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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of
May 2024
Commission File No.
001-32210
NORTHERN DYNASTY MINERALS LTD.
(Translation of registrant's name into English)
14
th
Floor - 1040 West Georgia Street
Vancouver, British Columbia, V6E 4H1, Canada
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual
reports under cover of Form 20-F or Form 40-F
Form 20-F
[ ]
Form 40-F [X]
Indicate by check mark if the registrant is submitting the Form 6-K in paper
as permitted by Regulation S-T Rule 101(b)(1) [ ]
Indicate by check mark if the registrant is submitting the Form 6-K in paper
as permitted by Regulation S-T Rule 101(b)(7) [ ]
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SUBMITTED HEREWITH
Exhibits
99.1 Notice and Access
Notification to Shareholders
99.2 Notice of Annual General Meeting of Shareholders and Information Circular
relating to Annual General Meeting of Shareholders to be held June 27, 2024
99.3 Proxy Card relating to Annual General Meeting
of Shareholders to be held June 27, 2024
99.4 Request for Annual and
Interim Financial Statements
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Date: May 22, 2024
NORTHERN DYNASTY MINERALS LTD.
(Registrant)
"
Trevor Thomas"
Trevor Thomas
Secretary and General Counsel
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NOTICE AND ACCESS NOTIFICATION TO SHAREHOLDERS
ANNUAL GENERAL MEETING OF SHAREHOLDERS
You are receiving this notification because
Northern Dynasty Minerals Ltd.
(the "
Company
") has decided to use the notice and access model ("
notice and access
") for the delivery of meeting materials to its shareholders in respect of its
Annual General Meeting of Shareholders to be held on
June 27, 2024
(the "
Meeting
"). Under notice and access, instead of receiving paper copies of the
Company's Notice of Annual General Meeting, form of Proxy and Information
Circular (the "
Information Circular
") (collectively, the "
Proxy Materials
"), you, as a shareholder of the Company, are receiving this Notice and Access
Notification ("
notification
") with information on how you may access such Proxy Materials, including the
Information Circular, electronically. With this notification, you will also
receive a proxy or voting instruction form, as applicable, allowing you to
vote by proxy, so your votes will be counted in the resolution votes at the
Meeting. This alternative means of delivery is an environmentally responsible
and cost-effective way to deliver Proxy Materials to the Company's
shareholders. You will also receive a Financial Statements Request Form
which, when completed and returned to the Company, allows you to inform the
Company of your choice to receive paper copies of the Company's annual and/or
interim financial statements for the following year.
MEETING DATE, TIME AND LOCATION
WHEN: 10:00 a.m. (Pacific Time) on WHERE: Northern Dynasty Minerals Ltd.
June 27, 2024 14
th
Floor 1040 West Georgia Street
Vancouver, British Columbia
SHAREHOLDERS WILL BE ASKED TO CONSIDER AND VOTE ON THE FOLLOWING MATTERS:
* APPOINTMENT OF AUDITOR:
To appoint the auditor of the Company for the ensuing year. See the section
entitled
Appointment of Auditor
in the Information Circular.
* ELECTION OF DIRECTORS:
To elect directors of the Company for the ensuing year. See the section
entitled
Election of Directors
in the Information Circular.
* CONTINUATION OF COMPANY'S SHARE OPTION PLAN, AS AMENDED.
See the section
Particulars of Matters to be Acted Upon - Share Option Plan Resolution
in the Information Circular.
* CONTINUATION OF THE DEFERRED SHARE UNIT PLAN.
See the section
Particulars of Matters to be Acted Upon - Deferred Share Unit Plan Resolution
in the Information Circular.
* CONTINUATION OF THE RESTRICTED SHARE UNIT PLAN.
See the section
Particulars of Matters to be Acted Upon - Restricted Share Unit Plan Resolution
in the Information Circular.
SHAREHOLDERS ARE REMINDED TO
REVIEW
THE PROXY MATERIALS, IN PARTICULAR THE
INFORMATION CIRCULAR,
PRIOR
TO VOTING.
WEBSITES WHERE PROXY MATERIALS ARE POSTED
The Proxy Materials can be viewed online under the Company's profile on SEDAR at
www.sedarplus.com
or on the Company's website at
https://www.northerndynastyminerals.com/investors/agm/
.
HOW TO OBTAIN A PRINTED PAPER COPY OF THE INFORMATION CIRCULAR
You may request that a paper copy of the Information Circular be sent to you
by postal delivery at no cost to you. Requests may be made up to one year from
the date the Proxy Materials were filed on SEDAR+ by telephone at:
604-684-6365 or 1-800-667-2114.; or by email to the Company at:
info@northerndynasty.com
. If you request a printed copy of the Information Circular on the Meeting
date or in the year following the filing of the Proxy Materials, the Company
will send it to you within 10 calendar days of receiving your request.
Following the Meeting, Proxy Materials will remain available at the websites
listed above for a period of at least one year.
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To allow adequate time for you, as a Shareholder of the Company, to receive
and review a paper copy of the Information Circular and then to submit your
vote prior to the proxy deadline of
10:00 a.m. (PST) on June 25, 2024
(the "
Proxy Deadline
"), please ensure your request is received by the Company no later than
June 17, 2024.
Please note you will not receive another form of proxy or voting instruction
form, so please keep the one you received with this notification.
Stratification used: NO
HOW DO I VOTE?
There are three convenient ways to vote your Common Shares:
Beneficial Shareholders Registered Shareholders
Shares held with a broker, Shares held in your own name and represented
bank or other intermediary. by a physical share certificate.
Internet: www.proxyvote.com www.investorvote.com
Phone or Fax: Call or fax to the number(s) listed on your voting instruction Phone: 1-866-732-8683
form and vote using the control number provided therein. Fax: 1-866-249-7775
Mail: Return the voting instruction form in Return the form of proxy in the
the enclosed postage paid envelope. enclosed postage paid envelope.
Please submit your vote well in advance of the PROXY DEADLINE of
10:00 a.m. (Pacific Time) on June 25, 2024.
BOARD RECOMMENDATION
The Company's Board of Directors unanimously recommends that shareholders VOTE
FOR each of the proposed resolutions (see page 1:
Shareholders Will be Asked to Consider and Vote on the Following Matters
).
If you have questions or require assistance with voting your Common Shares
you may contact the Company's proxy solicitation agent:
Laurel Hill Advisory Group
North American Toll-Free Number: 1-877-452-7184
Outside North America: 416-304-0211
Email:
assistance@laurelhill.com
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ANNUAL GENERAL MEETING OF SHAREHOLDERS
TO BE HELD ON JUNE 27, 2024
NOTICE OF ANNUAL GENERAL MEETING OF SHAREHOLDERS
AND
INFORMATION CIRCULAR
DATED MAY 15, 2024
These materials are important and require your immediate attention. If you
have questions or
require assistance with voting your shares, you may contact the Company's
proxy solicitation agent:
Laurel Hill Advisory Group
North America Toll-Free: 1-877-452-7184
Outside North America: 1-416-304-0211
Email:
assistance@laurelhill.com
YOUR VOTE IS IMPORTANT. PLEASE VOTE YOUR SHARES TODAY.
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14
th
Floor, 1040 West Georgia Street
Vancouver, British Columbia V6E 4H1
Telephone: (604) 684-6365 Fax: (604) 684-8092
NOTICE OF ANNUAL GENERAL MEETING OF SHAREHOLDERS
The annual general meeting (the "
Meeting
") of Shareholders ("
Shareholders
") of
Northern Dynasty Minerals Ltd.
(the "
Company
") will be held at the offices of Northern Dynasty Minerals Ltd., 14th Floor
1040 West Georgia Street, Vancouver, British Columbia, on June 27, 2024 at
10:00 a.m., local time, for the following purposes:
1.
to receive the Consolidated Annual Financial Statements for the years ended
December 31, 2023 and 2022, the related report of the auditor thereon (the "
Annual Financial Statements
") and the related Management Discussion and Analysis ("
MDA
");
2.
to elect directors of the Company for the ensuing year, see
Election of Directors
in the Information Circular;
3.
to appoint the auditor for the ensuing year, see
Appointment of Auditor
in the Information Circular;
4.
to consider, and if thought advisable, to approve an ordinary resolution of
disinterested shareholders, to ratify, confirm and approve the Share Option
Plan, as amended, for continuation for a three-year period, such Share Option
Plan, and the update amendments made thereto, being described in the
Information Circular, see
Particulars of Matters to be Acted Upon - Option Plan Resolution
in the Information Circular;
5.
to consider, and if thought advisable, to approve an ordinary resolution to
approve the continuation of the Deferred Share Unit Plan (the "DSU Plan") for
a three-year period, such DSU Plan, being described in the Information
Circular, see
Particulars of Matters to be Acted Upon - Deferred Share Unit Plan
Continuation and Renewal
in the Information Circular;
6.
to consider, and if thought advisable, to approve an ordinary resolution to
approve the continuation of the Restricted Share Unit Plan (the "RSU Plan")
for a three-year period, such RSU Plan, being described in the Information
Circular, see
Particulars of Matters to be Acted Upon - Restricted Share Unit Plan
Continuation and Renewal
in the Information Circular; and
7.
to consider any permitted amendment to or variation of any matter identified
in this Notice; and to transact such other business as may properly come
before the Meeting or any adjournments thereof.
The Company's Information Circular (the "
Information Circular
") dated May 15, 2024 accompanies this Notice of Annual General Meeting (the "
Notice
"). The Information Circular contains further particulars of matters to be
considered at the Meeting. The Meeting may also consider any permitted
amendment to or variation of any matter identified in this Notice, and
transact such other business as may properly come before the Meeting or any
adjournment thereof. Copies of the Annual Financial Statements and MDA will
be made available at the Meeting and, along with the Company's Annual
Information Form, are available under the Company's SEDAR+ profile at
www.sedarplus.ca
Notice-and-Access
The Company has elected to use the notice-and-access model set out in National
Instrument 51-102 -
Continuous Disclosure Obligations
and National Instrument 54-101 -
Communications with Beneficial Owners of Securities of a Reporting Issuer
(together "
Notice-and-Access Provisions
") for delivery of proxy materials relating to this Meeting. The
Notice-and-Access Provisions allow the Company to reduce the volume of
materials to be physically mailed to Shareholders by posting the Information
Circular and any additional annual meeting materials (together, the "
Proxy Materials
") online. Under Notice-and-Access Provisions, instead of receiving paper
copies of this Notice and the Information Circular, registered Shareholders of
the Company will receive the form of Notice and Access Notification (the "
Notification
") and the form of proxy (the "
Proxy
") relevant for the Meeting. In the case of the Company's beneficial
(non-registered) Shareholders, they will receive the Notification and a voting
instruction form (the "
VIF
"). The Proxy/VIF enables Shareholders to vote by proxy.
Before
voting, Shareholders are reminded to review the Information Circular online by
logging onto the website access page via the URL address provided and by
following the instructions set out below.
Shareholders may also choose to receive a printed copy of the Information
Circular by following the procedures set out below.
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Copies of the Proxy Materials and the Annual Financial Statements and MDA are
posted on the Company's website at
https://www.northerndynastyminerals.com/investors/agm/
.
How to Obtain Paper Copies of the Information Circular
Shareholders may request a paper copy of the Information Circular be mailed to
them at no cost by contacting the Company at 1040 West Georgia Street, Suite
1400, Vancouver, British Columbia V6E 4H1 or by telephone at 604-684-6365 or
1-800-667-2114. Shareholders may also use the toll-free number noted above to
obtain additional information about Notice-and-Access Provisions.
To allow adequate time for Shareholders to receive and review a paper copy of
the Information Circular and then to submit their votes by
10:00 a.m. (PDT) on June 25, 2024
(the "
Proxy Deadline
"), Shareholders requesting a paper copy of the Information Circular as
described above should ensure such request is received by the Company no later
than
June 17, 2024
. Under Notice-and-Access, Proxy Materials must be available for viewing from
the date of posting and for 1 year following the Meeting. Shareholders may
request a paper copy of the Information Circular from the Company at any time
during this period. To obtain a paper copy of the Information Circular after
the Meeting date, please contact the Company.
The Company will
not
use a procedure known as "
stratification"
in relation to its use of Notice-and-Access. Stratification occurs when a
reporting issuer while using Notice-and-Access Provisions also provides a
paper copy of the Information Circular to some of its Shareholders with the
notice package. Instead, all Shareholders will receive only the notice
package, which must be mailed to them pursuant to Notice-and-Access
Provisions, and which will
not
include a paper copy of the Information Circular.
The Information Circular contains details of matters to be considered and
voted on at the Meeting.
Please review the Information Circular before voting.
We recommend all shareholders submit votes by sending in a properly completed
and signed form of proxy (or voting instruction form) prior to the Meeting by
following instructions in this Information Circular. As of the date hereof the
Company intends to hold the Meeting at the location stated in the Notice of
Meeting. Should any changes to the Meeting occur, the Company will announce
any and all changes by way of news release filed under the Company's profile
on SEDAR+ at
www.sedarplus.ca
as well as on our Company website at www.northerndynastyminerals.com. Please
check our website prior to the Meeting for the most current information. In
the event of changes to the Meeting format, the Company will not prepare or
mail amended Proxy Materials.
Registered Shareholders who are unable to attend the Meeting in person and who
wish to ensure that their Common Shares will be voted at the Meeting are
requested to complete, date and sign the enclosed form of Proxy or complete
another suitable form of proxy and deliver it in accordance with the
instructions set out in the form of Proxy and in the Information Circular.
To be effective, the Proxy must be duly completed and signed and then
deposited with the Company's registrar and transfer agent, Computershare Trust
Company of Canada, 100 University Avenue, 8
th
Floor, Toronto, Ontario M5J 2Y1, or voted via telephone, fax or via the
internet (online) as specified in the Proxy, no later than 10:00 a.m. (PDT),
on June 25, 2024.
Non-registered Shareholders (Beneficial "Shareholders") who hold their Common
Shares through a brokerage firm, bank or trust company and plan to attend the
Meeting must follow the instructions set out in the accompanying VIF and in
the Information Circular in order to cast their vote and ensure that their
Common Shares will be voted at the Meeting.
2
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The accompanying Information Circular contains details of matters to be
considered at the Meeting.
Please review the Information Circular before voting.
DATED
at Vancouver, British Columbia, May 15, 2024.
BY ORDER OF THE BOARD
/s/ Ronald Thiessen
Ronald Thiessen
President and Chief Executive Officer
If you have any questions or require assistance with voting your shares,
please contact Laurel Hill Advisory Group, the proxy solicitation agent, by
telephone at: Toll Free 1-877-452-7184; or outside North America
1-416-304-0211; or by email at:
assistance@laurelhill.com.
3
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14
th
Floor, 1040 West Georgia Street
Vancouver, British Columbia V6E 4H1
Telephone No. (604) 684-6365 / Fax No. (604) 684-8092
INFORMATION CIRCULAR
TABLE OF CONTENTS
INFORMATION CIRCULAR 1
GENERAL PROXY INFORMATION 1
Solicitation of Proxies 1
Notice-and-Access 1
How to Obtain a Paper Copy of the Information Circular 2
Appointment of Proxyholders 3
Voting by Proxyholder 3
Registered Shareholders 3
Beneficial Shareholders 3
Notice to Shareholders in the United States 4
Revocation of Proxies 4
INTEREST OF CERTAIN PERSONS IN MATTERS TO BE ACTED UPON 5
RECORD DATE, VOTING SECURITIES AND PRINCIPAL HOLDERS OF VOTING SECURITIES 5
FINANCIAL STATEMENTS 5
VOTES NECESSARY TO PASS RESOLUTIONS 5
ELECTION OF DIRECTORS 6
Majority Vote Policy 6
Advance Notice Provisions 6
Management's Director Nominees 6
Biographical Information of Nominees for Director 7
Bankruptcies, Penalties, Sanctions or Cease-Trade Orders 12
Multiple Directorships 12
APPOINTMENT OF AUDITOR 13
CORPORATE GOVERNANCE 13
Mandate of the Board of Directors 13
Composition of the Board of Directors 13
Committees of the Board of Directors 14
Compensation Committee 15
Nominating and Governance Committee ("NG Committee") 15
Sustainability Committee 15
Board Diversity 16
Director Term Limits 16
Board of Directors Decisions 16
Governance Policies for Board of Directors and Directors' Attendance of Meetings 16
Directorships 17
Orientation and Continuing Education 17
Ethical Business Conduct 17
Nomination of Directors 18
Assessments 18
i
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Shareholder Engagement 18
Other Governance Matters - Compensation Clawback Policy 18
STATEMENT OF EXECUTIVE COMPENSATION 19
Compensation Discussion and Analysis 19
Named Executive Officers 19
Compensation Committee 19
Report on Executive Compensation 20
Performance Graph 22
Summary Compensation Table 23
Incentive Plan Awards 24
Outstanding Share-based Awards and Option-based Awards 24
Incentive Plan Awards - Value Vested or Earned During the Year 24
Pension Plan Benefits 25
Termination and Change of Control Benefits 25
Director Compensation 26
Philosophy and Objectives 26
Director Compensation Table 26
Outstanding Share-based Awards and Option-based Awards 27
SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS 28
INDEBTEDNESS OF DIRECTORS AND EXECUTIVE OFFICERS 36
INTEREST OF INFORMED PERSONS IN MATERIAL TRANSACTIONS 36
MANAGEMENT CONTRACTS 36
PARTICULARS OF MATTERS TO BE ACTED UPON 37
Amendment and Renewal of Option Plan 38
DSU Plan Resolution 39
RSU Plan Resolution 40
ADDITIONAL INFORMATION 41
OTHER MATTERS 41
ii
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14
th
Floor, 1040 West Georgia Street
Vancouver, British Columbia V6E 4H1
Telephone No. (604) 684-6365 / Fax No. (604) 684-8092
INFORMATION CIRCULAR
as at May 15, 2024 (except as otherwise indicated)
This Information Circular is furnished in connection with the solicitation of
proxies by the management of Northern Dynasty Minerals Ltd. (the "Company")
for use at the annual general meeting (the "Meeting") of its Shareholders
("Shareholders") to be held on June 27, 2024 at the time and place and for the
purposes set forth in the accompanying notice of the Meeting.
