DEF 14A 1 tm218335d2_def14a.htm DEF 14A

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

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¨ Preliminary Proxy Statement
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TRILOGY METALS INC.

(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 the appropriate box):

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Notice of

Annual Meeting

of Shareholders

Management

Information Circular

MEETING TO BE HELD MAY 19, 2021

Trilogy Metals Inc.

Suite 1150, 609 Granville

Vancouver, British Columbia

Canada V7Y 1G5

Tel: 604-638-8088 or 1-855-638-8088

Fax: 604-638-0644

Website: www.trilogymetals.com

TRILOGY METALS INC.
Suite 1150, 609 Granville Street
Vancouver, British Columbia V7Y 1G5

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

NOTICE IS HEREBY GIVEN that the Annual Meeting (the “Meeting”) of the shareholders (the “Shareholders”) of Trilogy Metals Inc. (the “Company”, “Trilogy”, or “Trilogy Metals”) will be held at the offices of the Company, Suite 1150, 609 Granville Street, Vancouver, British Columbia, V7Y 1G5, on May 19, 2021 at 10:00 a.m. (Vancouver time), for the following purposes:

To 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, 2020, together with the Report of the Auditors thereon;

To elect the Directors of the Company for the forthcoming year;

To appoint the Auditors of the Company for the forthcoming year and to authorize the Audit Committee to fix the Auditors’ remuneration;

To consider and, if deemed advisable, pass an ordinary resolution ratifying and approving all unallocated awards under the 2012 Equity Incentive Plan;

To consider and, if deemed advisable, pass an ordinary resolution ratifying and approving the Ambler Metals Equity Plan; and

To 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 23, 2021 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 the enclosed proxy, whether or not you plan to personally attend. Sending your proxy will not prevent you from voting in person at the Meeting. All proxies completed by registered Shareholders must be returned to the Company:

(a)

by delivering the proxy to the Company’s transfer agent, Computershare Investor Services Inc. at its office at 100 University Avenue, 8^th Floor, Toronto, Ontario, M5J 2Y1, for receipt no later than May 17, 2021, at 10:00 a.m. (Vancouver time);

(b)

by fax to the Toronto office of Computershare Investor Services Inc., Attention: Proxy Tabulation at 416-263-9524 or 1-866-249-7775 not later than May 17, 2021, at 10:00 a.m. (Vancouver time);

(c)

by telephone by calling 1-866-732-8683 toll-free in North America or (312) 588-4290 outside of North America, and following the instructions, no later than May 17, 2021, at 10:00 a.m. (Vancouver time); or

(d)

by internet, as instructed in the enclosed form of proxy, not later than May 17, 2021, at 10:00 a.m. (Vancouver time).

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 by non-registered Shareholders can be found on page 2 of the attached Circular.

Impact of COVID-19: Trilogy is carefully monitoring the public health impact of the coronavirus (COVID-19) on a daily basis, and may decide to modify the date, time or location of the Meeting depending on the situation. While we understand this could disrupt the travel plans of those who plan to attend the Meeting, our first priority is the health and safety of our communities, Shareholders, employees and other stakeholders. In the event we decide to modify the date, time or location of the Meeting, Shareholders will be notified and provided with additional details in a press release, at our website page for the Meeting at https://trilogymetals.com/investor-center/proxy-circular and pursuant to filings we make with the U.S. Securities and Exchange Commission and the Canadian securities regulatory authorities. As always, we encourage you to vote your shares prior to the Meeting.

DATED at Vancouver, British Columbia, this 30^th day of March, 2021.

	BY ORDER OF THE BOARD OF DIRECTORS

	“Tony Giardini”

	Tony Giardini, President and Chief Executive Officer

TRILOGY METALS INC.
MANAGEMENT INFORMATION CIRCULAR

TABLE OF CONTENTS

INFORMATION REGARDING ORGANIZATION AND CONDUCT OF MEETING	2
Solicitation of Proxies	2
Exercise of Proxies	4
Revocation of Proxies	4
Voting Standards	4
MATTERS TO BE ACTED UPON AT MEETING	5
Election of Directors	5
Appointment of Auditors	7
Approval of Continuation of 2012 Equity Incentive Plan	8
Approval of Ambler Metals Equity Plan	9
INFORMATION CONCERNING THE Board of directors, DIRECTOR NOMINEES AND EXECUTIVE OFFICERS	14
STATEMENT OF EXECUTIVE COMPENSATION	25
Compensation Discussion and Analysis	25
Compensation Governance	31
Employment Agreements	32
Termination of Employment or Change of Control	33
Summary Compensation Table	35
Incentive Plan Awards	37
SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS	38
Equity Incentive Plan Information	39
RSU Plan	42
DSU Plan	43
Summary of Securities Issued	45
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED SHAREHOLDER MATTERS	46
DIRECTOR COMPENSATION	49
Director Compensation Table	49
DSU Plan for Directors	49
Incentive Plan Awards	50
INDEBTEDNESS OF DIRECTORS AND OFFICERS	52
INTEREST OF INFORMED PERSONS IN MATERIAL TRANSACTIONS	52
STATEMENT OF CORPORATE GOVERNANCE PRACTICES	52
OTHER BUSINESS	60
ADDITIONAL INFORMATION	60
HOUSEHOLDING	60
OTHER MATERIAL FACTS	60
SHAREHOLDER PROPOSALS	60
CERTIFICATE	61
APPENDIX A BOARD MANDATE	62
APPENDIX B ADDITIONAL ANNUAL REPORT INFORMATION	72
APPENDIX C EQUITY INCENTIVE PLAN	74
APPENDIX D EQUITY INCENTIVE PLAN FOR AMBLER METALS LLC OFFICERS AND EMPLOYEES	88

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INFORMATION REGARDING ORGANIZATION AND CONDUCT OF MEETING

Solicitation of Proxies

THIS MANAGEMENT INFORMATION CIRCULAR (“CIRCULAR”) IS FURNISHED IN CONNECTION WITH THE SOLICITATION OF PROXIES BY OR ON BEHALF OF THE MANAGEMENT AND THE BOARD OF DIRECTORS (THE “BOARD OF DIRECTORS” OR THE “BOARD”) OF TRILOGY METALS INC. for use at the Annual Meeting of Shareholders of the Company to be held at the offices of the Company, Suite 1150, 609 Granville Street, Vancouver, British Columbia, V7Y 1G5, at 10:00 a.m. (Vancouver time) on May 19, 2021 (the “Meeting”) or at any adjournment thereof, for the purposes set forth in the accompanying Notice of Meeting. The Company anticipates this Circular, proxy materials and form of proxy will be first mailed to Shareholders on or about March 30, 2021.

Solicitation of proxies from registered Shareholders will primarily be by mail or courier, supplemented by telephone or other personal contact by employees or agents of the Company, and all costs thereof will be paid by the Company. The Company estimates such fees and costs to be nominal.

There are two kinds of non-registered, or beneficial, Shareholders – those who object to their name being made known to the issuers of securities which they own (called “OBOs” for Objecting Beneficial Owners) and those who do not object to the issuers of the securities they own knowing who they are (called “NOBOs” for Non Objecting Beneficial Owners).

Non-registered Shareholders who have not objected to their intermediary disclosing certain information about them to the Company are referred to as “NOBOs”, whereas non-registered Shareholders who have objected to their intermediary disclosing ownership information about them to the Company are referred to as “OBOs”. In accordance with National Instrument 54-101 – Communication with Beneficial Owners of Securities of a Reporting Issuer (“NI 54-101”), the Company has elected to send the Notice of Meeting, the Circular and the related form of proxy or voting instruction form indirectly to the NOBOs and to the OBOs through their intermediaries. Unless required pursuant to U.S. proxy rules, the Company does not intend to pay for intermediaries to forward to OBOs, under NI 54-101, the proxy related materials and Form 54-101F7, and in the case of an OBO, the OBO will not receive these materials unless the OBOs intermediary assumes the cost of delivery.

