SILVER NORTH RESOURCES LTD.
Annual General Meeting
to be held on March 27, 2024
Notice of Annual General Meeting
and
Information Circular
ONLINE AT:
Join Zoom Meeting
https://us02web.zoom.us/j/87847685482?pwd=L0dzTG5MSElmOHpsMFVuTlhqRmM5Zz09
Meeting ID: 878 4768 5482
Passcode: 435359
---
Find your local number: https://us02web.zoom.us/u/kFM03LEUk
SILVER NORTH RESOURCES LTD.
410 - 325 Howe Street
Vancouver, B.C. V6C 1Z7
NOTICE OF ANNUAL GENERAL MEETING OF SHAREHOLDERS
NOTICE IS HEREBY GIVEN that an annual general meeting (the “Meeting”) of the shareholders of Silver North Resources Ltd. (the “Company”) will be held by Zoom meeting conference: https://us02web.zoom.us/j/87847685482?pwd=L0dzTG5MSElmOHpsMFVuTlhqRmM5Zz09
(Meeting ID: 878 4768 5482 Passcode: 435359) on Wednesday, March 27, 2024 at 10:00 a.m. (local time in Vancouver, British Columbia). At the Meeting, the shareholders will receive the financial statements for the year ended September 30, 2023, together with the auditor’s report thereon, and consider resolutions to:
1.set the number of directors at four;
2.elect directors for the ensuing year;
3.appoint DeVisser Gray LLP, Chartered Professional Accountants, as auditor of the Company for the ensuing year and authorize the directors to determine the remuneration to be paid to the auditor;
4.confirm the Company’s stock option plan, as required annually by the policies of the TSX Venture Exchange; and
5.transact such other business as may properly be put before the Meeting.
Shareholders are reminded that no votes will be accepted at the Zoom Meeting. Shareholders who wish to ensure that their common shares will be voted, must complete, date and execute the enclosed form of proxy, or another suitable form of proxy, and deliver it by mail or by fax in accordance with the instructions set out in the form of proxy and in the management information circular accompanying this Notice. For greater clarity, proxies need to be received by Computershare Investor Services Inc. (“Computershare”). If a shareholder does not deliver a proxy to Computershare, Attention: Proxy Department, 100 University Avenue, 9th Floor, Toronto, Ontario, M5J 2Y1, before the proxy cut-off date of 10:00a.m. Vancouver time on Monday, March 25, 2024. Only shareholders of record at the close of business on Friday, February 16, 2024 will be entitled to vote at the Meeting.
An information circular and a form of proxy accompany this notice.
DATED at Vancouver, British Columbia, the 16th day of February, 2024.
ON BEHALF OF THE BOARD
“Jason Weber”
Jason Weber
President and Chief Executive Officer
SILVER NORTH RESOURCES LTD.
410 – 325 Howe Street
Vancouver, B.C. V6C 1Z7
INFORMATION CIRCULAR
(as at February 16, 2024 except as otherwise indicated)
SOLICITATION OF PROXIES
This information circular (the “Circular”) is provided in connection with the solicitation of proxies by the Management of Silver North Resources Ltd. (the “Company”). The form of proxy which accompanies this Circular (the “Proxy”) is for use at the annual general meeting of the shareholders of the Company to be held on Wednesday, March 27, 2024 (the “Meeting”), at the time and place set out in the accompanying notice of Meeting (the “Notice of Meeting”). The Company will bear the cost of this solicitation. The solicitation will be made by mail, but may also be made by telephone.
THE COMPANY IS HOLDING ITS MEETING BY ZOOM MEETING CONFERENCE ONLY. NO VOTES WILL BE ACCEPTED AT THE ZOOM MEETING CONFERENCE. SHAREHOLDERS WHO WISH TO ENSURE THAT THEIR COMMON SHARES WILL BE VOTED, MUST COMPLETE, DATE AND EXECUTE THE ENCLOED FORM OF PROXY, OR ANOTHER SUITABLE FORM OF PROXY, AND DELIVER IT BY MAIL OR BY FAX IN ACCORDANCE WITH THE INSTRUCTIONS SET OUT IN THE FORM OF PROXY AND IN THE NOTICE ACCOMPANYING THIS CIRCULAR. FOR GREATER CLARITY, PROXIES NEED TO BE RECEIVED BY COMPUTERSHARE BEFORE THE PROXY CUT-OFF DATE OF 10:00 A.M., VANCOUVER TIME ON MONDAY MARCH 25, 2024.
APPOINTMENT AND REVOCATION OF PROXY
The persons named in the Proxy are directors and/or officers of the Company. A registered shareholder who wishes to appoint some other person to serve as their representative at the Meeting may do so by striking out the printed names and inserting the desired person’s name in the blank space provided. The completed Proxy should be delivered to Computershare Investor Services Inc. (“Computershare”) by 10:00 a.m. (local time in Vancouver, British Columbia) on Monday,
March 25, 2024 or before 48 hours (excluding Saturdays, Sundays and holidays) before any adjournment of the Meeting at which the Proxy is to be used.
The Proxy may be revoked by:
(a)signing a proxy with a later date and delivering it at the time and place noted above;
(b)signing and dating a written notice of revocation and delivering it to the registered office of the Company, or by transmitting a revocation by telephonic or electronic means, to the registered office of the Company, at any time up to and including the last business day preceding the day of the Meeting, or any adjournment of it, at which the Proxy is to be used, or delivering a written notice of revocation and delivering it to the Chairman of the Meeting on the day of the Meeting or adjournment of it; or
(c)attending the Meeting or any adjournment of the Meeting and registering with the scrutineer as a shareholder present in person.
Provisions Relating to Voting of Proxies
The shares represented by Proxy in the form provided to shareholders will be voted or withheld from voting by the designated holder in accordance with the direction of the registered shareholder appointing him. If there is no direction by the registered shareholder, those shares will be voted for all proposals set out in the Proxy and for the election of directors and the appointment of the auditors as set out in this Circular. The Proxy gives the person named in it the discretion to vote as such person sees fit on any amendments or variations to matters identified in the Notice of Meeting, or any other matters which may properly come before the Meeting. At the time of printing of this Circular, the management of the Company (the “Management”) knows of no other matters which may come before the Meeting other than those referred to in the Notice of Meeting.
Advice to Beneficial Holders of Common Shares
The information set forth in this section is of significant importance to many shareholders, as a substantial number of shareholders do not hold common shares in their own name. Shareholders who hold their common shares through their brokers, intermediaries, trustees or other persons, or who otherwise do not hold their common shares in their own name (referred to herein as “Beneficial Shareholders”) should note that only proxies deposited by shareholders who appear on the records maintained by the Company’s registrar and transfer agent as registered holders of common shares will be recognized and acted upon at the Meeting. If common shares are listed in an account statement provided to a Beneficial Shareholder by a broker, then those common shares will, in all likelihood, not be registered in the shareholder’s name. Such common shares will more likely be registered under the name of the shareholder’s broker or an agent of that broker. In Canada, the vast majority of such shares are registered under the name of CDS & Co. (the registration name for The Canadian Depository for Securities Ltd., which acts as nominee for many Canadian brokerage firms). In the United States, the vast majority of such common shares are registered under the name Cede & Co., the registration name for The Depository Trust Company, which acts as nominee for many United States brokerage firms. Common shares held by brokers (or their agents or nominees) on behalf of a broker’s client can only be voted or withheld at the direction of the Beneficial Shareholder. Without specific instructions, brokers and their agents and nominees are prohibited from voting shares for the broker’s clients. Therefore, each Beneficial Shareholder should ensure that voting instructions are communicated to the appropriate person well in advance of the Meeting.