In this Information Circular, references to "the
Company
", "
we
" and "
our
" refer to
Northern Dynasty Minerals Ltd.
"
Common Shares
" means common shares without par value in the capital of the Company. "
Beneficial Shareholders
" means Shareholders who do not hold Common Shares in their own name and "
intermediaries
" refers to brokers, investment firms, clearing houses and similar entities
that hold securities on behalf of Beneficial Shareholders. All dollar amounts
presented in this Information Circular are in Canadian dollar amounts, unless
otherwise stated that they are in United States dollars (
"US$"
).
We recommend all shareholders submit votes by sending in a properly completed
and signed form of proxy (or voting instruction form) prior to the Meeting
following instructions in this Information Circular. As of the date hereof the
Company intends to hold the Meeting at the location stated in the Notice of
Meeting. Should any changes to the Meeting occur, the Company will announce
any and all changes by way of news release filed under the Company's profile
on SEDAR+ at
www.sedarplus.ca
as well as on our Company website at
https://www.northerndynastyminerals.com/investors/agm/
. We strongly recommend you check the Company's website prior to the Meeting
for the most current information. In the event of any changes to the Meeting
format, the Company will
not
prepare or mail amended Meeting Proxy Materials.
GENERAL PROXY INFORMATION
Solicitation of Proxies
The solicitation of proxies will be primarily by mail, but proxies may be
solicited personally or by telephone by directors, officers and employees of
the Company. The Company has retained the services of Laurel Hill Advisory
Group ("
Laurel Hill
") to act as the Company's proxy solicitation agent and assist the Company in
communication with the Company's Shareholders. In connection with these
services, Laurel Hill will receive a fee of $35,000, plus out-of-pocket
expenses. The Company will bear all costs of this solicitation. We have
arranged for intermediaries to forward the notice package (defined below) to
Beneficial Shareholders by those intermediaries and we may reimburse the
intermediaries for their reasonable fees and disbursements in that regard.
Notice-and-Access
The Company has chosen to deliver the Meeting proxy materials, including the
Notice and Access Notification to Shareholders (the "
Notification
"), the Notice of Meeting and the management information circular (together,
the "
Information Circular
") and a form of Proxy (the "
Proxy
") (together, the "
Proxy Materials
") using Notice-and-Access provisions, which govern the delivery of
proxy-related materials to Shareholders utilizing the internet. Notice-and-Acce
ss provisions are found in section 9.1.1 of National Instrument 51-102,
Continuous Disclosure Obligations
("
NI 51-102
"), for delivery to registered Shareholders, and in section 2.7.1 of National
Instrument 54-101,
Communication with Beneficial Owners of Securities of a Reporting Issuer
("
NI 54-101
"), for delivery to beneficial Shareholders (together the "
Notice-and-Access Provisions
").
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Notice-and-Access Provisions allow the Company to deliver Proxy Materials to
Shareholders by posting the materials on a non-SEDAR+ website (usually the
reporting issuer's website or the website of its transfer agent), provided
that the conditions of NI 51-102 and NI 54-101 are met, rather than by
printing and mailing all the Proxy Materials, in particular the Information
Circular. Shareholders may still choose to receive a paper copy of the
Information Circular, and are entitled to request a paper copy of the
Information Circular be mailed to them at the Company's expense.
Use of Notice-and-Access Provisions reduces paper waste and the Company's
printing and mailing costs. Under Notice-and-Access Provisions the Company
must mail a Notification and a Proxy or a voting information form (together
with the Notification, the "
notice package
") to each Shareholder, including Registered and Beneficial Shareholders,
indicating that the Proxy Materials have been posted online and explaining how
Shareholders can access them, and how they may obtain a paper copy of the
Information Circular, from the Company. The Information Circular has been
posted in full, together with the Notification and the Proxy, on the Company's
website at
https://www.northerndynastyminerals.com/investors/agm/
and under the Company's Sedar+ profile at
www.sedarplus.ca
.
The Information Circular contains details of matters to be considered at the
Meeting.
Please review the Information Circular before voting.
How to Obtain a Paper Copy of the Information Circular
Shareholders may request a paper copy of the Information Circular be mailed to
them, at no cost, by contacting the Company at 1040 West Georgia Street, Suite
1400, Vancouver, British Columbia V6E 4H1 or by telephone at 604-684-6365 or
1-800-667-2114. Shareholders may also use the toll-free number noted above to
obtain additional information about Notice-and-Access Provisions.
To allow adequate time for Shareholders to receive and review a paper copy of
the Information Circular and then to submit their vote by
10:00 a.m. (PDT) on June 25, 2024
(the "
Proxy Deadline
"), Shareholders requesting a paper copy of the Information Circular as
described above, should ensure such request is received by the Company no
later than
June 17, 2024
. Under Notice-and-Access Provisions, Proxy Materials must be available for
viewing for up to one year from the date of posting and a paper copy of the
Information Circular can be requested at any time during this period. To
obtain a paper copy of the Information Circular after the Meeting date, please
contact the Company.
Pursuant to Notice-and-Access Provisions, the Company has set the record date
for the Meeting to be at least 40 days prior to the Shareholder meeting in
order to ensure there is sufficient time for the Proxy Materials to be posted
on the applicable website and for them to be delivered to Shareholders. The
form of Notification in the Company's notice package (i) provides basic
information about the Meeting and the matters to be voted on; (ii) explains
how Shareholders can obtain a paper copy of the Information Circular and the
related Annual Financial Statements and MDA; and (iii) explains the
Notice-and-Access Provisions process. The notice package which is being
mailed to Shareholders by the Company in each case includes the applicable
voting document: the Proxy for Registered Shareholders or a voting
information form ("
VIF
") in the case of Beneficial Shareholders.
The Company will not rely upon the use of "stratification". Stratification
occurs when a reporting issuer using Notice-and-Access Provisions also
provides a paper copy of its information circular with the notice package to
some of its Shareholders. Instead, all Shareholders will receive only the
notice package, which must be mailed to them under Notice-and-Access
Provisions. All Proxy Materials, which have the information Shareholders
require to vote in respect of all resolutions to be voted on at the Meeting,
will be posted online. Shareholders will not receive a paper copy of the
Information Circular from the Company, or from any intermediary, unless a
Shareholder specifically requests one.
2
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Shareholders may call (toll-free) 1-800-667-2114 in order to obtain additional
information relating to Notice-and-Access Provisions or to request a paper
copy of the Information Circular, up to and including the date of the Meeting,
including any adjournment of the Meeting.
Appointment of Proxyholders
The individuals named in the Proxy contained within the notice package, are
directors or officers of the Company.
If you are a Registered Shareholder entitled to vote at the Meeting, you have
the right to appoint a person or company other than either of the persons
designated in the Proxy, who need not be a Shareholder, to attend and act on
your behalf at the Meeting. You may do so either by inserting the name of
that other person, and that person maybe you, in the blank space provided in
the Proxy or by completing and delivering another suitable form of proxy. If
your Common Shares are registered in your name, then you are a Registered
Shareholder and you will receive a Proxy for voting your Common Shares.
However, if like most Shareholders you keep your Common Shares in a brokerage
account, then you are a Beneficial Shareholder and the manner for voting is
different than the manner in which a Registered Shareholder votes. Beneficial
Shareholders will receive a VIF, which will allow you to instruct the
intermediary holding Common Shares on your behalf on how to vote. Please read
the instructions below carefully.
Voting by Proxyholder
The persons named in the Proxy will vote or withhold from voting the Common
Shares represented thereby in accordance with your instructions on any ballot
that may be called for. If you specify a choice with respect to any matter to
be acted upon, your Common Shares will be voted accordingly. The Proxy
confers discretionary authority on the persons named therein with respect to:
(a)
each matter or group of matters identified therein for which a choice is not
specified,
(b)
any amendment to or variation of any matter identified therein, and
(c)
any other matter that may properly come before the Meeting.
In respect of a matter for which a choice is not specified in the Proxy, the
persons named in the Proxy will vote the Common Shares represented by the
Proxy "for" approval of such matter.
Registered Shareholders
Registered Shareholders are encouraged to vote by proxy, and may do so by:
(a)
completing, dating and signing the form of Proxy enclosed with the notice
package, and returning it to the Company's transfer agent, Computershare Trust
Company of Canada ("
Computershare
"), by fax within North America at 1-866-249-7775, outside North America at
1-416-263-9524, or by mail to the 8th Floor, 100 University Avenue, Toronto,
Ontario M5J 2Y1; or
(b)
by using a touch-tone phone to transmit voting choices to a toll free number.
Registered Shareholders must follow the instructions of the voice response
system and refer to the form of Proxy enclosed with the notice package for the
toll-free number, the holder's account number and the proxy access number; or
(c)
by using the internet via the website voting page of Computershare at
www.investorvote.com
. Registered Shareholders must follow the instructions provided at the voting
page and refer to the form of Proxy enclosed with the notice package for the
holder's account number and the proxy access number.
In all cases a Registered Shareholder must ensure that the completed Proxy is
received at least 48 hours (excluding Saturdays, Sundays and holidays) before
the Meeting or the adjournment thereof at which the Proxy is to be used.
Beneficial Shareholders
The following information is of significant importance to shareholders who do
not hold Common Shares in their own name.
Beneficial Shareholders should note that the only proxies that can be
recognized and acted upon at the Meeting are those deposited by Registered
Shareholders (those whose names appear on the records of the Company as the
Registered Shareholders of Common Shares) or as set out in the following
disclosure.
3
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If Common Shares are listed in an account statement provided to a Shareholder
by a broker, then in almost all cases those Common Shares will not be
registered in the Shareholder's name on the records of the Company. Such
Common Shares will more likely be registered under the names of the
Shareholder's broker or an agent of that broker. In Canada, the vast majority
of such Common Shares are registered under the name of CDS & Co. (the
registration name for The Canadian Depository for Securities Limited), which
acts as nominee for many Canadian brokerage firms. In the United States of
America (the "
United States
"), the vast majority of such Common Shares are registered under the name of
Cede & Co. as nominee for The Depository Trust Company (which acts as
depositary for many United States brokerage firms and custodian banks).
Intermediaries are required to forward the notice package to the Beneficial
Shareholders unless, in the case of certain proxy-related materials, the
Beneficial Shareholder has waived the right to receive them. The majority of
intermediaries now delegate responsibility for obtaining instructions from
Beneficial Shareholders to Broadridge Financial Services, Inc. ("
Broadridge
"). Broadridge typically mails a scannable VIF to Beneficial Shareholders and
asks them to return the VIF to Broadridge. Alternatively, the Beneficial
Shareholder may call a toll-free number or go online to
www.proxyvote.com
to vote. The Company may utilize the Broadridge QuickVote
TM
service to assist Beneficial Shareholders with voting their shares. Certain
Beneficial Shareholders who have not objected to the Company knowing who they
are (non-objecting beneficial owners) may be contacted by Laurel Hill to
conveniently submit their vote directly by telephone.
Beneficial Shareholders cannot use the VIF provided to vote directly at the
Meeting. Should Beneficial Shareholders wish to attend and vote in person at
the Meeting, they must insert their names (or the name of such other persons
the Beneficial Shareholders choose to attend and vote on their behalf) in the
blank space provided for that purpose on the VIF; then the completed VIF must
be returned in accordance with the instructions provided, well in advance of
the Meeting.
Do You Have Questions?
If you have any questions or require assistance with voting your Common
Shares, please contact Laurel Hill Advisory Group, the proxy solicitation
agent, by telephone at: Toll Free 1-877-452-7184; or Outside North America
1-416-304-0211; or by email at:
assistance@laurelhill.com
.
Notice to Shareholders in the United States
The solicitation of proxies and the transactions contemplated in this
Information Circular involve securities of an issuer located in Canada and are
being effected in accordance with the corporate laws of the Province of
British Columbia, Canada, and the requirements of the securities laws of the
provinces of Canada. The proxy solicitation rules under the United States
Securities Exchange Act
of 1934
, as amended, are not applicable to the Company or this solicitation.
Shareholders should be aware that disclosure requirements under the securities
laws of the provinces of Canada differ from the disclosure requirements under
United States securities laws.
The enforcement by Shareholders of civil liabilities under United States
federal securities laws may be affected adversely by the fact that the Company
is incorporated under the
Business Corporations Act
(British Columbia)
, as amended, certain of its directors and its executive officers are
residents of Canada, and a portion of its assets and the assets of such
persons are located outside the United States. Shareholders may not be able
to sue a foreign company or its officers or directors in a foreign court for
violations of United States federal securities laws. It may be difficult to
compel a foreign company and its officers and directors to subject themselves
to the jurisdiction of, or a judgment made by, a United States court.
Revocation of Proxies
In addition to revocation in any other manner permitted by law, a Registered
Shareholder who has given a proxy may revoke it by:
(a)
executing a proxy bearing a later date or by executing a valid notice of
revocation, either of the foregoing to be executed by the Registered
Shareholder or the Registered Shareholder's authorized attorney in writing or,
if the Shareholder is a corporation, under its corporate seal by an officer or
attorney duly authorized, and by delivering the proxy bearing a later date or
the valid notice of revocation to Computershare at the address shown on the
preceding page or at the address of the registered office of the Company at
Suite 1500 Royal Centre, 1055 West Georgia Street, P.O. Box 11117, Vancouver,
British Columbia V6E 4N7, at any time up to and including the last business
day that precedes the day of the Meeting or, if the Meeting is adjourned, the
last business day that precedes any reconvening thereof, or to the chairman of
the Meeting on the day of the Meeting or any reconvening thereof, or in any
other manner provided by law, or
4
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(b)
personally attending the Meeting and voting the Registered Shareholder's
Common Shares.
A revocation of a proxy will not affect a matter on which a vote is taken
before the revocation.
Beneficial Shareholders who wish to change their vote must, within sufficient
time in advance of the Meeting, arrange for their respective intermediaries to
change their vote and if necessary, revoke their proxy in accordance with the
revocation procedures set out above.
INTEREST OF CERTAIN PERSONS IN MATTERS TO BE ACTED UPON
No director or executive officer of the Company, or any person who has held
such a position since the beginning of the last completed financial year of
the Company, nor any nominee for election as a director of the Company, nor
any associate or affiliate of the foregoing persons, has any substantial or
material interest, direct or indirect, by way of beneficial ownership of
securities or otherwise, in any matter to be acted on at the Meeting other
than the election of directors and as may be set out herein.
RECORD DATE, VOTING SECURITIES AND PRINCIPAL HOLDERS OF VOTING SECURITIES
The Board of Directors (the "
Board
") of the Company has fixed May 10, 2024 as the record date (the "
Record Date
") for determination of persons entitled to receive notice of the Meeting.
Only Shareholders of record at the close of business on the Record Date who
either attend the Meeting personally or complete, sign and deliver a form of
proxy in the manner and subject to the provisions described above will be
entitled to vote or to have their Common Shares voted at the Meeting.
The Company is authorized to issue an unlimited number of Common Shares. The
Common Shares are listed for trading on the Toronto Stock Exchange (the "
TSX
") and on the NYSE American. As of the Record Date, there were 537,724,281
Common Shares issued and outstanding, each carrying the right to one vote. No
group of Shareholders has the right to elect a specified number of directors,
nor are there cumulative or similar voting rights attached to the Common
Shares.
To the knowledge of the directors and executive officers of the Company, there
is currently no Shareholder of the Company that beneficially owns, directly or
indirectly, or exercises control or direction over, Common Shares carrying
more than 10% of the voting rights attached to all outstanding Common Shares
of the Company.
FINANCIAL STATEMENTS
The audited consolidated financial statements of the Company for the fiscal
years ended December 31, 2023, and 2022, the report of the auditor thereon and
the related management's discussion and analysis will be placed before the
Meeting. These documents have been filed with the securities commissions or
similar regulatory authorities in all Provinces of Canada in which the Company
is registered as a reporting issuer, being all Provinces of Canada, except
Quebec. Copies of the documents may be obtained by a Shareholder upon request
without charge from Investor Relations, Northern Dynasty Minerals Ltd., 14th
Floor, 1040 West Georgia Street, Vancouver, British Columbia V6E 4H1,
telephone: 604-684-6365 or 1-800-667-2114. These documents are also available
under the Company's Sedar+ profile at
www.sedarplus.ca
.
VOTES NECESSARY TO PASS RESOLUTIONS
A simple majority of affirmative votes cast at the Meeting is required to pass
the resolutions described herein. If, as a result of nominations received in
compliance with the Advance Notice Provisions (see "Advance Notice Provisions"
below), there are more nominees for election as directors than there are
vacancies to fill, those nominees receiving the greatest number of votes will
be elected. If the number of nominees for election or appointment is equal to
the number of vacancies to be filled, all such nominees will be declared
elected by acclamation. Subject to the Majority Vote Policy (as described
below) under which a director may be required to resign after his or her
election, the eight (8) nominees receiving the highest number of votes will be
elected, even if a director nominee gets fewer "for" votes than "withheld"
votes. Similarly, unless there is a nomination from the floor for an
alternative auditor, the auditor proposed by management will be appointed.
