DEF 14A of Niocorp Developments LTD, Dec 8, 2023

DEF 14A of Niocorp Developments LTD

Filed Dec 8, 2023 · FY20230001539497-23-002136

Open on EDGAR

  1. NOTICE OF MEETING

    | PAY VERSUS PERFORMANCE | 47 | | PERFORMANCE GRAPH | 49 | | INDEBTEDNESS OF DIRECTORS AND EXECUTIVE OFFICERS | 50 | | INTEREST OF INFORMED PERSONS IN MATERIAL TRANSACTIONS | 50 | | MANAGEMENT CONTRACTS | 50 | | CERTAIN RELATIONSHIPS AND RELATED PERSON TRANSACTIONS | 50 | | Related Person Transactions | 50 | | Review, Approval or Ratification of Related Person Transactions | 52 | | SHAREHOLDER PROPOSALS | 53 | | DISSENTERS’ RIGHTS OF APPRAISAL | 54 | | MULTIPLE SHAREHOLDERS SHARING THE SAME ADDRESS | 54 | | ADDITIONAL INFORMATION | 54 | | OTHER MATERIAL FACTS | 54 |

  2. I AND II – NUMBER AND ELECTION OF DIRECTORS

    I AND II – NUMBER AND ELECTION OF DIRECTORS Directors of the Company are elected at each annual general meeting of shareholders and hold office until the next annual general meeting of shareholders or until that person sooner ceases to be a director. Currently, the Board consists of eight directors whose terms expire at the Meeting. Anna Castner Wightman, a director since 2016, has not been nominated by the Board to stand for re-election at the Meeting, and we thank her for over six years of service. Accordingly, the shareholders will be asked to pass an ordinary resolution to set the number of directors of the Company at seven for the next year, subject to any increases permitted by the Company’s Articles. The number of directors will be approved if the affirmative vote of at least a majority of Common Shares present or represented by proxy at the Meeting and entitled to vote thereat are voted in favour of setting the number of directors at seven. Management recommends a vote “FOR” in respect of the resolution to set the number of directors of the Company at seven. Unless you provide other instructions, the proxy will be voted for the nominees listed below. Management does not expect that any of the nominees will be unable to serve as a director. If before the Meeting any vacancies occur in the slate of nominees listed below, the person named in the proxy will exercise his or her discretionary authority to vote the Common Shares represented by the proxy for the election of another person or persons as directors to fill such vacancies. The following are the Company’s seven directors that are up for election at the Meeting. Management has nominated each of the persons named in the table below for election as director. The information concerning current directors and proposed nominees has been furnished by each of them:

  3. I AND II – NUMBER AND ELECTION OF DIRECTORS

    | Name | Age | Position | Date of Appointment | | Mark A. Smith | 64 | Chief Executive Officer, President, Executive Chairman and Director | Chief Executive Officer and Director: September 23, 2013 President and Executive Chairman: May 31, 2015 | | Michael J. Morris | 78 | Director | July 27, 2014 | | David C. Beling | 82 | Director | June 6, 2011 | | Nilsa Guerrero-Mahon | 63 | Director | November 24, 2017 | | Peter Oliver | 60 | Director | May 25, 2022 | | Dean C. Kehler | 66 | Director | March 17, 2023(1) | | Michael G. Maselli | 63 | Director | March 17, 2023(1) |

  4. I AND II – NUMBER AND ELECTION OF DIRECTORS

    | (1) Pursuant to the Business Combination Agreement (as defined herein), the Company was required to cause two directors identified by GXII to become directors of the Company as of closing of the Transactions (as defined herein) (the “Closing”). On March 17, 2023, the Board appointed Messrs. Kehler and Maselli to the Board pursuant to such requirement. |

  5. I AND II – NUMBER AND ELECTION OF DIRECTORS

    The following sets forth a brief description of the business experience of each nominee for director of the Company, including current directorships and directorships held in, at least, the past five years:

  6. Director Nominees

    Director Nominees

  7. Voting Procedures for the Election of Directors

    Voting Procedures for the Election of Directors Cumulative voting (i.e., a form of voting where shareholders are permitted to cast all of their aggregate votes for a single nominee) will not be permitted. The directors must be elected by an affirmative vote of a plurality of the votes cast, either in person or by proxy, at the Meeting on this matter. Abstentions will not be counted FOR or WITHHOLD with respect to any nominee to the Board.

