NOVAGOLD RESOURCES INC
For the period ended May 16, 2024. Filed Mar 22, 2024.
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What shareholders are asked to vote on at a company's meeting. It is where to find what directors and top executives are paid, and who owns the most shares.
May 16, 2024 · Filed Mar 22, 2024
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
(RULE
14a-101)
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
Filed by Registrant
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Filed by a Party other than the Registrant
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Check the appropriate box:
| ☐ | Preliminary Proxy Statement |
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| ☐ | Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) |
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| ☒ | Definitive Proxy Statement |
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| ☐ | Definitive Additional Materials |
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| ☐ | Soliciting Material Under Rule 14a-12 |
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(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check all boxes that apply):
| ☒ | No fee required. |
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| ☐ | Fee paid previously with preliminary materials. |
| ☐ | Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11. |
NOTICE OF ANNUAL GENERAL MEETING OF SHAREHOLDERS
| Date: | May 16, 2024 |
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| Time: | 1:00 p.m. Pacific Time |
| Location: | Live Webcast at: www.virtualshareholdermeeting.com/NG2024 |
| Record Date: | March 18, 2024 |
The purposes of the annual meeting (the “Meeting”) are to: 1. receive the Annual Report of the Directors of the Company (the “Directors”) containing the consolidated financial statements of the Company for the year ended November 30, 2023, together with the Report of the Auditors thereon; 2. set the number of Directors of the Company; 3. elect Directors of the Company for the forthcoming year; 4. appoint the Auditors of the Company for the forthcoming year and to authorize the Directors through the Audit Committee to fix the Auditors’ remuneration; 5. consider and, if deemed advisable, pass a non-binding resolution approving the compensation of the Company’s Named Executive Officers; and 6. transact such further and other business as may properly come before the Meeting or any adjournment thereof.
The specific details of the matters currently proposed to be put before the Meeting are set forth in the Circular accompanying and forming part of this Notice.
Only Shareholders of record at the close of business on March 18, 2024 are entitled to receive notice of the Meeting and to vote at the Meeting.
To assure your representation at the Meeting, please complete, sign, date and return your voted proxy which will be delivered to you separately, whether or not you plan to attend. Sending your proxy will not prevent you from voting in person at the Meeting.
All proxies completed byregistered shareholders must be returned to the Company:
| • | by online proxy via the following website: www.proxyvote.com no later than May 14, 2024 at 4:00 p.m. Eastern time (1:00 p.m. Pacific time); |
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| • | by telephone by calling (800) 690-6903 and following the instructions, no later than May 14, 2024 at 4:00 p.m. Eastern time (1:00 p.m. Pacific time); or |
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| • | by requesting a paper copy of the proxy materials and mailing a completed proxy card to Broadridge at 51 Mercedes Way, Edgewood, NY 11717, Attn: Proxy Department, for receipt no later than May 14, 2024, at 4:00 p.m. Eastern time (1:00 p.m. Pacific time). |
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Non-registered shareholders whose shares are registered in the name of an intermediary should carefully follow voting instructions provided by the intermediary. A more detailed description on returning proxies bynon-registered shareholders can be found on page 4 of the attached Circular.
Shareholders may contact Kingsdale Advisors, the Company’s strategic advisor, by telephone at 1-866-228-8818 (toll-free in North America) or 1-416-623-2514 (text and call enabled outside North America), or by email atcontactus@kingsdaleadvisors.com. To obtain information about voting your NOVAGOLD Common Shares, please visitwww.NOVAGOLDAGM.com.
Your vote is important. We encourage you to vote promptly.
Internet and telephone voting are available through 4:00 p.m. Eastern Time on May 14, 2024.
By Order of the Board of Directors of
President and Chief Executive Officer
Vancouver, British Columbia
March 22, 2024
NOVAGOLD 2024 MANAGEMENT INFORMATION CIRCULAR
Dear Fellow Shareholders,
We are pleased to invite you to NOVAGOLD’s 2024 Annual General Meeting of Shareholders.