5
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ELECTION OF DIRECTORS
The term of office of each of the current directors will end at the conclusion
of the Meeting. Unless the director's office is vacated earlier in accordance
with the provisions of the
Business Corporations Act (British Columbia
), each director elected will hold office until the conclusion of the next
annual general meeting of the Company or, if no director is then elected,
until a successor is elected.
Majority Vote Policy
The Board has adopted a policy stipulating that if the votes "for" the
election of a director nominee at a meeting of Shareholders are fewer than the
number voted "withhold", the nominee will submit his or her resignation
promptly after the meeting for the consideration of the Nominating and
Governance Committee. The Nominating and Governance Committee will make a
recommendation to the Board of Directors after reviewing the matter, and the
Board will decide within 90 days after the date of the meeting of Shareholders
whether to accept or reject the resignation. The Board will accept the
resignation absent exceptional circumstances. The Board's decision to accept
or reject the resignation will be disclosed by way of a press release, a copy
of which will be sent to the Toronto Stock Exchange. If the Board does not
accept the resignation, the press release will fully state the reasons for the
decision. The nominee will not participate in any Committee or Board
deliberations whether to accept or reject the resignation. This policy does
not apply in circumstances involving contested director elections.
Advance Notice Provisions
The Company's Articles include advance notice provisions (the "
Advance Notice Provisions
"). The Advance Notice Provisions provide Shareholders, directors and
management of the Company with a clear framework for nominating directors.
Among other things, the Advance Notice Provisions fix a deadline by which
holders of Common Shares must submit director nominations to the Company prior
to any annual or special meeting of Shareholders and sets forth the minimum
information that a Shareholder must include in such notice to the Company for
the notice to be in proper written form.
As of the date hereof, the Company has not received notice of any additional
director nomination in compliance with the Advance Notice Provisions of the
Company's Articles. If no nominations are received by the Company in
compliance with these provisions prior to the Meeting, any nominations which
are not by or at the direction of the Board, or an authorized officer of the
Company, will be disregarded at the Meeting.
Management's Director Nominees
The Board has determined that eight (8) directors be elected to the Board at
the Meeting. The following disclosure and accompanying biographical
information sets out the names of management's eight (8) nominees for election
as directors, all major offices and positions with the Company and any of its
significant affiliates each now holds, each nominee's principal occupation,
business or employment for the five preceding years, the period of time during
which each has been a director of the Company, and the number of Common Shares
of the Company beneficially owned by each, directly or indirectly, or over
which each exercised control or direction. The information as to Common
Shares ("
Shares
"), options and DSU's beneficially owned or controlled is based on insider
reports filed on
www.sedi.ca
as at May 10, 2024.
Name of Nominee; Current Position with the Period as a Director of the Common Shares Beneficially
Company, and Province or State and Country of Company Owned or Controlled
Residence
Desmond M. Balakrishnan Since December 2015 67,962 Shares
Director 440,000 5
British Columbia, Canada 84,014 Options
25,000 DSUs
Warrants
Robert A. Dickinson Since June 1994 4,100,000 Shares
Chairman and Director 1,100,000 6
British Columbia, Canada 250,000 Options
Warrants
6
-------------------------------------------------------------------------------
Name of Nominee; Current Position with the Period as a Director of the Common Shares Beneficially
Company, and Province or State and Country of Company Owned or Controlled
Residence
Siri C. Genik Since February 21, 2023 Nil
2
,
3
4
Director
Ontario, Canada
Wayne Kirk Since March 2021 225,000 Shares
1, 404,000 Options
2 188,315 DSUs
, 3 15,000 Warrants
Director
Washington, United States
Christian Milau Since May 2016 40,000 Shares
1,2, 4 440,000 Options
Lead Director 63,486 DSUs
British Columbia, Canada 40,000 Warrants
Kenneth W. Pickering Since August 2013 276,000 Shares
1,3, 4 440,000 7
Director 92,177 Options
British Columbia, Canada DSUs
Isabel Satra Since March 24, 2023 Nil
3
Director
Tampa, Florida
Ronald W. Thiessen Since November 1995 5,311,291 Shares
President, CEO and Director 4,404,000 Options
British Columbia, Canada 375,000 Warrants
Notes:
1.
Member of the Audit and Risk Committee. Mr. Milau serves as Chair.
2.
Member of the Nominating and Governance Committee. Mr. Kirk serves as Chair.
3.
Member of the Compensation Committee. Mr. Pickering serves as Chair.
4.
Member of the Sustainability Committee. Ms. Genik serves as Chair.
5.
Mr. Balakrishnan holds 35,062 of these Common Shares through his affiliate,
Balakrishnan Law Corporation.
6.
Mr. Dickinson holds 700,000 of these Common Shares through an affiliated
private company, United Mineral Services Ltd.
,
of which Mr. Dickinson is a majority shareholder.
7.
Mr. Pickering holds 60,000 of these Common Shares through his affiliate,
Kenneth Pickering Mining Consultant Ltd.
Biographical Information of Nominees for Director
The following information as to principal occupation, business or employment
is not within the knowledge of the management of the Company and has been
furnished by the respective nominees.
Desmond M. Balakrishnan BA., LLB. - Director
Mr. Balakrishnan is a lawyer practicing in the areas of Corporate Finance and
Securities, Mergers and Acquisitions, Lending, Private Equity and Gaming and
Entertainment for McMillan LLP, where he has been a partner since 2004.
McMillan serves as the Company's Canadian attorneys. He has been lead counsel
on over $3 billion in financing transactions and in mergers and acquisitions
aggregating in excess of $6 billion. He also serves as a director and/or
officer of several resource, finance and gaming firms. He holds CLA and BA
from Simon Fraser University and a Bachelor of Laws (with Distinction) from
the University of Alberta.
7
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Mr. Balakrishnan is, or was within the past five years, an officer and/or
director of the following public companies:
Company Name of Market Positions Held From To
Northern Dynasty Minerals Ltd. TSX, NYSE American Director December 2015 Present
Big Sky Petroleum Corporation TSX-V Director November 2011 November 2020
Contagious Gaming Inc. TSX-V Director August 2014 Present
Isracann Biosciences Inc. CSE Director July 2019 June 2020
Karam Minerals Inc. CSE Director November 2018 March 2024
Ynvisible Interactive Inc. (formerly Network Exploration Ltd.) TSX-V Secretary May 2008 Present
Axcap Ventures Inc. (formerly Netcoins Holdings Inc.) CSE Director August 2018 Present
Solution Financial Inc. TSX-V (NEX) Director December 2010 Present
Strategem Capital Corp. TSX-V Director October 2020 Present
Basin Uranium Corp. (formerly Blackshield Metals Corp. CSE Director January 2020 Present
Cognetivity Neurosciences Ltd. CSE Director October 2021 Present
Coloured Ties Capital Inc. (formerly GrowMax Resources Corp.) TSX-V Director April 2020 Present
Dominus Acquisitions Corp. TSX-V Director December 2020 Present
Eat Well Investment Group Inc. CSE Director October 2021 Present
Planet Ventures Inc. TSX-V Director July 2015 Present
Robert A. Dickinson, B.Sc., M.Sc. - Director and Chairman of the Board
Robert Dickinson is an economic geologist who has been actively involved in
mineral exploration and mine development for over 46 years, and was inducted
into the Canadian Mining Hall of Fame in 2012. He is Chairman of HDI and HDSI
(both defined below), as well as a director and member of the management team
of a number of public companies associated with HDI and HDSI. He is also
President and Director of United Mineral Services Ltd., a private resources
company.
Mr. Dickinson is, or was within the past five years, an officer and/or
director of the following public companies:
Company Market Positions Held From To
Northern Dynasty Minerals Ltd. TSX, NYSE American Director June 1994 Present
Chairman April 2004 Present
Amarc Resources Ltd. TSX-V, OTCBB Director April 1993 Present
Chairman April 2004 Present
Blackwolf Copper and Gold Ltd. (formally Heatherdale Resources Ltd.) TSX-V Director November 2009 September 2020
Northcliff Resources Ltd. TSX Director June 2011 May 2023
Quartz Mountain Resources Ltd. TSX-V Director December 2003 February 2019
Director and Non-Executive Chairman May 2022 Present
President & CEO November 2017 February 2019
Taseko Mines Limited TSX, NYSE American Director January 1991 Present
8
-------------------------------------------------------------------------------
Siri C. Genik - Director
Siri Genik is a senior executive in the Natural Resources and Infrastructure
industries. She is a subject-matter expert in Sustainability and ESG,
Stakeholder Engagement and Governance, as well as Strategic Communications and
Supply Chain. Siri is the Principle and Founder of BRIDGE(c), a firm
providing sustainability strategies to Boards and Leadership. She has over 25
years of experience working on major capital projects through the world. Her
background with the mining industry includes serving as Head of Project
Services for BHP Canada as well as Glencore (Xstrata) working on projects in
Australia, Malaysia and New Caledonia. Siri is a lawyer and is fluent in
English, French and Spanish.
Ms. Genik is, or was within the past five years, an officer and/or director of
the following public companies:
Company Market Positions Held From To
Exploits Discovery Corp. CSE Director June 2021 Present
Northern Dynasty Minerals Ltd. TSX, NYSE American Director February 2023 Present
Radisson Mining Resources Inc. TSX-V Director June 2022 Present
Scandium Canada Ltd. TSX-V Director March 2018 March 2022
Wayne Kirk, LL.B - Director
Wayne Kirk has over 35 years of experience as a corporate attorney, including
nine years' experience as Vice President, General Counsel and Corporate
Secretary of Homestake Mining Company, and over 19 years of experience as a
director of publicly held companies. Mr. Kirk holds a B.A. in Economics
(Distinction) from the University of California (Berkeley) and an LL.B (magna
cum laude) degree from Harvard University. He has been a member of the
California Bar since 1969. He was also a director of the Company from July
2004 to February 2016
.
Mr. Kirk is, or was within the past five years, an officer and/or director of
the following public companies:
Company Market Positions Held From To
Gabriel Resources Ltd. TSX-V Director June 2008 September 2020
Nickel Creek Platinum Corp. TSX Director March 2016 Present
Northern Dynasty Minerals Ltd. TSX, NYSE American Director March 2021 Present
Christian Milau, CPA, CA, CPA (Illinois) - Lead Director
Mr. Milau is a Chartered Professional Accountant (Chartered Accountant). Mr
Milau is the CEO of Blue Dot Carbon Corp. since September 2022. Prior to this
he was the CEO and Director of Equinox Gold Corp from December 2017 until
September 2022. He also previously served as CEO and Director of Trek Mining
Inc., Luna Gold Corp and True Gold Mining Inc. Mr. Milau has finance and
capital markets experience as well as operational, government and stakeholder
relations experience in North and South America and West Africa. Prior to
these recent roles, Mr. Milau was CFO at Endeavour Mining Corporation and was
Treasurer of New Gold Inc.
Mr. Milau is, or was within the past five years, an officer and/or director of
the following public companies:
Company Market Positions Held From To
Arras Minerals Corp. TSX-V Director September 2022 Present
Copper Standard Resources Inc. CSE Director September 2023 Present
Equinox Gold Corp. TSX, NYSE American CEO and Director December 2017 August 2022
1
Northern Dynasty Minerals Ltd. TSX, NYSE American Director May 2016 Present
Plateau Energy Metals Inc. TSX-V Director June 2016 May 2021
9
-------------------------------------------------------------------------------
Note:
1.
Equinox Gold Corp. is the result of the merger in December 2017 of Trek Mining
Inc., NewCastle Gold Ltd. and Anfield Gold Corp. Trek Mining Inc. was the
result of the merger of Luna Gold Corp. and TSX-V listed JDL Gold Corp. in
March 2017.
Kenneth W. Pickering, P. Eng. - Director
Mr. Pickering is a Professional Engineer and mining executive with 41 years of
experience in a variety of capacities in the natural resources industry. He
has led the development, construction and operation of world-class mining
projects in Canada, Chile, Australia, Peru and the United States, focusing on
operations, executive responsibilities and country accountabilities.
Mr. Pickering is, or was within the past five years, an officer and/or
director of the following public companies:
Company Market Positions Held From To
Endeavour Silver Corp. TSX, NYSE American Director August 2012 Present
Northern Dynasty Minerals Ltd. TSX, NYSE American Director September 2013 Present
Taseko Mines Limited TSX, NYSE American Director December 2018 Present
Teck Resources Limited TSX, NYSE American Director March 2015 September 2022
Isabel Satra - Director
Isabel Satra is an analyst covering the utilities sector and co-Portfolio
Manager of the Kopernik Global Long-Term Opportunities strategy. She is a
currently a principal at Kopernik Global Investors and serves as the firm's
CFO. Isabel has been in the investment industry since 2004. Earlier in her
career, she held positions at Vinik Asset Management, Tradewinds Global
Investors, NWQ Investment Management, Ceramic Solutions, and Rocketdyne.
Isabel has a Bachelor of Science in engineering from Rutgers University and an
MBA from the University of California, Irvine.
Ms. Satra, or was within the past five years, an officer and/or director of
the following public companies:
Company Market Positions Held From To
Northern Dynasty Minerals Ltd. TSX, NYSE American Director June 2023 Present
Ronald W. Thiessen, FCPA, FCA - President, Chief Executive Officer and Director
Mr. Thiessen is a Chartered Professional Accountant (Chartered Accountant)
with professional experience in finance, taxation, mergers, acquisitions and
re-organizations. Since 1986, Mr. Thiessen has been involved in the
acquisition and financing of mining and mineral exploration companies. Mr.
Thiessen is a director of HDI and HDSI (both defined below), as well as a
director and member of the management team of a number of public companies
associated with HDI and HDSI, and focuses on directing corporate development
and financing activities.
Mr. Thiessen is, or was within the past five years, an officer and/or director
of the following public companies:
Company Market Positions Held From To
Northern Dynasty Minerals Ltd. TSX, NYSE American Director November 1995 Present
President, CEO November 2001 Present
Taseko Mines Limited TSX, NYSE American Director October 1993 Present
Chairman May 2006 Present
10
-------------------------------------------------------------------------------
None of the proposed nominees for election as a director of the Company are
proposed for election pursuant to any arrangement or understanding between the
nominee and any other person, except the directors and senior officers of the
Company acting solely in such capacity.
Director Information Table
COMMITTEE MEMBERSHIP Wayne Christian Kenneth Siri C. Desmond Robert Isabel Ronald
Kirk Milau Pickering Genik Balakrishnan Dickinson Satra Thiessen
Audit & Risk Committee
Nominating & Governance Committee
Compensation Committee
Sustainability Committee
ADDITIONAL INFORMATION
Director Since 2021 2016 2013 2023 2015 1994 2023 1995
2023 "For" Votes (%) 94.19% 95.4% 95.4% 94.44 57.54% 95.67% 94.68 95.73%
Other Public Company Boards 1 2 2 3 10 3 Nil 1
Board Response to Low Support at the 2023 AGM
Last year, while all director nominees were successfully elected to the Board,
Desmond Balakrishnan received less Shareholder support than other directors,
although he still achieved majority support at 57.54% from voting Shareholders.
Certain Shareholders and the proxy advisors have expressed concerns about the
number of directorships held by Mr. Balakrishnan and questioned whether his
effectiveness at Northern Dynasty would suffer due to such commitments.
To gain a better understanding of the concerns we have reached out to certain
of our largest institutional shareholders in an attempt to gather feedback to
guide our response to their concerns.
The Board understands the reasons and concerns regarding over-boarding in
general. However, the Board values the knowledge, experience and additional
perspective of directors who sit on boards of other publicly traded companies
provided they do not interfere with their commitment to Northern Dynasty. The
Board does not believe the contributions of Mr. Balakrishnan have been
adversely impacted by his other commitments. Mr. Balakrishnan has perfect
attendance, attending 100% of all Board meetings held in the last fiscal year,
is well prepared, and contributes significantly to discussions and
deliberations. In addition, the majority of Mr. Balakrishnan's director
positions are with TSX-V and CSE listed issuers. His active participation and
high-levels of engagement, coupled with his diverse experience and depth of
knowledge in the mining industry, render Mr. Balakrishnan a key member of the
Board.
Since there is no evidence that his effectiveness as a director of Northern
Dynasty has suffered as a result of his other commitments the Board and
Nominating & Governance Committee are satisfied that the nomination of Mr.
Balakrishnan is supported despite the number of directorships appearing to be
excessive by some measures.
11
-------------------------------------------------------------------------------
We will continue to monitor the effectiveness and commitments of all directors
and will recommend appropriate action such as resigning other directorships,
should any director's effectiveness decline due to over-boarding or for any
other reason.
Bankruptcies, Penalties, Sanctions or Cease-Trade Orders
Within the 10 years preceding the date of this Information Circular no
proposed nominee for election as a director of the Company was a director or
executive officer of any company (including the Company) or acted in that
capacity for a company that was:
(a)
subject to a cease trade or similar order or an order denying the relevant
company access to any exemptions under securities legislation, for more than
30 consecutive days;
(b)
subject to an event that resulted, after the director or executive officer
ceased to be a director or executive officer, in the company being the subject
of a cease trade or similar order or an order that denied the relevant company
access to any exemption under the securities legislation, for a period of more
than 30 consecutive days;
(c)
within a year of that person ceasing to act in that capacity, became bankrupt,
made a proposal under any legislation relating to bankruptcy or insolvency or
was subject to or instituted any proceedings, arrangement or compromise with
creditors or had a receiver, receiver manager or trustee appointed to hold its
assets; or has become bankrupt, made a proposal under any legislation
relating to bankruptcy or insolvency, or become subject to or instituted any
proceedings, arrangement or compromise with creditors, or had a receiver,
receiver manager or trustee appointed to hold the assets of the proposed
director;
(d)
subject to any penalties or sanctions imposed by a court relating to
securities legislation or by a securities regulatory authority or has entered
into a settlement agreement with a securities regulatory authority; or
(e)
subject to any other penalties or sanctions imposed by a court or a regulatory
body that would likely be considered important to a reasonable securityholder
in deciding whether to vote for a proposed director.