The Company will not transmit proxy materials using notice-and-access.

General

Unless otherwise specified, the information in this Circular is current as at March 1, 2021. Unless otherwise indicated, all references to “$” or “US$” in this circular refer to United States dollars. References to “C$” in this Circular refer to Canadian dollars.

Copies of this Circular and proxy-related materials, as well as the Company’s financial statements to be received at the Meeting and related MD&A and other information comprising the Company’s annual report, are available on the Company’s website at www.trilogymetals.com and under the Company’s profiles on SEDAR at www.sedar.com and on EDGAR at www.sec.gov.

Record Date and Quorum

The Board of Directors of the Company has fixed the record date for the Meeting as the close of business on March 23, 2021 (the “Record Date”). If a person acquires ownership of shares subsequent to the Record Date such person may establish a right to vote by delivering evidence of ownership of his or her common shares of the Company (“Common Shares”) satisfactory to the Board and a request for his or her name to be placed on the voting list to Blake, Cassels & Graydon LLP, the Company’s legal counsel, at Suite 2600, 595 Burrard Street, Vancouver, BC, V7X 1L3, Attention: Trisha Robertson. Subject to the above, all registered holders of Common Shares at the close of business on the Record Date (the “Shareholders”) will be entitled to vote at the Meeting. No cumulative rights are authorized and dissenter’s rights are not applicable to any matters being voted upon. Such registered Shareholders will be entitled to one vote per Common Share. At the close of business on March 23, 2021, 144,292,774 Common Shares were outstanding and entitled to vote.

Two or more persons who are, or who represent by proxy, holders of at least 5% of the Common Shares entitled to vote at the Meeting will constitute a quorum at the Meeting.

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Voting of Common Shares

Registered Shareholders

Registered Shareholders have two methods by which they can vote their shares at the Meeting, namely in person or by proxy. To assure your representation at the Meeting, please complete, sign, date and return the enclosed proxy, whether or not you plan to personally attend. Sending your proxy will not prevent you from voting in person at the meeting.

Shareholders who do not wish to attend the Meeting or do not wish to vote in person, can vote by proxy. A registered Shareholder must return the completed proxy to the Company:

(a)

by delivering the proxy to the Toronto office of the Company’s transfer agent, Computershare Investor Services Inc. (“Computershare”) at its office at 100 University Avenue, 8^th Floor, Toronto, Ontario, Canada M5J 2Y1, for receipt not later than May 17, 2021 at 10:00 a.m. (Vancouver time);

(b)

by fax to the Toronto office of Computershare, Attention: Proxy Tabulation at 416-263-9524 or 1-866-249-7775 not later than May 17, 2021 at 10:00 a.m. (Vancouver time);

(c)

by telephone by calling 1-866-732-8683 toll-free in North America or (312) 588-4290 outside of North America, and following the instructions, no later than May 17, 2021 at 10:00 a.m. (Vancouver time); or

(d)

by internet, as instructed in the enclosed form of proxy, not later than May 17, 2021 at 10:00 a.m. (Vancouver time).

The persons named in the enclosed form of proxy are an officer of the Company or counsel to the Company. Each Shareholder has the right to appoint a person or a company (who need not be a Shareholder) to attend and act for him/her and on his/her behalf at the Meeting other than the persons designated in the enclosed form of proxy. Such right may be exercised by striking out the names of the persons designated on the enclosed form of proxy and by inserting such appointed person’s name in the blank space provided for that purpose or by completing another form of proxy acceptable to the Board.

Non-registered Shareholders

The information set forth in this section is of significant importance to many Shareholders of the Company, as a substantial number of Shareholders do not hold Common Shares in their own name. Shareholders who do not hold their Common Shares in their own name (i.e. non-registered or beneficial Shareholders) should note that only proxies deposited by Shareholders whose names appear on the records of the Company as the registered holders of Common Shares can be recognized and acted upon at the Meeting. If Common Shares are listed in an account statement provided to a Shareholder by a broker, then, in almost all cases, those Common Shares will not be registered in the Shareholder’s name on the records of the Company. Such Common Shares will more likely be registered under the name of the Shareholder’s broker or an agent of that broker. In Canada and the United States, the vast majority of such Common Shares are registered under the name of CDS & Co. (the registration name for The Canadian Depository for Securities, which acts as nominee for many Canadian brokerage firms) or Cede & Co. (operated by the Depository Trust Company), respectively. Common Shares held by brokers or their agents or nominees can only be voted upon the instructions of the non-registered Shareholder except in limited cases for certain “routine” matters. An example of a “routine” matter includes the appointment of the Auditors, which is considered the only “routine” matter to be voted upon at the Meeting. Otherwise, without specific instructions, brokers and their agents and nominees are prohibited from voting Common Shares for their clients, which is generally referred to as a “broker non-vote.” Therefore, non-registered Shareholders should ensure that instructions respecting the voting of their Common Shares are communicated to the appropriate person if such Shareholders want their votes to count on all matters to be decided at the Meeting.

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Applicable regulatory policy requires intermediaries/brokers to seek voting instructions from non-registered Shareholders in advance of shareholders’ meetings. Every intermediary/broker has its own mailing procedures and provides its own return instructions to clients, which should be carefully followed by non-registered Shareholders in order to ensure that their shares are voted at the Meeting. The majority of brokers now delegate responsibility for obtaining instructions from clients to Broadridge. Broadridge typically uses its own form of proxy, mails those forms to the non-registered Shareholders and asks non-registered Shareholders to either return the proxy forms to Broadridge or alternatively provide voting instructions by using the Broadridge automated telephone system. Broadridge then tabulates the results of all instructions received and provides appropriate instructions respecting the voting of Common Shares to be represented at the Meeting. A non-registered Shareholder receiving a proxy from Broadridge cannot use that proxy to vote Common Shares directly at the Meeting – the proxy must be returned to Broadridge well in advance of the Meeting in accordance with Broadridge’s instructions in order to have the shares voted.

Although a non-registered Shareholder may not be recognized directly at the Meeting for the purposes of voting Common Shares registered in the name of his broker (or an agent of the broker), a non-registered Shareholder may attend the Meeting as a proxyholder for the registered Shareholder and vote the Common Shares in that capacity. Non-registered Shareholders who wish to attend the Meeting and indirectly vote their Common Shares as a proxyholder for the registered Shareholder should enter their own names in the blank space on the form of proxy provided to them by their broker (or agent) and return the same to their broker (or the broker’s agent) in accordance with the instructions provided by such broker (or agent), well in advance of the Meeting.

Exercise of Proxies

On any ballot that may be called for, the Common Shares represented by a properly executed proxy will be voted or withheld from voting in accordance with the instructions given on the form of proxy and, if the Shareholder specifies a choice with respect to any matter to be acted upon, the Common Shares will be voted accordingly. Where no choice is specified, the enclosed proxy will confer discretionary authority and will be voted in favour of all matters referred to on the form of proxy.

The proxy also confers discretionary authority to vote for, withhold or abstain from voting, or vote against, amendments or variations to matters identified in the Notice of Meeting and with respect to other matters not specifically mentioned in the Notice of Meeting but which may properly come before the Meeting. Management has no present knowledge of any amendments or variations to matters identified in the Notice of Meeting or any business other than that referred to in the accompanying Notice of Meeting which will be presented at the Meeting. However, if any other matters properly come before the Meeting, it is the intention of the person named in the enclosed proxy to vote in accordance with the recommendations of management of the Company.

Proxies must be received by the Toronto office of Computershare, located at 100 University Avenue, 8^th Floor, Toronto, Ontario, Canada M5J 2Y1 not later than May 17, 2021 at 10:00 a.m. (Vancouver time).