Please read this Circular as it contains important, detailed information about the meeting agenda, who is eligible to vote, how to vote, the Director nominees, our governance practices, and compensation of our executives and Directors.
NOVAGOLD RESOURCES INC. (the “Company” or “NOVAGOLD”) values engagement with our shareholders, whether at the annual meeting, at investment conferences, inone-on-one meetings, or via the Company’s electronic and social media communication channels. The Company’s Circular provides an important opportunity to reach every shareholder. This year, we thought it would be helpful to:
| 1. | summarize the items in this Circular being presented to shareholders for their vote, |
| 2. | highlight NOVAGOLD’s corporate governance practices, and |
| 3. | describe the Company’s shareholder engagement program. |
We are providing these materials in connection with the solicitation by the NOVAGOLD Board of Directors of proxies to be voted at our 2024 annual meeting of shareholders and at any adjournment or postponement of that meeting. The annual meeting of shareholders will be held in a virtual format on May 16, 2024 at 1:00 p.m. Pacific Time.
Our 2024 annual meeting of shareholders will be held in a virtual format only. Shareholders are encouraged to cast their vote in advance by proxy and participate from any geographic location with internet connectivity or by telephone. We believe this is an important step to enhancing accessibility to our annual meeting for all our shareholders and reducing the carbon footprint of our activities. Shareholders may view a live webcast of the annual meeting and registered shareholders and duly appointed proxyholders may submit questions digitally during the meeting atwww.virtualshareholdermeeting.com/NG2024. Questions may also be submitted to management and the Board prior to the meeting via email atinfo@novagold.com.
MATTERS FOR SHAREHOLDER VOTING
At this year’s annual general meeting, we are asking our shareholders to vote on the following matters:
Proposal 1: Setting the Number of Directors
The Board of Directors recommends a vote FOR this proposal. See page 7 for details.
Proposal 2: Election of Directors
The Board of Directors recommends a vote FOR the election of the director nominees named in this proxy statement. See pages 7-9 and 12-25 for further information on the nominees.
Proposal 3: Appointment of PricewaterhouseCoopers LLP as independent auditor for 2024
The Board of Directors recommends a vote FOR this proposal. See pages 9-10 for details.
Proposal 4: Advisory Approval of Executive Compensation
The Board of Directors recommends a vote FOR this proposal. See page 11 for details.
The Board of Directors knows of no other matters to be presented for action at the annual meeting. If any matter is presented from the floor of the annual meeting, the individuals serving as proxies intend to vote on these matters in the best interest of all shareholders. Your signed proxy gives this authority to Gregory Lang or Tricia Pannier.
Please refer to the material on pages 1-6 for information about how to cast your vote, how to attend the meeting virtually, and other frequently asked questions.
NOVAGOLD 2024 MANAGEMENT INFORMATION CIRCULAR
GOVERNANCE HIGHLIGHTS
NOVAGOLD is committed to maintaining robust corporate governance practices. Strong corporate governance helps us achieve our performance goals and maintain the trust and confidence of our investors, employees, regulatory agencies and other stakeholders. Our corporate governance practices are described in more detail on pages 90-101 and on the Governance page of our website atwww.novagold.com.