Multiple Directorships
Other than Ms. Satra,
the directors of the Company also serve as directors of other companies
involved in natural resource development. It may occur from time to time that,
as a consequence of a particular director's activity in the mining and mineral
industry and serving on such other boards, a director may become aware of
potential resource property opportunities which are of interest to more than
one of the companies on whose boards that person serves. Furthermore, it is
possible that the directors of the Company and the directors of one or more
such other companies (many of which are described herein) may also agree to
allow joint participation on the Company's properties or the properties of
that other company. Accordingly, situations may arise in the ordinary course
which involve a director in an actual or potential conflict of interest as
well as issues in connection with the general obligation of a director to make
corporate opportunities available to the company whose board the director
serves. In all such events, any director is required to disclose a financial
interest in a contract or transaction by virtue of office, employment or
security holdings or other such interest in another company or in a property
interest under consideration by the Board, and is obliged to abstain from
voting as a director of the Company in respect of any transaction involving
that other company or in respect of any property in which an interest is held
by him. The directors will use their best business judgment to help avoid
situations where conflicts or corporate opportunity issues might arise and
they must at all times fulfil their duties to act honestly and in the best
interests of the Company as required by law.
12
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APPOINTMENT OF AUDITOR
Deloitte LLP ("
Deloitte
"), Chartered Professional Accountants, and Independent Registered Public
Accounting Firm, Suite 2800, 1055 Dunsmuir Street, Vancouver, British
Columbia, will be nominated at the Meeting for appointment as auditor of the
Company. Deloitte was first appointed auditor of the Company in 2009.
CORPORATE GOVERNANCE
Mandate of the Board of Directors
The Board has a formal mandate as outlined in the Corporate Governance
Policies and Procedures Manual (the "
Governance Manual
"), dated August 14, 2023. The Governance Manual mandates the Board to: (i)
assume responsibility for the overall stewardship and development of the
Company and monitoring of its business decisions, (ii) identify the principal
risks and opportunities of the Company's business and ensure the implementation
of appropriate systems to manage these risks, (iii) oversee ethical management
and succession planning, including appointing, training and monitoring of
senior management and directors, and (iv) oversee the integrity of the
Company's internal financial controls and management information systems. The
Governance Manual also includes written charters for each committee and it
contains a code of ethics, policies dealing with issuance of news releases and
disclosure documents, as well as share trading black-out periods. The Manual
also provides director share ownership guidelines whereby an appropriate level
of share ownership for each director represents a value which is equal to
three times annual fees and should be acquired over a period of not more than
five years. Further, in the Governance Manual the Board encourages but does
not require continuing education for all the Company's directors. A copy of
the Governance Manual is available for review on the Company's website at
www.northerndynastyminerals.com
under the
About US / Corporate Governance
tab.
Composition of the Board of Directors
Applicable governance policies require that a listed issuer's board of
directors determine the status of each director as independent or not, based
on each director's interest in or other relationship with, the Company.
Governance authorities generally recommend that a board of directors be
constituted with a majority of directors who qualify as independent directors
(as defined below)
A board of directors should also examine its size with a view to determining
the impact of the number of directors upon the effectiveness of the board of
directors, and the board of directors should implement a system which enables
an individual director to engage an outside advisor at the expense of the
corporation in appropriate circumstances. The Company's policies allow for
retention of independent advisors for members of the board of directors when
they consider it advisable.
Under the policies, an "independent" director is one who "has no direct or
indirect material relationship" with the Company. Generally speaking, a
director is independent if he or she is free from any employment, business or
other relationship which could, or could reasonably be expected to, materially
interfere with the exercise of the director's independent judgment. A
material relationship includes having been (or having a family member who has
been) within the last three years an employee or executive of the Company or
employed by the Company's external auditor. An individual who (or whose
family member) is or has been within the last three years, an executive
officer of an entity where any of the Company's executive officers served at
the same time on that entity's Compensation Committee is deemed to have a
material relationship, as is any individual who (or whose family members or
partners) received directly or indirectly, any consulting, advisory,
accounting or legal fee or investment banking compensation from the Company
(other than compensation for acting as a director or as a part time chairman
or vice-chairman).
The Board is proposing eight (8) nominees to be elected to the office of
director, four (4) of whom can be considered independent directors. The
independent nominees are Christian Milau, Ken Pickering, Wayne Kirk and Siri
C. Genik. These nominees are considered independent by virtue of not being
executive officers of the Company, having received no compensation other than
in their role as directors or not having a direct or indirect material
relationship with the Company. The non-independent directors (and the reasons
for that status) are: Robert Dickinson (Chairman of the Board and geological
consultant for the Company), Ronald Thiessen (President and CEO), Desmond
Balakrishnan (a partner of McMillan LLP, legal counsel to the Company) and
Isabel Satra (a principal of Kopernik Global Investors, LLC ("
Kopernik
"), a significant shareholder of the Company that has also participated in
material financing initiatives undertaken by the Company, including the US$ 15
million convertible note offering, announced by the Company on December 21,
2023, on behalf of funds managed thereby). Accordingly, upon election of the
proposed nominees, the Board anticipates that one half (50%) of the directors
of the Company will continue to be independent. As discussed below the
Company has appointed Christian Milau, an independent director, as Lead
Director of the Company.
13
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Messrs. Dickinson and Thiessen serve together on boards of directors of other
publicly traded companies associated with Hunter Dickinson Inc. ("
HDI
"), a private company in which Messrs. Dickinson and Thiessen also serve as
directors. As described in the Company's Annual Information Form, HDI is the
parent company of Hunter Dickinson Services Inc. ("
HDSI
"), which provides geological, corporate development, administrative and
management services to, and incurs third party costs on behalf of, the Company
at a cost which in the Board's view does not exceed the fair market value of
such services. HDSI employs members of the executive management of some of
these public companies (of which the Company is one) and in turn invoices
those companies for their share of these services, pursuant to annually set
rates.
The Board's Nominating and Governance Committee (the "
NG Committee
") formalizes the process of ensuring high calibre directors and proper
director succession planning. The NG Committee currently consists of Wayne
Kirk (Chair), Siri C. Genik and Christian Milau, all of whom are independent
(discussed above).
The Board monitors the activities of senior management through regular
meetings and discussions amongst the Board and between the Board and senior
management. The Board is of the view that communication between senior
management, members of the Board and shareholders is good. Meetings of
independent directors are not held on a regularly scheduled basis but
communications among this group occur on an ongoing basis and, as needs arise,
from regularly scheduled meetings of the plenary Board or otherwise. The
Board also encourages independent directors to bring up and discuss any issues
or concerns and the Board is advised of and addresses any such issues or
concerns raised thereby.
The Board has appointed Christian Milau as Lead Director (Independent) and, as
such, Mr. Milau's mandate includes ensuring that the Board carries out its
responsibilities effectively and independent from management.
The Board believes that adequate structures and processes are in place to
facilitate the functioning of the Board with a sufficient level of
independence from the Company's management. The Board is satisfied with the
integrity of the Company's internal control and financial management
information systems.
Committees of the Board of Directors
Applicable regulatory governance policies require that (i) the Board's Audit
and Risk Committee be composed only of independent directors, and the role of
the Audit and Risk Committee be specifically defined and include the
responsibility for overseeing management's system of internal controls, (ii)
the Audit and Risk Committee have direct access to the Company's external
auditor, (iii) other committees of the Board be composed of at least a
majority of independent directors, (iv) the Board expressly assume
responsibility, or assign to a committee of directors responsibility, for the
development of the Company's approach to governance issues, and (v) the Board
appoint a committee, composed of a majority of independent directors, with the
responsibility for proposing new nominees to the Board and for assessing
directors on an ongoing basis.
The following committees have been established by the members of Northern
Dynasty's Board of Directors, all of the Committee members being independent:
Committee Membership
Audit and Risk Committee Christian Milau (Chair)
Wayne Kirk
Ken Pickering
Compensation Committee Ken Pickering (Chair)
Wayne Kirk
Siri Genik
Nominating and Governance Committee Wayne Kirk (Chair)
Siri C. Genik
Christian Milau
Sustainability Committee Siri C. Genik (Chair)
Ken Pickering
Christian Milau
14
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Audit and Risk Committee
For information concerning the Audit and Risk Committee, please see Item 19
and Appendix A of the Company's Annual Information Form dated April 1, 2024,
which was filed on April 1, 2024 under the Company's Sedarplus profile at
www.sedarplus.ca
.
Compensation Committee
The Compensation Committee recommends compensation for the directors and
executive officers of the Company. See further disclosure under the heading, "
Statement of Executive
Compensation"
. The Compensation Committee charter is included in the Governance Manual and
is available for viewing or can be downloaded from the Company's website under
About Us / Corporate Governance
at
www.northerndynastyminerals.com
.
The function of the Compensation Committee includes review, on an annual
basis, of the compensation paid to the Company's executive officers and
directors, review of the performance of the Company's executive officers and
making recommendations on compensation to the Board.
The Compensation Committee administers the Company's share option plan and
periodically considers the grant of share options. Share options have been
granted to the executive officers and directors and certain other service
providers, taking into account competitive compensation factors and the belief
that share options help align the interests of executive officers, directors
and service providers with the interests of shareholders.
The Compensation Committee also administers the Company's Non-Employee
Directors Deferred Share Unit Plan (the "
DSU Plan
") and Restricted Share Unit Plan (the "
RSU Plan
").
Nominating and Governance Committee ("NG Committee
"
)
The NG Committee Charter is included in the Governance Manual and is available
for viewing or downloading from the Company's website under
About Us / Corporate Governance
at
www.northerndynastyminerals.com
.
The NG Committee has been given the responsibility of developing and
recommending to the Board the Company's approach to corporate governance and
of assisting members of the Board in carrying out their duties. The NG
Committee also reviews with the Board the rules and policies applicable to
governance of the Company to assure that the Company remains in full
compliance with proper governance practices.
The nominating function of the NG Committee is to evaluate and recommend to
the Board the size of the Board and persons as nominees for the position of
director of the Company.
The NG Committee does not set specific minimum qualifications for director
positions. Instead, the NG Committee believes that nominations for election
or re-election to the Board should be based on a particular candidate's skills
and the Company's needs after taking into account the current composition of
the Board. When evaluating candidates annually for nomination for election,
the NG Committee considers each individual's skills, the overall diversity
needs of the Board (skills mix, age profiles, gender, ethnicity, work and life
experience) and independence and time availability.
The NG Committee seeks to achieve for the Board a balance of industry and
business knowledge and experience, including expertise in the mining industry,
in regulatory and public policy issues, in management and operations and in
transactional situations, as well as independence, financial expertise, public
company experience, sound judgment and reputation.
Sustainability Committee
The Sustainability Committee Charter is included in the Corporate Governance
Manual and is available for viewing or downloading from the Company's website
at
www.northerndynastyminerals.com
under
About Us / Corporate Governance
.
15
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The principal purpose of the Sustainability Committee is to review, monitor
and assess, on behalf of the Board of Directors, the policies and practices of
the Company as they relate to the environment, the health and safety of
employees in the work place, and sustainable development and social corporate
objectives.
Board Diversity
The NG Committee believes that a diverse Board offers depth of perspective and
enhances Board operations. As such, the NG Committee strives to identify
candidates with the ability to strengthen the Board. The NG Committee does
not specifically define diversity, but considers diversity of experience,
education, ethnicity and gender, as part of its overall annual evaluation of
director nominees. The Board appreciates that women have been underrepresented
on Canadian boards, and the Board believes that enhancing gender diversity
will strengthen the Board. However, the Board does not establish quotas for
any selection criteria, as the composition of the Board is based on numerous
factors and the character of a candidate, and the selection is often a
function of the "best available" candidate.
The Company has adopted an express policy specifically addressing gender
diversity. A copy of the Board Diversity Policy is set out as Appendix 11 to
the Governance Manual. The Company continues in its efforts to enhance Board
diversity and to meet the stated Board Diversity Policy targets on female
representation on the Board.
Although the Board was successful in 2023 in recruiting two female directors,
the Board plans to continue its efforts attempting to recruit additional
female and other diverse directors in accordance with its Diversity Policy.
Director Term Limits
The Company has not set mandatory age or term limits for its directors or
senior officers as it focuses on measurable performance rather than employing
arbitrary age thresholds which are of dubious legality in light of
discrimination laws. However, review by the NG Committee of the performance
of all Board members and senior officers of the Company is ongoing and it is
within the mandate of the NG Committee to keep within its scope the
possibility of imposing such limits in the future.
Code of Ethics
The Company's code of ethics, as set out in the Governance Manual, provides a
framework for undertaking ethical conduct in employment. Pursuant to its code
of ethics the Company will not tolerate any form of discrimination or
harassment in the workplace.
Board and Committee Assessments
The Company has formal procedures for assessing the effectiveness of Board
committees as well as the Board as a whole. This function is carried out
annually under the direction of the NG Committee and those assessments are
then provided to the Board.
Board of Directors Decisions
Good governance policies require the board of directors of a listed
corporation, together with its chief executive officer, to develop position
descriptions for its board of directors and for the chief executive officer,
including the definition of limits to management's responsibilities. Any
responsibility which is not delegated to the Company's senior management or to
a Board committee remains with the full Board. The Board has approved written
position descriptions for the Board Chair and the Chair of each of the Board
Committees.
The Board generally requires that all material transactions (including those
in excess of $5 million) receive prior Board approval. In this regard,
virtually all financing transactions are considered material to the Company.
Any property acquisitions and significant work programs in excess of $5
million must also receive approval of the Board. The Governance Manual
includes provisions that deal with these and other related items.
Governance Policies for Board of Directors and Directors' Attendance of Meetings
Good governance policies require that (i) the board of directors of every
listed corporation implement a process for assessing the effectiveness of the
Board and its committees, and the contribution of individual directors, (ii)
every corporation provide an orientation and education program for new
directors, and (iii) every board of directors review the adequacy and form of
compensation of directors and ensure that the compensation realistically
reflects the responsibilities and risks involved in being an effective
director.
16
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The following table sets forth the record of attendance of Board of Directors
and Board Committee meetings by Directors for the 12-month period ended
December 31, 2023:
Director Board of Audit and Risk Nominating Compensation Sustainability
Directors Committee and Committee Committee
Meetings Meetings Governance
Committee
Desmond Balakrishnan 3 of 3 N/A N/A N/A N/A
Robert Dickinson 3 of 3 N/A N/A N/A N/A
Siri C. Genik 3 of 3 N/A 1 of 1 N/A N/A
1
5
Wayne Kirk 3 of 3 2 of 2 3 of 3 N/A N/A
2
Christian Milau 3 of 3 4 of 4 3 of 3 N/A Nil
Ken Pickering 3 of 3 3 of 4 N/A Nil Nil
5 4
Isabel Satra 2 of 2 N/A N/A N/A N/A
3
5
Ronald Thiessen 3 of 3 N/A N/A N/A N/A
Notes:
1.
Effective May 17, 2023, Ms. Genik was appointed to the Nominating and
Governance Committee and the Sustainability Committee. There was one
Nominating and Governance Committee meeting thereafter in 2023.
2.
Effective May 17, 2023, Mr. Kirk was appointed to the Audit and Risk Committee
and the Compensation Committee. There were two Audit and Risk Committee
meetings thereafter in 2023.
3.
Ms. Satra was appointed on March 24, 2023, and to the Compensation Committee
on May 17, 2023. There were two Board of Director meetings thereafter in 2023.
4.
Effective June 30, 2023, Mr. Kirk and Ms. Satra were appointed to the
Compensation Committee.
5.
Effective May 7, 2024, Ms. Genik replaced Ms. Satra on the Compensation
Committee and Replaced Mr. Picketing as Chair of the Sustainability Committee.
While no formal meetings of the Compensation Committee and the Sustainability
Committee took place in 2023, the Compensation Committee and the Sustainability
Committee, and in particular Mr. Pickering, the Chair of each of the
Committees at the time, did monitor and oversee the Company's compensation and
sustainability related matters in 2023.
In addition, the Board of Directors receives regular reports from the Chairs
of each Committee at regularly scheduled meetings of the Board of Directors.
Directorships
The section entitled "
Election of Directors
" above gives details of other reporting issuers of which each director is a
director and/or officer where applicable.
Orientation and Continuing Education
The Company has traditionally retained experienced mining people as directors
and hence the orientation needed is minimized. When new directors are
appointed, they generally are acquainted with the Company's mineral project(s)
and the expectations of directors, or they would receive orientation
commensurate with their previous experience on the Company's properties,
business, technology and industry and the responsibilities of directors.
Board meetings generally include presentations by the Company's senior
management and project staff in order to give the directors full insight into
the Company's operations.
To enable each director to better perform his or her duties and to recognize
and deal appropriately with issues that arise, the Company will provide the
directors with appropriate education programs and/or suggestions to undertake
continuing director education, the cost of which will be borne by the Company.
Ethical Business Conduct
The Board has a formal ethics policy which is contained in the Governance
Manual and which is available for download from the Company's website at
www.northerndynastyminerals.com
under
About Us / Corporate Governance
. In addition, the Board has implemented an annual procedure whereby
directors and officers sign off on and ratify that they have read and
understand the Company's code of ethics and that they are unaware of any
violations thereof.