Revocation of Proxies

A Shareholder who has given a proxy may revoke it at any time insofar as it has not been exercised. In addition to any other manner permitted by law, a Shareholder who has given an instrument of proxy may revoke it by instrument in writing, executed by the Shareholder or by his attorney authorized in writing, or if the Shareholder is a Company, under its corporate seal, and deposited either with the Company’s transfer agent, Computershare at its Vancouver office at 510 Burrard Street, 2^nd Floor, Vancouver, BC, V6C 3B9 or with the Company’s legal counsel, Blake, Cassels & Graydon LLP, at Suite 2600, 595 Burrard Street, Vancouver, BC, V7X 1L3, Attention: Trisha Robertson, at any time up to and including the last business day preceding the Meeting at which the proxy is to be used, or any adjournment thereof or with the chairman of such Meeting on the date of the Meeting, or any adjournment thereof, and upon either of such deposits the proxy is revoked. A Shareholder attending the Meeting has the right to vote in person and if he does so, his proxy is nullified with respect to the matters such person votes upon and any subsequent matters thereafter to be voted upon at the Meeting.

Voting Standards

Except as otherwise noted in this Circular, a simple majority of votes cast at the Meeting, whether in person or by proxy, will constitute approval of any matter submitted to a vote. Abstentions and broker non-votes will not be counted either in favor of or against any proposal or either for or withheld in the election of directors, and, therefore, will have no effect on the outcomes of any proposal or election of directors.

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Broker non-votes occur with respect to shares where the broker does not receive voting instructions from its clients and the broker does not have the authority to vote those shares. The rules of the New York Stock Exchange applicable to brokers determine whether a broker has authority to vote on a proposal if the broker does not receive voting instructions from its client. The broker may vote on proposals that are determined to be “routine” under these rules and may not vote on proposals that are determined to be “non-routine” under these rules. If a proposal is determined to be routine, a broker who has received no voting instructions from its client with respect to that proposal has discretion to vote the client’s uninstructed shares on that proposal. If a proposal is determined to be non-routine, a broker who has received no voting instructions from its client with respect to that proposal does not have discretion to vote the client’s uninstructed shares on that proposal.

The following chart describes the proposals to be considered at the meeting, the voting options, the vote required for each matter, and the manner in which votes will be counted:

Matter	Voting Options	Required Vote	Impact of Abstentions or Broker Non-Votes
Election of Directors	For; Withhold	Plurality of votes - nominees receiving the eight highest number of votes at the meeting will be elected*	No effect
Appointment of Auditors	For; Withhold	Simple majority of votes cast (only votes “for” are considered votes cast)	No effect. (Brokers are permitted to exercise their discretion and vote without specific instruction on this matter. Accordingly, there are no broker non-votes.)
Approving Unallocated Entitlements under the 2012 Equity Incentive Plan	For; Against; Abstain	Simple majority of votes cast	No effect. Abstentions and broker non-votes will not be counted in favour or against the proposal and will therefore have no effect.
Approving the Ambler Metals Equity Plan	For; Against; Abstain	Simple majority of votes cast	No effect. Abstentions and broker non-votes will not be counted in favour or against the proposal and will therefore have no effect.

* See “Election of Directors” for a description of the Company’s Majority Voting Policy. In an uncontested election, if the number of votes “withheld” for any nominee exceeds the number of votes “for” the nominee, then the policy requires that the nominee shall tender his or her written resignation to the chair of the Board.

MATTERS TO BE ACTED UPON AT MEETING

Election of Directors

According to the Articles of the Company, the Board shall consist of not less than three and no more than such number of directors to be determined by resolution of Shareholders. The number of directors is currently determined at eight. At the Meeting, Shareholders will be asked to elect eight directors to the Board.

The proposed nominees in the list that follows are, in the opinion of management, well qualified to direct the Company’s activities for the ensuing year and have confirmed their willingness to serve as directors, if elected. The term of office of each director elected will be until the next annual meeting of the Shareholders of the Company or until his or her successor is elected or appointed, unless his or her office is earlier vacated, in accordance with the Articles of the Company and the provisions of the Business Corporations Act (British Columbia).

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The Board adopted a Majority Voting Policy on March 28, 2013, as amended March 14, 2017, stipulating that Shareholders shall be entitled to vote in favour of, or withhold from voting for, each individual director nominee at a Shareholders’ meeting. If the number of Common Shares “withheld” for any nominee exceeds the number of Common Shares voted “for” the nominee, then, notwithstanding that such director was duly elected as a matter of corporate law, he or she shall tender his or her written resignation to the chair of the Board. The Corporate Governance and Nominating Committee will consider such offer of resignation and will make a recommendation to the Board concerning the acceptance or rejection of the resignation after considering all factors deemed relevant. The Board must take formal action on the Corporate Governance and Nominating Committee’s recommendation within 90 days of the date of the applicable Shareholders’ meeting and announce its decision by press release. Absent exceptional circumstances, the Board will be expected to accept the resignation which will be effective on such date. The policy does not apply in circumstances involving contested director elections. See “Statement of Corporate Governance Policies – Majority Voting Policy”.

Unless the proxy specifically instructs the proxyholder to withhold such vote, Common Shares represented by the proxies hereby solicited shall be voted FOR the election of the nominees whose names are set forth below. If, prior to the Meeting, any of the listed nominees shall become unavailable to serve, the persons designated in the proxy form will have the right to use their discretion in voting for a properly qualified substitute. Management does not contemplate presenting for election any person other than these nominees but, if for any reason management does present another nominee for election, the proxyholders named in the accompanying form of proxy reserve the right to vote for such other nominee in their discretion unless the Shareholder has specified otherwise in the form of proxy.

Name, Province or State and Country of Residence	Independence	Principal Occupation	Director Since
Tony Giardini Rome, Italy	Non-Independent	President and Chief Executive Officer of the Company	January 2012
James Gowans⁽²⁾⁽³⁾ British Columbia, Canada	Independent	Independent director of various companies	May 2019
William Hayden⁽²⁾⁽³⁾ New South Wales, Australia	Independent	Self-employed Geologist	June 2015
William Iggiagruk Hensley^(2)(3)(4) Alaska, USA	Independent	Distinguished Visiting Professor of Business and Public Policy at the University of Alaska Anchorage	December 2017
Gregory Lang⁽¹⁾⁽³⁾ Utah, USA	Independent	President and Chief Executive Officer of NOVAGOLD Resources Inc.	January 2012
Kalidas Madhavpeddi⁽¹⁾⁽⁴⁾ Arizona, USA	Independent	President of Azteca Consulting LLC	January 2012
Janice Stairs Nova Scotia, Canada	Independent	Independent director of various companies	April 2011
Diana Walters⁽¹⁾⁽⁴⁾ Texas, USA	Independent	Manager and Founder of Amichel LLC	May 2016

	(1)	Member of the Audit Committee.
	(2)	Member of the Compensation Committee.
	(3)	Member of the Environment, Health, Safety and Technical (“EHST”) Committee.
	(4)	Member of the Corporate Governance and Nominating Committee.

The term of office for each director expires as at the date of each annual general meeting unless such director is re-elected at that annual general meeting.

Refer to Section “Information Concerning the Board of Directors and Executive Officers” for further information regarding the above directors.

See “Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters” for details on share ownership and the number of securities beneficially owned, or controlled or directed, directly or indirectly, by each proposed director.

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Appointment of Auditors

The independent auditors of the Company are PricewaterhouseCoopers LLP, Chartered Professional Accountants (“PwC”), located at 250 Howe Street, 14th Floor, Vancouver, British Columbia, Canada. PwC were first appointed auditors of the Company on March 28, 2012 by the shareholders of NOVAGOLD Resources Inc. (“NOVAGOLD”) prior to the spin out of Trilogy in April 2012. The Shareholders will be asked at the Meeting to vote for the appointment of PwC as auditors of the Company until the next annual meeting of the Shareholders of the Company or until a successor is appointed, at a remuneration to be fixed by the Audit Committee. To the Company's knowledge, a representative from PwC will not be present at the Meeting to take questions, although the firm will be permitted to make a statement if it so desires.