  8. Compensation Committee

    | • | Make recommendations to the Board on director compensation and compensation for the Chairman of the Board position; |

  9. Identification and Evaluation of Director Nominees

    Identification and Evaluation of Director Nominees In accordance with the Corporate Governance Guidelines, directors may be nominated by the Board or by shareholders in accordance with the Articles of the Company. The Nominating Committee will consider recommendations for director nominees made by shareholders and others and make recommendations to the Board in accordance with the policies and principles in the Nominating Committee’ Charter and the Corporate Governance Guidelines. For consideration by the Nominating Committee, the nominating shareholder or other person must provide the Company’s Chief Financial Officer and Corporate Secretary, Neal Shah, at the Company’s principal executive offices, with information about the nominee, including the detailed background of the suggested candidate. While there are no minimum qualifications, the Nominating Committee considers, among other factors, the nominee’s judgment, independence, relevant subject matter expertise, integrity, experience with businesses or other organizations of comparable size or industry and any other factors deemed relevant to the current needs of the Board, including those that promote diversity of age, gender, race, ethnicity, experience and background. Given the informal policy as described, the Nominating Committee believes that a formal, written policy and procedure with regard to consideration of director candidates recommended by shareholders is not necessary in order for the Nominating Committee to perform its duties. The Nominating Committee utilizes a variety of methods for identifying and evaluating nominees for director. The Nominating Committee makes recommendation to the Board concerning the selection criteria to be used in seeking nominees for election to the Board. In the case of newly created directorships or vacancies, the Nominating Committee recommends to the Board candidates for election by the Board based on the skills, qualifications and experience of such candidates and in accordance with the policies and principles in there charter and the criteria described in the Corporate Governance Guidelines. As described above, the Nominating Committee considers properly submitted shareholder nominations for candidates for the Board. In considering director nominees proposed by shareholders, the Nominating Committee reviews the skills, qualifications and experience of the director nominees. Outside of the participation of Mark A. Smith, the CEO, Dean C. Kehler and Michael G. Maselli on the Board as directors, no shareholder or shareholders holding 5% or more of the Company’s outstanding stock, either individually or in aggregate, has recommended a nominee for election to the Board as of the date of this Information Circular.

  10. Fiscal 2023 Director Compensation

    Fiscal 2023 Director Compensation Effective March 17, 2023, the Company increased the size of its Board to nine directors and appointed Michael G. Maselli and Dean C. Kehler. On May 15, 2023, Fernanda Reda Fenga Viana Klamas resigned from the Board. One of the directors serving on the Board (Mark A. Smith) is also a named executive officer. For a description of the compensation paid to Mr. Smith, see “Fiscal 2023 Summary Compensation Table” below. The following table sets forth all compensation the Company granted to our directors, other than Mr. Smith, for the fiscal year ended June 30, 2023:

  11. Fiscal 2023 Director Compensation

    | Name | Fees Earned or Paid in Cash ($) | Option Awards ($)(1) | All Other Compensation ($)(2) | Total ($) | | David C. Beling | - | $123,600 | $59,000 | $182,600 | | Michael J. Morris | - | 154,500 | 43,200 | 197,700 | | Anna Castner Wightman | - | 123,600 | 35,500 | 159,100 | | Nilsa Guerrero-Mahon | - | 139,050 | 27,500 | 166,550 | | Fernanda Reda Fenga Viana Klamas | - | 123,600 | 11,500 | 135,100 | | Peter Oliver | - | 123,600 | 4,000 | 127,600 | | Dean C. Kehler | - | - | – | - | | Michael G. Maselli | - | - | – | - |