Existing regulatory policy requires brokers and other intermediaries to seek voting instructions from Beneficial Shareholders in advance of shareholders’ meetings. The various brokers and other intermediaries have their own mailing procedures and provide their own return instructions to clients, which should be carefully followed by Beneficial Shareholders in order to ensure that common shares are voted at the Meeting. The form of instrument of proxy supplied to a Beneficial Shareholder by its broker (or the agent of the broker) is substantially similar to the instrument of proxy provided directly to registered shareholders by the Company. However, its purpose is limited to instructing the registered shareholder (i.e., the broker or agent of the broker) how to vote on behalf of the Beneficial Shareholder. The vast majority of brokers now delegate responsibility for obtaining instructions from clients to Broadridge Financial Solutions Inc. (“Broadridge”) in Canada. Broadridge typically prepares a machine-readable voting instruction form (“VIF”), mails those forms to Beneficial Shareholders and asks Beneficial Shareholders to return the VIFs to Broadridge, or otherwise communicate voting instructions to Broadridge (by way of the internet or telephone, for example). Broadridge then tabulates the results of all instructions received and provides appropriate instructions respecting the voting of shares to be represented at the Meeting. A Beneficial Shareholder who receives a Broadridge VIF form cannot use that form to vote common shares directly at the Meeting. The VIF must be returned to Broadridge (or instructions respecting the voting of common shares must otherwise be communicated to Broadridge) well in advance of the Meeting in order to have the common shares voted. If you have any questions respecting the voting of common shares held through a broker or other intermediary, please contact that broker or other intermediary for assistance.
The Notice of Meeting, Circular, Proxy and VIF, as applicable, are being provided to both registered shareholders and Beneficial Shareholders. Beneficial Shareholders fall into two categories - those who object to their identity being known to the issuers of securities which they own (“OBOs”) and those who do not object to their identity being made known to the issuers of the securities which they own (“NOBOs”). Subject to the provisions of National Instrument 54-101 - Communication with Beneficial Owners of Securities of a Reporting Issuer (“NI 54-101”), issuers may request and obtain a list of their NOBOs from intermediaries directly or via their transfer agent and may obtain and use the NOBO list for the distribution of proxy-related materials directly (not via Broadridge) to such NOBOs. If you are a Beneficial Shareholder and the Company or its agent has sent these materials directly to you, your name, address and information about your holdings of common shares have been obtained in accordance with applicable securities regulatory requirements from the intermediary holding the common shares on your behalf.
Pursuant to the provisions of NI 54-101, the Company is providing the Notice of Meeting, Circular and Proxy or VIF, as applicable, to both registered owners of the securities and non-registered owners of the securities. If you are a non-registered owner, and the Company or its agent has sent these materials directly to you, your name and address and information about your holdings of securities, have been obtained in accordance with applicable securities regulatory requirements from the intermediary holding on your behalf. By choosing to send these materials to you directly, the Company (and not the intermediary holding common shares on your behalf) has assumed responsibility for (i) delivering these materials to you, and (ii) executing your proper voting instructions. Please return your voting instructions as specified in the VIF. As a result, if you are a non-registered owner of the securities, you can expect to receive a scannable VIF from Computershare. Please complete and return the VIF to Computershare in the envelope provided or by facsimile. In addition, telephone voting and internet voting instructions can be found on the VIF. Computershare will tabulate the results of the VIFs received from the Company’s NOBOs and will provide appropriate instructions at the Meeting with respect to the common shares represented by the VIFs they receive.
The Company’s OBOs can expect to be contacted by Broadridge or their brokers or their broker’s agents as set out above. The Company does not intend to pay for intermediaries to deliver the Notice of Meeting, Circular and VIF to OBOs and accordingly, if the OBO’s intermediary does not assume the costs of delivery of those documents in the event that the OBO wishes to receive them, the OBO may not receive the documentation.
Although a Beneficial Shareholder may not be recognized directly at the Meeting for the purposes of voting common shares registered in the name of his broker, a Beneficial Shareholder may attend the Meeting as proxyholder for the registered shareholder and vote the common shares in that capacity. NI 54-101 allows a Beneficial Shareholder who is a NOBO to submit to the Company or an applicable intermediary any document in writing that requests that the NOBO or a nominee of the NOBO be appointed as proxyholder. If such a request is received, the Company or an intermediary, as applicable, must arrange, without expenses to the NOBO, to appoint such NOBO or its nominee as a proxyholder and to deposit that proxy within the time specified in this Circular, provided that the Company or the intermediary receives such written instructions from the NOBO at least one business day prior to the time by which proxies are to be submitted at the Meeting, with the result that such a written request must be received by 10:00 a.m. (local time in Vancouver, British Columbia) on the day which is at least three business days prior to the Meeting. A Beneficial Shareholder who wishes to attend the Meeting and to vote their common shares as proxyholder for the registered shareholder, should enter their own name in the blank space on the VIF or such other document in writing that requests that the NOBO or a nominee of the NOBO be appointed as proxyholder and return the same to their broker (or the broker’s agent) in accordance with the instructions provided by such broker.
All references to shareholders in the Notice of Meeting, Circular and the accompanying Proxy are to registered shareholders of the Company as set forth on the list of registered shareholders of the Company as maintained by the registrar and transfer agent of the Company, Computershare, unless specifically stated otherwise.
Financial Statements
The audited financial statements of the Company for the year ended September 30, 2023, together with the auditor’s report on those statements and Management Discussion and Analysis, will be presented to the shareholders at the Meeting.
VOTING SECURITIES AND PRINCIPAL HOLDERS OF VOTING SECURITIES
As at the date of the accompanying Notice of Meeting, the Company’s authorized capital consists of an unlimited number of common shares of which 36,877,994 common shares are issued and outstanding. All common shares in the capital of the Company carry the right to one vote.
Shareholders registered as at Friday, February 16, 2024, are entitled to attend and vote at the Meeting. Shareholders who wish to be represented by proxy at the Meeting must, to entitle the person appointed by the Proxy to attend and vote, deliver their Proxies at the place and within the time set forth in the notes to the Proxy.
To the knowledge of the directors and executive officers of the Company, as of the date of this Circular, the following persons beneficially own, directly or indirectly, or exercise control or direction over, 10% or more of the issued and outstanding common shares of the Company:
Shareholder
|
Number of Shares
| Percentage of
Issued Capital
|
Mark Brown (1)
| 5,154,745
| 14.0%
|
(1)Mr. Brown holds 32,600 common shares indirectly through a private company owned by Mr. Brown and 3,701,145 common shares indirectly through Pacific Opportunity Capital Ltd., a private company who Mr. Brown acts as a Director and President.