17
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Nomination of Directors
The Board considers its size each year when it considers the number of
directors to recommend to the shareholders for election at the annual meeting
of shareholders, taking into account the number required to carry out the
Board's duties effectively and to maintain a diversity of views and
experience. The NG Committee recommended to the Board the eight (8) nominees
for election as director in 2024. See the description of the NG Committee
above under the heading, "
Committees of the Board of Directors
"
.
Assessments
The Board monitors the adequacy of information given to directors,
communication between the Board and management and the strategic direction and
processes of the Board and its committees. The NG Committee oversees an
annual formal assessment of the Board and its four main committees namely the
Audit and Risk Committee, Compensation Committee , NG Committee and the
Sustainability Committee. The Board is satisfied with the overall project
and corporate achievements of the Company and believes this reflects well on
the Board and its practices.
Shareholder Engagement
The Board of Directors believes that regular and constructive engagement
between the Board and the Company's shareholders on governance matters is of
primary importance. Accordingly, the Board has adopted a Policy on Engagement
with Shareholders on Governance Matters reflecting the foregoing, a copy of
which is included as Appendix 10 to the Governance Manual and is available for
viewing from the Company's website at
www.northerndynastyminerals.com
under
About Us / Corporate Governance
.
Other Governance Matters - Compensation Clawback Policy
The Board has approved a Compensation Clawback Policy. Specifically, the
Board approved a Policy for the Recovery of Erroneously Awarded Incentive
Based Compensation (the "Compensation Clawback Policy") effective on August
14, 2023, as required by the NYSE American stock exchange. The Board believes
that having a compensation clawback policy is in line with good governance
practices.
The Compensation Clawback Policy is designed to facilitate reasonably prompt
recovery by the Company of the amount of any incentive-based compensation that
is deemed to have been erroneously awarded in the event that the Company is
required to restate its financial statements due to material non-compliance
with any financial reporting requirement under relevant securities laws.
In that event that the Company is required to prepare an accounting
restatement, the Company will reasonably promptly take action to recover the
amount of any erroneously awarded incentive-based compensation that has been
received by each applicable executive officer:
(a)
after beginning services as an executive officer;
(b)
who served as executive officer at any time during the performance period for
that incentive-based compensation;
(c)
while the Company has a class of securities listed on NYSE American (or
another national securities exchange in the United States or Nasdaq); and
(d)
during the three completed fiscal years immediately preceding the date on
which the Company was required to prepare the relevant accounting statement
that was the subject of the accounting restatement
The full text of the Compensation Clawback Policy is contained in Appendix 12
to the Company's Governance Manual which is available for download from the
Company's website at www.northerndynastyminerals.com.
18
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STATEMENT OF EXECUTIVE COMPENSATION
Compensation Discussion and Analysis
Named Executive Officers
In this section "Named Executive Officer" (or "
NEO
") means each of the following individuals:
(a)
the Chief Executive Officer ("
CEO
");
(b)
the Chief Financial Officer ("
CFO
");
(c)
each of the three most highly compensated executive officers, or the three
most highly compensated individuals acting in a similar capacity, other than
the CEO and CFO, at the end of the most recently completed financial year
whose total compensation was, individually, more than $150,000 for that
financial year; and
(d)
each individual who would be an NEO under paragraph (c) but for the fact that
the individual was neither an executive officer of the company, nor acting in
a similar capacity, at December 31, 2023.
The NEOs of the Company as at December 31, 2023, are as follows:
* Mr. Ronald Thiessen - President and CEO of the Company;
* Mr. Mark Peters - CFO of the Company;
* Mr. John Shively - CEO of Pebble Limited Partnership ("
PLP
");
* Mr. James Fueg - PLP Senior Permitting Advisor; and
* Mr. Stephen Hodgson -Vice President Engineering of the Company.
The following disclosure sets out the compensation payable to each NEO and
director for the financial year ended December 31, 2023.
Compensation Committee
As indicated above, the Company's Compensation Committee (the "
Committee
") assists the Board in carrying out its responsibilities relating to
executive and director compensation. The Committee charter is included in the
Governance Manual and is available for viewing from the under
About Us / Corporate Governance
on the Company's website at
www.northerndynastyminerals.com
.
The current members of the Committee of the Company are Ken Pickering (Chair),
Wayne Kirk and Siri Genik, all of whom are independent directors. The
Committee had no formal meetings during the year..
All of the Committee members serve on other boards of publicly traded mining
companies and the Committee members all possess the skills and experience that
enable the Committee to make decisions on the suitability of the Company's
compensation policies and practices. See disclosure under "
Biographical Information of Nominees for Director
" for relevant education and experience of the Committee.
As a result of their education and experience, each member of the Committee
has familiarity with, an understanding of, or experience in:
(a)
reviewing compensation philosophy, including base compensation structures and
incentive programs;
(b)
reviewing specific executive and director compensation;
(c)
administering of share options and other equity based compensation plans and
the determination of share option grants; and
(d)
reviewing performance goals and the assessments of corporate officers.
The Committee has, among other things, the following duties, responsibilities
and authority:
i.
to recommend to the Board the form and amount of compensation to be paid by
the Company to directors for service on the Board and on its committees. The
Committee reviews director compensation at least annually.
19
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ii.
to annually review the Company's base compensation structure and the Company's
incentive compensation, share option and other equity-based compensation
programs and recommend changes in or additions to such structure and plans to
the Board as needed.
iii.
to recommend to the Board the annual base compensation of the Company's
executive officers and senior managers (collectively the "
Officers
").
iv.
to recommend to the Board annual corporate goals and objectives under any
incentive compensation plan adopted by the Company for Officers, and recommend
incentive compensation participation levels for Officers under any such
incentive compensation plan. In determining the incentive component of
compensation, the Committee will consider the Company's performance and
relative Shareholder return, the values of similar incentives at comparable
companies and the awards given in past years.
v.
to evaluate the performance of Officers generally and in light of annual
corporate goals and objectives under any incentive compensation plan.
vi.
to periodically review with the Chairman and CEO their assessments of Officers
and succession plans and make recommendations to the Board regarding
appointment of Officers.
vii.
to administer the Company's share option and other equity based compensation
plans and determine the annual grants of share options and other equity based
compensation.
viii.
to recommend to the NG Committee the qualifications and criteria for
membership on the Committee.
Report on Executive Compensation
This report on executive compensation has been authorized by the Committee
members as aforementioned. The Board assumes responsibility for reviewing and
monitoring the long-range compensation strategy for the Company's senior
management, although the Committee guides it in this role. As part of its
mandate, the Board determines the type and amount of compensation for the
Company's executive officers. In addition, the Board reviews the methodology
utilized by the Company for setting salaries of employees throughout the
organization.
The Committee receives competitive market information on compensation levels
for executives. The Company's compensation policies and programs are designed
to be competitive with similar junior mining exploration companies and to
recognize and reward executive performance consistent with the success of the
Company's business.
Philosophy and Objectives
The Company's senior management compensation program is designed to ensure
that the level and form of compensation achieves certain objectives, including:
(a)
attracting and retaining talented, qualified and effective executives;
(b)
motivating the short and long-term performance of these executives; and
(c)
better aligning their interests with those of the Company's Shareholders.
In compensating its senior management, the Company employs a combination of
base salary, bonus compensation and equity participation through its share
option plan.
Base Salary
In the Board's view, paying base salaries that are competitive in the markets
in which the Company operates is a first step to attracting and retaining
talented, qualified and effective executives. The NEOs are paid a salary in
order to ensure that the compensation package offered by the Company is in
line with that offered by other companies in our industry, and as an immediate
means of rewarding the NEOs for efforts expended on behalf of the Company.
The salary to be paid to a particular NEO is determined by gathering
competitive salary information on comparable companies within the industry
from a variety of sources, including surveys conducted by independent
consultants and national and international publications. Payment of a cash
salary fits within the objectives of the compensation program since it rewards
each NEO for performance of his duties and responsibilities.
20
-------------------------------------------------------------------------------
Bonus Compensation
There are currently no performance goals set by the Company for executive
bonus compensation. Bonus compensation is awarded at the discretion of the
Board and the Board considers performance, shareholder benefits, competitive
factors and other matters in awarding bonuses. The Company's objective is to
achieve certain strategic objectives and milestones relating to the Pebble
Limited Partnership. The Board will consider executive bonus compensation
dependent upon the Company meeting those strategic objectives and milestones
and sufficient cash resources being available for the grant of bonuses.
The Company obtains salary and bonus information through its affiliation to
the HDI group of companies. No fees were paid directly to HDSI or any
consultant for compensation services for the last three recently financial
years.
All Other Fees
There were no other fees paid to any consultants or advisors, which relate to
executive compensation.
Equity Participation
The Company has a share option plan (the "
Option Plan
"), which was last approved by shareholders on June 30, 2021 for continuation
for three years. The Option Plan was established to provide incentive to
qualified parties to increase their proprietary interest in the Company,
encourage the alignment of interests with its shareholders, and foster their
continued association with the Company.
The Committee is delegated the authority to grant share options (the "
Options
"). The Committee reviews the grant of share options to directors,
management, employees and consultants. Share options are generally granted
annually, and at other times of the year to individuals commencing employment
with the Company. Share option exercise prices are set in accordance with TSX
policies ("
TSX rules
") and are based on the five-day volume weighted average trading price prior
to the date of grant.
The Company believes that encouraging its executives, employees and directors
to become Shareholders is the best way of aligning their interests with those
of its Shareholders. Equity participation is accomplished through the Option
Plan, as well as through the DSU Plan and the RSU Plan (see "
Securities
Authorized for Issuance under Equity Compensation Plans"
below). Share options are granted taking into account a number of factors,
including the amount and term of options previously granted, base salary and
bonuses, and competitive factors. Share options vest on terms established by
the Committee.
The Company's long term incentive plans are designed to foster and promote the
long-term financial success of the Company by strengthening the ability of the
Company to attract and retain highly competent employees, motivating
performance through incentive compensation, promoting greater alignment of
interests between employees and Shareholders in creating long-term shareholder
value, and enabling employees to participate in the long-term growth and
financial success of the Company. Share options also allow them to benefit
from the favourable tax treatment applicable to this form of compensation.
The Company also has a Restricted Share Unit Plan (the "RSU Plan") and a
Non-Employee Directors Deferred Share Unit Plan (the "DSU Plan") both of which
were initially approved by the shareholders in July 2015, and were last
approved by the shareholders, as amended, at the Company's annual shareholder
meeting held June 30, 2021.
See disclosure below under
Securities Authorized for Issuance under Equity Compensation Plans
and under
Particulars of Matters to be Acted Upon
for disclosure concerning the Option Plan, DSU Plan and RSU Plan, including
the material terms of the each plan. Management will present an ordinary
resolution at the Meeting to approve the continuation of each of the Option
Plan, DSU Plan and RSU Plan for three years until June 27, 2027. The
resolution to approve the continuation of the Option Plan, as amended, will be
an ordinary resolution of disinterested shareholders.
21
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General
The Committee considered the implications of the risks associated with the
Company's compensation policies and practices and concluded that, given the
nature of the Company's business and the role of the Committee in overseeing
the Company's executive compensation practices, the compensation policies and
practices do not serve to encourage any officer or individual at a principal
business unit or division to take inappropriate or excessive risks, and no
risks were identified arising from the Company's compensation policies and
practices that are reasonably likely to have a material adverse effect on the
Company.
There is a restriction on officers and directors regarding the purchase of
financial instruments including prepaid variable forward contracts, equity
swaps, collars, or units of exchange funds that are designed to hedge or
offset a decrease in market value of Company equity securities granted as
compensation or held, directly or indirectly, by the officer or director. For
the years ended December 31, 2023 and 2022, no officer or director, directly
or indirectly, employed a strategy to hedge or offset a decrease in market
value of Company equity securities.
Given the evolving nature of the Company's business, the Board continues to
review and redesign the overall compensation plan for senior management so as
to continue to address the objectives identified above.
Performance Graph
The following graph compares the cumulative Shareholder return on an
investment of $100 in the Common Shares of the Company for the past five years
of the Company on the TSX with a cumulative total shareholder return on the
S&P/TSX Composite Index.
Since 2018, the Company's share price has trended down. The share price was
however, negatively impacted when the United States Army Corps of Engineers
("USACE") issued its 2020 record of decision rejecting the Pebble
Partnership's permit application and by the Unted States Environmental
Protection Agency re-initiating its pre-emptive veto process in 2022 which
culminated in its issue of a Final Determination under the Clean Water Act in
January 2023. The USACE remanded certain elements of the 2020 record of
decision to the Alaska District of the USACE under the Administrative Appeal
Decision, however, in April 2024, the Alaska District informed the Company
that it has declined to engage in the remand process, citing the intervening
EPA's Final Determination. The Company share price as such has and remains
uncertain notwithstanding the recent legal actions filed by the Company,
seeking to vacate the EPA's Final Determination and a takings case. Further
details are discussed in the Company's Annual Information Form and other
continuous disclosure documents. NEO compensation decreased from 2018 to
2019, mainly due to the lower fair value estimated for share options at grant
date and lower salaries. In 2020, NEO compensation increased due to the
higher fair value attributed to share options granted as share prices were
significantly higher on date of grant than in the prior year.
In 2021, NEO compensation decreased as no options were granted. In 2022, NEO
compensation increased as result of the granting of options. In 2023, NEO
compensation decreased due to no options being granted.
22
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Summary Compensation Table
The compensation paid to the NEOs during the Company's three most recently
completed financial years ended December 31 is as set out below and expressed
in Canadian dollars unless otherwise noted:
Non-equity
Name and Share- Option- incentive plan
principal Year based based compensation ($) Pen- All other Total
position Salary ($) awards awards sion compen- Compen-
($) ($) value sation sation
($) ($) ($)
Long-term
Annual incentive
incentive plans
plans ($)
($)
Ronald Thiessen 2023 506,000 - - 506,000
2, 2 - - - -
President & CEO
2022 506,000 - 594,880 1,100,880
2 3
2021 506,000 - - 506,000
2
Mark Peters 2023 275,000 - - 275,000
2 2 - - - -
CFO
2022 275,000 - 297,440 572,440
2 3
2021 275,000 - - 275,000
2
John Shively 2023 809,717 - - 26,721 836,438
1, - - - 6
4
PLP CEO
2022 813,229 - 74,212 24,803 912,244
3 6
2021 789,966 - - 21,815 811,781
6
James Fueg 2023 407,713 - - - - - 92,900 500,613
1, 6, , 9
4
PLP Senior Permitting Advisor
2022 677,690 - 56,369 24,803 758,862
3 6
2021 602,770 - - 21,815 624,585
6
Stephen Hodgson 2023 219,794 - - - - - 2,845 222,639
1,5 8
VP Engineering
2022 206,702 - 103,896 4,500 - - 2,473 317,571
3 8
2021 299,204 - - 5,000 - - 18,204 322,408
8 7, 8
Notes:
1.
Messrs. Shively and Fueg and Hodgson (until to the end of February 2021, refer
to note 8 below), were paid in United States dollars ("
US dollars
"). The following annual average exchange rates have been applied where
applicable:
2023 2022 2021
US$ for $1.00 0.7410 0.7378 0.7976
2.
Salaries shown for Messrs. Thiessen and Peters are paid by the Company
directly to HDSI. Mr. Thiessen, who is a director of HDSI, and Mr. Peters, who
is the CFO of HDSI, spend the majority of their time providing services to the
Company.
3.
The options were granted in August 2022 pursuant to the Company's share option
plan. For compensation purposes, the Black-Scholes option valuation model has
been used to determine the fair value on the date of grant using the following
assumptions: expected life of 5 years, expected volatility of 99.98%, expected
dividend yield of 0%, and risk-free interest rate of 3.06%. The Black-Scholes
grant date fair value for these awards was $0.297 per option which was 72% of
the option exercise price.
4.
Mr. Shively, who has held the position of CEO for PLP since September 2020,
and Mr. Fueg, who previously held the position of Senior Vice President for
PLP and currently is Senior Permitting Advisor, are employed and paid through
a subsidiary of the Company.
5.
Mr. Hodgson has been the Vice President Engineering for the Company since
2005. From July 2018, Mr. Hodgson was employed through a US subsidiary of
HDSI ("
HDUS
") and provided services to PLP as Senior Vice President Engineering & Project
Director until the end of February 2021. The Company reimbursed HDUS for the
salary cost incurred and has since March 1, 2021, paid HDSI pursuant to set
rates for the services of Mr. Hodgson. Mr. Hodgson's US dollar salary cost
has been translated at the annual average exchange rate for 2021 (see note 1
above). The numbers reflected in the table are amounts paid directly to Mr.
Hodgson.
6.
A subsidiary of the Company has a 401(k)-retirement savings plan for U.S.
employees whereby employees are able to contribute a portion of their pay and
receive a dollar-for-dollar Company match up to 6% of their pay, subject to
United States Internal Revenue Service limitations.
23
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7.
Until the end of February 2021, Mr. Hodgson received housing, vehicle and
spousal/partner allowances as his primary residence was outside of Alaska.
8.
Mr. Hodgson received reimbursement of relocation costs and, since March 2021,
has received HDSI taxable benefits.
9.
Mr. Fueg's other compensation included a payout of vacation accrued totaling
$66,179.