In the absence of a contrary instruction, it is intended that all proxies received will be voted FOR the appointment of PricewaterhouseCoopers LLP as auditors of the Company until the next annual meeting of Shareholders or until a successor is appointed, at a remuneration to be fixed by the Directors upon the recommendation of the Audit Committee.

A table setting forth the fees paid by the Company to PwC, its independent auditor, during the fiscal years ended November 30, 2020, and 2019 is set forth below.

	Year Ended November 30
	2020 $		2019 $
Audit Fees ⁽¹⁾		199,948		165,375
Audit Related Fees ⁽²⁾		10,644		9,137
Tax Fees ⁽³⁾		-		-
All Other Fees ⁽⁴⁾		52,875		21,000
Total		263,467		195,512

(1)

“Audit Fees” are the aggregate fees billed by PwC for the audit of the Company’s consolidated annual financial statements, reviews of interim financial statements and attestation services that are provided in connection with statutory and regulatory filings or engagements.

(2)

“Audit-Related Fees” are fees charged by PwC for assurance and related services 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.” This category comprises fees billed for review and advisory services associated with the Company’s financial reporting.

(3)

“Tax Fees” are fees billed by PwC for tax compliance, tax advice and tax planning.

(4)

“All Other Fees” are fees charged by PwC for services not described above. The 2020 fees are for audit procedures related to the Joint Venture transaction completed on February 11, 2020. The 2019 fees are for PwC’s services in connection with the Company’s base shelf prospectus filing.

Pre-Approval Policies and Procedures

All services to be performed by the Company’s independent auditor must be approved in advance by the Audit Committee. The Audit Committee has considered whether the provision of services other than audit services is compatible with maintaining the auditors’ independence and has adopted a charter governing its conduct. The charter is reviewed annually and requires the pre-approval of all auditing services and permitted non-audit services (including the fees and terms thereof) to be performed for the Company by its independent auditor, subject to the de minimis exceptions for non-audit services as allowed by applicable law or regulation. The Audit Committee may form and delegate authority to subcommittees consisting of one or more members when appropriate, including the authority to grant pre-approvals of audit and permitted non-audit services, provided that decisions of such subcommittee to grant pre-approvals shall be presented to the full Audit Committee at its next scheduled meeting. Pursuant to these procedures, all services and related fees reported were pre-approved by the Audit Committee.

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Report of the Audit Committee

The Audit Committee reviewed and discussed with management and the Company's independent auditors the audited consolidated financial statements included in the Company's Annual Report on Form 10-K for the year ended November 30, 2020. In addition, the Audit Committee has discussed with the Company's independent auditors the matters required to be discussed by Auditing Standard No. 1301, as amended, as adopted by the Public Company Accounting Oversight Board and the SEC. The Audit Committee has also received the written disclosures and the letter from the Company's independent auditors required by Independence Standards Board Standard No. 1 (Independence Discussions with Audit Committees) and has discussed with the Company's independent auditors that audit firm's independence from the Company and its management. Based on the review and discussions, the Audit Committee recommended to the Board that the audited financial statements be included in the Annual Report on Form 10-K for the year ended November 30, 2020, for filing with the SEC, which Annual Report is available under the Company’s profile on SEDAR at www.sedar.com and on EDGAR at www.sec.gov/edgar.

Audit Committee of the Board
Kalidas Madhavpeddi, Chair

Gregory Lang

Diana Walters

Approval of Continuation of 2012 Equity Incentive Plan

Background and Approval

Pursuant to Toronto Stock Exchange (“TSX”) rules, every three years following institution of the Company’s 2012 Equity Incentive Plan (the “Equity Incentive Plan”), Shareholders must approve all unallocated options, rights or entitlements, including Common Shares issued under the Share Bonus Plan (“Awards”), issuable pursuant thereto. Shareholders last approved the Equity Incentive Plan in 2018. The Equity Incentive Plan is in the same form as the plan previously approved by Shareholders.

At the Meeting, Shareholders will be asked to pass a resolution (the “Equity Incentive Plan Resolution”) substantially in the following form:

“BE IT RESOLVED THAT:

	1.	The unallocated entitlements under the Trilogy Equity Incentive Plan are hereby approved and Trilogy will have the ability to grant Awards and shares under the Trilogy Equity Incentive Plan until the date that is three years from the date of the Meeting, being May 19, 2024; and

	2.	Any director or officer of Trilogy be and is hereby authorized, for and on behalf of Trilogy, to do all such things and execute all such documents and instruments as may be necessary or desirable to give effect to this resolution.”

The Equity Incentive Plan Resolution must be passed by a majority of the votes cast by Shareholders who, being entitled to do so, vote in person or by proxy on the Equity Incentive Plan Resolution.

In the event that the resolution to approve the Equity Incentive Plan is not passed by the requisite number of votes cast at the Meeting, the Company will neither be able to grant new Awards nor will it be able to re-allocate outstanding Awards that expire unexercised. Previously allocated Awards under the Equity Incentive Plan will continue unaffected by the approval or disapproval of the Equity Incentive Plan Resolution. Any Awards that have been terminated, cancelled or that have expired will not be available for re-granting.

The Board of Directors of the Company has unanimously concluded that the approval of the Equity Incentive Plan Resolution is in the best interest of the Company and its Shareholders and recommends that Shareholders vote FOR the Equity Incentive Plan Resolution. The Company has been advised that the directors and senior officers of the Company intend to vote all Common Shares held by them in favour of the Equity Incentive Plan Resolution. In the absence of a contrary instruction, the person(s) designated by management of the Company in the enclosed form of proxy intend to vote FOR the Equity Incentive Plan Resolution. Abstentions and broker non-votes will not be counted either in favour of or against this proposal and, therefore, will have no effect on the outcomes of such proposal.

-8-

Previously Granted Awards Under the Equity Incentive Plan

The following table provides information related to the total number of Common Shares issuable in connection with outstanding, unexercised Award grants under the Equity Incentive Plan held by each of the following individuals and groups as at March 1, 2021.

Name	Stock Options Previously Granted #
Tony Giardini		3,193,400
Elaine Sanders		1,650,000
All executive officers as a group		4,843,400
All directors who are not executive officers as a group		2,325,000
All employees who are not executive officers as a group		4,273,750
Total prior awards under the Equity Incentive Plan		11,442,150

All Awards as approved by the Compensation Committee are made at the discretion of the Compensation Committee and Board of Directors. Accordingly, the benefits and amounts that will be received or allocated to Award recipients under the Equity Incentive Plan are not determinable at this time.

Summary of the Equity Incentive Plan

As of March 1, 2021, the total number of Common Shares issuable in connection with outstanding, unexercised Award grants under the Equity Incentive Plan was 11,442,150, which represent, in the aggregate, 7.9% of the total number of outstanding Common Shares. Of the 11,442,150 outstanding unexercised Awards, Awards to purchase 8,254,479 Common Shares are fully vested, with 3,187,671 remaining unvested. As of March 1, 2021, the total number of Common Shares reserved for issuance under the Equity Incentive Plan was 14,426,941, including Common Shares issuable in connection with outstanding, unexercised Award grants. The closing price of the Common Shares on the TSX as of March 1, 2021 was C$2.83. The closing price of the Common Shares on the NYSE American as of March 1, 2021 was US$2.25.

See “Securities Authorized for Issuance Under Equity Compensation Plans – Equity Incentive Plan Information” and “Securities Authorized for Issuance Under Equity Compensation Plans – Summary of Securities Issued” in this Circular for a summary of the Equity Incentive Plan, which forms a part of this proposal, and which is qualified in its entirety by reference to the complete copy of the Equity Incentive Plan which is filed on EDGAR under the Company’s profile at www.sec.gov/edgar and a copy of which is attached hereto as Appendix C.