| Director Independence | • Eight of our ten nominees are independent • All of our key Board committees (Audit, Compensation, and Corporate Governance and Nominations) are composed exclusively of independent Directors • Our CEO is the only executive Director |
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| Board Leadership | • The positions of Chairman and CEO are separate • Our Board has appointed an independent Lead Director |
| Accountability and ShareholderRights | • Extensive proxy season shareholder engagement involved reaching out to holders of approximately 92% of our issued and outstanding Common Shares in 2023 • Proactive Shareholder engagement is a year-round activity, not limited to proxy season • All Directors stand for election annually • In uncontested elections, Directors must be elected by a majority of votes cast • Eligible shareholders may nominate Directors and submit other proposals for consideration at annual meetings; see “Shareholder Proposals” on page 103 below for details on timing and other requirements for submitting shareholder proposals |
| Board Practices and Governance | • Our Board regularly reviews its effectiveness • The Board has created five standing committees to oversee specific areas of importance to the Company which report to the Board on a regular basis. The Board has ultimate oversight of all matters of strategic importance to the Company • The Board has adopted a Board Charter to formalize its practices and responsibilities • In January 2022 the Board adopted a Diversity, Equity and Inclusion Policy • The independent Directors meet in executive session without the presence of management or the non-independent Directors immediately following each regular Board meeting |
| Share Ownership | • Our Directors must hold at least $128,400 (3 times their annual retainer) worth of NOVAGOLD common stock within five years of joining the Board (increased from C$50,000) • Our CEO must, within five years of commencement of employment, hold NOVAGOLD common stock valued at an amount at least equal to five times his annual base pay (recently increased from three times his annual base pay) • Our CFO must, within five years of commencement of employment, hold NOVAGOLD common stock valued at an amount at least equal to two times his annual base pay • Hedging or pledging of NOVAGOLD stock is prohibited for Directors as well as employees • NOVAGOLD encourages its employees to be shareholders in the Company by making share-based compensation and employee stock purchase programs available to all employees |
| Board Oversight of RiskManagement | • Our Board reviews NOVAGOLD’s systematic approach to identifying and assessing risks faced by NOVAGOLD and its projects which practice is reflected in the NOVAGOLD Integrated Risk Management Policy adopted in August 2022 • In January 2023 the Company adopted a Climate Change Policy and a Biodiversity Policy to set out the approach NOVAGOLD takes to address its contributions to and impacts of climate change and biodiversity with reference to its operations • See the chart on the following page for a description of the Board’s allocation of risk assessment oversight |
NOVAGOLD 2024 MANAGEMENT INFORMATION CIRCULAR
BOARD OVERSIGHT OF RISK MANAGEMENT
Board of Directors • Oversight of environmental, social, and governance (ESG) matters and the risk management process. • Development of business strategy and major resource allocation. • Leadership of management succession planning. • Business conduct and compliance oversight. • Review of reports from board committees with specific risk oversight responsibilities.
| Audit Committee | • Oversight of enterprise risk management activities of NOVAGOLD, including cybersecurity and the activities of the Company’s IT Steering Committee comprised of employees including the VP & CFO. • Oversight of the staffing and performance of NOVAGOLD’s internal audit function. • Oversight of integrity of NOVAGOLD’s financial statements and internal control over financial reporting. • Responsible for the appointment, compensation, and oversight of NOVAGOLD’s independent registered public accounting firm. • Oversight of NOVAGOLD’s finance requirements, plans, and strategies. |
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| Compensation Committee | • Oversight of compensation-related risks and overall executive compensation philosophy as further described under “Risk Assessment of Compensation Policies and Practices” in our CD&A. • Responsible for executive succession planning recommendations to the Board. • Reports to the board following each regular committee meeting. |
| Corporate Governance and Nominations Committee | • Overall corporate governance leadership. • Provide recommendations regarding board and committee composition and performance in accordance with the board charter, board service policy, board diversity, equity, and inclusion policy, and the committee charter. • Oversight of regulatory compliance and corporate initiatives. • Reports to the board following each regular committee meeting. |
| Engineering and Technical Committee | • Advise board on engineering and technical aspects of project site operations and capital projects, including oversight of the development, implementation and monitoring of the Company’s policies, project site operations, and capital project plans. • Reports to the board following each regular committee meeting, |
| Sustainability Committee | • Oversight of both development and implementation of NOVAGOLD’s health, safety. environment, and sustainability policies, including climate change and biodiversity. • Provide strategic direction to management regarding community relations and government affairs matters. • Review NOVAGOLD’s disclosures containing environmental, health, safety, and sustainability information. • Reports to the board following each regular committee meeting, |
NOVAGOLD 2024 MANAGEMENT INFORMATION CIRCULAR
WHAT’S NEW?