Incentive Plan Awards
Outstanding Share-based Awards and Option-based Awards
The Company currently has an option-based awards plan (the "Option Plan") and
two share-based awards plans (the "DSU Plan" and the "RSU Plan"). The
following table sets out the options and share-based awards outstanding as of
December 31, 2023, for each NEO:
Option-based Awards Share-based Awards
Year of
Name grant
Market or
payout
Market or value of
Number payout vested
Number of Value of of shares value of share-
securities unexercised or units share- based
underlying Option in-the- of shares based awards not
un- Option expiry money that have awards paid out or
exercised exercise date options not that have distrib-
options price m-d-y (note1) vested (#) not vested uted
(#) ($) ($) (note 2) ($) (note 2)
($)
Ronald Thiessen 2019 1,200,000 0.99 Sep-27-2024 - - - -
President and CEO
2020 1,200,000 2.01 Jul-17-2025 - - - -
2022 2,004,000 0.41 Aug-18-2027 20,040 - - -
Mark Peters 2019 600,000 0.99 Sep-27-2024 - - - -
CFO
2020 600,000 2.01 Jul-17-2025 - - - -
2022 1,002,000 0.41 Aug-18-2027 10,020 - - -
John Shively 2019 102,000 0.99 Sep-27-2024 - - - -
PLP CEO
2020 102,000 2.01 Jul-17-2025 - - - -
2022 250,000 0.41 Aug-18-2027 2,500 - - -
James Fueg 2019 51,000 0.99 Sep-27-2024 - - - -
PLP Senior Permitting Advisor
2020 51,000 2.01 Jul-17-2025 - - - -
2022 200,000 0.41 Aug-18-2027 2,000 - - -
Stephen Hodgson 2019 102,000 0.99 Sep-27-2024 - - - -
VP Engineering
2020 102,000 2.01 Jul-17-2025 - - - -
2022 350,000 0.41 Aug-18-2027 3,500 - - -
Note:
1.
The value is calculated as the difference between the TSX closing price of
$0.42 per common share at December 29, 2023, being the last trading day, and
the exercise price of options.
2.
There are no share-based awards that have been issued to the NEOs.
For the year ended December 31, 2023, no new options were granted by the
Company.
Incentive Plan Awards - Value Vested or Earned During the Year
The following table sets out value vested or earned for all incentive plans
during the year ended December 31, 2023, for each NEO:
24
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Option-based Share-based Non-equity
awards - awards - Value incentive plan
Value vested vested during compensation -
during the year the year Value earned
Name ($) ($) during the year ($)
1
Ronald Thiessen - - -
,
President and CEO
Mark Peters - - -
,
CFO
John Shively, - - -
PLP CEO
James Fueg, - - -
PLP Senior Permitting Advisor
Stephen Hodgson - - -
,
VP Engineering
Notes:
3.
Represents the aggregate dollar value that would have been realized if options
under the option-based award had been exercised on the 2023 vesting date
determined by taking the difference between the market price of common shares
subject to the option at date of vesting and the exercise price of the option.
However, no value has been determined as the market price did not exceed the
exercise price at the time of vesting.
Pension Plan Benefits
Except as outlined herein, the Company has no pension or deferred compensation
plans for its NEOs, directors, officers, or employees.
The Pebble Partnership, a subsidiary of the Company, has a 401(k)-retirement
savings plan for U.S. employees whereby employees are able to contribute a
portion of their pay and receive a dollar-for-dollar Company match up to 6% of
their pay, subject to IRS limitations.
Termination and Change of Control Benefits
Other than the employment agreements that our wholly-owned subsidiary, Pebble
Services Inc. ("
PSI
"), had with Messrs. Shively and Fueg, there is no written employment contract
between the Company or its subsidiaries and the NEOs. However, Messrs.
Thiessen, Peters and Hodgson have agreements with HDSI and are seconded to the
Company. Mr. Hodgson was until February 2021 seconded to the Company on a
full-time basis based in Anchorage, Alaska, through a written employment
contract with a wholly-owned US subsidiary of HDSI. Each of Messrs. Thiessen,
Peters and Hodgson have change of control agreements with the Company.
There are no compensatory plan(s) or arrangement(s), with respect to any NEO,
other than discussed below, resulting from the resignation, retirement, or any
other termination of employment of the officer's employment or from a change
of any NEO's responsibilities following a change in control.
Under the employment agreement for Mr. Shively, upon termination for
unsatisfactory performance, Mr. Shively is entitled to three months prior
written notice or payment in lieu thereof. Upon termination within 12 months
following a change of control, or if Mr. Shively's position is no longer
required, or the Company no longer desires Mr. Shively to fill the position or
if the Company determines not to proceed with the Pebble Project, Mr. Shively
is entitled to receive 12 months prior written notice or payment in lieu
thereof, and in the event of a termination following a change of control any
options to purchase common shares held by Mr. Shively would vest and be
exercisable in full until their normal expiry date.
Under the change of control agreements for Messrs. Thiessen, Peters and
Hodgson, upon resignation or termination without cause, including constructive
dismissal, following a change of control:
* Mr. Thiessen would be entitled to receive a payment of $920,000 payable by
the Company as set out in the agreement;
* Mr. Peters would be entitled to receive a payment of $500,000 payable by
the Company as set out in the agreement; and
* Mr. Hodgson would be entitled to receive a payment equal to his annual
salary payable under his employment contract.
In addition to the foregoing, Messrs. Thiessen, Peters and Hodgson would be
entitled to receive any amount earned and payable under any Company incentive
plan, or if no amount is earned for the year in question any incentive plan
payment made in the previous year, and all stock options held by them would
vest and be exercisable in full until their normal expiry date.
25
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Director Compensation
Philosophy and Objectives
The main objective of director compensation is to attract and retain directors
with the relevant skills, knowledge, and abilities to carry out the Board's
mandate.
Director Compensation Table
The compensation provided to the directors, excluding a director who is
included in disclosure for an NEO, for the Company's most recently completed
financial year of December 31, 2023, is:
Non-equity
Share incentive
Fees Share- option- plan Pension All other
earned based based compen- value compen- Total
Name ($) awards awards sation ($) sation ($)
($) ($) ($) ($)
Desmond Balakrishnan 44,550 - - - - - 44,550
Steven Decker 24,199 - - - - - 24,199
1
Robert Dickinson 170,000 - - - - - 170,000
2,
Siri Genik 44,476 - - - - - 44,476
Gordon Keep 26,125 - - - - - 26,125
1, 4
Wayne Kirk 20,354 25,273 - - - - 45,627
3
David Laing 28,050 - - - - - 28,050
1, 4
Christian Milau 61,820 - - - - - 61,820
1
Ken Pickering 56,100 - - - - - 56,100
1
Isabel Satra - - - - - - -
Notes:
1.
In 2023, each director of the Company was entitled to an annual director's fee
comprising of: a) $44,550 Base Fee; b) $9,570 for being the Chair of the Audit
and Risk Committee; c) $3,850 for being the Chair of the Compensation
Committee, Nominating and Governance Committee and Sustainability Committee;
and d) $3,850 for being a member of one of the Committees.
2.
Fees for Mr. Dickinson are paid through HDSI. The fee amount shown is the
amount paid to HDSI by the Company for Mr. Dickinson serving as a director and
as Chair of the Board.
3.
Mr. Kirk elected to receive his fees 50% in cash and 50% in DSUs. The amount
shown for share-based awards represents the fair value of the DSUs granted in
respect to fees earned in the fiscal year based on the TSX closing price of
Common Shares on date of grant as follows:
Number Of DSUs TSX Price ($) Total ($)
20,329 0.300 6,099
18,906 0.330 6,239
20,804 0.305 6,345
14,644 0.450 6,590
74,683 25,273
4.
Messrs. Keep and Laing did not stand for re-election at the June 30, 2022,
annual general meeting and accordingly per the DSU plan, requested the
redemption of their DSUs. The Company elected to complete the pay out in
Common Shares less required withholdings. Mr. Keep had 85,884 DSUs and Mr.
Liang had 57,738 DSUs.
26
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Outstanding Share-based Awards and Option-based Awards
The following table sets out all option-based awards outstanding pursuant to
the Option Plan and all outstanding share-based awards pursuant to the DSU
Plan and the RSU Plan as of December 31, 2023, for each director, excluding a
director who is already set out in disclosure for an NEO above:
Option-based Awards Share-based Awards
Year
of
Name grant
Market or Market or
payout payout value
Number of Value of Number of value of of vested
securities unexercised in- shares or share-based share-based
underlying Option Option expiry the-money units of awards that awards not
unexercised exercise date options shares that have not paid out or
options price ($) m - d - y (note 1) have not vested distributed
(#) ($) vested (note 1) (note 2)
(#) ($) ($)
Desmond Balakrishnan 2016 - - - - - - 35,286
2019 120,000 0.99 Sep-27-2024 - - - -
2020 120,000 2.01 Jul-17-2025 - - - -
2022 200,000 0.41 Aug-18-2027 2,000 - - -
Robert Dickinson 2019 300,000 0.99 Sep-27-2024 - - - -
2020 300,000 2.01 Jul-17-2025 - - - -
2022 500,000 0.41 Aug-18-2027 5,000 - - -
Wayne Kirk 2019 102,000 0.99 Sep-27-2024 - - - -
3
2020 102,000 2.01 Jul-17-2025 - - - -
3
2021 - - - - - - 8,224
2022 200,000 0.41 Aug-18-2027 2,000 - - 25,862
2023 - - - - - - 31,367
Christian Milau 2016 - - - - - - 26,664
2019 120,000 0.99 Sep-27-2024 - - - -
2020 120,000 2.01 Jul-17-2025 - - - -
2022 200,000 0.41 Aug-18-2027 2,000 - - -
Ken Pickering 2016 - - - - - - 38,714
2019 120,000 0.99 Sep-27-2024 - - - -
2020 120,000 2.01 Jul-17-2025 - - - -
2022 200,000 0.41 Aug-18-2027 2,000 - - -
Notes:
1.
For options, the value is the difference between the TSX closing price of
$0.42 per Common Share at December 31, 2023, and the exercise price of the
options.
2.
The values relate to DSUs, which were fully vested on date of grant, and has
been calculated based on the number of Common Shares underlying such awards
multiplied by the TSX closing price of $0.42 per Common Share at December 31,
2023. The following table provides the number of DSUs outstanding and values
attributed:
Director Number of DSUs Values ($)
Desmond Balakrishnan 84,014 35,286
Wayne Kirk 155,840 65,453
Christian Milau 63,486 26,664
Ken Pickering 92,177 38,714
3.
Mr. Kirk received these options as a director of Pebble Mines Corp., the
General Partner of the Company's subsidiary Pebble Limited Partnership.
27
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Incentive Plan Awards - Value Vested or Earned During the Year
The following table sets out all awards pursuant to incentive plans (value
vested or earned) during the year ended December 31, 2023, for each director,
excluding a director who is already set out in disclosure for an NEO above:
Name Option-based awards - Share-based awards - Non-equity incentive
Value vested during the Value vested during the plan compensation -
year year Value earned during
(note 1) ($) the year
($) ($)
Desmond Balakrishnan - - -
Robert Dickinson - - -
Siri Genik - - -
Wayne Kirk - - -
Christian Milau - - -
Ken Pickering - - -
Isabel Satra - - -
Notes:
1.
Represents the aggregate dollar value that would have been realized if options
under the option-based award had been exercised on the vesting date,
determined by taking the difference between the TSX closing price of the
Company's Common Shares at date of vesting and the exercise price of the share
option. However, no value has been determined as the market price did not
exceed the exercise price at the time of vesting.
SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS
See disclosure below concerning all of the Company's Share Compensation
Arrangements, being:
1.
the Share Option Plan (the "
Option Plan
"), a rolling 8% maximum option plan, which Option Plan, and the related
Common Share allocations pursuant to the Option Plan, were last approved and
ratified by shareholders on June 30, 2021 for a three-year period;
2.
the Restricted Share Unit Plan ("
RSU Plan
") with a rolling 1% maximum of Restricted Share Units ("
RSUs
") available pursuant to the RSU Plan, subject to the 8% rolling maximum under
all Share Compensation Arrangements of the Company, which was last approved by
the shareholders on June 30, 2021 for a three-year period; and
3.
The Non-Employee Directors Deferred Share Unit Plan ("
DSU Plan
") with a rolling 1% maximum of Deferred Share Units ("
DSUs
") available pursuant to the DSU Plan, subject to the 8% rolling maximum under
all Share Compensation Arrangements of the Company, which was also last
approved by the shareholders on June 30, 2021 for a three-year period;
(together, the "
Plans
").
At the Meeting the Company will present ordinary resolutions to ratify and
approve:
i.
the Option Plan, as amended;
ii.
the RSU Plan; and
iii.
the DSU Plan;
for continuation for three more years until June 27, 2027, see related
disclosure under
Particulars of Matters to be Acted Upon
. The resolution to approve the Option Plan, as amended, will be an ordinary
resolution of disinterested shareholders.
28
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Option Plan
Pursuant to the current Option Plan, Options may be granted to purchase Common
Shares, up to an aggregate maximum of 8% of the outstanding Common Shares,
including all Share Compensation Arrangements of the Company, see "
Equity Compensation Plan Information
"
below. As outstanding Options are exercised, additional Options may be
granted to replace the exercised Options. In addition, as the number of
issued and outstanding Common Shares increases, the number of Options
available for grant to eligible optionees also increases. As at the date
hereof, there are Options outstanding to purchase an aggregate of 27,731,100
Common Shares representing approximately 5.3% of the outstanding Common Shares.
A complete copy of the Option Plan was filed on May 26, 2021, and is available
for viewing, under the Company's SEDAR+ profile at
www.sedarplus.ca
.
A copy of the amended Option Plan dated May 17, 2024, including the proposed
amendments described below, is also available for viewing under the Company's
SEDAR+ profile at
www.sedarplus.ca
. Capitalized terms used but not defined herein have the meaning ascribed to
them in the Option Plan. The following is a summary of the material terms of
the Option Plan, inclusive of the amendments to the Plan approved by our Board
of Directors, as described below under "PARTICULARS OF MATTERS TO BE ACTED
UPON - Amendment and Renewal of Option Plan:
(a)
Persons who are directors, officers, employees, or consultants to the Company
or its affiliates, or who are employees of a management company providing
services to the Company, are eligible to receive grants of Options under the
Option Plan.
(b)
Options may be granted only to an individual or to a company that is owned by
individuals eligible for an Option grant. If the Option is granted to a
company, the company must undertake that it will not permit any transfer of
its shares, nor issue further shares, to any other individual or entity as
long as the incentive stock Option remains in effect without the consent of
the TSX.
(c)
All Options granted under the Option Plan may be exercisable only by the
Optionee to whom they have been granted and the Options are non-assignable and
non-transferable, except that in the case of the death of an Optionee, any
vested Option held by the deceased Optionee at the date of death will become
exercisable by the Optionee's lawful personal representatives, heirs or
executors until the earlier of (1) one year after the date of death of such
Optionee and (2) the date of expiration of the term otherwise applicable to
such Option.
(d)
Vesting of Options is determined by the Board and subject to the following:
* where an Optionee has left the Company's employ/office or has been advised
their services are no longer required or their service contract has expired,
subject to other provisions set out in the Option Plan, vested Options expire
on the earlier of the expiry date of the Option or 90 days after the date the
Optionee ceases to be employed by, provide services to, or be a director or
officer of, the Company, and all unvested Options immediately terminate
without right to exercise same unless the Board otherwise resolves;
* in the case of the death of an Optionee, any vested Option held by him
at the date of death will become exercisable by the Optionee's lawful
personal representatives, heirs or executors until the earlier of one year
after the date of death of such Optionee and the date of expiration of the
term otherwise applicable to such Option;
* in the case of an Optionee being dismissed from employment or service for
cause, such Optionee's Options, whether or not vested at the date of
dismissal, immediately terminate without right to exercise same;
* in the event of a change of control occurring, Options granted to
directors and officers which are subject to vesting provisions are deemed to
have immediately vested upon the occurrence of the change of control; and
* in the event of a director not being nominated for re-election as a
director of the Company, although consenting to act and being under no legal
incapacity which would prevent the director from being a member of the Board,
Options granted which are subject to a vesting provision are deemed to have
vested on the date of Meeting upon which the director is not re-elected;
29
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(e)
All share Options granted under the Option Plan are exercisable for a period
of up to 5 years and will vest at the discretion of the Board, provided that
the term of such Options may be extended in circumstances where the expiry
date otherwise falls during a black-out period (defined below) as determined
in accordance with the Company's policies or applicable securities
legislation, and subject to:
(i)
the Optionee remaining employed by or continuing to provide services to the
Company or any of its subsidiaries and affiliates as well as, at the
discretion of the Board, achieving certain milestones which may be defined by
the Board from time to time or receiving a satisfactory performance review by
the Company or its subsidiary or affiliate during the vesting period; or
(ii)
remaining as a director of the Company or any of its subsidiaries or
affiliates during the vesting period.
A "blackout period" is any period of time during which a participant in the
Option Plan is unable to trade securities of the Company as a consequence of
the implementation of a general restriction on trading by an authorized
Officer or Director pursuant to the Company's governance policies that
authorize general and/or specific restrictions on trading by service providers
in circumstances where there may exist undisclosed material changes or
undisclosed material facts in connection with the Company's affairs. The term
of an Option will expire on its Expiry Date as defined in the Option Plan
unless the Expiry Date occurs during a blackout period or within five business
days after the expiry of the blackout period, in which case the Expiry Date
for that Option will be the date that is the tenth business day after the date
the blackout period expires.
(f)
The exercise price of the Option is established by the Board at the time the
Option is granted, provided that the minimum exercise price shall not be less
than the weighted average trading price of the Company's shares on the TSX for
the five trading days preceding the date of the grant.
