s Corporate Governance Guidelines which are regularly reviewed by the Nominating and Corporate Governance Committee. The guidelines are available on the Company’s website at www.grantierra.com/governance.

Succession Planning

As part of its mandate and annual workplan, the Nominating and Corporate Governance Committee reviews the succession plan for each senior officer, including the President and Chief Executive Officer. The Nominating and Corporate Governance Committee is responsible for ensuring that there is an orderly succession plan for the position of the President and Chief Executive Officer and other members of senior management. To meet this obligation, the President and Chief Executive Officer meets with the Nominating and Corporate Governance Committee and reviews each position, the status of the incumbent, a review of our talent pool and the succession plan for each role.

Board Role in Risk Oversight

 

Full Board

 

The full Board is entrusted with the responsibility for overseeing the significant risks to which our business is exposed and ensuring there are processes in place to effectively identify, monitor and manage them. A significant risk is one that, if it were to occur, could materially impact our ability to meet or support our business objectives. The Board delegates responsibility for the execution of certain elements of risk oversight to the committees to ensure appropriate expertise, attention and diligence. The committees oversee the relevant risk areas and report to the Board regularly. Each committee operates according to a Board-approved written mandate outlining its duties and responsibilities. They also oversee the procedures and programs put in place by management to mitigate the risks and the allocation of adequate resources to address the risks. Management is responsible for ensuring that the Board and its committees are kept well informed of changing risks. The risk oversight responsibilities of the committees include the following:

 

 

 
         

The Audit Committee is responsible for overseeing the integrity of the Company’s financial statements, the independent auditor’s qualifications and independence, the performance of the Company’s internal audit function and independent auditor, compliance with legal and regulatory requirements, major financial and information technology risk exposures and the Company’s accounting and financing reporting processes.

 

        

The Compensation Committee is responsible for oversight of compensation-related risks, including reviewing management’s assessment of risks related to employee compensation programs.

        

The Health, Safety and Environment Committee assists in overseeing the development, monitoring and effective implementation of systems, programs and initiatives to promote the management of health, safety and security at Gran Tierra and to address environmental, safety and operational risks.

 

        

The Nominating and Corporate Governance Committee assists in overseeing governance related risks, including regulatory, reputation and other risks.

        

The Reserves Committee assists in overseeing the risks related to the Company’s estimates of proved reserves of oil and natural gas.

 

   
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Communications with the Board of Directors

Stockholders are encouraged to communicate by voting on the items in the proxy statement, by attending the annual meeting, by participating in the Company’s quarterly investor calls and by contacting us by mail or email. Security holders wishing to communicate with the Board or an individual director may send a written communication addressed to the Secretary of the Company at 900, 520 - 3rd Avenue S.W., Calgary, Alberta T2P 0R3, Canada, Attention: Secretary. Communications also may be sent by e-mail to the following address info@grantierra.com. Further information about Gran Tierra’s Security Holder Communication Process is available on Gran Tierra’s website at www.grantierra.com/governance.

BOARD STRUCTURE AND PROCESSES

Board Leadership Structure

The positions of Board Chair and the Chief Executive Officer of the Company are held by two individuals. We believe separation of the roles of Board Chair and Chief Executive Officer helps preserve our Board’s independence and objectivity and provides an appropriate division of labor between our Board Chair and Chief Executive Officer. The Board believes that the current board leadership structure, coupled with a strong emphasis on board independence, effectively allocates authority, responsibility, and oversight between management and the independent members of our Board. Robert B. Hodgins currently serves as non-executive Board Chair and as a non-executive and independent director. The Board Chair presides over meetings of the Board, presides over meetings of stockholders, consults and advises the Board and its committees on the business and affairs of the Company, and performs additional duties as the Board may otherwise determine and delegate.

Board Effectiveness and Director Assessment

The Board performs an annual self-assessment, led by the Chair of the Nominations and Corporate Governance Committee, to evaluate its effectiveness in fulfilling its obligations. Directors complete a written questionnaire covering performance of the Board and its committees. The Chair of the Nominations and Corporate Governance Committee then interviews each director to obtain an assessment of the effectiveness of the Board and committees, as well as director performance and Board dynamics, summarizes these individual assessments for discussion with the Board and committees, and then leads a discussion with the Nominating and Corporate Governance Committee and the Board.

Considerations in Evaluating Director Nominees

The Nominating and Corporate Governance Committee is responsible for identifying and recruiting new candidates for nomination to the Board. The Nominating and Corporate Governance Committee considers recommendations for nominees for directorships submitted by stockholders. The Company will evaluate director nominees proposed by stockholders on the same basis as recommendations received from any other source. Please see “Stockholder Recommendations and Nominations to the Board” in this Proxy Statement for procedures to recommend individuals for consideration by the Nominating and Corporate Governance Committee to become nominees for election to the Board.

In developing recommendations for the Board, the Nominating and Corporate Governance Committee uses a variety of methods for identifying and evaluating nominees for directors. Candidates for director nominees are reviewed in the context of the current composition of the Board, the operating requirements of Gran Tierra and the long-term interests of stockholders. Some of the qualifications that the Nominating and Corporate Governance Committee considers include:

 

     

Independence

(as per applicable NYSE American
listing standards and applicable
SEC rules and regulations)

        

Relevant Industry

Experience

         Excellence in His
or Her Field

 

       
Potential Conflicts
of Interest and
Other Commitments
         Board Experience             Ethics          Diversity of
Experience

In conducting this assessment, the Nominating and Corporate Governance Committee considers diversity, age, skills, and such other factors as it deems appropriate given the current needs of the Board and Gran Tierra, to maintain a balance of knowledge, experience and capability. In February 2021, the Board updated its Corporate Governance Guidelines to state that as part of the search process for each new director, the Nominating and Corporate Governance Committee will actively seek out women and minority candidates to include in the pool from which Board nominees are chosen.

 

   
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The Nominating and Corporate Governance Committee believes that candidates should have certain minimum qualifications including:

    the highest personal and professional ethics and integrity

 

    skills that are complementary to those of the existing Board

 

    being over 21 years of age
    financial literacy

 

    sound business judgment

 

    commitment to represent the long-term interests of Gran Tierra’s stockholders
 

 

To identify, recruit and evaluate qualified candidates for the Board, the Nominating and Corporate Governance Committee may use the services of professional search firms. In some cases, nominees have been individuals known to Board members or others through business or other relationships.

Director Tenure

Gran Tierra does not have a retirement policy or term limit for directors. We review our Board composition annually to ensure our board has the right skills to ensure the Company’s long-term success. None of the Company’s directors have served on the board for more than seven years.

Orientation and Education

The purpose of the Director Orientation and Education Program is to ensure there is an orientation program for new directors and an ongoing education program for existing directors. The program includes materials and resources that will inform and educate directors on the Company’s corporate governance framework, its business, operations and current issues and strategies. New directors attend an orientation session at which senior management review the Company’s business, strategic plans, its significant financial, accounting and risk management issues, its compliance programs, its Code of Business Conduct and Ethics, its principal officers, and its internal and independent auditors. New directors are also provided with a copy of the Company’s director’s manual which includes the Board and Committee mandates, corporate governance guidelines and other company policies.

Each director is expected to maintain the necessary level of expertise to perform his or her responsibilities as a director. Continuing education is provided through a number of methods, including an annual dedicated strategy session, periodic field trips, presentations from senior management, employees, and outside experts to the Board and its Committees on topics of interest and developing issues, as well as the ongoing distribution of relevant information. These presentations, meetings and discussions serve to increase the Board’s knowledge of the Company and its business, and assist the Board in the execution of its duties. During 2021, the Board attended a number of sessions relevant to our business and the regulatory environment presented by senior executives of the Company and our legal counsel.

All of our directors are members of the Institute of Corporate Directors (ICD) and the National Association of Corporate Directors (NACD), which provide continuing education for directors through publications, seminars and conferences. During 2021, a number of our directors attended seminars provided through ICD and NACD.

 

   
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Director Meetings and Attendance

Directors are expected to attend, in person or by telephone, all meetings of the Board and all meetings of each committee of which they are a member. During 2021, the Board held seven meetings, the Audit Committee held four meetings, the Compensation Committee held three meetings, the Health, Safety and Environment Committee held four meetings, the Nominating and Corporate Governance Committee held three meetings and the Reserves Committee held three meetings. No member of the Board attended fewer than 75% of the aggregate of the total number of meetings of the Board (held during the period for which he or she was a director) and the total number of meetings held by all committees of the Board on which such director served (held during the period that such director served). Directors are also expected to attend the Company’s annual meeting of stockholders and all of the Company’s directors attended the 2021 annual meeting which was held by webcast.

 

Name

   Meetings Attended / Meetings Held (2)             Overall
Attendance
 
   Board      Audit
Committee
     Compensation
Committee
     Health,
Safety and
Environment
Committee
     Nominating
and
Corporate
Governance
Committee
     Reserves
Committee
 

Peter J. Dey

     7/7               3/3        4/4        3/3               100

Gary S. Guidry (1)

     7/7                                           100

Evan Hazell

     7/7        4/4               4/4               3/3        100

Robert B. Hodgins

     7/7        4/4        3/3               3/3               100

Alison Redford

     2/2                                           100

Ronald W. Royal

     7/7        4/4               4/4               3/3        100

Sondra Scott

     7/7                      4/4        3/3        3/3        100

David P. Smith

     7/7        4/4        3/3                             100

Brooke Wade

     7/7               3/3               3/3        3/3        100

 

1.

Mr. Guidry is not a member of any committee of the Board as he is not considered to be an independent director. Mr. Guidry participates in various committee meetings; however, each committee holds executive sessions without Mr. Guidry present.

 

2.

Directors who are not members of the committee attended certain of these meetings by invitation.

Executive Sessions

As part of each regularly scheduled Board meeting, the independent directors meet without our management team. The Board Chair leads such discussions.

 

   
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INFORMATION REGARDING COMMITTEES OF THE BOARD OF DIRECTORS

The Board has five standing committees: an Audit Committee, a Compensation Committee, a Health, Safety and Environment Committee, a Nominating and Corporate Governance Committee, and a Reserves Committee. The composition and responsibilities are described below. Members serve on these committees until their resignation or until otherwise determined by the Board.

The committees regularly report their activities and actions to the full Board, generally at the next Board meeting following the committee meeting. Each of the committees operates under a charter approved by the Board. Current copies of the charters of the committees are available on the Company’s website at www.grantierra.com/governance.