  12. Fiscal 2023 Director Compensation

    | (1) Reflects the grant date fair value of Options granted during the 2023 fiscal year, consisting of 50,000 Options for Mr. Morris, 45,000 Options for Ms. Guerrero-Mahon, and 40,000 Options each for Ms. Wightman, Ms. Fenga, Mr. Beling, and Mr. Oliver, in each case at an exercise price of $6.95 per share, computed in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 718. Assumptions used in the calculation of these amounts are described in Note 11 in the Company’s consolidated financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2023. These Options were fully vested on the grant date and generally remain exercisable until three years after the grant date. | | (2) The amounts in this column reflect a special cash bonus paid to directors equal to $5,000 per year of service or portion thereof, based on their individual years of service on the Board. |

  13. Fiscal 2023 Director Compensation

    For the fiscal year ended June 30, 2023, the directors of the Company did not receive any cash fees for serving on the Board, other than the special cash bonuses set forth in the table above. The directors of the Company have no standard compensation arrangements, or any other arrangements, with the Company, except as herein disclosed. Option grants are determined by the Compensation Committee on a discretionary basis each year. Executive officers of the Company who also act as directors of the Company do not receive any additional compensation for services rendered in such capacity. See “Fiscal 2023 Summary Compensation Table” below. The aggregate number of Option awards outstanding at the end of fiscal year 2023 for each non-employee director who served during fiscal 2023 was as follows: Mr. Beling, 122,500 Options; Mr. Morris, 107,500 Options; Ms. Wightman, 122,500 Options; Ms. Guerrero-Mahon, 105,000 Options; Ms. Fenga, 117,500 Options; Mr. Oliver, 90,000 Options; Mr. Kehler, 0 Options; and Mr. Maselli, 0 Options. As of June 30, 2023, all the above Options were 100% vested.

  14. Fiscal 2023 Summary Compensation Table

    Fiscal 2023 Summary Compensation Table

  15. Fiscal 2023 Summary Compensation Table

    | Name and Principal Position | Fiscal Year | Salary ($) | Bonus ($) | Option Awards (1) ($) | Total ($) | | Mark A. Smith, Chief Executive Officer, President (2) | 2023 | $304,000 | $100,000 | $216,300 | $620,300 | | | 2022 | 297,000 | — | 256,471 | 553,471 | | Scott Honan, Chief Operating Officer | 2023 | 265,000 | 50,000 | 123,600 | 438,600 | | | 2022 | 260,000 | — | 118,371 | 378,371 | | Neal Shah, Chief Financial Officer and Corporate Secretary | 2023 | 227,500 | 50,000 | 123,600 | 401,100 | | | 2022 | 220,000 | — | 118,371 | 338,371 |

  16. Fiscal 2023 Summary Compensation Table

    | (1) Reflects the grant date fair value of the Options granted during the reported fiscal years. Fiscal year 2023 grants consisted of 70,000 Options for Mr. Smith and 40,000 Options for each of Messrs. Honan and Shah, in each case at an exercise price of $6.95 per share. Grant date fair values were computed in accordance with FASB ASC Topic 718. Assumptions used in the calculation of these amounts are described in Note 11 in the Company’s consolidated financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2023. These Options were fully vested on the grant date and generally remain exercisable until three years after the grant date. | | (2) Disclosed amounts paid to 76 Resources, LLC, an entity controlled by Mr. Smith, as further described below under “Employment Agreements.” |