What changed in 2023? The Corporate Governance and Nominations Committee continued its search for Board candidates with the assistance of a third-party executive search firm. The Committee focused on searching for candidates with expertise in financial matters, capital markets, legal matters, and cybersecurity knowledge relevant to mining, as well as senior executive experience. The Committee considered a number of prospective candidates of both genders, and the Board unanimously nominated Hume Kyle, Daniel Muñiz Quintanilla and Dawn Whittaker to stand for election to the Board at the May 18, 2023 Annual and General Meeting. The Shareholders overwhelmingly elected these three nominees to the Board.
ENVIRONMENTAL, SOCIAL AND GOVERNANCE HIGHLIGHTS
In 2023, NOVAGOLD published its 2022 Sustainability Report with detailed environmental, social and governance (“ESG”) information about NOVAGOLD and its flagship Donlin Gold project which is available on NOVAGOLD’s website atwww.novagold.com/sustainability. The detailed sustainability information aligns with the Task Force on Climate Related Financial Disclosures (“TCFD”) framework. We plan to issue a Sustainability Report in the first half of 2024 reporting on the Company’s ESG goals, activities, and performance during fiscal year 2023. NOVAGOLD will update the ESG information on its website regularly and will continue to report on NOVAGOLD’s ESG goals and performance annually. We hope you find this information useful and informative.1
SHAREHOLDER ENGAGEMENT
Maintaining an active shareholder engagement program continues to be a high priority for the Company and is an integral part of our corporate governance practices. The Board Chair, CEO, and Vice President of Corporate Communications meet regularly with large shareholders, and the Company’s Corporate Communications team is very responsive to shareholder inquiries regardless of ownership level.
In 2023, NOVAGOLD placed calls to or met in person with all its shareholders owning 40,000 shares or more; in other words, NOVAGOLD contacted or attempted to contact its owners holding approximately 92% of the Company’s issued and outstanding Common Shares entitled to vote at NOVAGOLD’s 2023 annual meeting of shareholders. We plan to continue to regularly engage with our shareholders.
FAREWELL
Anthony Walsh has decided not to stand forre-election to NOVAGOLD’s Board of Directors after many years of dedicated service as the Company’s Independent Lead Director and Chair of the Audit Committee. We will miss Mr. Walsh’s wise and thoughtful counsel and wish him well.
CONCLUSION
More information about NOVAGOLD can be found in the Annual Report on Form 10-K for the fiscal year ended November 30, 2023, which is available on the Company’s website atwww.novagold.com, on SEDAR+ atwww.sedarplus.ca and on EDGAR atwww.sec.gov.
Shareholders may contact Kingsdale Advisors, the Company’s strategic advisor by telephone at 1-866-228-8818 or 1-416-623-2514 (text and call enabled outside North America), or by email atcontactus@kingsdaleadvisors.com. To obtain information about voting your NOVAGOLD Common Shares, please visitwww.NOVAGOLDAGM.com.
The Board and management team wish to thank you for your continued confidence in NOVAGOLD.