 

          Audit Committee
                      
     

 

David P. Smith (Chair) Evan Hazell

Robert B. Hodgins

Alison Redford

Ronald W. Royal

          

The Audit Committee oversees the accounting and financial reporting process and the audit of the Company’s financial statements, and assists the Board in monitoring the financial systems and Gran Tierra’s legal and regulatory compliance. The Audit Committee met four times in 2021 and at each meeting met with our independent auditors and the internal auditor, both privately and in the presence of management. The Audit Committee is responsible for, among other things:

 

  Evaluation and retention of Auditors

 

  Approval of audit engagements

 

  Approval of non-audit services

 

  Review of audited financial statements and management’s discussion and analysis

 

  Review of quarterly financial statements

 

  Review of earnings press releases

 

  Review of accounting principles and policies

 

  Establish procedures for the receipt, retention and treatment of complaints relating to accounting, internal accounting controls or auditing matters and violations of applicable laws, rules and regulations

 

  Review of guidelines and policies with respect to risk assessment and risk management

 

  Review of the scope, adequacy and effectiveness of internal control over financial reporting

 

  Review and oversee the internal audit function

 

  Approval of the Company’s hedging policies

 

The Audit Committee operates under a written charter that was adopted by the Board and satisfies the applicable standards of the SEC and the NYSE American. A copy of the Audit Committee Charter is available on Gran Tierra’s website at www.grantierra.com/governance.

 

       

 

The Board has determined that each of the members of the Audit Committee satisfies the requirements for audit committee independence and financial literacy under the rules and regulations of the NYSE American and the SEC. The Board has determined that Messrs. Hodgins and Smith are financial experts as per Item 407(d)(5) of Regulation S-K established by the SEC. The Audit Committee held four meetings during the fiscal year ended December 31, 2021.

       

 

   
26   Gran Tierra Energy 2022 Proxy Statement


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PROPOSAL 1: ELECTION OF DIRECTORS

 

 

          Compensation Committee
                      
     

 

Brooke Wade (Chair) Peter J. Dey

Robert B. Hodgins

David Smith

 

          

The Compensation Committee acts on behalf of the Board to review, recommend for adoption and oversee Gran Tierra’s compensation strategy, policies, plans and programs. The Compensation Committee’s responsibilities include, among other things:

 

  Review and approve the components of compensation for the Chief Executive Officer and other executive officers

 

  Review and approve the corporate goals and objectives relevant to the compensation for the Chief Executive Officer and other executive officers

 

  Evaluate the performance of the Chief Executive Officer and other executive officers in light of established goals and objectives

 

  Establish policies with respect to equity compensation arrangements

 

  Review the risks arising from our compensation policies and practices

 

  Review and approve the compensation and other terms of employment or service, including severance and change-in-control arrangements, of Gran Tierra’s Chief Executive Officer and the other executive officers

 

  Oversee Gran Tierra’s equity compensation plans for employees and directors

 

  Evaluate and make recommendations regarding director compensation

 

  Select compensation consultants and other advisors

 

  Review the Compensation Discussion and Analysis

 

  Oversee Gran Tierra’s strategies and policies related to human capital management, including matters such as diversity and inclusion, workplace environment and culture, and talent development and retention.

 

The Compensation Committee operates under a written charter that was adopted by the Board and satisfies the applicable standards of the SEC and the NYSE American. A copy of the Compensation Committee Charter is available on Gran Tierra’s website at www.grantierra.com/governance.

 

       

 

The Board has determined that each of the members of the Compensation Committee satisfies the requirements for compensation committee independence under the rules and regulations of the NYSE American and the SEC. The Compensation Committee held three meetings during the fiscal year ended December 31, 2021.

 

 

       

 

          Health, Safety and Environment Committee
                                
     

 

Evan Hazell (Chair)

Peter Dey

Alison Redford

Ronald W. Royal

Sondra Scott

 

 

 

           The Health, Safety and Environment Committee acts on behalf of the Board and assists the Board in fulfilling its responsibilities in relation to environmental, health and safety matters, including monitoring and overseeing the Company’s policies and procedures for ensuring compliance by the Company with environmental regulatory requirements and ensuring that employees are provided with a safe environment in which to perform their duties. The Health, Safety and Environment Committee is responsible for, among other things:
       

 

The Board has determined that each of the members of the Health, Safety and Environment Committee satisfies the requirements for independence under the rules and regulations of the NYSE American. The Health, Safety and Environment Committee is scheduled to meet each quarter, and held four meetings during the fiscal year ended December 31, 2021.

            

 

  Develop and approve the environmental, health and safety goals and objectives of the Company

 

  Review and monitor the environmental policies and activities of the Company and review and monitor the Company’s compliance programs with respect to environmental laws and legislation and that the Company conforms with industry standards

 

  Review and monitor the health and safety policies and activities of the Company

 

  Review and discuss with management environmental, health and safety compliance issues and incidents of non-compliance and discuss with management the Company’s response with respect to those matters

 

  Review significant external or internal audit or consultants’ reports relating to environmental, health or safety matters;

 

  Review significant legislative and regulatory changes including policy proposals and modifications that could impact the Company

 

  Review and report to the Board on the sufficiency of resources available for carrying out the actions and activities recommended

 

The Health, Safety and Environment Committee operates under a written charter that was adopted by the Board, a copy of which is available on Gran Tierra’s website at www.grantierra.com/governance.

 

 

   
Gran Tierra Energy 2022 Proxy Statement   27


Table of Contents

PROPOSAL 1: ELECTION OF DIRECTORS

 

 

          Reserves Committee
                                
     

 

Ronald W. Royal (Chair)

Evan Hazell

Sondra Scott

Brooke Wade

 

 

          

The Reserves Committee acts on behalf of the Board and assists the Board in fulfilling its oversight responsibilities with respect to evaluating and reporting on the Company’s oil and gas reserves. The Reserves Committee is responsible for, among other things:

 

  Approve the engagement of the independent reserves evaluators and their compensation and evaluate any such reserve evaluator’s performance

 

  Review disclosure procedures with respect to the oil and gas activities of the Company

 

  Review the Company’s procedures for providing information to the independent reserves evaluator

 

  Meet with the independent reserves evaluators

 

  Make recommendations to the Board regarding the approval of the Company’s year-end reserves evaluations

 

The Reserves Committee operates under a written charter that was adopted by the Board, a copy of which is available on Gran Tierra’s website at www.grantierra.com/governance.

 

       

 

The Board has determined that each of the members of the Reserves Committee satisfies the requirements for independence under the rules and regulations of the NYSE American. The Reserves Committee held three meetings during the fiscal year ended December 31, 2021.

 

       

 

          Nominating and Corporate Governance Committee
                                
     

 

Peter J. Dey (Chair) Robert B. Hodgins

Alison Redford

Sondra Scott

Brooke Wade

 

 

          

The Nominating and Corporate Governance Committee assists the Board in overseeing the Company’s corporate governance functions; identify, review and evaluate candidates to serve as directors of Gran Tierra, assessing the performance of the Board and management, and developing a set of corporate governance principles for Gran Tierra. The Nominating and Corporate Governance Committee is responsible for, among other things:

 

  Identify and review director nominees

 

  Consider recommendations for Board nominees and proposals submitted by the Company’s stockholders

 

  Assess the performance of the Board

 

  Recommend chair and membership of board committees

 

  Review director independence

 

  Review succession planning for the Board and key leadership roles on the Board and its committees

 

  Review the Board’s leadership structure and recommend changes to the Board

 

  Consider and review continuing education for directors

 

  Review and assess our Corporate Governance Guidelines

 

  Review succession planning for our Chief Executive Officer and other executive officers

 

  Review insurance coverage for the directors and executive officers

 

The Nominating and Corporate Governance Committee operates under a written charter that was adopted by the Board and satisfies the applicable standards of the SEC and the NYSE American. A copy of the Compensation Committee Charter is available on Gran Tierra’s website at www.grantierra.com/governance.

 

       

 

The Board has determined that each of the members of the Nominating and Corporate Governance Committee satisfies the requirements for independence under the rules and regulations of the NYSE American. The Nominating and Corporate Governance Committee held three meetings during the fiscal year ended December 31, 2021.

 

 

       

Compensation Committee Interlocks and Insider Participation

None of the members of the Compensation Committee has at any time been an officer or employee of Gran Tierra. No member of the Board or of the Compensation Committee served as an executive officer of another entity that had one or more of our executive officers serving as a member of that entity’s board or compensation committee.

 

   
28   Gran Tierra Energy 2022 Proxy Statement


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PROPOSAL 1: ELECTION OF DIRECTORS

 

 

DIRECTOR COMPENSATION

The objective of Gran Tierra’s compensation program for non-executive directors is to attract and retain directors of a quality and nature that will enhance our long-term sustainable profitability and growth. Director compensation is intended to provide an appropriate level of remuneration considering the experience, responsibilities, time commitment and accountability of their roles. The Company intends for Director compensation to be competitive with our peer companies. Any director who is also an employee of the Company does not receive additional compensation for serving as a director.

Non-executive director compensation is reviewed annually by the Nominating and Corporate Governance Committee to ensure that it is reasonable in light of the time required from directors and aligns directors’ interests with those of our stockholders.

In order to align the interests of our directors and the stockholders they represent, the Company divides the compensation of non-executive directors into cash and equity components.

We further align the interests of our directors with our stockholders by requiring that Directors own a minimum number of shares or Deferred Stock Units (“DSUs” and each a “DSU”). Each non-executive director must hold shares or DSUs with a value equal to three times the annual cash retainer. The shareholdings of each non-executive director are valued using either the closing price of our shares on December 31 each year or the value at the time they were acquired, whichever is greater. Directors have five years to meet the share ownership requirement. As of December 31, 2021, all of the current Directors have met their share ownership requirements with the exception of Alison Redford, who joined the Board on September 21, 2021 and has 5 years to meet the share ownership requirement.

Directors’ DSU Plan

The DSU plan allows directors to defer receipt of their fees and invest such deferred amounts in notional shares of Gran Tierra. Directors who have elected to be paid all or a portion of the annual retainer in DSUs receive their awards on a quarterly basis effective the first day of each quarter. The number of DSUs credited to each director is calculated by dividing the dollar value of the portion of the director’s retainer that he or she has elected to be paid in the form of DSUs by the fair market value of a common share of Gran Tierra on the day of determination. The DSUs vest immediately but are not paid out until the director ceases to be a director of Gran Tierra. The Board has discretion to settle the DSUs in common shares or in a cash amount equal to the market value of common shares at the time of settlement. DSUs are not shares and do not carry voting rights. DSUs received by directors in lieu of cash compensation and held by them represent an at-risk investment in Gran Tierra. The value of DSUs is based on the value of the common shares of Gran Tierra, and therefore is not guaranteed.