(g)
Subject to the policies of the TSX, the Option Plan may be amended by the
Board without further shareholder approval to:
(i)
make amendments which are of a typographical, grammatical or clerical nature;
(ii)
change the vesting provisions of an Option granted under the Option Plan;
(iii)
change the termination provision of an Option granted under the Option Plan,
if it does not entail an extension beyond the original expiry date of such
Option;
(iv)
add a cashless exercise feature payable in cash or Common Shares;
(v)
make amendments necessary as a result in changes in securities laws applicable
to the Company;
(vi)
make such amendments as may be required by the policies of such senior stock
exchange or stock market if the Company becomes listed or quoted on a stock
exchange or stock market senior to the TSX; and
(vii)
it may make such amendments as reduce, and do not increase, the benefits of
this Plan to Service Providers.
(h)
The Option Plan has the following additional restrictions:
(i)
Common Shares to be issued to Insiders under the Option Plan, when combined
with all of the Company's other share compensation arrangements, may not
exceed 8% of the outstanding Common Shares in any 12 month period;
(ii)
the number of Common Shares issuable to Insiders as a group under the Plan,
when combined with Common Shares issuable to Insiders under all the Company's
other security based compensation plans, may not exceed 8% of the Company's
issued Common Shares;
30
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(iii)
the aggregate annual value of Common Shares being issuable to directors who
are non-employee directors of the Company may not exceed the following limits
for each individual director:
a.
$100,000 in any twelve-month period in the form of stock Options granted under
this Plan; and
b.
$150,000 in any twelve-month period when combined with all of the Company's
other Share Compensation Arrangements currently in effect for their benefit
(for avoidance of doubt excluding any previously exercised Options or other
Share Compensation Arrangement already paid).
(iv)
a reduction in the exercise price of an Option granted hereunder to an Insider
or an extension of the term of an Option granted hereunder benefiting an
Insider, would require the approval of the disinterested shareholders (defined
below) of the Company.
Disinterested Shareholder approval shall be required in respect of:
a.
any amendment which reduces the Exercise Price of an Option;
b.
any amendment to extend the term of an Option;
c.
amendments to increase any of the limits on the number of Options that may be
granted;
d.
any amendment that may permit an increase to the proposed limit on
non-employee director participation;
e.
any amendment relating to the transferability or assignability of an Option;
f.
any amendment to section 2.10 - "
Terms or Amendments Requiring Disinterested Shareholder Approval
" of the Plan; and
g.
any amendments required to be approved by shareholders under applicable law.
The Option Plan provides for the grant of Options that meet the definition of
Incentive Stock Options under the
United States Internal Revenue Code
. Subject to adjustment for general changes to the Common Shares, the total
number of Common Shares which may be issued pursuant to such Incentive Stock
Options is limited to 5,000,000 Common Shares.
A "disinterested shareholder" means a shareholder that is not an Insider
eligible to receive Share Options under the Option Plan, and who is not an
Associate of an Insider. An "Insider" is a director or an officer of the
Company, a director or an officer of a company that is itself an Insider or a
subsidiary of an Insider, or a person that has beneficial ownership of and/or
control or direction, either directly or indirectly, over, securities of the
Company carrying more than 10% of the voting rights attached to all the
Company's outstanding voting securities.
DSU Plan
Summary
A complete copy of the DSU Plan was filed on May 26, 2021, and is available
for viewing, under the Company's SEDAR+ profile at
www.sedarplus.ca
.
Capitalized terms used but not defined herein have the meaning ascribed to
them in the DSU Plan. A summary of the DSU Plan is set out below.
Administration of Plan
The Compensation Committee shall administer the DSU Plan. The DSU Plan
provides that non-employee directors may elect to receive up to 100% of their
annual compensation amount as established from time to time by the Board (the "
Annual Base Compensation
") in DSUs. A DSU is a unit credited to a Participant by way of a bookkeeping
entry in the books of the Company. The value of each DSU is equivalent to one
Common Share. All DSUs paid with respect to Annual Base Compensation will be
credited to the director by means of an entry in a notional account in their
favour on the books of the Company (a "
DSU Account
") when such Annual Base Compensation is payable. The director's DSU Account
will be credited with the number of DSUs calculated to the nearest thousandth
of a DSU, determined by dividing the dollar amount of compensation payable in
DSUs on the payment date by the Share Price of a Common Share at the time.
Share Price is defined in the DSU Plan and means (if the Common Shares are
listed and posted for trading on the TSX) the closing price of a Common Share
on the TSX averaged over the five (5) consecutive trading days immediately
preceding the date of grant or (if the Company elects to redeem the DSUs by
payment of cash) the redemption date, as the case may be. Fractional Common
Shares will not be issued and any fractional entitlements will be rounded down
to the nearest whole number.
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Generally, a Participant (as defined in the DSU Plan) shall be entitled to
redeem his or her DSUs during the period commencing on the business day
immediately following the date upon which the Participant ceases to hold any
position as a director of the Company or its subsidiaries and is no longer
otherwise employed by the Company or its subsidiaries, including in the event
of death of the Participant (the "
Termination Date
") and ending on the 90th day following the Termination Date, provided,
however that for U.S. Eligible Participants, redemption will be made upon such
Participant's "separation from service" as defined under Internal Revenue Code
Section 409A. Redemptions of DSUs under the DSU Plan may be in Common Shares
issued from treasury, may be in Common Shares purchased on behalf of the
Company on the open market for delivery to the former non-employee director,
may be settled in cash, or any combination of the foregoing.
Maximum Number of Common Shares Issuable for DSUs
DSUs may be granted in accordance with the DSU Plan, provided that the
aggregate number of DSUs outstanding pursuant to the DSU Plan from time to
time does not exceed 1.0% of the issued and outstanding Common Shares from
time to time. The maximum number of Common Shares issuable pursuant to all
Security Based Compensation Arrangements (including all of the Option, DSU and
RSU Plans) at any time shall not exceed 8% of the total number of outstanding
Common Shares. As at the date hereof, there are 427,992 DSU's outstanding,
representing approximately 0.08% of the outstanding Common Shares.
The DSU Plan provides that the maximum number of Common Shares issued to
insiders (as that term is defined by the TSX) in any 12-month period and
issuable at any time under all share compensation arrangements cannot exceed
8% pursuant to Section 6.1 and 6.2 of the DSU Plan.
Transferability
No right to receive payment of deferred compensation or retirement awards
shall be transferable or assignable by any Participant under the DSU Plan
except by will or laws of descent and distribution.
Amendments to the DSU Plan
The Board may at any time, and from time to time, and without shareholder
approval, amend any provision of the DSU Plan, subject to any regulatory or
stock exchange requirement at the time of such amendment, including, without
limitation:
(a)
for the purposes of making formal minor or technical modifications to any of
the provisions of the DSU Plan including amendments of a "clerical" or
"housekeeping" nature;
(b)
to correct any ambiguity, defective provision, error or omission in the
provisions of the DSU Plan;
(c)
amendments to the termination provisions of the DSU Plan;
(d)
amendments necessary or advisable because of any change in applicable laws;
(e)
amendments to the transferability of DSUs;
(f)
amendments relating to the administration of the DSU Plan; or
(g)
any other amendment, fundamental or otherwise, not requiring shareholder
approval under applicable laws;
provided, however, that:
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(h)
no such amendment of the DSU Plan may be made without the consent of each
affected Participant in the DSU Plan if such amendment would adversely affect
the rights of such affected Participant(s) under the DSU Plan; and
(i)
shareholder approval shall be obtained in accordance with TSX requirements,
for any amendment:
i.
to increase the maximum number of Common Shares which may be issued under the
DSU Plan;
ii.
to the amendment provisions of the DSU Plan; or
iii.
to expand the definition of "Participant".
Certain United States Federal Income Tax Consequences
The following is a summary of the principal U.S. federal income tax
consequences generally applicable to DSUs awarded under the DSU Plan. The
following description applies to DSUs that are subject to U.S. federal income
tax. The grant of DSUs and the crediting of DSUs to a Director's DSU Account
should not result in taxable income to the Director at the time of grant. When
DSUs are paid out, the Director will recognize ordinary income equal to the
fair market value of the Common Shares and cash received in settlement of the
DSUs, and the Company will be entitled at that time to a corporate income tax
deduction (for U.S. federal income tax purposes) for the same amount, subject
to the general rules concerning deductibility of compensation. A Director's
basis in any Common Shares received will equal the fair market value of the
Common Shares when the DSUs are paid out. If, as usually is the case, the
Common Shares are a capital asset in the Director's hands, any additional gain
or loss recognized on a subsequent sale or exchange of the Common Shares will
not be ordinary income but will qualify as capital gain or loss. To the extent
that a Director's DSUs are subject to U.S. federal income tax and to taxation
under the Income Tax Act (Canada), DSUs awarded under the DSU Plan are
intended to comply with Section 409A of the Internal Revenue Code and to avoid
adverse tax consequences under paragraph 6801(d) of the regulations under the
Income Tax Act (Canada), To that end, the DSU Plan contains certain forfeiture
provisions that could apply to DSUs awarded under the DSU Plan in limited
circumstances.
RSU PLAN
Summary
A complete copy of the RSU Plan was filed on May 26, 2021, and is available
for viewing, under the Company's SEDAR+ profile at
www.sedarplus.ca
.
Capitalized terms used but not defined herein have the meaning ascribed to
them in the RSU Plan. A summary of the RSU Plan is set out below.
Eligible Participants
The RSU Plan is administered by the Compensation Committee of the Board.
Employees, executive officers or executive directors and eligible consultants
of the Company and its designated subsidiaries ("
Participants
") are eligible to participate in the RSU Plan. Non-executive directors may
not be Participants under the RSU Plan. RSUs awarded to Participants are
credited to them by means of an entry in a notional account in their favour on
the books of the Company. Each RSU awarded conditionally entitles the
Participant to receive one Common Share (or the cash equivalent) upon
attainment of the RSU vesting criteria.
Vesting
The "
vesting
" (i.e. fulfillment of conditions required for absolute entitlement) of RSUs
is conditional upon the expiry of a time-based vesting period. The duration of
the vesting period and other vesting terms applicable to the grant of the RSUs
shall be determined at the time of the grant by the Compensation Committee.
Once the RSUs vest, the Participant is entitled to receive the equivalent
number of underlying Common Shares or cash equal to the Market Value of the
equivalent number of Common Shares. The vested RSUs may be settled through the
issuance of Common Shares from treasury, by the delivery of Common Shares
purchased on behalf of the Company in the open market, in cash or in any
combination of the foregoing (at the discretion of the Company). If settled in
cash, the amount shall be equal to the number of Common Shares in respect of
which the Participant is entitled multiplied by the Market Value of a Common
Share on the payout date. Market Value per share is defined in the RSU Plan
and means, as at any date (if the Common Shares are listed and posted for
trading on the TSX), the arithmetical average of the closing price of the
Common Shares traded on the TSX for the five (5) trading days on which a board
lot was traded immediately preceding such date. The RSUs may be settled on the
payout date, which shall generally be before the third anniversary of the date
of the grant. The expiry date of RSUs will be determined by the Committee at
the time of grant. However, unless otherwise determined on the Grant Date, the
expiry date shall be within the maximum term for all RSUs of three years. All
RSUs for which vesting cannot be satisfied due to a departure from the
Company, would be available for future grants.
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Maximum Number of Common Shares Issuable
RSUs may be granted in accordance with the RSU Plan, provided the aggregate
number of RSUs outstanding pursuant to the RSU Plan from time to time shall
not exceed 1.0% of the number of issued and outstanding Common Shares from
time to time. Furthermore, the aggregate maximum number of Common Shares
issuable pursuant to all Security Based Compensation Arrangements (including
Option, DSU and RSU Plans), at any time, shall not exceed 8% of the total
number of outstanding Common Shares. As at the date hereof, there are 0 RSU's
outstanding, representing approximately 0% of the outstanding Common Shares.
The RSU Plan provides that the maximum number of Common Shares issued to
insiders (as that term is defined by the TSX) in any 12-month period and
issuable at any time under all share compensation arrangements cannot exceed
8% pursuant to Section 11.1 and 11.2 of the RSU Plan.
The RSU Plan provides that the maximum number of Shares issued to Insiders (as
that term is defined by the TSX) pursuant to the RSU Plan, together with any
Common Shares issuable pursuant to any other security-based compensation
arrangement of the Company, within any one year period, shall not exceed 8% of
the total number of weighted average number of Shares outstanding during the
year.
Cessation of Entitlement
Unless otherwise determined by the Company in accordance with the RSU Plan,
RSUs which have not vested on a Participant's termination date shall terminate
and be forfeited. If a Participant who is an employee ceases to be an employee
as a result of termination of employment without cause, in such case, at the
Company's discretion (unless otherwise provided in the applicable Grant
Agreement), all or a portion of such Participant's RSUs may be permitted to
continue to vest, in accordance with their terms, during any statutory or
common law severance period or any period of reasonable notice required by law
or as otherwise may be determined by the Company in its sole discretion. All
forfeited RSUs are available for future grants.
Transferability
RSUs are not assignable or transferable other than by operation of law except,
if and on such terms as the Company may permit, to certain family members and
private affiliate companies of the Participants.
Amendments to the RSU Plan
The Board may, without notice, at any time and from time to time, without
shareholder approval, amend the RSU Plan or any provisions thereof in such
manner as the Board, in its sole discretion, determines appropriate including,
without limitation:
(a)
for the purposes of making formal minor or technical modifications to any of
the provisions of the RSU Plan;
(b)
to correct any ambiguity, defective provision, error or omission in the
provisions of the RSU Plan;
(c)
to change the vesting provisions of RSUs;
(d)
to change the termination provisions of RSUs or the RSU Plan that does not
entail an extension beyond the original expiry date of the RSU;
(e)
to preserve the intended tax treatment of the benefits provided by the RSU
Plan, as contemplated therein; or
(f)
any amendments necessary or advisable because of any change in applicable laws;
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provided, however, that:
(g)
no such amendment of the RSU Plan may be made without the consent of each
affected Participant if such amendment would adversely affect the rights of
such affected Participant(s) under the RSU Plan; and
(h)
shareholder approval shall be obtained in accordance with TSX requirements for
any amendment that results in:
i.
an increase in the maximum number of Common Shares issuable pursuant to the
RSU Plan other than as already contemplated in the RSU Plan;
ii.
an extension of the expiry date for RSUs granted to insiders under the RSU Plan;
iii.
other types of compensation through Common Share issuance;
iv.
expansion of the rights of a Participant to assign RSUs beyond what is
currently permitted in the RSU Plan;
v.
the addition of new categories of Participants, other than as already
contemplated in the RSU Plan; or
vi.
any amendments to section 12 - Amendment, Suspension or Termination of the
Plan that will increase the Company's ability to amend the Plan without
shareholder approval.
Certain United States Federal Income Tax Consequences
The following description applies to RSUs that are subject to U.S. federal
income tax. The grant of RSUs should not result in taxable income to the
Participant at the time of grant. When RSUs are paid out, the Participant will
recognize ordinary income equal to the fair market value of the Common Shares
and cash received in settlement of the RSUs, and the Company will be entitled
at that time to a corporate income tax deduction (for U.S. federal income tax
purposes) for the same amount, subject to the general rules concerning
deductibility of compensation. A Participant's basis in any Common Shares
received will equal the fair market value of the Common Shares when the RSUs
are paid out. If, as usually is the case, the Common Shares are a capital
asset in the Participant's hands, any additional gain or loss recognized on a
subsequent sale or exchange of the Common Shares will not be ordinary income
but will qualify as capital gain or loss.
Equity Compensation Plan Information
The table below sets out equity compensation plan information as of December
31, 2023 financial year end.
Number of shares to Weighted-average Number of securities
be issued upon exercise price of remaining available for
exercise of outstanding share future issuance under
outstanding share options and rights equity compensation
options and rights plans (excluding
securities reflected in
column (a))
1, 3
Plan Category (a) (b) (c)
Share Option Plan 24,318,500 $1.00 18,251,794
2 1
Deferred Share Unit Plan 470,347 N/A 4,914,433
2
Restricted Share Unit Plan Nil N/A 5,384,780
2
Total 24,788,847 N/A 18,289,394
2 1
Notes:
1.
Determined based on the 8% aggregate maximum Common Shares allowable pursuant
to all share compensation arrangements, which as of December 31, 2023 was
43,078,241 Common Shares on 538,478,010 Common Shares issued and outstanding.
2.
Total outstanding grants was 4.6% of issued Common Shares at December 31,
2023, consisting of 24,318,500 Options (4.5%) and 470,347 DSUs (0.1%). There
were no issued and outstanding RSUs.
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3.
The number of securities remaining available for future issuance has been
determined based on the maximum number of eligible Common Shares permitted to
be issued under the Share Option Plan, the DSU Plan and the RSU Plan being, in
the aggregate, 8% of the outstanding Common Shares as at December 31, 2023,
and will be reduced to the extent that any additional DUSs or RSUs are issued.
The maximum number of DSUs outstanding from time to time may not exceed 1% of
the number of outstanding Common Shares and the maximum number of RSUs
outstanding from time to time may not exceed 1% of the outstanding Common
shares, subject further to the overall limit of 8% for all equity compensation
plans. Therefore, potentially there are 18,289,394 of combined Options, DSUs
and RSUs that can be issued as of December 31, 2023, with the maximum number
of DSUs being limited to 4,914,433 (0.9% of outstanding Common Shares) and
5,384,780 RSUs (1% of outstanding Common Shares) that may be issued as of
December 31, 2023, under those plans, subject further to the overall
limitation of 8% for all equity compensation plans.