ELECTION OF DIRECTORS
The directors of the Company are elected annually and hold office until the next annual general meeting of the shareholders or until their successors are elected or appointed. The Management of the Company (“Management”) proposes to nominate the persons listed below for election as directors of the Company to serve until their successors are elected or appointed. In the absence of instructions to the contrary, Proxies given pursuant to the solicitation by the Management of the Company will be voted for the nominees listed in this Circular. Management does not contemplate that any of the nominees will be unable to serve as a director.
The following table sets out the names of the nominees for election as directors, the offices they hold within the Company, their occupations, the length of time they have served as directors of the Company, and the number of common shares of the Company which each beneficially owns, directly or indirectly, or over which control or direction is exercised, as of the date of this Circular.
Name, province or state and country of residence and positions, current and former, if any, held in the Company
|
Principal occupation for last five years
|
Served as director since
| Number of common shares beneficially owned or controlled or directed, directly or indirectly, at present(1)
|
JASON WEBER
British Columbia, Canada
Director, Chief Executive Officer and President
| CEO and President of Alianza Minerals Ltd., May 2015-Present; CEO and President of Estrella Gold Corporation, May 2014-April 2015; CEO, President and director of Kiska Metals Corporation, August 2010 – October 2013; and CEO, President and director of Rimfire Minerals Corporation, December 2007 – August 2010.
| March 7, 2014
| 229,666
|
MARK T. BROWN (2)
British Columbia, Canada
Director
| President of Pacific Opportunity Capital Ltd. (“POC”)
| February 28, 2014
| 5,154,745 (4)
|
MARC G. BLYTHE (2)
British Columbia, Canada
Director
| Consultant; Vice President, Corporate Development of Nevsun Resources Ltd., 2017-2018
| July 23, 2007
| 74,597
|
CRAIG LINDSAY (2)
British Columbia, Canada
Director
| Managing Director of Arbutus Grove Capital Corp. and President and CEO of Otis Gold Corp. from June 2007 to April 2020.
| November 3, 2008
| 92,000 (3)
|
Notes:
(1)The information as to common shares beneficially owned or controlled has been provided by the nominees themselves.
(2)A member of the Audit Committee.
(3)Mr. Lindsay holds 92,000 common shares indirectly through Arbutus Grove Capital Corp., a private company controlled by Mr. Lindsay.
(4)Mr. Brown holds 32,600 common shares indirectly through a private company owned by Mr. Brown and 3,701,145 common shares indirectly through Pacific Opportunity Capital Ltd., a private company who Mr. Brown acts as a Director and President.
No proposed director is being elected under any arrangement or understanding between the proposed director and any other person or company.
Corporate Cease Trade Orders or Bankruptcies
Other than listed below, no director or proposed director of the Company is, or within the ten years prior to the date of this Circular has been, a director or executive officer of any company, including the Company, that while that person was acting in that capacity:
(a)was the subject of a cease trade order or similar order or an order that denied the company access to any exemption under securities legislation for a period of more than 30 consecutive days; or
(b)was subject to an event that resulted, after the director ceased to be a director or executive officer of the company being the subject of a cease trade order or similar order or an order that denied the relevant company access to any exemption under securities legislation, for a period of more than 30 consecutive days; or
(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.
Mark Brown, a director of the Company, was formerly a director of Ascent Industries Corp. (“Ascent”), a company listed on the Canadian Securities Exchange. Mr. Brown resigned as a director of Ascent on February 13, 2019. On Friday, March 1, 2019, the Supreme Court of British Columbia issued an order granting Ascent’s application for creditor protection under the Companies’ Creditors Arrangement Act (Canada) (“CCAA”) to address near term liquidity issues. On April 5, 2019, Ascent sold its Canadian Assets for $41.5 million, repaid all liabilities, and has excess cash on hand such that it expects to be discharged from the CCAA process shortly.
Mark Brown, a director of the Company, was formerly a director of Sutter Gold Mining Inc. (“SGM”). On May 6, 2019, SGM received a cease trade order issued by the British Columbia Securities Commission for failure to file audited financial statements and Management’s Discussion & Analysis for the year ended December 31, 2018. SGM’s listing on the TSX Venture Exchange remains suspended until SGM meets TSX Venture Exchange’s requirements and upon the revocation of the cease trade order. On May 21, 2019, Mr. Brown resigned as a director of SGM.
Individual Bankruptcies
No director or proposed director of the Company has, within the ten years prior to the date of this Circular, become bankrupt or made a proposal under any legislation relating to bankruptcy or insolvency, or been 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 that individual.
Penalties or Sanctions
None of the proposed directors have been subject to any penalties or sanctions imposed by a court relating to securities legislation or by a securities regulatory authority, has entered into a settlement agreement with a securities regulatory authority or has been subject to any other penalties or sanctions imposed by a court or regulatory body that would be likely to be considered important to a reasonable security holder making a decision about whether to vote for the proposed director.
EXECUTIVE COMPENSATION
Named Executive Officers
During the financial year ended September 30, 2023, the Company had the following Named Executive Officers (“NEOs”) being, Jason Weber, the President and Chief Executive Office (“CEO”), Winnie Wong, the Chief Financial Officer (“CFO”) and Secretary and Rob Duncan, VP of Exploration.
“Named Executive Officer” means: (a) each CEO, (b) each CFO, (c) each of the three most highly compensated executive officers of the company, including any of its subsidiaries, 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; and (d) each individual who would be a NEO under (c) above but for the fact that the individual was neither an executive officer of the Company, nor acting in a similar capacity, at the end of that financial year.
COMPENSATION DISCUSSION AND ANALYSIS
Compensation Discussion and Analysis
The compensation of the Company’s NEOs is determined by the Company’s Board which is composed of three members, two of whom are independent. The Board’s compensation program is designed to provide competitive levels of compensation, a significant portion of which is dependent upon individual and corporate performance and contribution to increasing shareholder value. The Board recognizes the need to provide a total compensation package that will attract and retain qualified and experienced executives as well as align the compensation level of each executive to that executive’s level of responsibility. In general, a NEOs compensation is comprised of two components:
(a) Salary, wages or contractor payments; and
(b) Stock option grants.
The objectives and reasons for this system of compensation are generally to allow the Company to remain competitive compared to its peers in attracting experienced personnel. The CEO is paid a salary that is lower than his comparative salary levels for a person of his experience and capabilities. The CFO also takes a payment as a contractor that is lower than comparative salary levels because she also works as the CFO for other companies and does not devote 100% of her time to the Company.
Stock option grants are designed to reward the NEOs for success on a similar basis as the shareholders of the Company, but these rewards are highly dependent upon the volatile stock market, much of which is beyond the control of the NEOs.
The Board has not proceeded to a formal evaluation of the implications of the risks associated with the Company’s compensation policies and practices. Risk management is a consideration of the Board when implementing its compensation programme, and the Board does not believe that the Company’s compensation programme results in unnecessary or inappropriate risk taking including risks that are likely to have a material adverse effect on the Company.
The Company’s NEOs and directors are not permitted to purchase financial instruments, including for greater certainty, 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 equity securities granted as compensation or held, directly or indirectly, by the NEO or director.
Share-Based and Option-Based Awards
The Company does not grant share-based awards. Stock option grants are made on the basis of the number of stock options currently held, position, overall individual performance, anticipated contribution to the Company’s future success and the individual’s ability to influence corporate and business performance. The purpose of granting such stock options is to assist the Company in compensating, attracting, retaining and motivating the officers, directors and employees of the Company and to closely align the personal interest of such persons to the interest of the shareholders.