2021 Non-Executive Director Compensation

Annually, our Board of Directors reviews the competitiveness of our compensation program for non-executive directors. There were no changes to the Director compensation program in 2021.

The director compensation structure for non-executive directors as of January 1, 2021 is as follows:

 

     2021 Annual Cash Retainer
and Travel Fees
(1)
    

2021 Annual Equity Retainer

(DSUs, RSUs, Stock Options)  (1)

 

Board Chair

   $ 72,652      $ 149,230  

Board Member

   $ 43,198      $ 102,498  

Audit Committee Chair

   $ 35,344           

Other Committee Chairs

   $ 23,563           

Committee Members

   $ 11,781           

Travel Fee (over three hours) per meeting

 

   $ 1,178           
(1)

All compensation to non-employee directors is paid in Canadian dollars and converted into U.S. dollars for the purposes of the above table. The exchange rate at December 31, 2021 was one US dollar to Canadian $1.2678.

The cash retainer portion of the director’s fees can be taken in the form of cash, restricted stock units (“RSUs”), DSUs or any combination thereof, as elected by each non-employee director. The equity portion must be taken in the form of equity until the stock ownership guideline is achieved. A maximum of 25% of the equity retainer can be taken as stock options which vest immediately and expire after five years. DSUs vest immediately but are not paid out until the director ceases to be a director of Gran Tierra and RSUs vest and are paid out after three years. The number of DSUs, RSUs or stock options credited to each director is calculated by dividing the dollar value of the portion of the director’s retainer to be paid in the form of DSUs, RSUs or stock options by the fair market value on the day of determination. A travel fee is paid to each director for travel over three hours to a Board meeting.

 

   
Gran Tierra Energy 2022 Proxy Statement   29


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PROPOSAL 1: ELECTION OF DIRECTORS

 

 

Director Compensation Table

The following table shows for the fiscal year ended December 31, 2021, the value of amounts paid or granted to all non-employee directors of Gran Tierra.

 

     Fees Earned or
Paid in Cash
($)
(1)
     Equity Retainer     

All Other

Compensation
($) (4)

    

Total

($)

 
   Stock Awards (2)      Stock Options (3)  

Peter J. Dey

     90,708        77,201        25,709        0        193,618  

Evan Hazell

     90,708        83,634        19,284        1,183        194,810  

Robert B. Hodgins

     108,456        149,866        0        1,183        259,505  

Alison Redford

     20,377        31,814        27,957        1,183        81,331  

Ronald W. Royal

     90,708        77,201        25,709        1,183        194,801  

Sondra Scott

     136,358        45,908        0        1,183        182,639  

David P. Smith

     90,708        77,201        25,709        2,366        195,984  

Brooke Wade

     90,708        77,201        25,709        1,183        194,801  

 

(1)

Amounts reported in this column represent cash and committee retainers. Cash fees that were deferred by an election of a director and received in the form of DSUs (Stock Awards) are reported in the table below. All compensation to non-employee directors is paid in Canadian dollars and converted into U.S. dollars for the purposes of the above table. For 2021 compensation amounts, the exchange rate at December 31, 2021 of one U.S. dollar to Canadian $1.2678 is used.

 

     Cash Fees - Cash Retainer  
     Cash
($)
     Stock Awards (DSUs)  

Peter J. Dey

     0        90,708  

Evan Hazell

     35,248        55,460  

Robert B. Hodgins

     108,456        0  

Alison Redford

     14,411        5,965  

Ronald W. Royal

     0        90,708  

Sondra Scott

     136,358        0  

David P. Smith

     43,382        47,326  

Brooke Wade

     0        90,708  

 

(2)

Amounts in the Stock Awards column reflect the aggregate grant date fair value of DSUs computed in accordance with GAAP. The Company currently intends to settle the DSUs outstanding as of December 31, 2021 in cash, and, therefore, DSUs are accounted for as liability instruments. The amounts in this column include DSUs which were issued as a result of an election by the directors to be paid a portion of their retainer in the form of DSUs. The value ultimately realized by each director may or may not be equal to this determined value. As of December 31, 2021, each of the non-employee directors had aggregate outstanding DSUs as follows, all of which were fully vested: Mr. Dey – 932,079; Mr. Hazell – 774,268; Mr. Hodgins – 848,230; Ms. Redford – 41,861; Mr. Royal – 965,286; Ms. Scott – 755,787; Mr. Smith – 427,967; and Mr. Wade – 965,286. None of the directors hold RSUs.

 

(3)

Amounts in the Options Awards column reflect the aggregate grant date fair value computed in accordance with ASC 718. Assumptions made in the valuation of stock options granted are discussed in Notes 9 and 15 to Gran Tierra’s 2021 Consolidated Financial Statements, which can be found in Item 8 of the Form 10-K filed with the SEC on February 22, 2022.

 

(4)

Amounts reported in this column represent fees paid for travel to or from a meeting of the Board in excess of three hours per meeting

Director Share Ownership Requirements

Gran Tierra maintains a policy requiring directors to acquire common shares and/or DSUs equivalent in value to three times their annual cash retainer within five years from the date of first election to the Board. The following table sets out the non-executive director share ownership requirements for 2021.

 

     Ownership Requirement 2021

Board Chair

  

3x annual Board cash retainer fees in Common Shares and DSUs

3 X $72,652 = $217,955

Non-Executive Directors

  

3x annual Board cash retainer fees in Common Shares and DSUs

3 x $43,198 = $129,595

 

   
30   Gran Tierra Energy 2022 Proxy Statement


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PROPOSAL 1: ELECTION OF DIRECTORS

 

 

All of the Directors have met their share ownership requirements as of December 31, 2021 with the exception of Alison Redford, who joined the Board on September 21, 2021. She has until September 20, 2026 to meet the share ownership requirements.

 

Name

  

Common
Shares

(#)

    

DSUs

(#)

    

Total Value of
Common Shares
and DSUs
(1)

($)

    

Share
Ownership
Requirement

($)

     Share
Ownership
Achievement
 

Peter J. Dey

     20,000        932,079        723,580        129,595        Achieved  

Evan Hazell

     55,000        774,268        630,244        129,595        Achieved  

Robert B. Hodgins

     20,000        848,230        659,855        217,955        Achieved  

Alison Redford

     0        41,861        31,814        129,595        On Track  

Ronald W. Royal

     254,667        965,286        927,164        129,595        Achieved  

Sondra Scott

            755,787        574,398        129,595        Achieved  

David P. Smith

     555,000        427,967        747,055        129,595        Achieved  

Brooke Wade

     2,133,600        965,286        2,355,153        129,595        Achieved  

 

(1)

Based on the closing market price of the Company’s shares on December 31, 2021 of $0.76.

Prohibition on Hedging and Pledging

We maintain a policy for securities transactions applicable to all employees including officers, directors, and other members of management of the Company which prohibits engaging in short sales, transactions in put or call options, hedging transactions or other inherently speculative transactions with respect to our stock at any time. The policy also prohibits margining or pledging Company securities. In addition, our Insider Trading Policy, among other things, prohibits our officers, directors and employees from trading during quarterly and special blackout periods.

Directors’ and Officers’ Insurance

We maintain an insurance policy for directors’ and officers’ liability which provides coverage for costs incurred to defend and settle claims against directors or officers up to an annual limit of $50 million. The cost of coverage for 2021-2022 is approximately $877,940. Directors and officers do not pay any portion of the premiums. No claims were made or became payable in 2021.

 

   
Gran Tierra Energy 2022 Proxy Statement   31


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Audit-Related Matters

PROPOSAL 2: RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS

The Audit Committee of the Board believes that the continued retention of KPMG LLP to serve as the Company’s independent registered public accounting firm is in the best interests of the Company and its stockholders and has further directed that management submit the selection of KPMG LLP for ratification by the stockholders at the annual meeting.

Neither Gran Tierra’s Bylaws nor other governing documents or law require stockholder ratification of the selection of KPMG LLP as Gran Tierra’s independent registered public accounting firm. However, the Audit Committee of the Board is submitting the selection of KPMG LLP to the stockholders for ratification as a matter of good corporate practice. If the stockholders fail to ratify the selection, the Audit Committee of the Board will reconsider whether or not to retain that firm. Even if the selection is ratified, the Audit Committee of the Board in its discretion may direct the appointment of different independent auditors at any time during the year if it determines that such a change would be in the best interests of Gran Tierra and its stockholders.

Representatives of KPMG LLP are expected to be present at the annual meeting and will have an opportunity to make a statement and respond to appropriate questions from stockholders raised at the meeting.

THE BOARD UNANIMOUSLY RECOMMENDS A VOTE IN FAVOR OF PROPOSAL 2.

Audit Committee Report

The Audit Committee is a committee of the Board comprised solely of independent directors as required by the listing standards of the NYSE American and rules of the SEC. In accordance with the written Audit Committee Charter, the Audit Committee assists the Board in fulfilling its responsibility for oversight of the quality and integrity of the accounting, auditing and financial reporting practices or the Company.

The Audit Committee has reviewed and discussed the audited financial statements for the fiscal year ended December 31, 2021, with management of Gran Tierra and the independent registered public accounting firm. Management has the responsibility for the preparation of the Company’s financial statements, and the independent registered public accounting firm has the responsibility for the audit of those statements. The Audit Committee has discussed with the independent registered public accounting firm the matters required to be discussed by applicable standards of the Public Company Accounting Oversight Board (“PCAOB”) and the SEC. The Audit Committee has also received the written disclosures and the letter from the independent registered public accounting firm required by applicable requirements of the PCAOB regarding the independent accountant’s communications with the Audit Committee concerning independence, and has discussed with the independent registered public accounting firm the accounting firm’s independence. Based on the foregoing, the Audit Committee has recommended to the Board that the audited financial statements be included in Gran Tierra’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021, for filing with the Securities and Exchange Commission.