Approval of Ambler Metals Equity Plan

Background and Approval

The equity incentive plan (the “Ambler Metals Equity Plan”) for Ambler Metals LLC (“Ambler Metals”) was adopted by our Board of Directors to be effective on March 18, 2021, subject to Shareholder approval at the Meeting.

The Company is a member of Ambler Metals, a joint venture entity formed to explore and develop the Upper Kobuk Mineral Projects. The Company owns fifty percent (50%) of the equity and has fifty percent (50%) of the voting rights with respect to Ambler Metals. The purpose of the Ambler Metals Equity Plan is to permit the Company to fund certain membership obligations, including the funding of certain executive compensation and long term incentives for officers and employees of Ambler Metals, through the issuance of equity awards to officers and employees of Ambler Metals with a view to aligning the interests of such persons with those of Shareholders through the incentive inherent in share ownership and by providing them an opportunity to participate in the Company’s future performance through awards of stock options and/or Common Shares.

-9-

Our Board of Directors believes that employees of Ambler Metals should be entitled to receive awards of stock options and Common Shares. Because of certain requirements imposed by law on our existing Ambler Metals Equity Plans, it is necessary to establish a separate plan for the officers and employees of Ambler Metals. Accordingly, our Board of Directors adopted the Ambler Metals Equity Plan and decided to submit to Shareholder the Ambler Metals Equity Plan at the Meeting.

At the Meeting, Shareholders will be asked to pass a resolution (the “Ambler Metals Equity Plan Resolution”) substantially in the following form:

“BE IT RESOLVED THAT:

	1.	that the Ambler Metals Equity Plan allowing for the issuance of a maximum of 3,500,000 Common Shares from treasury, a copy of which is attached to the Information Circular as Appendix D be and is hereby approved; and

	2.	any director or officer of the Company be and is hereby authorized, for and on behalf of the Company, to do all such things and execute all such documents and instruments as may be necessary or desirable to give effect to this resolution.”

The Ambler Metals Equity Plan Resolution must be passed by a majority of the votes cast by Shareholders who, being entitled to do so, vote in person or by proxy on the Ambler Metals Equity Plan Resolution.

The Board of Directors of the Company has unanimously concluded that the approval of the Ambler Metals Equity Plan Resolution is in the best interest of the Company and its Shareholders and recommends that Shareholders vote FOR the Ambler Metals Equity Plan Resolution. The Company has been advised that the directors and senior officers of the Company intend to vote all Common Shares held by them in favour of the Ambler Metals Equity Plan Resolution. In the absence of a contrary instruction, the person(s) designated by management of the Company in the enclosed form of proxy intend to vote FOR the Ambler Metals Equity Plan Resolution. Abstentions and broker non-votes will not be counted either in favour of or against this proposal and, therefore, will have no effect on the outcomes of such proposal.

Summary of the Ambler Metals Equity Plan

Eligible Participants

Under the Ambler Metals Equity Plan, awards may be granted to officers and employees of Ambler Metals provided that the services provided by such officers and employees are not in connection with the offer or sale of securities in a capital-raising transaction, and do not directly or indirectly promote or maintain a market for the Company's securities. Approximately three officers are eligible to participate in the Ambler Metals Equity Plan.

The total number of Common Shares reserved for issuance in connection with Awards granted or that may be granted under the Ambler Metals Equity Plan is 3,500,000 Common Shares.

The maximum number of Common Shares issuable to insiders pursuant to the Ambler Metals Equity Plan, together with any Common Shares issued pursuant to any other share compensation arrangement of the Company, at any time shall not exceed (i) 10% of the total number of outstanding Common Shares on the date of grant; and (ii) 10% of the total number of outstanding Common Shares within any one-year period.

The maximum number of Common Shares issuable to any one eligible person pursuant to the Ambler Metals Equity Plan, together with any Common Shares issued pursuant to any other share compensation arrangement of the Company, at any time shall not exceed 10% of the total number of outstanding Common Shares on the date of grant.

-10-

All Awards are made at the discretion of the Compensation Committee and the Board. Accordingly, the benefits and amounts that will be received or allocated to eligible participants under the Ambler Metals Equity Plan are not determinable at this time.

The total number of Common Shares that will be reserved for issuance under the Ambler Metals Equity Plan is 3,500,000, which represent, in the aggregate, approximately 2.4% of the total number of outstanding Common Shares as of March 1, 2021. As of March 1, 2021, no Awards have been granted under the Ambler Metals Equity Plan. The closing price of the Common Shares on the TSX as of March 1, 2021 was C$2.83. The closing price of the Common Shares on the NYSE American as of March 1, 2021 was US$2.25.

Exercise

Under the terms of the Ambler Metals Equity Plan, upon vesting, options may be exercised by delivery to the Company of a written stock option exercise agreement, together with payment of the exercise price (plus any applicable taxes, including withholding obligations) for the number of Common Shares being purchased.

Payment of Cash in Lieu of Issuing Common Shares

Under the terms of the Ambler Metals Equity Plan , the Company will, upon receipt of the written stock option exercise agreement and payment, have the option, in its sole discretion, to make a cash payment to the eligible person in lieu of issuing Common Shares. The amount of such cash payment will be equal to the market price of the underlying Common Shares on the date that the written stock option exercise agreement and payment are received.

Administration

The Ambler Metals Equity Plan is to be administered by the Compensation Committee appointed by the Board of Directors. Subject to the terms of the Ambler Metals Equity Plan, the Compensation Committee may determine, among other things, the persons to whom Awards may be granted, the number of Awards to be granted to any person, the exercise price and the schedule and dates for vesting of Awards granted. The term of the Awards granted under the Ambler Metals Equity Plan shall be determined by the Compensation Committee, however, in no event shall an option be exercisable during a period extending more than ten years after the date of grant.. In the circumstance where the end of the term falls within, or within ten business days after the end of, a “black out” or similar period imposed under any insider trading policy or similar policy of the Company, the end of the term shall be the tenth business day after the earlier of the end of such black out period or the original expiry date. In no event shall the exercise price of an Award be less than the greater of: (i) the market price, which means the volume weighted average price of the Common Shares on the NYSE American for the five trading days prior to the date of grant of the option; and (ii) the fair market value, which means the closing price of the Common Shares on the NYSE American on the last trading day prior to the date of grant of the option.

Ambler Share Bonus Plan

Pursuant to the share bonus plan (the “Ambler Share Bonus Plan”), the terms of which are included as part of the Ambler Metals Equity Plan, the Board, on the recommendation of the Compensation Committee, shall have the right, subject to the limitations set forth in the Ambler Metals Equity Plan, to issue or reserve for issuance, for no cash consideration, to any eligible person, any number of Common Shares as a long term incentive or as a discretionary bonus of Common Shares subject to such provisos and restrictions, including vesting provisions, as the Board may determine. The aggregate number of Common Shares that may be issued under the Ambler Share Bonus Plan is 1,000,000.

Subject to any vesting requirements or termination provisions attached to a specific award of Common Shares made under the Ambler Metals Equity Plan and subject further to the discretion of the Compensation Committee to accelerate vesting, upon the termination of a participant or upon a Joint Venture Exit (as defined below), all unvested Common Share awards will be void and of no further force or effect.

Change of Control

In the event of, among other things, a change of control affecting the Company, the Board of Directors of the Company will notify each awardee under the Ambler Metals Equity Plan of the full particulars of the offer whereupon all options will become vested and may be exercised. Any unvested Awards outstanding from the Ambler Share Bonus Plan will vest immediately upon a change of control.

-11-

Cessation of Entitlement

If an officer or employee ceases to be so engaged by the Company for any reason or upon the occurrence of any event that results in the Company ceasing to be a member of Ambler Metals (a “Joint Venture Exit”), such will have the right to exercise any vested Award not exercised prior to such termination or Joint Venture Exit within the lesser of three months from the date of the termination or Joint Venture Exit and the expiry date of the Award provided that the Committee retains the discretion to accelerate vesting. Notwithstanding the foregoing, if the termination is for just cause, the right to exercise the vested Award shall terminate on the date of termination. All non-vested Awards shall terminate on the date of termination or the date of the Joint Venture Exit.