  17. Outstanding Equity Awards at 2023 Fiscal Year-End

    Outstanding Equity Awards at 2023 Fiscal Year-End

  18. Outstanding Equity Awards at 2023 Fiscal Year-End

    | | Option Awards(1) | | | | | | Name | Grant Date | Number of Securities Underlying Unexercised Options (#) Exercisable | Number of Securities Underlying Unexercised Options (#) Unexercisable | Option Exercise Price ($) | Option Expiration Date | | Mark A. Smith | 12/14/2020 | 50,000 | — | 5.66(2) | 12/14/2023 | | | 12/17/2021 | 65,000 | — | 10.27(2) | 12/17/2024 | | | 03/27/2023 | 70,000 | — | 6.95 | 03/27/2026 | | Scott Honan | | | | | | | | 11/15/2018 | 35,000 | — | 4.08(2) | 11/15/2023 | | | 12/14/2020 | 25,000 | — | 5.66(2) | 12/14/2023 | | | 12/17/2021 | 30,000 | — | 10.27(2) | 12/17/2024 | | | 03/27/2023 | 40,000 | — | 6.95 | 03/27/2026 | | Neal Shah | | | | | | | | 11/15/2018 | 35,000 | — | 4.08(2) | 11/15/2023 | | | 12/14/2020 | 25,000 | — | 5.66(2) | 12/14/2023 | | | 12/17/2021 | 30,000 | — | 10.27(2) | 12/17/2024 | | | 03/27/2023 | 40,000 | — | 6.95 | 03/27/2026 |

  19. Outstanding Equity Awards at 2023 Fiscal Year-End

    | (1) In connection with the Reverse Stock Split effected by the Company on March 17, 2023, each then-outstanding Option then held by our named executive officers was adjusted as follows: (a) the number of shares subject to each such Option was divided by ten, with the resulting number rounded down to the nearest whole share; and (b) the exercise price applicable to each such outstanding Option was multiplied by ten, with the resulting price rounded up to the nearest whole cent. The amounts set forth in the table above with respect to options granted prior to March 27, 2023, reflect such adjustments. | | (2) Option exercise price based on a spot exchange rate of C$1.324 to US$1.00 on June 30, 2023. |

  20. PAY VERSUS PERFORMANCE

    PAY VERSUS PERFORMANCE As required by new pay versus performance (“PVP”) rules adopted by the SEC in August 2022 and in effect for the first time for the Company for this Information Circular, the following Pay Versus Performance table (“PVP Table”) provides SEC-required information about compensation for this Information Circular’s named executive officers, as well as our named executive officers from our Management Information and Proxy Circular for our 2022 Annual General Meeting of Shareholders (each of fiscal years 2022 and 2023, a “Covered Year”). We refer to all of the named executive officers covered in the PVP Table below, collectively, as the “PVP NEOs”. The PVP Table also provides information about the results for certain measures of performance during those same Covered Years. In reviewing this information, there are a few important things we believe you should consider: The information in columns (b) and (d) of the PVP Table comes directly from this year’s Summary Compensation Table (or last year’s Summary Compensation Table), without adjustment, calculated in substantially the same manner as required under SEC rules; As required by the SEC’s PVP rules, we describe the information in columns (c) and (e) of the PVP Table as “compensation actually paid” (or “CAP”) to the applicable PVP NEOs. However, these CAP amounts do not necessarily reflect the final compensation that our NEOs actually earned or walked away with for their service in the Covered Years, respectively; and As required by the SEC’s PVP rules, we provide information in the PVP Table below about our absolute total shareholder return (“TSR”) results and our U.S. generally accepted accounting principles net income results (the “External Measures”) during the Covered Years.

  21. Pay Versus Performance Table

    Pay Versus Performance Table

  22. Pay Versus Performance Table

    | Year(a) | Summary Compensation Table (“SCT”) Total for PEO (b)(1) | Compensation Actually Paid to PEO (c)(1)(2) | Average SCT Total for Non-PEO NEOs (d)(1) | Average Compensation Actually Paid to Non-PEO NEOs (e)(1)(2) | Value of Initial Fixed $100 Investment Based on Total Shareholder Return (f)(3) | Net Loss Attributable to the Company (g) | | 2023 | $620,300 | $620,300 | $419,850 | $419,850 | $74.22 | $40,080 | | 2022 | $553,471 | $553,471 | $351,704 | $351,704 | $58.82 | $10,887 |

  23. Pay Versus Performance Table

    | (1) Mark A. Smith was our principal executive officer (“PEO”) for the full year for each of the Covered Years. Our non-PEO PVP NEOs (“Non-PEO NEOs”) for fiscal year 2023 were Scott Honan and Neal Shah. Our Non-PEO NEOs for fiscal year 2022 were Scott Honan, Neal Shah, and Jim Sims. |