The following table sets out the annual burn rate for grants issued under each
equity compensation plan for the past three fiscal years:
For the fiscal year ended December 31
2023 2022 2021
The Option Plan N/A 2.12% N/A
The DSU Plan 0.01% 0.01% 0%
The RSU Plan N/A N/A N/A
Notes:
1.
The annual burn rate is calculated as the number of securities granted under
the arrangement during the applicable fiscal year divided by the weighted
average number of securities outstanding for the applicable fiscal year.
2.
N/A denotes no issuances or grants were made in the fiscal period.
INDEBTEDNESS OF DIRECTORS AND EXECUTIVE OFFICERS
No directors, proposed nominees for election as directors, executive officers
or their respective associates or affiliates, or other management of the
Company were indebted to the Company as of the end of the most recently
completed financial year or as at the date hereof.
INTEREST OF INFORMED PERSONS IN MATERIAL TRANSACTIONS
To the knowledge of management of the Company, no informed person (a director,
officer or holder of 10% or more of the Common Shares) or nominee for election
as a director of the Company or any associate or affiliate of any informed
person or proposed director had any interest in any transaction which has
materially affected or would materially affect the Company or any of its
subsidiaries during the year ended December 31, 2023, nor have they had any
interest in any material transaction in the current year other than as set out
herein or in a document disclosed to the public.
MANAGEMENT CONTRACTS
Except as hereafter described, there are no management functions of the
Company which are to any substantial degree performed by a person or company
other than the directors or senior officers of the Company.
HDSI is a company which is privately owned by persons of whom some are
directors of the Company, being Messrs. Dickinson and Thiessen.
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The Company has a management services agreement with HDSI dated July 2, 2010
(the "Agreement") pursuant to which HDSI provides geological, corporate
development, administrative and management services to, and incurs third-party
costs on behalf of, the Company and its subsidiaries at annually set rates.
During the year ended December 31, 2023, the Company paid HDSI approximately
$3.9 million (2022 - $3.9 million) for services rendered by HDSI and
reimbursed HDSI approximately $0.9 million (2022 - $0.7 million) for third
party costs incurred on the Company's behalf.
Details with respect to fees paid by the Company to HDSI for fiscal years
ended December 31, 2023 and 2022 expressed in thousands, is set forth below:
Transactions 2023 2022
Services rendered by HDSI
:
Technical
1
Engineering $ 363 $ 372
Environmental 321 508
Other technical services 125 44
809 924
General and administrative
Management, consulting, corporate communications, secretarial, financial and administration 2,450 2,223
Shareholder communication 695 727
3,145 2,950
Total for services rendered 3,954 3,874
Reimbursement (refund) of third-party expenses
Conferences and travel 246 124
Insurance 87 48
Office supplies and information technology 575 532
2
Total reimbursed 908 704
Total $ 4,862 $ 4,578
Certain members of the Company's senior management are employed directly by
HDSI rather than by Northern Dynasty.
PARTICULARS OF MATTERS TO BE ACTED UPON
In addition to the annual matters requiring Shareholder approval, which are
described in detail above, namely the election of directors and appointment of
the auditors for the ensuing year, the Company will also seek Shareholder
approval of the following:
1.
an ordinary resolution of disinterested shareholders, to ratify and approve
Company's Share Option Plan as amended (the "
Option Plan
") to extend the restrictions on the aggregate annual value of Options that
may be granted to each independent director to apply to all non-employee
directors;
2.
an ordinary resolution of shareholders to approve the continuation of the
Company's Non-Employee Directors Deferred Share Unit ("
DSU
") Plan and the Restricted Share Unit ("RSU") Plan; and
3.
an ordinary resolution of shareholders to approve the continuation of the
Company's Restricted Share Unit ("
RSU
") Plan.
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Amendment and Renewal of Option Plan
Under TSX rules, a listed company with a stock option plan reserving a
percentage of the issued and outstanding voting securities in its capital
stock on a rolling basis, must obtain Shareholder approval to continue its
stock option plan at a meeting of shareholders every three years following the
meeting at which the stock option plan was last approved.
Our Board of Directors has approved the continuation of the Option Plan,
together with the following amendments:
1.
Section 2.9(c) of the Plan, which includes restrictions on the value of Common
Shares that may be subject grants of stock options and other awards under
Share Compensation Arrangements to certain of our directors, has been amended
to:
a.
expand the scope of directors who are subject to these grant restrictions to
include all non-employee directors, representing an expansion from the
previous requirement that the restrictions only apply to independent directors
of the Company (as "independent director" is defined in Section 1.4 and 1.5 of
National Instrument 52-110);
b.
to confirm that the aggregate annual value of Common Shares being issuable to
directors who are non-employee directors of the Company may not exceed the
following limits for each individual director may not exceed (i) $100,000 in
any twelve-month period in the form of stock options granted under this Plan,
and (ii) $150,000 in any twelve-month period when combined with all of the
Company's other Share Compensation Arrangements currently in effect for their
benefit (for avoidance of doubt excluding any previously exercised Options or
other Share Compensation Arrangement already paid).
Accordingly, Section 2.9(c) of the Plan, as amended, will now read:
"(c) the aggregate annual value of Common Shares being issuable to
directors who are non-employee directors of the Company may not exceed the
following limits for each individual director:
(i)
$100,000 in any twelve-month period in the form of stock options granted under
this Plan, and
(ii)
$150,000 in any twelve-month period when combined with all of the Company's
other Share Compensation Arrangements currently in effect for their benefit
(for avoidance of doubt excluding any previously exercised Options or other
Share Compensation Arrangement already paid)."
2.
Section 2.11 of the Plan has been amended to add new Section 2.11(g), as
copied below, which will permit our Board of Directors to make amendments to
the Plan that reduce, and do not increase the benefits of this Plan to Service
Providers without the requirement of obtaining shareholder approval:
"(g) it may make such amendments as reduce, and do not increase, the
benefits of this Plan to Service Providers."
The TSX has conditionally approved the amendment to and the continuation of
the Option Plan subject to approval of the Shareholders.
To be effective, the Option Plan Resolution ratifying and approving the Option
Plan for continuation must be approved by not less than a simple majority of
votes by shareholders of the Company present in person or represented by proxy
at the Meeting, excluding the votes cast by Insiders of the Company, which as
at record date of May 10, 2024 hold a total of 10,824,173 common shares. All
other Shareholders of the Company are entitled to vote on this resolution.
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The text of the Option Plan Resolution to be submitted to Shareholders for
approval at the Meeting is set forth below:
"Be it RESOLVED as an ordinary resolutions of disinterested shareholders that:
(1)
the Option Plan of the Company dated for reference May 17, 2024, together with
the amendments approved by the Board of Directors of the Company and described
in the Company's Information Circular, be and are hereby ratified and approved;
(2)
all currently available and unallocated Options issuable pursuant to the 2024
Option Plan be and are hereby approved and authorized for grant until June 27,
2027;
(3)
the 24,356,100 Options outstanding, granted pursuant to the Company's option
plan approved by the Shareholders on June 30, 2021 to the date of the annual
general meeting of the Company held on June 27, 2024, are hereby approved and
rolled into the Option Plan; and
(4)
any one director or officer of the Company be and is hereby authorized and
directed for and on behalf of the Company to execute or cause to be executed,
whether under the common seal of the Company or otherwise, and to deliver or
cause to be delivered all such documents, and to do or cause to be done all
such acts and things, as in the opinion of such director or officer may be
necessary or desirable in order to give effect to these resolutions."
Recommendation
The Board unanimously recommends the Shareholders approve the Option Plan
Resolution as incentive options
are an important element of corporate compensation and, should the Company be
unable to grant them, the Company would then be at a severe competitive
disadvantage in attracting and retaining talented management and employee
personnel.
If the Shareholders fail to approve the Option Plan Resolution the Company
will no longer be in a position to grant further Options. Any previously
granted Options which, upon exercise, would normally be returned to the base
count of Common Shares available for grant of Options would no longer be
available for reissuance; and if any previously granted Options are cancelled
or expire prior to exercise, would, similarly, not be available for reissuance.
DSU Plan Resolution
The TSX has conditionally approved the continuation of the DSU Plan, subject
to approval of the Shareholders.
To be effective, the DSU Plan Resolution ratifying and approving the DSU Plan
for continuation must be approved by not less than a simple majority of the
votes cast by the holders of Common Shares present in person, or represented
by proxy, at the Meeting. Unless otherwise indicated, the persons designated
as proxyholders in the form of Proxy included with the notice package mailed
for the Meeting, will vote the Common Shares represented by such Proxy,
properly executed, for the DSU Plan Resolution. The text of the DSU Plan
Resolution to be submitted to Shareholders for approval at the Meeting is set
forth below:
Based on the foregoing, Shareholders are asked to consider and, if thought
advisable, to pass the following ordinary resolution approving the DSU Plan
(the "
DSU Plan Resolution
"), with or without variation:
"BE IT RESOLVED, as an ordinary resolution, that:
1.
the 2024 Non-Employee Directors Deferred Share Unit Plan (the "
2024 DSU Plan
") allowing for the issuance of a maximum of that number of Common Shares from
treasury equal to 1.0% of the Common Shares of the Company issued and
outstanding from time to time, a copy of which is filed on SEDAR+ at
www.sedarplus.ca
, be and is hereby ratified, confirmed and approved for continuation; and
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2.
all currently available and unallocated Deferred Share Units ("
DSUs
") issuable pursuant to the 2024 DSU Plan be and are hereby approved and
authorized for grant until June 27, 2027."
The Board unanimously recommends that Shareholders vote FOR the DSU Plan
Resolution set out above.
In the absence of a contrary instruction, the person(s) designated by
management of the Company in the enclosed form of proxy intend to vote FOR the
DSU Plan Resolution, including for the Common Shares to be taken from treasury
and set aside for issuance under the 2024 DSU Plan. A simple majority of the
votes cast by Shareholders present in person or by proxy is required to
approve and pass the DSU Plan Resolution.
If the Shareholders fail to approve the DSU Plan Resolution the Company will
no longer be in a position to grant further DSUs. Any previously granted DSUs
which, upon conversion, would normally be returned to the base count of Common
Shares available for award of DSUs would no longer be available for
reissuance; and if any previously granted DSUs are cancelled or expire prior
to conversion, would, similarly, not be available for reissuance.
RSU Plan Resolution
The TSX has conditionally approved the continuation of the RSU Plan, subject
to approval of the Shareholders.
To be effective, the RSU Plan Resolution ratifying and approving the RSU Plan
for continuation must be approved by not less than a simple majority of the
votes cast by the holders of Common Shares present in person, or represented
by proxy, at the Meeting. Unless otherwise indicated, the persons designated
as proxyholders in the form of Proxy included with the notice package mailed
for the Meeting, will vote the Common Shares represented by such Proxy,
properly executed, for the RSU Plan Resolution. The text of the RSU Plan
Resolution to be submitted to Shareholders for approval at the Meeting is set
forth below:
Based on the foregoing, Shareholders are asked to consider and, if thought
advisable, to pass the following ordinary resolution approving the RSU Plan,
with or without variation:
"BE IT RESOLVED, as an ordinary resolution, that:
1.
the 2024 Restricted Share Unit Plan (the "
RSU Plan
") allowing for the issuance of a maximum of that number of Common Shares from
treasury equal to 1.0% of the Common Shares of the Company issued and
outstanding from time to time, a copy of which is filed under the Company's
SEDAR+ profile at
www.sedarplus.ca
, be and is hereby ratified, confirmed and approved for continuation; and
2.
all currently available and unallocated RSUs issuable pursuant to the RSU Plan
be and are hereby approved and authorized for grant until June 27, 2027."
The Board unanimously recommends that Shareholders vote FOR the RSU Plan
Resolution set out above.
In the absence of a contrary instruction, the person(s) designated by
management of the Company in the enclosed form of proxy intend to vote FOR the
RSU Plan Resolution, including for the Common Shares to be taken from treasury
and set aside for issuance under the RSU Plan. A simple majority of the votes
cast by Shareholders present in person or by proxy is required to approve and
pass the RSU Plan Resolution.
If the Shareholders fail to approve the RSU Plan Resolution the Company will
no longer be in a position to grant further RSUs. Any previously granted RSUs
which, upon conversion, would normally be returned to the base count of Common
Shares available for award of RSUs would no longer be available for
reissuance; and if any previously granted RSUs are cancelled or expire prior
to conversion, would, similarly, not be available for reissuance.
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ADDITIONAL INFORMATION
Additional information relating to the Company is included in the Company's
Annual Information Form and in the Audited Consolidated Financial Statements
for the years ended December 31, 2023 and 2021, Report of Independent
Accounting Firm, and related Management Discussion and Analysis filed under
the Company's profile on SEDAR+ at
www.sedarplus.ca
. Copies of the Company's most recent interim financial statements and
related management discussion and analysis, and additional information, may
also be obtained from SEDAR and upon request from the Company at telephone no.
(604) 684-6365 or fax number (604) 684-8092.
OTHER MATTERS
The Board of Directors is not aware of any other matters which it anticipates
will come before the Meeting as of the date of this Information Circular.
The contents of this Information Circular and its distribution to shareholders
have been approved by the Board of Directors.
DATED
at Vancouver, British Columbia, May 15, 2024.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Ronald Thiessen
Ronald Thiessen
President and Chief Executive Officer
41
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QUESTIONS MAY BE DIRECTED TO THE PROXY SOLICITOR
North America Toll Free
1-877-452-7184
Outside North America
416-304-0211
Email
assistance@laurelhill.com
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Request for Annual and Interim Financial Statements and MD&A
Under National Instrument 51-102
Continuous Disclosure Obligations
("
NI 51-102
"),
Northern Dynasty Minerals Ltd.
(the "
Company
") is only required to deliver annual and interim financial statements and the
related Management's Discussion & Analysis ("
MD&A
") to a person or company owning common shares ("Holders") of the Company who
requests them.
If you wish to receive printed copies of the Company's annual financial
statements and annual MD&A or interim financial statements and interim MD&A,
you should complete the return form (the "Return Form") on the back of this
page. Please forward the completed Return Form to the Company at the
following address:
NORTHERN DYNASTY MINERALS LTD.
14
th
Floor, 1040 West Georgia Street
Vancouver, BC V6E 4H1
Tel: 604-684-6365
Fax: 604-684-8092
Toll Free: 1 800 667-2114
Email:
info@northerndynasty.com
The Company reserves the right, in its discretion, to choose to send the
annual / interim financial statements and MD&A, either to all registered
holders, or to all registered holders and beneficial owners who are identified
under NI 51-102 as having chosen to receive securityholder materials sent to
beneficial owners of securities,
notwithstanding elections which such holders or beneficial owners may make
under the Return Form
.
Failure to return the Return Form or to otherwise specifically request a copy
of financial statements or MD&A will override a beneficial owner's standing
instructions under NI 51-102 in respect of such financial statements and MD&A.
Notwithstanding whether you have given previous instructions regarding
delivery of materials, if you would like to receive the annual or interim
financial statements and related MD&A, you should complete and return the
Return Form to the Company.
Please note that a Return Form will be mailed to you each year.
This Return Form is a request to receive:
(i)
annual financial statements and MD&A for the fiscal year ending
December 31, 2024; and/or
(ii)
interim financial statements and MD&A which the Company may send to
securityholders in 2025 and any other period prior to the Company sending a
new request form.
If you wish to receive copies of financial statements or MD&A for any earlier
period, you should send a separate request specifying the requested financial
statements and MD&A.
A copy of the Company's financial statements and MD&A may be accessed under
the Company's SEDAR+ profile at
www.sedarplus.ca
.
* * * * * * * * * * * *
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(COMPLETE AND RETURN THIS FORM)
RETURN FORM
NORTHERN DYNASTY MINERALS LTD. (the "Company")
If you would like to receive financial statements and MD&A by email, please
provide us with your email address:
_________________________________________________________
(Please mark the appropriate box with an "X")
Registered Holder
O
The undersigned is a registered holder
of common shares of the Company and:
(a) O
hereby requests that the Company
send the undersigned a copy of the
Annual Financial Statements for the fiscal year ended
December 31, 2024 and the related MD&A; and/or
(b) O
hereby requests that the Company
send the undersigned a copy of the
Interim Financial Statements and the related MD&A for all fiscal quarters in 2025
and any subsequent quarters before a new Return Form is sent by the Company.
Non-Registered Holder
O
The undersigned is a beneficial holder
of common shares of the Company and:
(a) O
hereby requests that the Company
send the undersigned a copy of the
Annual Financial Statements for the fiscal year ended
December 31, 2024 and the related MD&A; and/or
(b) O
hereby requests that the Company
send the undersigned a copy of the
Interim Financial Statements and related MD&A for all fiscal quarters in 2025
and any subsequent quarters before a new Return Form is sent by the Company.
The undersigned acknowledges that this request shall expire and cease to have
effect if the undersigned ceases to be either a registered holder or
beneficial owner of securities of the Company.
Name
:
(please print)
Address
:
Postal/Zip Code
Signature ___________________________________________________Date:_______________________________
:
FOR BENEFICIAL HOLDERS WHO DO NOT WANT TO DISCLOSE THEIR NAME AND ADDRESS BUT
WHO WANT TO RECEIVE A COPY OF THE ANNUAL FINANCIAL STATEMENTS AND MD&A AND/OR
INTERIM FINANCIAL STATEMENTS AND MD&A, PLEASE CONTACT YOUR BROKER OR
INTERMEDIARY.
To subscribe to our investor list, please visit our website:
www. northerndynastyminerals.com
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