Stock Options Granted to U.S. Participants

Stock options may only be awarded U.S. participants to the extent those U.S. participants perform direct services to (A) the Company or any other entity controlled by the Company (as described in more detail in the Ambler Metals Equity Plan), or (B) to an entity that otherwise qualifies as an eligible issuer of service recipient stock pursuant to United States Treasury Regulation Section 1.409A-1(b)(5)(iii)(E)(1). The exercise price of a stock option will not be less than the market price.

Amendment

The Board may, from time to time, subject to applicable law and the rules of the TSX, and in compliance with Section 409A of the U.S. Internal Revenue Code of 1986 (the “Code”), as applicable, but without shareholder approval, suspend, terminate, or amend the Ambler Metals Equity Plan or any option granted thereunder for the purposes of (i) making minor or technical modifications, (ii) to correct any ambiguity, defective provisions, error or omission in the provisions of the Ambler Metals Equity Plan, (iii) to change any vesting provisions of the options or Common Shares issued under the Ambler Share Bonus Pan, (iv) to change the termination provisions of the options provided it does not entail an extension beyond the original expiry date of the options, (v) to add or change provisions relating to any form of financial assistance provided that would facilitate the purchase of options, (vi) to add a cashless exercise feature providing for the payment in cash or securities upon the exercise of options, (vii) subject to the restrictions below, to extend the term or reduce the exercise price of any option previously granted in accordance with Ambler Metals Equity Plan terms, or (viii) to reduce the allocation of Common Shares to the Ambler Share Bonus Plan issuable under the Ambler Metals Equity Plan or; and the Board, absent prior approval of the Shareholders of Trilogy and the TSX or any regulatory body having authority over the Company, will not be entitled to: (i) increase the maximum number of Common Shares issuable by the Company pursuant to the Ambler Metals Equity Plan; (ii) amend an option grant for an option held by an insider to effectively reduce the exercise price or extend the expiry date of such options; (iii) permit options granted under the Ambler Metals Equity Plan to be transferable or assignable other than for normal estate settlement purposes; or (v) make any change to the amendment provisions of the Ambler Metals Equity Plan.

Transferability

Awards under the Ambler Metals Equity Plan are not transferable or assignable by the participant, otherwise then by will or operation of law.

U.S. Federal Income Tax Consequences of Grant and Exercise of Awards

Awards granted under the Ambler Metals Equity Plan are intended either to be exempt from, or to comply with, Code Section 409A, and will be administered accordingly. However, there is no guaranty that the Internal Revenue Service will not take a contrary position. The tax consequences described below assume that Awards will be exempt from, or will comply with, Code Section 409A. If the Awards are found not to be exempt from, or not to comply with, Code Section 409A, different and less favorable tax treatment could result, including recognition of income at the time of vesting of an Option (even if not exercised at that time) and a 20% penalty tax.

-12-

Stock Options

Grant of Options

The Ambler Metals Equity Plan permits the award of non-qualified stock options. The grant of an option is not expected to result in any taxable income to the recipient.

Exercise of Options

Upon exercising a non-qualified stock option, the optionee must recognize ordinary income equal to the excess of the fair market value of the Common Shares acquired on the date of exercise over the exercise price, and the Company generally will be entitled at that time to an income tax deduction for the same amount.

Disposition of Common Shares Acquired Upon Exercise of Options

The tax consequence upon a disposition of Common Shares acquired through the exercise of an option will depend on how long the Common Shares have been held. If, as usually is the case, the Common Shares acquired upon exercise of a non-qualified stock option are a capital asset in the participant’s hands, any additional gain or loss recognized on a subsequent sale or exchange of the Common Shares will not be ordinary income, but will qualify as capital gain or loss. Provided that an optionee holds the Common Shares received upon exercise of the non-qualified stock option for more than one year from the date the option was exercised, the difference, if any, between the amount realized on a sale or other taxable disposition and the optionee’s tax basis will be long-term capital gain or loss.

Awards Under the Ambler Share Bonus Plan

For Awards granted under the Ambler Share Bonus Plan that are payable in Shares that are not subject to substantial risk of forfeiture, the holder of the Award must recognize ordinary income equal to the fair market value of the Common Shares received (determined as of the date such shares are received), and the Company generally will be entitled to an income tax deduction for the same amount, subject to the rules of Section 162(m) of the Code.

If an Award is payable in Common Shares that are subject to a substantial risk of forfeiture (e.g. vesting conditioned on continued service or performance conditions), then unless a special election under the Code is made by the participant, the holder must recognize ordinary income equal to the fair market value of the Common Shares received (determined as of the first time the Common Shares become transferable or not subject to substantial risk of forfeiture, whichever occurs earlier). The Company generally will be entitled to an income tax deduction for the same amount, subject to the rules of Section 162(m) of the Code. However, Section 83(b) of the Code allows a participant who receives an award of restricted Common Shares (i.e. the Common Shares are subject to a substantial risk of forfeiture) to elect to be taxed as of the grant date (rather than the later vesting date) and to recognize ordinary income equal to the fair market value of the common stock on the date of grant. If the participant does not make a Section 83(b) election within 30 days from the date of grant of the restricted stock award, the participant will recognize ordinary income equal to the fair market value of the common stock upon the expiration of the restriction period.

The holder’s basis for the determination of gain or loss upon the subsequent disposition of Common Shares acquired under the Ambler Share Bonus Plan will be the amount ordinary income recognized either when the Common Shares are received or when the Common Shares are vested, as applicable. Provided that the participant holds the Common Shares for the capital gains holding period, the difference, if any, between the amount realized on a sale or other taxable disposition and the participant’s tax basis will be long-term capital gain or loss.

-13-

INFORMATION CONCERNING THE BOARD OF DIRECTORS, DIRECTOR NOMINEES AND EXECUTIVE OFFICERS

The following table sets forth certain information with respect to our current directors and executive officers. The term for each director expires at our next annual meeting of the Shareholders of the Company or at such time as his or her successor is appointed, upon ceasing to meet the qualifications for election as a director, upon death, upon removal by the Shareholders or upon delivery or submission to the Company of the director's written resignation, unless the resignation specifies a later time of resignation. Each executive officer shall hold office until the earliest of the date his or her resignation becomes effective, the date his or her successor is appointed or he or she ceases to be qualified for that office, or the date he or she is terminated by Board of Directors of the Company. The names, locations of residence, ages of, and offices held by, the directors and executive officers has been furnished by each of them and is current as of March 1, 2021. Unless otherwise indicated, the address of each director and executive officer in the table set forth below is the principal executive office of Trilogy Metals Inc. located at Suite 1150, 609 Granville Street, Vancouver, British Columbia, V7Y 1G5 Canada.

Name and Municipality of Residence	Position and Office Held	Director/Officer Since	Age
Tony Giardini⁽¹⁾ Rome, Italy	Director, President and Chief Executive Officer of the Company	January 26, 2012	61
James Gowans⁽³⁾⁽⁵⁾ British Columbia, Canada	Director	May 22, 2019	69
William Hayden⁽³⁾⁽⁵⁾ New South Wales, Australia	Director	June 19, 2015	69
William Hensley^(3)(4)(5) Alaska, USA	Director	December 22, 2017	79
Gregory Lang ⁽²⁾⁽⁵⁾ Utah, USA	Director	January 26, 2012	66
Kalidas Madhavpeddi⁽²⁾⁽⁴⁾ Arizona, USA	Director	January 26, 2012	65
Janice Stairs⁽⁶⁾ Nova Scotia, Canada	Chair	April 27, 2011	61
Diana Walters⁽²⁾⁽⁴⁾ Texas, USA	Director	May 18, 2016	57
Elaine Sanders British Columbia, Canada	Vice President, Chief Financial Officer and Corporate Secretary of the Company	April 29, 2011⁽⁷⁾	51

	(1)	Mr. Giardini was appointed President and Chief Executive Officer on June 1, 2020, replacing James Gowans, who acted as Interim President and Chief Executive Officer from September 4, 2019 to June 1, 2020.
	(2)	Member of the Audit Committee.
	(3)	Member of the Compensation Committee.
	(4)	Member of the Corporate Governance and Nominating Committee.
	(5)	Member of the EHST Committee.
	(6)	Ms. Stairs was appointed Chair of the Board on May 23, 2019.
	(7)	Appointed Corporate Secretary on April 29, 2011 and Vice President and CFO on January 30, 2012.