Respectfully submitted by the Audit Committee of the Board of Directors,

David P. Smith, Chair

Evan Hazell

Robert B. Hodgins

Alison Redford

Ronald W. Royal

 

   
32   Gran Tierra Energy 2022 Proxy Statement


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PROPOSAL 2: RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS

 

 

Principal Accountant Fees and Services

The Audit Committee is responsible for the audit fee negotiations associated with the retention of our independent registered public accounting firm. For the fiscal years ended December 31, 2021, and December 31, 2020, KPMG LLP served as our independent registered public accounting firm. The aggregate fees paid by the Company to KPMG LLP for professional services rendered in Gran Tierra’s last two fiscal years are as follows. In determining the independence of KPMG LLP, the Audit Committee considered whether the provision of non-audit services is compatible with maintaining KPMG LLP’s independence.

 

     Year Ended December 31,  

(Thousands of U.S. Dollars)

   2021      2020  

Audit Fees

   $ 819      $ 716  

Tax Fees (1)

     350        353  

All Other Fees

     0        4  

Total Fees

   $ 1,169      $ 940  

 

(1)

Included in Tax Fees are $92k fees related to tax compliance for 2021 (2020 - $116)

Audit Fees

Audit Fees are primarily for the annual audit of the Company’s consolidated financial statements included in the Form 10-K, including the audit of the effectiveness of the Company’s internal controls over financial reporting, the reviews of the Company’s financial statements included in the Forms 10-Qs, statutory audits, and other procedures required to be performed by the independent auditor to be able to form an opinion on the Company’s consolidated financial statements.

Tax Fees

Tax fees were for tax compliance, tax advice and tax planning.

All Other Fees

All other fees related to products and services provided by KPMG LLP other than those described as “Audit fees”, “Audit-related fees” and “Tax fees”.

All services described above were approved by the Audit Committee.

Pre-Approval Policies and Procedures

Our Audit Committee is responsible for the engagement of the independent auditors and for approving, in advance, all auditing services and permitted non-audit services to be provided by the independent auditors. The Audit Committee maintains a policy for the engagement of independent auditors that is intended to maintain the independence from Gran Tierra of the independent auditors. In adopting this policy, our Audit Committee considered the various services that independent auditors have historically performed or may be needed to perform in the future for Gran Tierra. Under this policy:

 

   

the Audit Committee approves the performance by the independent auditors of audit or permitted non-audit services, subject to restrictions in certain cases, based on the Audit Committee’s determination that such services would not be likely to impair the independence of the independent auditors from Gran Tierra;

 

   

Gran Tierra’s management must obtain the specific prior approval of our Audit Committee for each engagement of the independent auditors to perform any audit or permitted non-audit services; and

 

   

the performance by the independent auditors of certain types of services (bookkeeping or other services related to the accounting records or financial statements of Gran Tierra; financial information systems design and implementation; appraisal or valuation services, fairness opinions or contribution-in-kind reports; actuarial services; internal audit outsourcing services; management functions or human resources; broker or dealer, or investment adviser or investment banking services; legal services and expert services unrelated to the audit; and any other service that the applicable federal oversight regulatory authority determines, by regulation, is impermissible) is prohibited due to the likelihood that their independence would be impaired.

In its review of all non-audit service fees, our Audit Committee considers, among other things, the possible effect of these services on the independence of our independent auditors. Relevant considerations include, but are not limited to, whether the services are prohibited pursuant to SEC rules, whether the auditors are best positioned to provide the services, and the percentage of total services the non-audit services will comprise.

 

   
Gran Tierra Energy 2022 Proxy Statement   33


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PROPOSAL 2: RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS

 

 

Any approval required under this policy must be given by our Audit Committee or by the chairperson of the Audit Committee in office at the time, provided that any pre-approval decisions made by the chairperson must be reported to the Audit Committee at its next scheduled meeting. Gran Tierra’s Audit Committee will not delegate its responsibilities to approve services performed by the independent auditors to any member of management. All services rendered by KPMG LLP in 2021 were subject to our pre-approval policy.

 

   
34   Gran Tierra Energy 2022 Proxy Statement


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Proposal 3: Advisory Vote to Approve Named Executive Officer Compensation

Under the Dodd-Frank Wall Street Reform and Consumer Protection Act, and Section 14A of the Exchange Act, Gran Tierra’s stockholders are entitled to vote to approve, on an advisory basis, the compensation of Gran Tierra’s named executive officers as disclosed in this proxy statement in accordance with SEC rules. This vote is not intended to address any specific item of compensation, but rather the overall compensation of Gran Tierra’s named executive officers for the last completed fiscal year and the philosophy, policies and practices described in this proxy statement.

The compensation of Gran Tierra’s named executive officers subject to the vote is disclosed in the Compensation Discussion and Analysis, the compensation tables that follow, and the narrative disclosure related to such compensation tables contained in this proxy statement. As discussed in those disclosures, Gran Tierra believes that its compensation policies and decisions are consistent with current market practices and are focused on pay-for-performance principles that strongly align the interests of our named executive officers with those of our stockholders. Compensation of Gran Tierra’s named executive officers is designed to enable Gran Tierra to attract and retain talented and experienced executives to lead Gran Tierra successfully in a competitive environment.

Accordingly, the Board is asking the stockholders to indicate their support for the compensation of Gran Tierra’s named executive officers as described in this proxy statement in pages 39 to 49 by casting a non-binding advisory vote “FOR” the following resolution:

“RESOLVED, that the compensation paid to Gran Tierra’s named executive officers, as disclosed pursuant to Item 402 of Regulation S-K, including the Compensation Discussion and Analysis, compensation tables and narrative discussion related to such compensation tables in this proxy statement, is hereby APPROVED.”

Because the vote is advisory, it is not binding on the Board or Gran Tierra. Nevertheless, the views expressed by the stockholders, whether through this vote or otherwise, are important to management and the Board and, accordingly, the Board and the Compensation Committee intend to consider the results of this vote in making determinations in the future regarding executive compensation arrangements. Pursuant to Proposal 4, stockholders are being given the opportunity to indicate their preference on the frequency of future advisory votes to approve the compensation of the named executive officers. The Board is recommending that stockholders vote to hold such advisory vote on an annual basis. Therefore, unless the Company modifies its policy on the frequency of holding such a vote, the next non-binding advisory vote on the compensation of named executive officers is expected to occur in 2023.

THE BOARD UNANIMOUSLY RECOMMENDS A VOTE IN FAVOR OF PROPOSAL 3.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth certain information regarding the beneficial ownership of Gran Tierra common stock as of March 8, 2022 (unless otherwise indicated) by each person known by the Company to own beneficially more than 5% of the outstanding shares of the Company’s common stock.

 

Name of Person or Identity of Group

         

Amount and

Nature of
Beneficial

Ownership

     Percentage
of Class
(1)
 

Entities affiliated with GMT Capital Corp. (2)

              24,357,912        6.6

 

(1)

Based on 367,692,131 shares of common stock outstanding.

 

(2)

As of December 31, 2021, based upon information contained in a Schedule 13G/A filed with the SEC on February 10, 2022. GMT Capital Corp. has shared voting and dispositive authority with respect to 24,357,912 shares. The address of GMT Capital Corp. is 2300 Windy Ridge Parkway, Suite 550, South Atlanta, GA 30339.

 

   
Gran Tierra Energy 2022 Proxy Statement   35


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PROPOSAL 3: ADVISORY VOTE TO APPROVE NAMED EXECUTIVE OFFICER COMPENSATION

 

 

BENEFICIAL OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS

The following table sets forth certain information regarding the beneficial ownership of Gran Tierra common stock as of March 8, 2022 by (i) each named executive officer of Gran Tierra named on pages 37 and 38, (ii) each current director of Gran Tierra (including director nominees) and (iii) all of Gran Tierra’s executive officers and directors as a group as of March 8, 2022. Except as otherwise noted, the persons named in the table have sole voting and investment power with respect to all shares beneficially owned by them.

 

Name of Person

   Common
Stock
     Shares
Which
May Be
Acquired
Within 60
Days
(1)
     Total
Shares
Beneficially
Owned
(2)
     Percent of
Outstanding
Common
Stock
(3)
 

Peter J. Dey

     20,000        1,246,391        1,266,391        *  

Ryan Ellson (4) (5)

     578,711        940,959        1,519,670        *  

Jim Evans (4) (6)

     394,404        550,298        944,702        *  

Gary S. Guidry (4)

     3,817,626        1,365,440        5,183,066        1

Evan Hazell

     55,000        1,059,802        1,114,802        *  

Robert B. Hodgins

     20,000        914,929        934,929        *  

Alison Redford

     —          180,441        180,441        *  

Ronald W. Royal

     254,667        1,279,598        1,534,265        *  

Sondra Scott

     —          840,787        840,787        *  

David P. Smith (7)

     555,000        716,797        1,271,797        *  

Rodger Trimble

     277,461        417,711        695,172        *  

Brooke Wade (8)

     2,133,600        1,279,598        3,413,198        *  

Lawrence West

     350,000        550,298        900,298        *  
                                     

Directors and executive officers as a group (total of 13 persons)

                       19,799,518        5.4

 

*

Less than 1%.

 

(1)

Includes shares which may be acquired as of or within 60 days after March 8, 2022, upon the exercise of stock options and stock awards held by executive officers and directors.

 

(2)

Represents the total shares listed under the columns “Common Stock” and “Shares Which May Be Acquired Within 60 Days.” Under SEC rules, beneficial ownership as of any date includes any shares as to which a person, directly or indirectly, has or shares, voting power or dispositive power and also any shares as to which a person has the right to acquire such voting or dispositive power as of or within 60 days after such date through the exercise of any stock option or other right.

 

(3)

Based on 367,692,131 shares of common stock issued and outstanding as of March 8, 2022.

 

(4)

Includes the shares held by the Executive in the Company’s Employee Share Purchase Plan.

 

(5)

The number of common stock includes 30,000 shares owned by Mr. Ellson’s spouse.

 

(6)

The number of common stock includes 61,000 shares owned by Mr. Evans’ spouse.

 

(7)

The number of common stock includes 222,500 shares owned by Mr. Smith’s spouse.

 

(8)

The number of common stock includes 1,706,000 shares owned by Wade Capital Corporation, a corporation owned by Mr. Wade.

 

   
36   Gran Tierra Energy 2022 Proxy Statement


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PROPOSAL 3: ADVISORY VOTE TO APPROVE NAMED EXECUTIVE OFFICER COMPENSATION

 

 

EXECUTIVE OFFICERS

Our executive officers as of March 8, 2022, are as follows:

Name

   Age      Title

Gary S. Guidry

     66      President and Chief Executive Officer

Ryan Ellson

     46      Executive Vice President and Chief Financial Officer

James (“Jim”) Evans

     56      Vice President, Corporate Services

Rodger Trimble

     60      Vice President, Investor Relations

Lawrence West

     65      Vice President, Exploration

Gary S. Guidry. For the biography of Mr. Guidry, see “Proposal 1, Election of Directors.”