The recipients of incentive stock options and the terms of the stock options granted are determined from time to time by the Board. The exercise price of the stock options granted is generally determined by the market price at the time of grant.
SUMMARY COMPENSATION TABLE
Set out below is a summary of compensation paid or accrued during the Company’s three most recently completed financial years to the Company’s NEOs.
Summary Compensation Table
Name and principal position
|
Year
|
Salary
($)
|
Option-based awards
($)
| Non-equity incentive plan compensation
($)
|
Pension value
($)
|
All other compensation
($)
|
Total compensation
($)
|
Annual incentive plans
| Long-term incentive plans
|
Jason Weber
President and CEO
| 2023
2022
2021
| 162,000
162,000
162,000
| Nil
59,000(3)
30,270(3)
| N/A
N/A
N/A
| N/A
N/A
N/A
| N/A
N/A
N/A
| N/A
N/A
N/A
| 162,000
221,000
192,270
|
Winnie Wong
CFO
| 2023
2022
2021
| N/A
N/A
N/A
| Nil
29,500(3)
20,180(3)
| N/A
N/A
N/A
| N/A
N/A
N/A
| N/A
N/A
N/A
| 158,000(1)
201,500(1)
187,245(1)
| 158,000
231,000
207,425
|
Rob Duncan
VP Exploration
| 2023
2022
2021
| 150,000
150,000
145,625
| Nil
44,250(2)
30,270(3)
| N/A
N/A
N/A
| N/A
N/A
N/A
| N/A
N/A
N/A
| N/A
N/A
N/A
| 150,000
194,250
175,895
|
Notes:
(1)Paid to Pacific Opportunity Capital Ltd. Mr. Brown is the president of Pacific Opportunity Capital Ltd. (“POC”) and Ms. Wong is the vice president of POC which has a contract to provide financial and management consulting services to the Company (the “POC Contract”).
(2)Representing fair market value of options at an exercise price of $0.10 per share expiring January 18, 2027; calculated using Black Scholes: no dividend, exercise price $0.10; interest 1.32%, volatility 104.30% and 5 year term.
(3)Representing fair market value of options at an exercise price of $0.14 per share expiring October 15, 2025; calculated using Black Scholes: no dividend, exercise price $0.14; interest 1.29%, volatility 101.56% and 5 year term.
Narrative Discussion
Jason Weber: Effective August 15, 2020, the Company and Jason Weber entered into an employment contract whereas the Company engaged Mr. Weber as the Company’s CEO and President for $162,000 per annum as well as health benefits. In the case of change of control resulting in involuntarily termination of Mr. Weber without cause or in the event of a termination of Mr. Weber for Good Reason, Mr. Weber is entitled to 18 months’ base salary and 18 months’ continued benefits coverage. The Company agreed to also reimburse him for all approved disbursements incurred by him on the Company’s behalf in connection with the provision of his services. In addition, Mr. Weber was entitled to participate in the Company’s stock option plan.
Winnie Wong: Pursuant to the POC Contract, the Company paid a total of $158,000 during the financial year ended September 30, 2023 to POC, a company of which Ms. Wong is the Vice President, for the management and accounting services of an accounting and administrative team of four people during 2023.
Rob Duncan: Effective August 4, 2020, the Company and Mr. Duncan entered into a consulting agreement whereas the Company engaged Mr. Duncan as the Company’s VP of Exploration for $12,500 per month. In the case of the Company being substantially sold or had a change of control, Mr. Duncan is entitled to 1-year pay. The Company agreed to also reimburse him for all approved disbursements incurred by him on the Company’s behalf in connection with the provision of his services. In addition, Mr. Duncan was entitled to participate in the Company’s stock option plan.
INCENTIVE PLAN AWARDS
Outstanding Share-Based Awards and Option-Based Awards
The Company does not have any share-based awards held by a NEO. The following table sets forth the outstanding option-based awards held by the NEOs of the Company at the end of the most recently completed financial year:
Outstanding Option-Based Awards
| Option-based Awards
|
Name
| Number of securities underlying unexercised options
(#)
|
Option exercise price
($)
|
Option expiration date
|
Value of unexercised
in-the-money options
($)(1)
|
Jason Weber
President and CEO
| 60,000
60,000
200,000
| $0.50
$0.70
$0.50
| 07/30/2024
10/15/2025
01/18/2027
| Nil
Nil
Nil
|
Winnie Wong
CFO
| 50,000
40,000
100,000
| $0.50
$0.70
$0.50
| 07/30/2024
10/15/2025
01/18/2027
| Nil
Nil
Nil
|
Rob Duncan
VP of Exploration
| 40,000
60,000
150,000
| $0.50
$0.70
$0.50
| 07/30/2024
10/15/2025
01/18/2027
| Nil
Nil
Nil
|
Note:
(1)“In-the-Money Options” means the excess of the market value of the Company’s common shares on September 30, 2023 over the exercise price of the options. The market price for the Company’s common shares on September 30, 2023 was $0.21.
Incentive Plan Awards – Value Vested or Earned During the Year
The following table sets forth details of the value vested or earned for all incentive plan awards during the most recently completed financial year by each NEO:
Value Vested or Earned for Incentive Plan Awards During the Most
Recently Completed Financial Year
Name
|
Option-based awards – Value vested during the year(1)
($)
| Non-equity incentive plan compensation – Value earned during the year
($)
|
Jason Weber
President and CEO
| Nil
| Nil
|
Winnie Wong
CFO
| Nil
| Nil
|
Rob Duncan
VP of Exploration
| Nil
| Nil
|
Note:
(1)The options granted to the NEOs were vested immediately. The aggregate dollar value that would have been realized if the options under the option-based award had been exercised on the vesting date is calculated by determining the difference between the market price of the underlying securities on the date of vest and the exercise price of the options under the option-based award multiplied by the number of options vested on the vesting date.
PENSION BENEFITS
The Company does not have a pension plan that provides for payments or benefits to the NEOs at, following, or in connection with retirement.
TERMINATION AND CHANGE OF CONTROL BENEFITS
Jason Weber: Effective August 15, 2020, the Company and Jason Weber entered into an employment contract whereas in the case of change of control resulting in involuntarily termination of Mr. Weber without cause or in the event of a termination of Mr. Weber for Good Reason, Mr. Weber is entitled to 18 months’ base salary and 18 months’ continued benefits coverage.
Rob Duncan: Effective August 4, 2020, the Company and Mr. Duncan entered into a consulting agreement whereas in the case of the Company being substantially sold or had a change of control, Mr. Duncan is entitled to 1-year pay.
In July 2007, the Company and its subsidiary entered into the POC Contract with POC, an external management company, for accounting and financial management services, including the services of Winnie Wong as Chief Financial Officer. The POC Contract has no termination or change of control benefits.
Other than as described above, the Company has no other compensatory plan, contract or arrangement to compensate a NEO in the event of resignation, retirement or other termination of the NEOs employment with the Company, a change of control of the Company, or a change in responsibilities of the NEO following a change in control.