  24. Pay Versus Performance Table

    | (2) For each Covered Year, in determining both the CAP for our PEO and the average CAP for our Non-PEO NEOs for purposes of this PVP Table, we deducted from or added back to the total amount of compensation reported in column (b) and column (d) for such Covered Year the following amounts: |

  25. Pay Versus Performance Table

    | Item and Value Added (Deducted) | 2023 | 2022 | | For Mr. Smith: | | | | - SCT “Stock Awards” column value | — | — | | - SCT “Option Awards” column value | $(216,300) | $(256,471) | | + year-end fair value of outstanding unvested equity awards granted in Covered Year | — | — | | +/- change in fair value of outstanding unvested equity awards granted in prior years | — | — | | + vesting date fair value of equity awards granted and vested in Covered Year | $216,300 | $256,471 | | +/- change in fair value of prior-year equity awards vested in Covered Year | — | — | | - prior year-end fair value of equity awards granted in prior years and forfeited in Covered Year | — | — | | + includable dividends/earnings on equity awards during Covered Year | — | — | | For Non-PEO NEOs (Average): | | | | - SCT “Stock Awards” column value | — | — | | - SCT “Option Awards” column value | $(123,600) | $(118,371) | | + year-end fair value of outstanding unvested equity awards granted in Covered Year | — | — | | +/- change in fair value of outstanding unvested equity awards granted in prior years | — | — | | + vesting date fair value of equity awards granted and vested in Covered Year | $123,600 | $118,371 | | +/- change in fair value of prior-year equity awards vested in Covered Year | — | — | | - prior year-end fair value of equity awards granted in prior years and forfeited in Covered Year | — | — | | + includable dividends/earnings on equity awards during Covered Year | — | — |

  26. Pay Versus Performance Table

    | (3) For each Covered Year, our TSR was calculated based on the yearly percentage change in our cumulative TSR on our Common Shares, measured as the quotient of (a) the sum of (i) the cumulative amount of dividends for a period beginning with our closing price on the TSX on June 30, 2021 through and including the last day of the fiscal year covered (each one- or two-year period, the “Measurement Period”), assuming dividend reinvestment, plus (ii) the difference between our closing share price at the |

  27. Pay Versus Performance Table

    end versus the beginning of the Measurement Period, divided by (b) our closing share price at the beginning of the Measurement Period. Each of these yearly percentage changes was then applied to a deemed fixed investment of $100 at the beginning of each Measurement Period to produce the Covered Year-end values of such investment as of the end of 2023 and 2022, as applicable. Because Covered Years are presented in the table in reverse chronical order (from top to bottom), the table should be read from bottom to top for purposes of understanding cumulative returns over time. Net loss attributable to the Company increased significantly during fiscal year 2023, reflecting costs associated with the Transactions, as defined herein, while CAP for our PEO and the average CAP for our Non-PEO NEOs increased slightly for the same fiscal year. Because we are not a production stage mining company, we did not have any revenue from continuing operations during the periods presented. As described in more detail above in the section “Compensation Program Design,” we currently utilize subjective assessments of executive performance, and we have not historically focused on net loss as a performance measure for our executive compensation programs. TSR improved moderately during fiscal year 2023 and CAP for our PEO and the average CAP for our Non-PEO NEOs also increased slightly. The following chart provides, across the Covered Years, descriptions of the relationships between the CAP for the PEO and the average CAP for our Non-PEO NEOs (in each case as set forth in the PVP Table above) and our TSR.

  28. INDEBTEDNESS OF DIRECTORS AND EXECUTIVE OFFICERS

    INDEBTEDNESS OF DIRECTORS AND EXECUTIVE OFFICERS None of our directors or executive officers, proposed nominees for election as directors or associates of any of them, is or has been indebted to the Company or our subsidiaries at any time since the beginning of the most recently completed financial year, and no indebtedness remains outstanding as at the date of this Information Circular.