Ryan Ellson has been our Executive Vice President and Chief Financial Officer since May 2015. Mr. Ellson has over 22 years of experience in a broad range of international corporate finance and accounting roles. Mr. Ellson is currently a Director of PetroTal Corp. (since December 2017). From July 2014 until December 2014 Mr. Ellson was Head of Finance for Glencore E&P (Canada) Inc. and prior thereto Vice President, Finance at Caracal Energy Inc., a London Stock Exchange (“LSE”) listed company with operations in Chad, Africa from August 2011 until July 2014. Glencore E&P (Canada) purchased Caracal in July 2014. Prior to Caracal, Mr. Ellson was Vice President of Finance at Sea Dragon Energy from April 2010 until August 2011. In these positions, over his career, Mr. Ellson has been involved in raising over $2 billion in debt and equity, and over $3 billion in mergers and acquisitions. Mr. Ellson oversaw financial and accounting functions, implemented and oversaw internal financial controls, secured reserve based lending facility’s and was involved in multiple capital raises. Mr. Ellson has held management and executive positions with companies operating in Chad, Egypt, India and Canada. Mr. Ellson is a Chartered Professional Accountant and holds a Bachelor of Commerce and a Master of Professional Accounting from the University of Saskatchewan. Mr. Ellson has completed the Leadership for Senior Executives program at Harvard Business School and multiple executive education programs at The Wharton School of the University of Pennsylvania.

James Evans has been our Vice President, Corporate Services since May 2015. Mr. Evans has over 28 years of finance and corporate experience including working the last 13 years in the international oil and gas industry. Most recently, Mr. Evans was the Head of Compliance & Corporate Services for Glencore E&P (Canada), an oil and gas company, from July 2014 to December 2014, and prior thereto Vice President of Compliance & Corporate Services at Caracal Energy, an international oil and gas company, from July 2011 to June 2014, in each case where he oversaw the execution of corporate strategy and goals, developed and implemented a robust corporate compliance program, and managed all aspects of information technology, document control, security and administration. Mr. Evans also managed the recruitment, training and retention of staff in both Calgary and Chad. He oversaw the growth of Caracal Energy from seven employees to more than 400 employees as Caracal Energy exceeded 20,000 barrels of oil per day at the time of sale to Glencore. Prior to Caracal, Mr. Evans held senior management and executive positions at Orion Oil and Gas and Tanganyika Oil, with operating experience in Egypt, Syria and Canada. Mr. Evans holds a Bachelor of Commerce degree from the University of Calgary.

Rodger Trimble has been our Vice President, Investor Relations since June 2016. Mr. Trimble is a Professional Engineer with over 28 years of experience in domestic and international basins in various management positions. Prior to joining Gran Tierra, Mr. Trimble was Head of Corporate Planning, Budgeting & Finance with Glencore E&P (Canada) Inc., an oil and gas company. In January 2013, Mr. Trimble became Director Corporate Planning, Budget & Business Development with Caracal Energy Inc., an international oil and gas company, which was acquired by Glencore E&P (Canada) in July 2014. He has held several senior management positions ranging from Country Manager in Argentina with Canadian Hunter Exploration, Vice President, Exploitation with Esprit Energy Trust, Manager, Reservoir Engineering with Apache Canada Inc. and Manager, Upstream Evaluations—Frontiers & International with Husky Energy. Mr. Trimble is an Alberta-registered Professional Engineer and a member of APEGA. He received a Bachelor of Science in Petroleum Engineering (with Distinction) from Stanford University.

Lawrence West has been our Vice President, Exploration since May 2015. Mr. West has over 35 years of experience as an executive, explorationist, and geologist. Most recently, Mr. West was Vice President, Exploration at Caracal Energy, an international oil and gas company, from July 2011 to June 2014. Mr. West built a multi-disciplinary team to assess resources and grow reserves in the interior rift basins within Chad and led a successful exploration program. During his tenure he successfully executed two large 2D/3D seismic shoots in remote frontier basins, on time and on budget. Prior to Caracal he has been involved in starting and growing several public and private companies, including Reserve Royalty Corp., Chariot Energy, Auriga Energy and Orion Oil and Gas. Lawrence worked at Alberta Energy Company (“AEC”), where he was on the team that merged with Conwest. He built and led the

 

   
Gran Tierra Energy 2022 Proxy Statement   37


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PROPOSAL 3: ADVISORY VOTE TO APPROVE NAMED EXECUTIVE OFFICER COMPENSATION

 

 

AEC East team to the Rocky Mountain USA basins. His career began with Imperial Oil working on prospect and reservoir characterization, in multi-disciplinary teams, and as a technical mentor to exploration teams. Mr. West has an Honours Bachelor of Science in Geology from McMaster University and an MBA, specializing in economics, from the University of Calgary.

 

   
38   Gran Tierra Energy 2022 Proxy Statement


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Compensation Discussion and Analysis

 

 

The following discussion provides details regarding our executive compensation program and 2021 compensation arrangements for each of our Named Executive Officers (“NEOs”) who, in 2021 were:

Gary S. Guidry

President and Chief Executive Officer

Ryan Ellson

Executive Vice President and Chief Financial Officer

Jim Evans

Vice President, Corporate Services

Rodger Trimble

Vice President, Investor Relations

Lawrence West

Vice President, Exploration

 

   

COMPENSATION DISCUSSION AND ANALYSIS

     39  

Philosophy and Objectives of our Executive Compensation Program

     39  
   

Responsibilities for Executive Compensation

     40  
   

Assessment of Company Performance

     40  
   

Role of the Independent Compensation Consultant

     41  
   

Risk Considerations

     41  
   

Compensation Peer Group – 2021

     41  
   

Elements of Our Compensation Program

     42  
   

Base Salary

     42  
   

Short Term Incentives – Cash Bonus

     42  
   

Assessment of Individual Performance

     43  
   

2021 Corporate Performance Goals and Scores

     43  
   

Actual Annual Cash Bonuses Earned for 2021

     44  
   

Long-Term Equity Incentive Program

     44  
   

2021 PSUs Granted

     44  
   

Stock Options

     46  
   

Equity Awards Granted During 2022

     47  
   

Benefits

     47  
   

Share Ownership Guidelines

     47  
   

Clawback Provisions

     48  
   

Prohibition on Speculative Trading of Company Stock

     48  
   

Employment Agreements

     48  
   

Say on Pay Advisory Vote on Executive Compensation

     48  
   

Report of the Compensation Committee

     49  
 

 

Philosophy and Objectives of our Executive Compensation Program

Our compensation philosophy is to provide an attractive, flexible, and market-based total compensation program that is tied to performance and aligns the interests of our NEOs with those of our stockholders. The Company’s objective is to recruit and retain the caliber of executive officers and other key employees necessary to deliver sustained high performance to our stockholders as well as economic growth and respect for the communities in which we have a strong presence. Our compensation philosophy also serves as a means of communicating our goals and standards of conduct and performance, and for motivating and rewarding our NEOs in relation to their achievements. Our compensation philosophy includes the principles described below:

 

   

Hire and retain top caliber and highly capable executives: Executive officers should have a total compensation package that is market competitive and permits us to hire and retain high-caliber individuals at all levels.

 

   

Pay for performance: A significant portion of the annual compensation opportunity for our executive officers should be directly tied to the achievement of key operational and financial measures aligned with our strategy, relative TSR and our share price performance. Directly linking pay with our performance is essential to delivering long-term value to our stockholders.

 

   

Create Stockholder Alignment: A significant portion of compensation should be variable (at risk) and equity-based. Executives are also required to meet significant share-ownership guidelines.

 

   
Gran Tierra Energy 2022 Proxy Statement   39


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COMPENSATION DISCUSSION AND ANALYSIS

 

 

Responsibilities for Executive Compensation

Compensation decisions for our executive officers are made by the Compensation Committee, with input from our independent compensation consultants as well as from our Chief Executive Officer. The specific roles are summarized below:

 

   

Compensation Committee

  

   Oversees compensation policies, plans and programs, reviews and determines the compensation to be paid to our executive officers and directors annually.

 

   Oversees our annual and long-term incentive plans and programs and periodically assesses our non-employee director compensation program.

 

   Approves the goals of our Chief Executive Officer, evaluates our Chief Executive Officer’s performance in light of those goals and objectives and recommends to the Board the approval of the Chief Executive Officer’s annual compensation.

 

   Together with our Chief Executive Officer, reviews and approves the corporate performance goals and objectives of our other NEOs and recommends to the Board the approval of the annual compensation package for the other NEOs.

 

   Holds executive sessions with no management present.

Board

  

   Reviews Chief Executive Officer’s performance.

 

   Approves Chief Executive Officer and NEO compensation.

Independent Compensation Consultants

  

   Provides the Compensation Committee with independent advice concerning the types and levels of compensation to be paid to our Chief Executive Officer and the other NEOs.

 

   Provides market compensation data (e.g., industry compensation surveys and benchmarking data) on base salary, annual incentives and long-term incentives and industry trends.

Chief Executive Officer

  

   Reviews performance of other NEOs with the Compensation Committee.

 

   Makes recommendations on base salary, annual bonus and long-term incentives awards for the other NEOs.

The Board and the Compensation Committee hold regular executive sessions at the end of each meeting with no representatives of the management team present. Our Chief Executive Officer does not attend any portion of the Compensation Committee or Board meeting at which his compensation is deliberated or approved. Except as described in the table above, our Chief Executive Officer does not play any role with respect to any matter affecting his own compensation.

The agenda for each meeting is usually developed by the Chair of the Compensation Committee, in consultation with the Chief Executive Officer. From time to time, various members of management and other employees as well as outside advisors or consultants may be invited by the Compensation Committee to make presentations, to provide financial or other background information or advice or to otherwise participate in Compensation Committee meetings. Under the charter, the Compensation Committee has the authority to obtain, at the expense of Gran Tierra, advice and assistance from compensation consultants, internal and external legal, accounting or other advisors and other external resources that the Compensation Committee considers necessary or appropriate in the performance of its duties. The Compensation Committee has direct responsibility for the oversight of the work of any advisers engaged for the purpose of advising the Compensation Committee and may amend the engagement with or terminate any such advisor as it deems necessary or appropriate.