DIRECTOR COMPENSATION
The Company does not have share-based awards held by a director. Other than compensation paid to the NEOs, and except as noted below, no compensation was paid to directors in their capacity as directors of the Company or its subsidiaries, in their capacity as members of a committee of the Board or of a committee of the board of directors of its subsidiaries, or as consultants or experts, during the Company’s most recently completed financial year.
Set out below is a summary of compensation paid or accrued during the Company’s most recently completed financial year to the Company’s directors, other than the NEOs previously disclosed:
Director Compensation Table
Name
|
Fees
earned
($)
| Option-based awards
($)
| Non-equity incentive plan compensation
($)
|
Pension value
($)
|
All other compensation
($)
|
Total
($)
|
Craig Lindsay
| N/A
| Nil
| N/A
| N/A
| N/A
| Nil
|
Sven Gollan (2)
| N/A
| Nil
| N/A
| N/A
| N/A
| Nil
|
Marc Blythe
| N/A
| Nil
| N/A
| N/A
| N/A
| Nil
|
Mark T. Brown
| N/A
| Nil
| N/A
| N/A
| N/A
| Nil
|
Note:
(1)The fair value of the option-based awards which vested during 2023 was determined by the Black-Scholes Option Pricing Model with assumptions for risk-free interest rate, dividend yields, volatility factors of the expected market price of the Company’s common shares and expected life of the options.
(2)Mr. Gollan will not stand for re-election at the Meeting.
Narrative Discussion
Directors are compensated through the grant of stock options. No directors’ fees are paid.
INCENTIVE PLAN AWARDS
Outstanding Share-Based Awards and Option-Based Awards
The Company does not have any share-based awards held by a director. The following table sets forth details of all awards granted to directors of the Company which are outstanding at the end of the most recently completed financial year.
Outstanding Option-Based Awards
| Option-based Awards
|
Name
| Number of securities underlying unexercised options
(#)
|
Option exercise price
($)(1)
|
Option expiration date
|
Value of unexercised in-the-money options
($)(1)
|
Craig Lindsay
| 30,000
40,000
100,000
| $0.50
$0.70
$0.50
| 07/30/2024
10/15/2025
01/18/2027
| Nil
Nil
Nil
|
Sven Gollan (2)
| 100,000
| $0.50
| 03/17/2027
| Nil
|
Marc Blythe
| 30,000
40,000
100,000
| $0.50
$0.70
$0.50
| 07/30/2024
10/15/2025
01/18/2027
| Nil
Nil
Nil
|
Mark T. Brown
| 60,000
60,000
150,000
| $0.50
$0.70
$0.50
| 07/30/2024
10/15/2025
01/18/2027
| Nil
Nil
Nil
|
Note:
(1)“In-the-Money Options” means the excess of the market value of the Company’s common shares on September 30, 2023 over the exercise price of the options. The market price for the Company’s common shares on September 30, 2023 was $0.21.
(2)Mr. Gollan will not stand for re-election at the Meeting.
Incentive Plan Awards – Value Vested or Earned During the Year
The following table sets forth details of the value vested or earned for all incentive plan awards during the most recently completed financial year by each director:
Value Vested or Earned for Incentive Plan Awards During the Most
Recently Completed Financial Year
Name
|
Option-based awards – Value vested during the year
($)(1)
|
Share-based awards – Value vested during the year
($)
| Non-equity incentive plan compensation – Value earned during the year
($)
|
Craig Lindsay
| Nil
| N/A
| N/A
|
Sven Gollan (2)
| Nil
| N/A
| N/A
|
Marc Blythe
| Nil
| N/A
| N/A
|
Mark T. Brown
| Nil
| N/A
| N/A
|
Note:
(1)The options granted to the NEOs were vested immediately. The aggregate dollar value that would have been realized if the options under the option-based award had been exercised on the vesting date is calculated by determining the difference between the market price of the underlying securities on the date of vest and the exercise price of the options under the option-based award multiplied by the number of options vested on the vesting date.
(2)Mr. Gollan will not stand for re-election at the Meeting.
EQUITY COMPENSATION PLAN INFORMATION
The following table sets out those securities of the Company which have been authorized for issuance under equity compensation plans, as at the previous year end:
Plan Category
|
Number of securities to be issued upon exercise of outstanding options, warrants and rights
(a)
|
Weighted-average exercise price of outstanding options, warrants and rights
(b)
| Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
(c)
|
Equity compensation plans approved by the securityholders
| 2,006,000
| $0.54
| 1,181,799
|
Equity compensation plans not approved by the securityholders
| N/A
| N/A
| N/A
|
Total
| 2,006,000
| $0.54
| 1,181,799
|
INDEBTEDNESS OF DIRECTORS AND EXECUTIVE OFFICERS
None of the current or former directors, executive officers, employees of the Company, the proposed nominees for election to the Board, or their respective associates or affiliates, are or have been indebted to the Company since the beginning of the last completed financial year of the Company.
INTEREST OF CERTAIN PERSONS OR COMPANIES IN MATTERS TO BE ACTED UPON
No director or executive officer of the Company or any proposed nominee of Management of the Company for election as a director of the Company, nor any associate or affiliate of the foregoing persons, has any material interest, direct or indirect, by way of beneficial ownership of securities or otherwise, since the beginning of the Company’s last financial year in matters to be acted upon at the Meeting, other than the election of directors, the appointment of auditors and the confirmation of the Stock Option Plan.
INTEREST OF INFORMED PERSONS IN MATERIAL TRANSACTIONS
None of the persons who were directors or executive officers of the Company or a subsidiary of the Company at any time during the Company’s last financial year, the proposed nominees for election to the Board, any person or company who beneficially owns, directly or indirectly, or who exercises control or direction over (or a combination of both) more than 10% of the issued and outstanding common shares of the Company, nor any associate or affiliate of those persons, has any material interest, direct or indirect, by way of beneficial ownership of securities or otherwise, in any transaction or proposed transaction which has materially affected or would materially affect the Company.
APPOINTMENT OF AUDITOR
Auditor
Management intends to nominate De Visser Gray LLP, Chartered Professional Accountants, of Suite 401 - 905 West Pender Street, Vancouver, British Columbia V6C 1L6, for re-appointment as auditor of the Company. Forms of proxies given pursuant to this solicitation will, on any poll, be voted as directed and, if there is no direction, for the re-appointment of De Visser Gray LLP, Chartered Professional Accountants, as the auditor of the Company to hold office for the ensuing year with remuneration to be fixed by the directors. De Visser Gray LLP, Chartered Professional Accountants was first appointed as auditor of the Company on May 22, 2015.
MANAGEMENT CONTRACTS
Management, administrative and secretarial functions are provided by POC. A total of $158,000 was invoiced by POC for management and accounting services rendered and for the services of Winnie Wong, the Chief Financial Officer and three other staff members of POC for the year ended September 30, 2023.
Other than as disclosed herein, no management functions of the Company are to any substantial degree performed by a person or company other than the directors or executive officers of the Company.
AUDIT COMMITTEE
The Company is required to have an audit committee comprised of not less than three directors, a majority of whom are not officers, control persons or employees of the Company or an affiliate of the Company.
Audit Committee Charter
The text of the audit committee’s charter is attached as Schedule “A” to this Circular.
