Timminco Limited
TSX : TIM

Timminco Limited

November 11, 2008 16:38 ET

Timminco Announces Incentive Compensation Arrangements for Silicon Business Executives

TORONTO, ONTARIO--(Marketwire - Nov. 11, 2008) - Timminco Limited ("Timminco")(TSX:TIM) today announced that it has approved new long-term incentive compensation arrangements for executives and other key employees of its silicon business, including Becancour Silicon Inc. ("BSI"). These arrangements are intended to reward participants for contributions to the success of the solar grade silicon product line, to provide incentive for participants to maximize the profitability and future value of the silicon business, and to provide a significant long-term retention incentive for important personnel.

The new long-term incentive compensation arrangements have two principal components: annual profit participation, based on BSI's earnings before interest and taxes ("EBIT"), and grants of options to purchase Timminco common shares. The profit participation component will entitle participants to receive a cash payment equal to a certain percentage of the amount by which EBIT exceeds a minimum annual performance threshold. The options are granted at the current fair market value of Timminco shares, have a nine-year vesting schedule with 50% becoming exercisable only after the fifth anniversary of the grant date, and expire ten years after grant. The options are subject to early vesting in the event of a termination of employment due to death, permanent disability or following a change in control, or in the event of a termination of employment other than for cause. All other material terms of the options, including the determination of the exercise price, are consistent with Timminco's existing share option plan adopted in 2004. However, the options are pursuant to a new Timminco share option plan, which will be in addition to Timminco's share option plan adopted in 2004 and submitted for approval by Timminco's shareholders at the next annual general meeting, and is also subject to Toronto Stock Exchange approval and other applicable regulatory requirements. The total number of shares available for options under such new plan is 10 million, representing approximately 9.6% of Timminco's issued and outstanding shares.

Mr. Rene Boisvert, President and CEO of BSI, is one of the initial participants in these new incentive compensation arrangements, which were approved by the Board of Directors of Timminco and will be administered by its compensation committee. Mr. Boisvert's percentage for the profit participation component is 5% of EBIT above the minimum threshold, and a portion of such participation percentage is subject to achieving additional individual performance objectives. He has also been granted an option to purchase 5 million common shares under the new Timminco share option plan. In addition, Mr. Dominic Leblanc, Metallurgical Engineer, R&D of BSI, has been granted an option to purchase 2 million common shares under the new Timminco share option plan.

"I am very pleased about rewarding executives for the significant value they have created to date and about the incentives we have created to retain them for the long-term," said Dr. Heinz Schimmelbusch, Chairman of the Board and CEO of Timminco. "As I have stated previously, one of the keys to our success is our management team and its expertise in the silicon industry. We expect that Rene Boisvert and the members of his management team will play a very important part in the future success of our silicon business."

ABOUT TIMMINCO

Timminco is a leader in the production and marketing of lightweight metals, specializing in solar grade silicon for the rapidly growing solar photovoltaic energy industry. Using its proprietary technology, Timminco processes metallurgical grade silicon into low cost solar grade silicon for use in the manufacture of solar cells. Timminco also produces silicon metal, magnesium extrusions and other specialty metals for use in a broad range of industrial applications serving the aluminum, chemical, pharmaceutical, electronics and automotive industries.

CAUTIONARY NOTE ON FORWARD-LOOKING INFORMATION

This news release contains "forward-looking information", as such term is defined in applicable Canadian securities legislation, concerning Timminco's future financial or operating performance and other statements that express management's expectations or estimates of future developments, circumstances or results. Generally, forward-looking information can be identified by the use of forward-looking terminology such as "expects", "believes", "anticipates", "budget", "scheduled", "estimates", "forecasts", "intends", "plans" and variations of such words and phrases, or by statements that certain actions, events or results "may", "will", "could", "would" or "might" "be taken", "occur" or "be achieved". In this news release, such information includes statements regarding pending approvals regarding the adoption of a new share option plan.

Forward-looking information is based on a number of assumptions and estimates that, while considered reasonable by management based on the business and markets in which Timminco operates, are inherently subject to significant operational, economic and competitive uncertainties and contingencies. Timminco cautions that forward-looking information involves known and unknown risks, uncertainties and other factors that may cause Timminco's actual results, performance or achievements to be materially different from those expressed or implied by such information, including, but not limited to: limited history with solar grade silicon production; expansion of solar grade silicon production and sales; production capacity expansion at the Becancour facilities; protection of intellectual property rights; increasing and maintaining the purity of solar grade silicon; long-term contracts for supplying solar grade silicon; selling prices for solar grade silicon; price volatility for silicon metal; pricing and availability of raw materials for silicon metal and solar grade silicon production; dependence upon power supply for silicon metal production; cost of solar grade silicon production; price volatility for magnesium metal; magnesium supply chain interruptions; dependence upon key customers of magnesium extruded and fabricated products; manufacturing cost reduction initiatives; financing requirements for capital expenditures; limitations under existing credit facilities; foreign currency exchange; dependence upon key executives and employees; customer concentration; completion and integration of potential acquisitions, partnerships or joint ventures; risks with foreign operations and suppliers; environmental, health and safety laws and liabilities; equipment failures; transportation disruptions; conflicts of interest; intellectual property infringement claims; new regulatory requirements; labour disputes; and changes in tax laws. These factors are discussed in greater detail in Timminco's Annual Information Form for the year ended December 31, 2007, which is available via the SEDAR website at www.sedar.com. Although Timminco has attempted to identify important factors that could cause actual results, performance or achievements to differ materially from those contained in forward-looking information, there can be other factors that cause results, performance or achievements not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate or that management's expectations or estimates of future developments, circumstances or results will materialize. Accordingly, readers should not place undue reliance on forward-looking information. The forward-looking information in this news release is made as of the date of this news release and Timminco disclaims any intention or obligation to update or revise such information, except as required by applicable law.

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Contact Information

  • Timminco Limited
    Robert J. Dietrich
    Executive Vice President - Finance and CFO
    (416) 364-5171
    (416) 364-3451 (FAX)
    Email: rdietrich@timminco.com