The Compensation Committee and the Board make their compensation decisions for the upcoming year, and review performance for the prior year, generally in the first quarter of the year. For example, annual bonuses in respect of 2021 performance were recommended by the Compensation Committee and approved by the Board in January of 2022.

Assessment of Company Performance

The Compensation Committee uses Company performance measures to establish total compensation ranges relative to our performance and the performance of our comparator groups as outlined on the following page. In addition, the Compensation Committee establishes specific performance measures that determine payouts under cash and equity-based incentive programs.

 

   
40   Gran Tierra Energy 2022 Proxy Statement


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COMPENSATION DISCUSSION AND ANALYSIS

 

 

Role of the Independent Compensation Consultant

When making determinations regarding executive compensation, the Compensation Committee considers advice from external advisors and third-party compensation surveys as well as the advice of Compensation Committee members and other members of the Board based on their knowledge and experience to set competitive, results driven levels of salary and other compensation.

The Compensation Committee may, in its sole discretion, retain or obtain the advice of independent compensation consultants or other external advisors and is directly responsible for the appointment, compensation arrangements and oversight of the work of any such person. The retention of independent compensation consultants and scope of services provided by them are assessed on an annual basis.

The Compensation Committee may select a compensation consultant only after taking into consideration all factors relevant to that person’s independence from management. We will provide appropriate funding, as determined by the Compensation Committee, for payment of reasonable compensation to any independent compensation consultants or other external advisors retained by the Compensation Committee.

Risk Considerations

The Compensation Committee and the Board periodically review the risks associated with our compensation policies and practices. These assessments include an examination of the changes in our risk profile over the past year for our compensation policies and practices. Based on this assessment, the Compensation Committee and the Board each determined that these risks were not reasonably likely to have a material adverse effect on us. Among other things, the Compensation Committee and the Board took into consideration the fact that:

 

   

the current significant weighting towards long-term incentive compensation, the value of which depends on the value of our shares, discourages short-term risk taking;

 

   

our annual incentive compensation program includes several different metrics, preventing NEOs from focusing on one metric at the exclusion of other important performance goals;

 

   

our compensation program is appropriately balanced such that if annual bonus targets are not achieved, base pay and long-term incentive compensation will still provide the executives with a reasonable amount of compensation;

 

   

stock options and PSUs for executives vest over three years, which discourages short-term risk taking;

 

   

our clawback policy permits us to recover executive compensation in the case of fraud or intentional misconduct requiring a material restatement of financial results;

 

   

stock ownership guidelines encourage a long-term perspective by our executives; and

 

   

incentive awards are decided by the Compensation Committee and recommended to the Board for approval.

Compensation Peer Group – 2021

The following is our peer group for executive compensation purposes. The companies in the executive compensation peer group were selected with the assistance of our independent compensation consultants. companies that are of similar size as Gran Tierra, are in the same line of business, and are listed on a major exchange in Canada or the United States. We included companies with and enterprise value of at least $0.7 billion and Working Interest production before royalties of 20,000+ BOEPD.

 

   

Athabasca Oil Corporation

   Baytex Energy Corp.

Bonavista Energy Corporation

   Frontera Energy Corporation

Denbury Resources Inc.

   Kosmos Energy Ltd.

Civitas Resources Inc. (Formerly Extraction Oil & Gas, Inc.)

  

Matador Resources Company

Geopark Limited

  

Parex Resources Inc.

Laredo Petroleum, Inc.

  

Whitecap Resources Inc.

Paramount Resources Ltd.

    

Transglobe Energy Corporation

    

The Company has a separate peer group for evaluating performance which is further explained on page 45.

 

   
Gran Tierra Energy 2022 Proxy Statement   41


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COMPENSATION DISCUSSION AND ANALYSIS

 

 

Elements of Our Compensation Program

Our executive compensation program includes a mix of fixed and variable pay with performance periods ranging from one to five years. The primary elements are summarized in the table below:

 

Compensation

   Fixed/Variable    Cash/Equity    Time Period    Goal

Base Salary

   Fixed    Cash    1 year    Provide fixed level of income

Short-term Incentive

   Variable    Annual cash bonus    1 year    Reward contribution to annual corporate and individual performance

Long-term Incentive

   Variable   

PSUs

Stock options

  

3 years

5 years

   Reward medium and long-term performance and align interests of management and stockholders

Base Salary

We pay base salaries in order to attract and retain talented executives and to provide our NEOs with a fixed base of cash compensation. The salaries typically reflect each NEO’s experience, skills, knowledge and responsibilities. Competitive market conditions also have an impact on setting salary levels. The salaries of our NEOs are reviewed on an annual basis by our Chief Executive Officer (other than with respect to his own salary, which is reviewed and determined by the Compensation Committee). There were no changes to our NEO’s salaries from 2020 to 2021.

 

Name

   2021 Base Salary  (1)
($)
   2020 Base Salary  (1)
($)
   % Change 2020-2021  

Gary S. Guidry

   $473,261    $473,261    0  

Ryan Ellson

   $335,226    $335,226    0  

Jim Evans

   $295,788    $295,788    0  

Rodger Trimble

   $236,630    $236,630    0  

Lawrence West

   $295,788    $295,788    0  

 

(1)

For ease of comparison, amounts reported in this column are converted from Canadian dollars to U.S. dollars at the exchange rate of 1.2678 at December 31, 2021.

Short Term Incentives – Cash Bonus

One of our key compensation objectives is for a significant portion of each NEO’s compensation to be tied to Company performance. Our annual cash bonus plan provides opportunities for our executives, including the NEOs, to earn annual cash bonuses tied to the successful achievement of key operational, financial and market objectives that drive our business and stockholder value.

In January 2021, the Compensation Committee approved the annual bonus target for each of our NEOs which were calculated as a percentage of their respective base salaries.

The value of the bonus is calculated as below:

 

Bonus Payment Amount

   =    Salary    x    Bonus
Target %
  x    (    Individual
Weighting

x

Individual
Rating

   +    Corporate
Weighting

x

Corporate
Rating

  

)

 

   
42   Gran Tierra Energy 2022 Proxy Statement


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COMPENSATION DISCUSSION AND ANALYSIS

 

 

The following bonus structure was approved by the Compensation Committee for the following executives in connection with 2021 performance which was unchanged from the previous year:

 

Name

   Target Payout as a % of
Base Salary
    Corporate Performance
Weighting
    Individual Performance  
Weighting
 
 

Gary S. Guidry

     100     100    
 

Ryan Ellson

     80     80     20
 

Jim Evans

     50     60     40
 

Rodger Trimble

     50     60     40
 

Lawrence West

     50     60     40

Assessment of Individual Performance

Individual performance has a significant impact on the annual cash bonus for NEOs other than the Chief Executive Officer and is weighted between 20% and 40% of the award with the remaining amount being driven by our performance relative to our corporate performance measures. The individual performance rating for each NEO, other than the Chief Executive Officer, is determined through a formal performance evaluation conducted with the Chief Executive Officer. The performance evaluation measures how each NEO performs against criteria directly related to their position.

2021 Corporate Performance Goals and Scores

Results between the Company’s Corporate Target can be interpolated on a linear basis. The lower number results in a multiplier of 0, middle results in a multiplier of 1 and the upper threshold is a multiplier of 2.

 

Target    Unit    Corporate
Target
     Weighting         Score    

Operational

                          
WI Production    kboepd      27 – 29 – 31        15%     0%
1P FD&A Costs (1)    $/boe      18 – 15 –12        10%     0%
1P Reserve Replacement Ratio (2)    %      85 – 100 – 115        15%     30%

Financial

                          
G&A (gross, excluding bonus)    $MM      51 – 43 – 35        10%     6%
Lifting Costs /boe (3)    $/boe      12 – 10 – 8        10%     4%
Total Workovers Costs    $MM      51 – 43 – 35        10%     0%
Funds Flow (4)    $MM      140 – 160 –180        10%     20%

Market

                          
Generate Free Cash Flow    $MM      10 – 20 –30        10%     20%

Strategic

                          
Farm out/Diversification/Asset sale    $MM      25.00        10%     20%
2021 Performance Factor                          100%

 

(1)

FD&A costs are calculated as estimated exploration and development capital expenditures in Colombia, divided by the applicable reserves additions both before and after changes in FDC.

 

(2)

1P reserves have been calculated in compliance with NI 51-101 and COGEH and are based on the GTE McDaniel Reserves Report. See “Disclosure of Oil and Gas Information” for important information.

 

(3)

Lifting Costs include production and transportation expenses.

 

(4)

Free Cash Flow equals funds from operations less capital expenditures before exploration expense and before STIP payment.

 

   
Gran Tierra Energy 2022 Proxy Statement   43


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COMPENSATION DISCUSSION AND ANALYSIS

 

 

Actual Annual Cash Bonuses Earned for 2021

The following table shows the 2021 annual cash bonus awards earned by each NEO:

 

     2021 Base Salary ($)      Target Payout as a
% of Base Salary
     2021 Cash Bonus
Awarded ($)
(1)
     2021 Cash Bonus  
(% of Base Salary)  
 

Gary S. Guidry

     473,261        100%        473,261        100    

Ryan Ellson

     335,226        80%        294,999        88    

Jim Evans

     295,788        50%        163,275        55    

Rodger Trimble

     236,630        50%        118,315        50    

Lawrence West

     295,788        50%        148,288        50    

 

(1)

2021 Cash Bonuses are payable on March 15, 2022

Long-Term Equity Incentive Program

Our equity compensation program has been designed to incorporate equity awards that vest based on the achievement of key operational goals established by the Board of Directors as described below. Approximately 80% of the value of equity awards granted in 2021 consisted of PSUs and 20% of the value of equity awards consisted of stock options, based on the fair value at grant date.

2021 PSUs Granted

As part of our long-term incentive plan, PSUs are designed to create a link between executive compensation and increased stockholder value by rewarding NEOs for achievement against key performance metrics over a three-year period. Our goal is to further incentivize our executives to achieve the operational goals established by the Board and to increase share and net asset value for our stockholders.

Each PSU entitles the holder to be issued the number of common shares designated in the performance award multiplied by a payout multiplier, with such common shares (or cash equal in value to such shares) to be issued on dates determined by the Compensation Committee, but no later than March 10 of the year following the year in which the last performance period applicable to the award ends. The payout multiplier is dependent on the performance of the Company relative to pre-defined corporate performance measures for the period. The number of PSUs that vest may range from zero to 200% of the target number granted based on the performance multiplier earned under the terms of the award agreement. Each recipient must also remain in the continuous service of Gran Tierra from the date of grant through the date of settlement in order for the award to vest. PSUs are granted annually.