Composition of Audit Committee and Independence
National Instrument 52-110 Audit Committees, (“NI 52-110”) provides that a member of an audit committee is “independent” if the member has no direct or indirect material relationship with the Company, which could, in the view of the Board, reasonably interfere with the exercise of the member’s independent judgment.
NI 52-110 provides that an individual is “financially literate” if he or she has the ability to read and understand a set of financial statements that present a breadth and level of complexity of accounting issues that are generally comparable to the breadth and complexity of the issues that can reasonably be expected to be raised by the Company’s financial statements. The following sets out the members of the audit committee and their education and experience that is relevant to the performance of his responsibilities as an audit committee member.
The Company’s current audit committee consists of Marc G. Blythe, Craig Lindsay and Mark T. Brown. Two of the three members are considered “independent” and all members are “financially literate” as such terms are defined in NI 52-110.
Relevant Education and Experience
Based on their business and educational experiences, each audit committee member has a reasonable understanding of the accounting principles used by the Company to assess the general application of such principles in connection of the accounting for estimates, accruals and reserves; experience analyzing and evaluating financial statements that present a breadth and level of complexity of issues that can reasonably be expected to be raised by the Company’s financial statements, or experience actively supervising one or more individuals engaged in such activities; and an understanding of internal controls and procedures for financial reporting.
Marc G. Blythe: Marc G. Blythe has a Master of Business Administration degree and has also completed the IIROC/TSX course on company disclosure. He has acted as a director and/or officer of numerous other publicly traded companies since 2007. He is a former Vice President of Mining for Almaden Minerals Ltd.
Craig T. Lindsay: Mr. Lindsay has been a director or officer of a number of public companies in the natural resource sector and as a director has been responsible for approving financial statements. Through his work as a director and senior officer of public companies, including a number of TSX Venture companies. He is currently the President and CEO of Otis Gold Corp., CEO of Philippine Metals Inc. and former President of Magnum Uranium Corp. Mr. Lindsay has gained a sufficient understanding of financial reporting requirements with respect to junior resource exploration companies to enable him to discharge his duties as an Audit Committee member. He has a Master of Business Administration degree and is a Chartered Financial Analyst.
Mark T. Brown: Mr. Brown received a Bachelor of Commerce Degree from the University of British Columbia in 1990 and is a member of the Institute of Chartered Professional Accountants of British Columbia. He is currently President of POC, a private company which provides financial solutions, equity and management services to small and medium size entrepreneurial enterprises. Mr. Brown is an officer and director of a number of public and private companies and his corporate activities include transactions, financings and corporate financial planning. He is a founder of Rare Element Resources Ltd., which is listed on the Toronto Stock Exchange and the NYSE AMEX. Between 1990 and 1994, Mr. Brown worked with PricewaterhouseCoopers. He is currently a director and /or officer of various other public companies.
Audit Committee Oversight
Since the commencement of the Company’s most recently completed financial year, the audit committee of the Company has not made any recommendations to nominate or compensate an external auditor which were not adopted by the Board.
Reliance on Certain Exemptions
Since the commencement of the Company’s most recently completed financial year, the Company has not relied on:
(a)the exemption in section 2.4 (De Minimis Non-audit Services) of NI 52-110; or
(b)an exemption from NI 52-110, in whole or in part, granted under Part 8 (Exemptions).
Pre-Approval Policies and Procedures
The audit committee has not adopted any specific policies and procedures for the engagement of non-audit services.
Audit Fees
The following table sets forth the fees billed by DeVisser Gray LLP, Chartered Professional Accountants, to the Company and its subsidiaries, for services rendered in the last two fiscal years:
|
| 2023
| 2022
|
|
| ($) ($)
|
Audit fees(1)
|
| 35,000
| 20,500
|
Audit related fees(2)
|
| N/A
| N/A
|
Tax fees(3)
|
| N/A
| N/A
|
All other fees(4)
|
| N/A
| N/A
|
Total
|
| 35,000
| 20,500
|
Notes:
(1)“Audit fees” include aggregate fees billed by the Company’s external auditor in each of the last two fiscal years for audit fees.
(2)“Audited related fees” include the aggregate fees billed in each of the last two fiscal years for assurance and related services by the Company’s external auditor that are reasonably related to the performance of the audit or review of the Company’s financial statements and are not reported under “Audit fees” above. The services provided include employee benefit audits, due diligence assistance, accounting consultations on proposed transactions, internal control reviews and audit or attest services not required by legislation or regulation.
(3)“Tax fees” include the aggregate fees billed in each of the last two fiscal years for professional services rendered by the Company’s external auditor for tax compliance, tax advice and tax planning. The services provided include tax planning and tax advice includes assistance with tax audits and appeals, tax advice related to mergers and acquisitions, and requests for rulings or technical advice from tax authorities.
(4)“All other fees” include the aggregate fees billed in each of the last two fiscal years for products and services provided by the Company’s external auditor, other than “Audit fees”, “Audit related fees” and “Tax fees” above.
Exemption in Section 6.1
The Company is a “venture issuer” as defined in NI 52-110 and is relying on the exemption in section 6.1 of NI 52-110 relating to Parts 3 (Composition of Audit Committee) and 5 (Reporting Obligations).
CORPORATE GOVERNANCE DISCLOSURE
National Instrument 58-101, Disclosure of Corporate Governance Practices, requires all reporting issuers to provide certain annual disclosure of their corporate governance practices with respect to the corporate governance guidelines (the “Guidelines”) adopted in National Policy 58-201. These Guidelines are not prescriptive, but have been used by the Company in adopting its corporate governance practices. The Board and senior management of the Company consider good corporate governance to be an integral part of the effective and efficient operation of Canadian corporations. The Company’s approach to corporate governance is set out below.
Board of Directors
Management is nominating five individuals to the Board, all of whom are current directors of the Company.
The Board has a stewardship responsibility to supervise the management of and oversee the conduct of the business of the Company, provide leadership and direction to Management, evaluate Management, set policies appropriate for the business of the Company and approve corporate strategies and goals. The day-to-day management of the business and affairs of the Company is delegated by the Board to the CEO and the President. The Board will give direction and guidance through the President to Management and will keep Management informed of its evaluation of the senior officers in achieving and complying with goals and policies established by the Board.
The Guidelines suggest that the board of directors of every reporting issuer should be constituted with a majority of individuals who qualify as “independent” directors under NI 52-110, which provides that a director is independent if he or she has no direct or indirect “material relationship” with the Company. The “material relationship” is defined as a relationship which could, in the view of the Company’s Board, reasonably interfere with the exercise of a director’s independent judgement. All of the current members of the Board are considered “independent” within the meaning of NI 52-110, except for Marc G. Blythe, who is the CEO and President of the Company and Mark Brown who is the CFO and Secretary of the Company.
The Board recommends nominees to the shareholders for election as directors. Immediately following each annual general meeting, the Board appoints an Audit Committee and the chairperson of the Audit Committee. The Board elects a chairperson of the Board and establishes his or her duties and responsibilities, appoints the CEO, CFO and President of the Company and establishes the duties and responsibilities of those positions and on the recommendation of the CEO, appoints the senior officers of the Company and approves the senior Management structure of the Company.