-14-

Tony Giardini, CPA, CA

Tony Giardini is currently the President and Chief Executive Officer of the Company, a position he has held since June 2020. Mr. Giardini was President of Ivanhoe Mines Ltd. from May 2019 to March 2020 and was Executive Vice President and Chief Financial Officer of Kinross Gold Corporation from December 2012 to April 2019. He was Chief Financial Officer of Ivanhoe Mines Ltd. from May 2006 to April 2012. Prior to joining Ivanhoe Mines Ltd., Mr. Giardini spent more than 10 years with Placer Dome Inc. as Vice President and Treasurer. Mr. Giardini is a Chartered Professional Accountant and a Certified Public Accountant and spent 12 years with accounting firm KPMG prior to joining Placer Dome Inc.

Principal Occupation During Past Five Years: President of Ivanhoe Mines Ltd. (May 2019 – March 2020); Chief Financial Officer of Kinross Gold Corporation (December 2012 - April 2019); Chief Financial Officer of Capstone Mining Corp. (August – November 2012); and Chief Financial Officer of Ivanhoe Mines Ltd. (2006 – 2012).

The Board has determined that Mr. Giardini should serve as a director due to his role as President and Chief Executive Officer of the Company and his experience in finance, financial reporting and operations as a chief financial officer of a major mining company.

Areas of experience include: finance, investment banking, governance, mining industry, treasury and audit.

Directorships Held During Past Five Years

Current: none

Non-current: none

Overall Attendance
100%

Securities Held

Board / Committee Membership

Regular Meeting

Common Shares
#

Stock Options
#

DSUs
#

Board

8/8

533,048

3,193,400

202,324

Audit

2/2

Compensation

2/2

-15-

James (Jim) Gowans

James Gowans is an independent director of various companies. He was previously the Interim President and Chief Executive Officer of the Company from September 2019 to June 2020. He was previously the president, CEO and a director of Arizona Mining Inc. from January 2016 until it was purchased by South32 Limited in August 2018. He was senior advisor to the chair of the board of Barrick Gold Corporation from August to December 2015, co-president from July 2014 to August 2015 and executive vice-president and COO from January to July 2014. He served as managing director of the Debswana Diamond Company in Botswana from 2011 to 2014. He has extensive experience as a senior executive in the mining industry, including holding executive positions at DeBeers SA, DeBeers Canada Inc. and PT Inco in Indonesia, and with Placer Dome Ltd. Mr. Gowans is the past chair of the Mining Association of Canada.

Mr. Gowans also has experience in Alaska, having worked for Cominco Limited where he oversaw the completion of a feasibility study and the subsequent design and construction of the Red Dog Mine. Mr. Gowans then operated the Red Dog Mine for three years following its commissioning.

Mr. Gowans received a Bachelor of Applied Science degree in Mineral Engineering from the University of British Columbia and attended the Banff School of Advanced Management. He has extensive mining knowledge and perspective on the importance of corporate social responsibility and brings human resources experience as a former vice-president, human resources at Placer Dome.

In addition to the public company board listed below, Mr. Gowans has been a director of the private company, Gedex Technologies Inc. from 2015 until late 2017.

Principal Occupation During Past Five Years: Interim President and Chief Executive Officer of the Company (September 2019 – Present); Independent director of various companies (August 2018 – present); President, CEO and a director of Arizona Mining Inc. (January 2016 – August 2018).

The Board has determined that Mr. Gowans should serve as a director due to his experience as a director and senior officer for various mining companies, his experience in mine operations and project development and his Alaskan-based project experience.

Areas of experience include: senior officer and board experience, mining industry, project and operations management, project design, human resources management, Alaskan-based project experience, environment and safety.

Directorships Held During Past Five Years

Current: Cameco Corp., New Gold Inc., Titan Mining Corp., Marathon Gold Corporation

Non-current: Arizona Mining Inc., Dominion Diamond Corporation, NewCastle Gold Ltd., PhosCan Chemical Corp., Detour Gold.

Overall Attendance
100%

Securities Held

Board / Committee Membership

Regular Meeting

Common Shares
#

Stock Options
#

DSUs
#

Board

8/8

73,800

1,037,500

85,892

EHST

4/4

Compensation

3/3

-16-

William (Bill) Hayden

Mr. Hayden is a self-employed geologist with over 39 years of experience in the mineral exploration industry, much of which has been in Africa, South America and the Asia-Pacific region. Bill was the co-founder and President of Ivanhoe Nickel and Platinum Ltd. (now Ivanhoe Mines Ltd), a Canadian company which assembled extensive mineral holdings in South Africa and the Democratic Republic of Congo. Since 1983, Bill has worked in a management capacity with several exploration and mining companies both in Australia and overseas. Bill was the President of Ivanhoe Philippines and GoviEx Uranium Inc., and a former director of Sunward Resources Ltd.

Principal Occupation During Past Five Years: Self-employed geologist (2011 – Present).

The Board has determined that Mr. Hayden should serve as a director due to his knowledge of the mining industry and public capital markets.

Areas of experience include: senior officer, mining industry, international project, and public capital markets.

Directorships Held During Past Five Years

Current: Ivanhoe Mines Ltd., Globe Metals & Mining Ltd., Palisades Gold Corp, Asia Pacific Mining Limited

Non-current: Sunward Resources Ltd., Noble Metals Ltd.

Overall Attendance
100%

Securities Held

Board / Committee Membership

Regular Meeting

Common Shares
#

Stock Options
#

DSUs
#

Board

8/8

137,945

400,000

102,738

Compensation

4/4

EHST

4/4

-17-

William Iggiagruk Hensley

Mr. Hensley is the Distinguished Visiting Professor in the Department of Business and Public Policy at the University of Alaska in Anchorage. He recently retired from Alyeska Pipeline Service Company where he served as Manager of Federal Government Relations in Washington, DC. Prior to his employment with Alyeska, Mr. Hensley was appointed Commissioner of Commerce and Economic Development, where he was responsible for Alaska's involvement in tourism and seafood marketing, international trade, insurance, banking and securities as well as occupational licensing. He also served on the Oil and Gas Policy Council, the Board of directors of the Alaska Permanent Fund Corporation, the Alaska Railroad and the Alaska Industrial Development Authority. Mr. Hensley was a founder of NANA Regional Corporation, served as a director for 20 years and concluded his career there as President. While at NANA, he directed its involvement in the oilfield services area, most specifically in the environmental services and drilling ventures. He was also active in the development of the world's largest lead and zinc mine, Red Dog. He was a founder of Maniilaq, the regional non-profit representing the tribes in the Kotzebue region, and was involved in the formation of the Alaska Federation of Natives and served as executive director, President and Co-Chairman.

Principal Occupation During Past Five Years: Distinguished Visiting Professor in the Department of Business and Public Policy at the University of Alaska in Anchorage (2012 – present).

The Board has determined that Mr. Hensley should serve as a director due to his knowledge of public policy and strategy and leadership.

Areas of experience include: public policy, strategy and leadership, metals and mining, operations and development and accounting.

Diverse on the basis of ethnicity.