The PSUs granted to our NEOs in 2021 may become fully vested at the end of the three-year performance period, based upon our performance with respect to four separate performance periods as follows:

 

Performance Period

   Percentage of Target Award Subject to Performance Period       

January 1, 2021—December 31, 2021

     20

January 1, 2022—December 31, 2022

     20

January 1, 2023—December 31, 2023

     20

January 1, 2021—December 31, 2023

     40
       100

The calculation of the performance multiplier is as follows:

 

   

50% weighting: Gran Tierra’s Total Shareholder Return (“TSR”) relative to that of peer companies;

 

   

25% weighting: Gran Tierra’s Financial Covenant Compliance and Free Cash Flow; and

 

   

25% weighting: execution of strategy (as determined by the Board).

Total Shareholder Return. The Compensation Committee believes that the comparison of Gran Tierra’s TSR over a specified period of time to the returns of peer companies over the same period is an objective external measure of the Company’s effectiveness in translating its results into stockholder returns. TSR is calculated by comparing Gran Tierra’s change in share price

 

   
44   Gran Tierra Energy 2022 Proxy Statement


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COMPENSATION DISCUSSION AND ANALYSIS

 

 

plus reinvestment of dividends relative to the performance of a pre-selected peer group of companies with respect to the same measures. The framework included in the table below is used in determining our relative TSR. Results between the performance levels are interpolated on a linear basis.

 

Performance Level

   Annualized TSR
Above/Below Median
of Peers
    Payout Multiplier  
  (% of the Target Award)  

Threshold

   -15%   0

Target

   At median   100

Maximum

   20%   200

The Compensation Committee approved the following total shareholder return performance peer group (the “Performance Peer Group”) for the 2021 PSUs:

 

   

Baytex Energy Corp.

   Obsidian Energy Ltd. (formerly Penn West Petroleum Ltd.)

Callon Petroleum Company

  

Parex Resources Inc.

Canacol Energy Ltd.

  

Tamarack Valley Energy Ltd.

Crescent (Formerly Contango Oil & Gas Company)

   TransGlobe Energy Corp.

Kosmos Energy Ltd.

  

W&T Offshore Inc.

Matador Resources Company

    

Frontera Energy Corporation (formerly Pacific Exploration & Production Corp.)

    

If any of the peer companies undergoes a change in corporate capitalization or a corporate transaction (including, but not limited to, a going-private transaction, bankruptcy, liquidation, merger or consolidation) during the performance period, the Compensation Committee will undertake an evaluation to determine whether such peer company will be replaced.

The Performance Peer Group was developed with the assistance of our independent compensation consultants to meet at least one of the following specifications: an enterprise value of at least $1 billion; Proved Reserves of 30 million BOE; WI production before royalties of 20,000+ BOEPD; production to be at least 50% oil and natural gas liquids. Enterprise value was calculated as the market value of our common stock plus the market value of debt minus cash and investments.

Financial Covenant Compliance and Free Cash Flow. The Company has a number of financial covenants that it must stay in compliance with in order to maintain good standing with its lenders. The Company must also generate Free Cash Flow calculated as funds from operations less capital expenditures before exploration expense and before STIP payment. Free Cash Flow was chosen as a performance metric for our PSUs because it provides an indication of the ability of the Company to execute its exploration program and paydown its debt. Financial covenant compliance and free cash flow demonstrates the Company’s ability to increase the underlying value of the Company without risking stockholder value and diluting stockholders. The framework included in the table below is used to assess Financial Covenant Compliance and Free Cash Flow performance. Results between the performance levels are interpolated on a linear basis.

 

Financial Covenant Compliance

         

Performance Level

   Financial Covenant
Compliance
     Payout Multiplier  
  (% of the Target Award)  

Threshold

   non-compliance    0

Target

   compliance    200

Free Cash Flow

     

Performance Level

  

Free cash flow

measured at end
of year

     Payout Multiplier  
  (% of the Target Award)  

Threshold

   less than $10mm    0

Target

   $20mm    100

Maximum

   Greater than $30mm    200

 

   
Gran Tierra Energy 2022 Proxy Statement   45


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COMPENSATION DISCUSSION AND ANALYSIS

 

 

Strategy. Execution of strategy was chosen as a performance metric for our PSUs because it provides a link to the Company’s success in meeting key milestones and achieving its strategic goals. The Strategic Goals included metrics set by the Compensation Committee relating to acquisitions, exploration discoveries, financing and exploration commitments which have been included in the Company’s annual budget and subsequently approved by the Board.

The following table lists the number of PSUs awarded in 2021 at minimum, target, and maximum levels:

 

     Minimum # of units      Target # of units      Maximum # of units  

Gary S. Guidry

     0        1,631,068        3,262,136  

Ryan Ellson

     0        1,114,563        2,229,126  

Jim Evans

     0        650,485        1,300,970  

Rodger Trimble

     0        466,019        932,038  

Lawrence West

     0        650,485        1,300,970  

2021 Performance Results. In January 2022, the Compensation Committee confirmed and approved the performance results for the portion of the 2021 annual PSU awards that vest based on performance during the one-year performance period ended December 31, 2021 and continued employment through the end of 2021.

For the performance period ended December 31, 2021, the performance results were as follows:

 

    2021 Performance
Factor Level
  Weighting    Payout Multiplier

TSR – Relative TSR above or below median of peers

  Above Target   50%    1.00

Financial Covenant Compliance and Free Cash Flow

  Above Target   25%    0.50

Strategy Achievement

  Above Target   25%    0.50

Total Multiplier

           2.0

The PSUs granted in 2019 vested on December 31, 2021 and the calculation of the performance multiplier for the three-year period is as follows:

 

Year

   Performance Multiplier    Weighted Contribution

2019

   0.09    0.02

2020

   0.50    0.10

2021

   2.00    0.40

Three-Year

   0.53    0.21

TOTAL MULTIPLIER

        0.73

Stock Options

Stock options provide NEOs with an option to purchase Gran Tierra common shares at a future date at the exercise price determined at the time of grant.

Our Compensation Committee and Board continues to believe that time-vested stock options are an important element of our equity compensation program because they serve as a strong retention tool while ensuring that the recipient only receives value upon an increase in the value of our common stock. Stock options within the LTIP mix account for 20% of the value of equity awards granted, based on the grant date fair value.

Stock options vest pro-rata annually over three years, beginning with the first anniversary of the date of grant, and have a term of five years, subject to the officer’s continuous provision of services to Gran Tierra through the vesting date (except as otherwise provided in an officer’s award agreement or any employment agreement with Gran Tierra). The exercise price for our stock options is equal to the market price per share at the time of grant. The Compensation Committee meets in the first quarter each year to evaluate, review and approve the annual stock option award design and level of awards for the NEOs.

 

   
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COMPENSATION DISCUSSION AND ANALYSIS

 

 

Equity Awards Granted During 2022

In 2022, the Compensation Committee approved the following awards under our 2007 Equity Incentive Plan for the NEOs:

 

    

Total LTI
Grant Date
Fair Value

($)

     PSUs      Stock Options  
     Target # of
PSUs
     Grant Date
Fair Value
($)
(1)
     # of options     

Grant Date
Fair Value

($) (1)

 

Gary S. Guidry

     1,670,297        1,631,068        1,337,476        688,525        332,821  

Ryan Ellson

     1,141,369        1,114,563        913,942        470,492        227,427  

Jim Evans

     666,130        650,485        533,398        274,590        132,732  

Rodger Trimble

     477,227        466,019        382,136        196,721        95,091  

Lawrence West

     666,130        650,485        533,398        274,590        132,732  

 

(1)

The grant date fair value reported in this column is calculated in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718 Compensation—Stock Compensation (“ASC 718”).

Benefits

The NEOs are eligible for full participation in all rights and benefits under any life insurance, disability, medical, dental, health and accident plans maintained by Gran Tierra for its employees and executive officers. Our executive officers generally do not receive any supplemental retirement benefits or perquisites, except for corporate health services and other limited perquisites provided on a case-by-case basis. In addition, our employees including our executive officers will be paid 100% of their base salary in the event they become disabled while still employed by us, until such time as the executive officer begins to receive long-term disability insurance benefits which are intended to pay two-thirds of base salary to a maximum of $15,000/month to age 70. These are standard basic benefits in our industry and help to retain and recruit key talent. In addition, the NEOs are eligible to participate in the Company’s Employee Share Purchase Plan which allows employees to contribute up to 10% of their gross salary which is then matched by the Company and used to purchase undiscounted shares.

Share Ownership Guidelines

We have implemented share ownership guidelines for all of our executives, which are designed to align their long-term financial interests with those of our stockholders. The NEO share ownership guidelines are as follows:

 

Position

   Guideline     Ownership Relative to 
Base Salary as of 
December 31, 2021 

Chief Executive Officer

   3 X base salary    Exceeds

Chief Financial Officer

   2 X base salary    Exceeds

Other NEOs

   1 X base salary    Exceeds

If at any time an executive officer does not meet their ownership requirement, they must retain (a) any of our Common Stock owned by them (whether owned directly or indirectly) and (b) any net shares received as the result of the exercise, vesting or payment of any equity award until the ownership requirement is met, in each case unless otherwise approved by the Compensation Committee. For this purpose, “net shares” means the shares of stock that remain after shares are sold or withheld to (i) pay the exercise price for a stock option award or (ii) satisfy any tax obligations, including withholding taxes, arising in connection with the exercise, vesting or payment of an equity award.

Compliance with these requirements is evaluated as of December 31 of each year. The value of an individual’s share ownership as of such date is determined by multiplying the number of shares of our stock or other eligible equity interests held by the individual by the greater of the purchase price of the stock or the closing price on December 31 of each year.

In determining stock ownership levels, we include shares of common stock held directly or indirectly by the officer (including shares beneficially owned in a trust, by a limited liability company or partnership, and by a spouse and/or minor children). Outstanding RSUs, PSUs and unexercised stock options are not included. If an executive officer does not satisfy the stock ownership requirements, they must retain all shares acquired on the vesting of equity awards or the exercise of stock options (net of exercise costs and taxes) until compliance is achieved.