The Board exercises its independent supervision over management by its policies that (a) periodic meetings of the Board be held to obtain an update on significant corporate activities and plans; and (b) all material transactions of the Company are subject to prior approval of the Board. The Board shall meet not less than three times during each year and will endeavour to hold at least one meeting in each fiscal quarter. The Board will also meet at any other time at the call of the CEO, or subject to the Articles of the Company, of any director.
The mandate of the Board, as prescribed by the Business Corporations Act (British Columbia), is to manage or supervise management of the business and affairs of the Company and to act with a view to the best interests of the Company. In doing so, the Board oversees the management of the Company’s affairs directly and through its committees.
Directorships
The following directors and proposed director of the Company are also directors of other reporting issuers as stated:
·Marc G. Blythe is a director of Au Gold Corp. an, Banyan Gold Corp.;
·Craig Lindsay is a director of Excellon Resources Inc., Revolve Renewable Power Corp., Electric Royalties Ltd. and VR Resources Ltd;
·Jason Weber is a director of ACME Gold Company Ltd.;
·Mark T. Brown is a director of Avrupa Minerals Ltd., Copper Fox Metals Inc., MTB Metals Corp., Green Bridge Metals Corporation, Au Gold Corp., East West Petroleum Corp. and Mineral and Financial Investments Limited; and
Orientation and Continuing Education
The Board does not have any formal policies with respect to the orientation of new directors nor does it take any measures to provide continuing education for the directors. At this stage of the Company’s development the Board does not feel it necessary to have such policies or programs in place.
Ethical Business Conduct
To date, the Board has not adopted a formal written Code of Business Conduct and Ethics. However, the current limited size of the Company’s operations, and the small number of officers and consultants, allow the Board to monitor on an ongoing basis the activities of management and to ensure that the highest standard of ethical conduct is maintained. As the Company grows in size and scope, the Board anticipates that it will formulate and implement a formal Code of Business Conduct and Ethics.
Nomination of Directors
The Board has not adopted a formal process to select new nominees to the Board. The current nominees have been recruited by the current Board members, and the recruitment process has involved both formal and informal discussions among Board members and the CEO.
Compensation Governance
The quantity and quality of the Board and CEO compensation is reviewed on an annual basis and determined by the Board as a whole, which allows the independent directors to have input into compensation decisions. At this time, the Company does not believe its size and limited scope of operations requires a formal compensation committee.
Other Board Committees
At the present time, the only standing committee is the Audit Committee. The written charter of the Audit Committee, as required by NI 52-110, is contained in Schedule “A” to this Circular. As the Company grows, and its operations and management structure became more complex, the Board expects it will constitute more formal standing committees, such as a Corporate Governance Committee, a Compensation Committee and a Nominating Committee, and will ensure that such committees are governed by written charters and are composed of at least a majority of independent directors.
Assessments
The Board monitors the performance of individual Board members and their contributions. The Board does not, at present, have a formal process in place for assessing the effectiveness of the Board as a whole, its committees or individual directors, but will consider implementing one in the future should circumstances warrant. Based on the Company’s size, its stage of development and the limited number of individuals on the Board, the Board considers a formal assessment process to be inappropriate at this time.
PARTICULARS OF MATTERS TO BE ACTED UPON
Confirming Stock Option Plan
Shareholders are being asked to confirm approval of the Company’s Stock Option Plan (the “Plan”) which was initially adopted by the directors of the Company on February 8, 2022. There have been no material changes to the Plan since it was adopted by the directors. The Plan is subject to approval by the Exchange.
The information below is a summary of the Plan and should be read in conjunction with full text of the Plan which will be accessible on the Company’s SEDAR profile at www.sedar.com. Any definitions or capitalized terms used or referenced below have the same meaning attributed to them in the Plan.
The purpose of the Plan is to give to Eligible Persons as additional compensation, the opportunity to participate in the success of the Company by granting to such individuals Options, exercisable over periods of up to ten (10) years as determined by the board of directors of the Company, to buy shares of the Company at a price not less than the Market Price prevailing on the date the Option is granted less applicable discount, if any, permitted by the policies of the Exchanges and approved by the Board. The key terms of the Plan are reflected in the disclosure below.
Key Term
|
| Summary
|
Administration
|
| The Board shall, without limitation, have full and final authority in their discretion, but subject to the express provisions of the Plan, to interpret the Plan, to prescribe, amend and rescind rules and regulations relating to the Plan and to make all other determinations deemed necessary or advisable in respect of the Plan. Except as set forth in certain sections of the Plan and subject to any required prior Exchange approval, the interpretation and construction of any provision of the Plan by the Board shall be final and conclusive. Administration of the Plan shall be the responsibility of the appropriate officers of the Company and all costs in respect thereof shall be paid by the Company.
|
Number of Shares
|
| The maximum aggregate number of Shares that are issuable pursuant to security based compensation granted or issued under the Plan and all of the Company's other previously established or proposed security based compensation plans (to which the following limits apply under Exchange policies):
(a)to all Optionees as a group (including for greater certainty Insiders (as a group) shall not exceed 10% of the total number of issued and outstanding Shares on a non-diluted basis at any point in time;
(b)to Insiders (as a group) in any 12-month period shall not exceed 10% of the total number of issued and outstanding Shares on a non-diluted basis on the Grant Date, unless the Company has obtained the requisite disinterested shareholder approval pursuant to applicable Exchange policies;
(c) to any one Optionee (including, where permitted under applicable policies of the Exchanges, any companies that are wholly owned by such Optionee) in any 12-month period shall not exceed 5% of the total number of issued and outstanding Shares on a non-diluted basis on the Grant Date, unless the Company has obtained the requisite disinterested shareholder approval pursuant to applicable Exchange policies.
(d)to any one Consultant in any 12-month period shall not exceed 2% of the total number of issued and outstanding Shares on a non-diluted basis on the Grant Date;
(e)to Investor Relations Service Providers (as a group) in any 12-month period shall not exceed 2% of the total number of issued and outstanding Shares on a non-diluted basis on the Grant Date, and Investor Relations Service Providers shall not be eligible to receive any security based compensation other than Options if the Shares are listed on the TSX Venture Exchange at the time of any issuance or grant; and
(f)to Eligible Charitable Organizations (as a group) shall not exceed 1% of the total number of issued and outstanding Shares on a non-diluted basis on the Grant Date.
|
Securities
|
| Each Option entitles the holder thereof to purchase one Share at an exercise price determined by the Board.
|
Participation
|
| Any directors, officers, Employees, Management Company Employees, Consultants and Eligible Charitable Organizations of the Company and its subsidiaries (collectively "Eligible Persons").
|
Option Price
|
| The Option Price under each Option shall be not less than the Market Price on the Grant Date less the applicable discount permitted under the policies of the Exchanges.
|
Exercise Period
|
| The exercise period of an Option will be the period from and including the grant date up to 4:00 p.m. Pacific Time on the expiry date that will be determined by the Board at the time of grant (the “Expiry Date”), provided that the Expiry Date of an Option will be no later than the tenth anniversary of the Grant Date of the Option.
|
Cessation of Employment
|
| If an Optionee ceases to be an Eligible Person, his or her Option shall be exercisable as follows:
(a)Death or Disability
If the Optionee ceases to be an Eligible Person, due to his or her death or Disability or, in the case of an Optionee that is a company, the death or Disability of the person who provides management or consulting services to the Company or to any entity controlled by the Company, the Option then held by the Optionee shall be exercisable to acquire Vested Unissued Option Shares at any time up to but not after the earlier of:
(i)365 days after the date of death or Disability; and
(ii)the Expiry Date;
(b)Termination For Cause
If the Optionee or, in the case of a Management Company Employee or a Consultant Company, the Optionee’s employer, ceases to be an Eligible Person as a result of termination for cause as that term is interpreted by the courts of the jurisdiction in which the Optionee, or, in the case of a Management Company Employee or a Consultant Company, of the Optionee’s employer, is employed or engaged; any outstanding Option held by such Optionee on the date of such termination, whether in respect of Option Shares that are Vested or not, shall be cancelled as of that date.