Sincerely,
President and Chief Executive Officer, Director
| 1 | The contents of our website and our Sustainability Report are referenced for general information only and are not incorporated by reference in this Proxy Circular. |
NOVAGOLD 2024 MANAGEMENT INFORMATION CIRCULAR
TABLE OF CONTENTS
| INFORMATION REGARDING ORGANIZATION AND CONDUCT OF MEETING | 1 |
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| Solicitation of Proxies | 1 |
| How to Vote | 3 |
| Voting Shares and Principal Holders Thereof | 6 |
| MATTERS TO BE ACTED UPON AT MEETING | 7 |
| Number of Directors | 7 |
| Election of Directors | 7 |
| Appointment of Auditors | 9 |
| Report of the Audit Committee | 10 |
| Additional Matters to be Acted Upon | 11 |
| INFORMATION CONCERNING THE BOARD OF DIRECTORS, DIRECTOR NOMINEES, AND EXECUTIVE OFFICERS | 12 |
| Board Diversity and Tenure | 24 |
| SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED SHAREHOLDER MATTERS | 26 |
| INTEREST OF CERTAIN PERSONS OR COMPANIES IN MATTERS TO BE ACTED UPON | 30 |
| COMPENSATION DISCUSSION & ANALYSIS | 31 |
| Overview | 31 |
| Compensation Committee | 32 |
| Risk Assessment of Compensation Policies and Practices | 33 |
| Statement of Executive Compensation | 36 |
| Executive Compensation Philosophy | 36 |
| Executive Compensation Objectives and Elements | 37 |
| Annual Compensation Decision-Making Process | 39 |
| Base Salary | 44 |
| Annual Incentive Plan | 45 |
| Stock-Based Incentive Plans (Long-Term Incentives) | 52 |
| Executive Share Ownership | 55 |
| Retirement Plans | 55 |
| Benefits | 56 |
| Advisory Vote on Executive Compensation | 56 |
| Compensation Committee Report | 56 |
| TABULAR DISCLOSURE OF EXECUTIVE COMPENSATION | 57 |
| Summary Compensation Table | 57 |
| Grants of Plan-Based Awards in Fiscal 2023 | 58 |
| Outstanding Equity Awards at Fiscal Year-End | 59 |
| Option Exercises and Stock Vested in Fiscal 2023 | 60 |
| CEO Pay Ratio – 10.6 to 1 | 60 |
| Pay Versus Performance | 61 |
| Summary Compensation Table Total versus Compensation Actually Paid Reconciliation Table | 62 |
| Performance Graph | 65 |
| Executive Employment Agreements | 66 |
| Potential Payments Upon Termination or Change of Control | 68 |
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| NON-EXECUTIVE DIRECTOR COMPENSATION | 70 |
| Non-Executive Director Compensation Table | 71 |
| Directors’ Share Ownership | 73 |
| Incentive Plan Awards | 74 |
| Value Vested or Earned During the Year | 75 |
| SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS | 76 |
| Equity Compensation Plan Information | 76 |
| General Information – Stock Based Incentive Plans | 78 |
| Stock Award Plan | 78 |
| Performance Share Unit Plan | 81 |
| Deferred Share Unit Plan | 85 |
| INDEBTEDNESS OF DIRECTORS AND OFFICERS | 89 |
| INTEREST OF INFORMED PERSONS IN MATERIAL TRANSACTIONS | 89 |
| STATEMENT OF CORPORATE GOVERNANCE PRACTICES | 90 |
| Board of Directors | 90 |
| Board Service Policy | 97 |
| Insider Trading Policy | 97 |
| Policy on Granting Equity Awards | 97 |
| Anti-Corruption, Anti-Bribery, Anti-Fraud Policy | 97 |
| Anti-Hedging and Anti-Pledging Policy | 98 |
| Incentive Compensation Recovery Policy | 98 |
| Human Rights Policy | 98 |
| Environmental, Social and Governance Matters | 98 |
| Climate Change and Carbon Footprint Considerations | 99 |
| Climate Change Policy | 99 |
| Biodiversity Policy | 100 |
| Integrated Risk Management Policy | 100 |
| Corporate Disclosure Policy | 100 |
| Other Board Committees | 100 |
| Assessments | 101 |
| Majority Voting Policy | 101 |
| Compensation Committee Interlocks and Insider Participation | 101 |
| Shareholder Communication with the Board | 101 |
| OTHER BUSINESS | 102 |
| ADDITIONAL INFORMATION | 102 |
| OTHER MATERIAL FACTS | 102 |
| SHAREHOLDER PROPOSALS | 103 |
| HOUSEHOLDING | 104 |
| CERTIFICATE | 104 |
NOVAGOLD 2024 MANAGEMENT INFORMATION CIRCULAR
MANAGEMENT INFORMATION CIRCULAR
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