 

   
Gran Tierra Energy 2022 Proxy Statement   47


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COMPENSATION DISCUSSION AND ANALYSIS

 

 

The following table shows the number and value of shares owned at December 31, 2021 compared with the minimum share ownership guideline:

 

     Number of
Shares
Owned as of
December 31,
2021
(1)
     Value of
Shares
owned as of
December 31,
2021
(2)
     Value of
Shares
Based on
Original
Purchase
Price
     Minimum
Ownership
Per
Guideline
 

Gary S. Guidry

     3,802,692      $ 2,890,046      $ 8,086,138      $ 1,419,782  

Ryan Ellson

     568,133      $ 431,781      $ 941,674      $ 670,453  

Jim Evans

     389,738      $ 296,201      $ 824,901      $ 295,788  

Rodger Trimble

     269,994      $ 205,195      $ 315,380      $ 236,630  

Lawrence West

     350,000      $ 266,000      $ 809,034      $ 295,788  

 

(1)

Includes shares held by the NEO in the Company’s Employee Share Purchase Plan.

 

(2)

Value is calculated based on the closing price of the Company’s shares on the NYSE American on December 31, 2021, which was $0.76.

Clawback Provisions

The Company has adopted a policy specifying that if an executive engages in fraud or intentional misconduct that requires a material restatement of financial results, and the fraud or intentional misconduct results in an incorrect determination that an incentive compensation performance goal had been achieved, the Board may take action to recover any incentive compensation resulting from the incorrect determination that had been paid to the executive during the three-year period preceding the filing of the accounting restatement.

Prohibition on Speculative Trading of Company Stock

We maintain a policy for securities transactions applicable to all employees including officers, directors, and other members of management of the Company which prohibits engaging in short sales, transactions in put or call options, hedging transactions or other inherently speculative transactions with respect to our stock at any time. The policy also prohibits margining or pledging Company securities. In addition, our Insider Trading Policy, among other things, prohibits our officers, including our NEOs, directors and employees from trading during quarterly and special blackout periods.

Employment Agreements

The Compensation Committee approves the terms of all NEO employment agreements. The terms of those agreements were structured to attract and retain persons key to our success, as well as to be competitive with compensation practices for executives in similar positions at companies of similar size and complexity. In assessing whether the terms of the employment agreements were competitive, the Compensation Committee received advice from our independent compensation consultant and reviewed appropriate surveys and industry benchmarking data. The employment agreements do not have a fixed term. No changes were made to any of the NEO employment agreements already in place during 2021. The terms of the NEO employment agreements provide for certain payments and benefits in connection with a termination of employment and corporate transaction. The Compensation Committee believes these payments allow management to focus their attention and energy on making objective business decisions that are in the best interests of stockholders without allowing personal considerations to affect the decision-making process. Additionally, executive officers at other companies in our industry and the general market in which we compete for executive talent commonly provide post-termination payments, and we have consistently provided this benefit to certain executives in order to remain competitive in attracting and retaining skilled professionals in our industry. In 2017, the Company’s pay practices were amended so that no new employment agreements entered into between Gran Tierra and executive officers will include any provisions that provide for excise tax gross-ups or change in control “Single” or “Modified Single” triggers of severance payments or equity vesting accelerations.

Say on Pay Advisory Vote on Executive Compensation

The Company asked stockholders to vote on a “say-on-pay” advisory vote on our executive compensation in 2021 at the 2021 annual meeting of stockholders. Stockholders expressed support for the compensation of our named executive officers, with

 

   
48   Gran Tierra Energy 2022 Proxy Statement


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COMPENSATION DISCUSSION AND ANALYSIS

 

 

approximately 83.5% of the votes cast in favor of the “say-on-pay” advisory vote. Given the stockholders support, the Company did not make any significant changes to our compensation programs in 2021 as a result of the “say-on-pay” advisory vote. The Compensation Committee also considers many other factors in evaluating our executive compensation programs as discussed in this Compensation Discussion and Analysis, including the Compensation Committee’s assessment of the interaction of our compensation programs with our corporate business objectives and review of peer group data, each of which is evaluated in the context of the Compensation Committee’s duty to act in the best interests of our stockholders.

Tax Considerations

Following the enactment of the Tax Cuts and Jobs Act, compensation in excess of $1 million earned by our executive officers who are subject to Section 162(m) of the Internal Revenue Code is not deductible. The Compensation Committee has the discretion to approve, and we will continue to pay, compensation that will not be deductible for federal income tax purposes. Consistent with our compensation philosophy, we currently expect that we will continue to structure our executive compensation program so that a significant portion of total executive compensation is linked to the performance of our company.

REPORT OF THE COMPENSATION COMMITTEE

The Compensation Committee has reviewed and discussed with management the Company’s disclosure under “Compensation Discussion and Analysis” contained in this proxy statement. Based on such review and discussion, the Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this proxy statement.

Members of the Compensation Committee:

Brooke Wade, Chair

Peter J. Dey

Robert B. Hodgins

David Smith

 

   
Gran Tierra Energy 2022 Proxy Statement   49


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Executive Compensation

Summary Compensation Table

The following table summarizes the compensation of our NEOs for their performance during the years ended December 31, 2021, 2020 and 2019.

 

Name and Position

   Year     

Salary

($) (1)

    

Stock
Awards
 (2)

($)

    

Option
Awards
 (3)

($)

    

Non-Equity
Incentive Plan
Compensation
 (4)

($)

     All Other
Compensation
 (5)
($)
    

Total

($)

 

Gary S. Guidry

President and Chief Executive

Officer

     2021        473,261        1,337,476        332,821        473,261        57,410        2,674,229  
     2020        431,982        1,255,922        312,288        391,140        42,345        2,433,677  
     2019        461,965        1,265,456        316,520        152,448        11,359        2,207,748  

Ryan Ellson

Executive Vice President & Chief Financial Officer

     2021        335,226        913,942        227,427        294,999        44,702        1,816,297  
     2020        305,988        858,214        213,397        257,619        30,576        1,665,794  
     2019        327,225        864,727        216,289        147,829        10,620        1,566,690  

Jim Evans

Vice President, Corporate Services

     2021        295,788        533,398        132,732        163,275        23,345        1,148,538  
     2020        306,788        500,873        124,544        129,595        121,307        1,183,107  
     2019        288,728        504,674        126,231        115,491        244,486        1,279,610  

Rodger Trimble

Vice President, Investor Relations

     2021        236,630        382,136        95,091        118,315        32,219        864,391  
     2020        215,991        358,835        89,225        103,676        20,332        788,059  
     2019        230,982        361,558        90,434        69,295        7,994        760,263  

Lawrence West

Vice President,

Exploration

     2021        295,788        533,398        132,732        148,288        8,556        1,118,762  
     2020        269,989        500,873        124,544        129,595        8,393        1,033,394  
     2019        288,728        504,674        126,231        83,924        7,994        1,011,551  

 

(1)

All compensation is paid in Canadian dollars and converted into U.S. dollars for the purposes of the above table. For 2021 compensation amounts, the exchange rate at December 31, 2021 of one U.S. dollar to Canadian $1.2678 is used.

 

(2)

Amounts reported in the “Stock Awards” column represent the aggregate grant date fair value of RSU and PSU awards, computed in accordance with ASC 718, disregarding estimated forfeitures. The PSU awards are subject to market conditions and have been valued based on the probable outcome of the market conditions as of the grant date. For a discussion of valuation assumptions, see Note 7—Share Capital of the Notes to Consolidated Financial Statements included under Item 8 in our Annual Report on Form 10-K for the year ended December 31, 2021. Assuming maximum performance is achieved, the value of PSUs granted in 2021 based on the price of the Company’s shares at the date of grant would be as follows: Gary S. Guidry—$ 2,674,952; Ryan Ellson—$ 1,827,884; Jim Evans—$ 1,066,796; Rodger Trimble—$ 764,272 and Lawrence West—$ 1,066,796.

 

(3)

Amounts reported in the “Option Awards” column represent the aggregate grant date fair value of stock options, computed in accordance with ASC 718. The value ultimately realized by the NEOs upon the actual vesting of the award(s) or the exercise of the stock option(s) may or may not be equal to this determined value. For a discussion of valuation assumptions, see Note 7—Share Capital of the Notes to Consolidated Financial Statements included under Item 8 in our Annual Report on Form 10-K for the year ended December 31, 2021.

 

(4)

Amounts reported in the “Non-equity Incentive Plan Compensation” column for each year represent the amount earned in that year, irrespective of when the amount was paid.

 

(5)

Amounts reported in the “All Other Compensation” column include matching contributions to the Employee Share Purchase Plan, parking and transportation allowances, corporate health and group term life insurance, and other perquisites, as shown in the table below.

 

   
50   Gran Tierra Energy 2022 Proxy Statement


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EXECUTIVE COMPENSATION

 

 

Name

  

Employee
Share
Purchase  Plan
Contribution
 (1)

($)

    

Corporate
Health
and
Group
Term Life
Insurance

(S)

    

Parking and
Transportation
Allowance

($)

     Other
($)
    

Total

($)

 

Gary S. Guidry

     47,326        4,270        5,814               57,410  

Ryan Ellson

     33,523        5,366        5,814               44,702  

Jim Evans

     14,789        4,770        3,786               23,345  

Rodger Trimble

     23,663        4,770        3,786               32,219  

Lawrence West

            4,770        3,786               8,556  

 

(1)

These amounts reflect the Company’s matching contributions to the NEOs’ Employee Share Purchase Plan accounts.

2021 GRANTS OF PLAN-BASED AWARDS

The following table shows certain information regarding grants of plan-based awards granted to the NEOs for the fiscal year ended December 31, 2021:

 

           Estimated Future Payouts Under
Non-Equity Incentive Plan
Awards
    Estimated Future Payouts Under
Equity Incentive Plan Awards
     All Other
Option
Awards:
Number of
Securities
Underlying
     Exercise
or Base
Price of
Option
     Grant
Date
Fair
Value of
Stock
and
Option
 

Name

   Grant
Date
    Threshold
($)
     Target
($)
     Maximum
($)
    Threshold
(#)
     Target
(#)
     Maximum
(#)
     Options
(#)
     Awards
($/Sh)
     Awards
($) 
(1)
 
     

Gary S. Guidry

           $ 0        473,261        946,522                                                       
     
     3/1/2021                                 0        1,631,068        3,262,136                          1,337,476  
     
       3/1/2021                                                            688,525        0.82        332,821  
     

Ryan Ellson

           $ 0        268,181        536,362                                                       
     
     3/1/2021