(c)Early Retirement, Voluntary Resignation or Termination Other than For Cause
If the Optionee or, in the case of a Management Company Employee or a Consultant Company, the Optionee’s employer, ceases to be an Eligible Person due to his or her retirement at the request of his or her employer earlier than the normal retirement date under the Company’s retirement policy then in force, or due to his or her termination by the Company other than for cause, or due to his or her voluntary resignation, the Option then held by the Optionee shall be exercisable to acquire Vested Unissued Option Shares at any time up to but not after the earlier of the Expiry Date and the date which is 90 days (30 days if the Optionee was engaged in Investor Relations Activities) after the Optionee or, in the case of a Management Company Employee or a Consultant Company, the Optionee’s employer, ceases to be an Eligible Person.
|
Acceleration Events
|
| If at any time when an Option granted under the Plan remains unexercised with respect to any Unissued Option Shares, an Offer is made by an offeror, the Board may, upon notifying each Optionee of full particulars of the Offer and subject to the approval of the Exchanges with respect to Investor Relations Service Providers, declare all Option Shares issuable upon the exercise of Options granted under the Plan, Vested, and declare that the Expiry Date for the exercise of all unexercised Options granted under the Plan is accelerated so that all Options will either be exercised or will expire prior to the date upon which Shares must be tendered pursuant to the Offer. The Board shall give each Optionee as much notice as possible of the acceleration of the Options under this section, except that not less than 5 business days notice is required and more than 30 days notice is not required
|
Amendments
|
| The Board may from time to time, subject to applicable law and to the prior approval, if required, of the shareholders (or disinterested shareholders, if required), Exchanges or any other regulatory body having authority over the Company or the Plan, suspend, terminate or discontinue the Plan at any time, or amend or revise the terms of the Plan or of any Option granted under the Plan and the Option Agreement relating thereto, provided that no such amendment, revision, suspension, termination or discontinuance shall in any manner adversely affect any Option previously granted to an Optionee under the Plan without the consent of that Optionee.
|
Accordingly, at the Meeting, the shareholders will be asked to pass the following resolution:
“IT IS RESOLVED THAT the Stock Option Plan is hereby approved and confirmed.”
General Matters
It is not known whether any other matters will come before the Meeting other than those set forth above and in the Notice of Meeting, but if any other matters do arise, the person named in the Proxy intends to vote on any poll, in accordance with his or her best judgement, exercising discretionary authority with respect to amendments or variations of matters set forth in the Notice of Meeting and other matters which may properly come before the Meeting or any adjournment of the Meeting.
ADDITIONAL INFORMATION
Additional information relating to the Company may be found on SEDAR at www.sedarplus.ca. Financial information about the Company is provided in the Company’s comparative annual financial statements to September 30, 2023, a copy of which, together with Management’s Discussion and Analysis thereon, can be found on the Company’s SEDAR profile at www.sedarplus.ca. Additional financial information concerning the Company may be obtained by any securityholder of the Company free of charge by contacting the Company, at 604-687-3520.
BOARD APPROVAL
The contents of this Circular have been approved and its mailing authorized by the directors of the Company.
DATED at Vancouver, British Columbia, the 16th day of February, 2024.
ON BEHALF OF THE BOARD
“Jason Weber”
Jason Weber,
President and Chief Executive Officer
ALIANZA MINERALS LTD.
Schedule “A”
Audit Committee Charter
The audit committee is a committee of the board of directors to which the board delegates its responsibilities for the oversight of the accounting and financial reporting process and financial statement audits.
The audit committee will:
(a)review and report to the board of directors of the Company on the following before they are published:
(i)the financial statements and MD&A (management discussion and analysis) (as defined in National Instrument 51-102) of the Company;
(ii)the auditor’s report, if any, prepared in relation to those financial statements,
(b)review the Company’s annual and interim earnings press releases before the Company publicly discloses this information,
(c)satisfy itself that adequate procedures are in place for the review of the Company’s public disclosure of financial information extracted or derived from the Company’s financial statements and periodically assess the adequacy of those procedures,
(d)recommend to the board of directors:
(i)the external auditor to be nominated for the purpose of preparing or issuing an auditor’s report or performing other audit, review or attest services for the Company; and
(ii)the compensation of the external auditor,
(e)oversee the work of the external auditor engaged for the purpose of preparing or issuing an auditor’s report or performing other audit, review or attest services for the Company, including the resolution of disagreements between management and the external auditor regarding financial reporting,
(f)monitor, evaluate and report to the board of directors on the integrity of the financial reporting process and the system of internal controls that management and the board of directors have established,
(g)monitor the management of the principal risks that could impact the financial reporting of the Company,
(h)establish procedures for:
(i)the receipt, retention and treatment of complaints received by the Company regarding accounting, internal accounting controls, or auditing matters; and
(ii)the confidential, anonymous submission by employees of the Company of concerns regarding questionable accounting or auditing matters,
(i)pre-approve all non-audit services to be provided to the Company or its subsidiary entities by the Company’s external auditor,
(j)review and approve the Company’s hiring policies regarding partners, employees and former partners and employees of the present and former external auditor of the Company, and
(k)with respect to ensuring the integrity of disclosure controls and internal controls over financial reporting, understand the process utilized by the Chief Executive Officer and the Chief Financial Officer to comply with Multilateral Instrument 52-109.
Composition of the Committee
The committee will be composed of three directors from the Company’s board of directors, a majority of whom will be independent. Independence of the Board members will be as defined by applicable legislation and as a minimum each independent committee member will have no direct or indirect relationship with the Company which, in the view of the board of directors, could reasonably interfere with the exercise of a member’s independent judgment.
All members of the committee will be financially literate as defined by applicable legislation. If, upon appointment, a member of the committee is not financially literate as required, the person will be provided a three month period in which to achieve the required level of literacy.
Authority
The committee has the authority to engage independent counsel and other advisors as it deems necessary to carry out its duties and the committee will set the compensation for such advisors.
The committee has the authority to communicate directly with and to meet with the external auditors and the internal auditor, without management involvement. This extends to requiring the external auditor to report directly to the committee.
Reporting
The reporting obligations of the committee will include:
1.reporting to the board of directors on the proceedings of each committee meeting and on the committee’s recommendations at the next regularly scheduled directors’ meeting; and
2.reviewing, and reporting to the board of directors on its concurrence with, the disclosure required by Form 52-110F2 in any management information circular prepared by the Company.