Directorships Held During Past Five Years

Current: Chair, Board of Trustees, First Alaskans Institute, Vice Chair, Board of Trustees, Aqqaluk Trust, Advisory Board Member, Pebble Partnership

Non-current: Charter College Board of Trustees

Overall Attendance
91%

Securities Held

Board / Committee Membership

Regular Meeting

Common Shares
#

Stock Options
#

DSUs
#

Board

8/8

5,000

325,000

100,699

Compensation

2/4

Corporate Governance and Nominating

6/6

EHST

4/4

-18-

Gregory Lang

Mr. Lang is President and Chief Executive Officer of NOVAGOLD Resources Inc., a gold mining company. Mr. Lang has over 35 years of diverse experience in mine operations, project development and evaluations, including experience as President of Barrick Gold of North America, a wholly-owned subsidiary of Barrick Gold Corporation. Mr. Lang has held operating and project development positions over his 10-year tenure with Barrick Gold Corporation and, prior to that, with Homestake Mining Company and International Corona Corporation, both of which are now part of Barrick Gold Corporation. He holds a Bachelor of Science in Mining Engineering from University of Missouri-Rolla and is a Graduate of the Stanford University Executive Program.

Principal Occupation During Past Five Years: President and Chief Executive Officer of NOVAGOLD Resources Inc. (January 2012 –present).

The Board has determined that Mr. Lang should serve as a director due to his knowledge of mine building and operations.

Areas of experience include: senior officer, mine engineering, construction, safety and operations.

Directorships Held During Past Five Years

Current: NOVAGOLD Resources Inc.

Non-current: Sunward Resources Ltd.

Overall Attendance
100%

Securities Held

Board / Committee Membership

Regular Meeting

Common Shares
#

Stock Options
#

DSUs
#

Board

8/8

272,879

400,000

202,172

Audit

2/2

Corporate Governance and Nominating

4/4

EHST

4/4

-19-

Kalidas Madhavpeddi

Mr. Madhavpeddi, a director of the Company, has 40 years of international experience in corporate strategy, mergers and acquisitions, government relations, marketing, mining engineering and capital. He is currently the President of Azteca Consulting LLC, an advisory firm to the metals and mining sector. From 2010 to 2018 he was CEO of China Molybdenum International, a privately held company and global producer of copper, gold, cobalt, phosphates, niobium and molybdenum. His extensive career in the mining industry includes over 25 years at Phelps Dodge Corporation (“Phelps Dodge”), a Fortune 500 company, starting as a Systems Engineer and ultimately becoming Senior Vice President for Phelps Dodge, and contemporaneously the President of Phelps Dodge Wire and Cable. Mr. Madhavpeddi is an alumnus of the Indian Institute of Technology, Madras, India; the University of Iowa and Harvard Business School.

Principal Occupation During Past Five Years: President of Azteca Consulting LLC (2006 – present) and Chief Executive Officer of CMOC International (2008- 2018)

The Board has determined that Mr. Madhavpeddi should serve as a Director to benefit from his long-term experience in the mining industry working as an executive in global corporate development, exploration, mergers and acquisitions, joint ventures and finance.

Areas of experience include: corporate strategy, mergers and acquisitions, mining operations and capital, marketing and sales, and corporate leadership.

Diverse on the basis of ethnicity.

Directorships Held During Past Five Years

Current: Dundee Precious Metals Inc. (since Feb. 2021), Glencore Plc, NOVAGOLD Resources Inc.

Non-current: Namibia Rare Earths Inc., Capstone Mining Corp.

Overall Attendance
100%

Securities Held

Board / Committee Membership

Regular Meeting

Common Shares
#

Stock Options
#

DSUs
#

Board

8/8

329,293

400,000

212,772

Audit

4/4

Corporate Governance and Nominating

2/2

EHST

3/3

-20-

Janice Stairs, LLB, MBA

Ms. Stairs has over 30 years of experience working with companies involved in the resource sector including general counsel and other executive positions held with Namibia Critical Metals Inc., Endeavour Mining Corporation and Etruscan Resources Inc. Prior to 2004, Ms. Stairs was a partner with the law firm of McInnes Cooper (formerly Patterson Palmer) located in Halifax, Nova Scotia, and she continues to act as counsel to the firm. Ms. Stairs practiced law in private practice for 19 years specializing in corporate finance, securities and resource-related issues for private and public companies. Ms. Stairs graduated from Dalhousie Law School and holds a Masters of Business Administration degree from Queen's University.

Principal Occupation During Past Five Years: General Counsel to Namibia Critical Metals Inc. (2011-2019). Director of various public companies (2020-present).

The Board has determined that Ms. Stairs should serve as a director due to her experience in securities compliance and public listing requirements and knowledge of legal and corporate governance.

Areas of experience include: legal aspects of corporate finance, securities and resource-related issues for private and public companies.

Diverse on the basis of gender.

Directorships Held During Past Five Years

Current: Marathon Gold Corporation, Gatos Silver, Inc.

Non-current: AuRico Gold Inc., AuRico Metals Inc., Namibia Critical Metals Inc., Gabriel Resources Ltd,

Overall Attendance
100%

Securities Held

Board / Committee Membership

Regular Meeting

Common Shares
#

Stock Options
#

DSUs
#

Board

8/8

273,658

400,000

206,472

-21-

Diana Walters

Ms. Walters has more than 35 years of experience in the natural resources sector, as a private equity investor, investment banker, CFO, board member and in other roles within the sector. Ms. Walters is the owner and sole manager of Amichel LLC, an investment company that also provides advisory services in the field of natural resources. She served as the President of Liberty Metals & Mining Holdings, LLC, and as a member of senior management of Liberty Mutual Asset Management from January 2010 to September 2014. She was a Managing Partner of Eland Capital, LLC, a natural resources advisory firm founded by her, from 2007 to 2010. Ms. Walters has extensive investment experience with both debt and equity through various leadership roles at Credit Suisse, HSBC and other firms. She also served previously as Chief Financial Officer of Tatham Offshore Inc., an independent oil and gas company with assets in the Gulf of Mexico. Ms. Walters graduated with Honors from the University of Texas at Austin with a B.A. in Plan II Liberal Arts and an M.A. in Energy and Mineral Resources.

Principal Occupation During Past Five Years: Manager and Founder of Amichel LLC (2019 to present), Manager and Founder of 575 Grant LLC (2014 – 2019); and President, Liberty Metals and Mining. (2010 – 2014).

The Board has determined that Ms. Walters should serve as a director due to her knowledge and experience of corporate finance and the mining sector.

Areas of experience include: finance, accounting, mergers and acquisitions, compensation, corporate governance, restructuring and the mining industry.

Diverse on the basis of gender.

Directorships Held During Past Five Years

Current: Platinum Group Metals Ltd., Atmos Energy Corporation

Non-current: Electrum Special Acquisition Corporation, Centennial Energy Corporation., Alta Mesa Resources, Inc.

Overall Attendance
100%

Securities Held

Board / Committee Membership

Regular Meeting

Common Shares
#

Stock Options
#

DSUs
#

Board

8/8

10,000

400,000

125,441

Audit

4/4

Corporate Governance and Nominating

6/6

-22-

Elaine Sanders, CPA, CA, CPA (Illinois)

Ms. Sanders is the Chief Financial Officer and Corporate Secretary of the Company and was Vice President, Chief Financial Officer and Corporate Secretary of NOVAGOLD previously. She brings over 25 years of experience in audit, finance and accounting with public and private companies. She has been involved with numerous financings and acquisitions, and has listed companies on both the TSX and NYSE American. Ms. Sanders is responsible for all aspects of financial reporting, compliance and corporate governance of the Company. She holds a Bachelor of Commerce degree from the University of Alberta, and is a Chartered Professional Accountant and a Certified Public Accountant.

Principal Occupation During Past Five Years: Chief Financial Officer and Corporate Secretary of the Company (2012–present)

Areas of experience include: finance, securities compliance, senior officer and corporate governance.

Diverse on the basis of gender and ethnicity.

Directorships Held During Past Five Years

Current: Alexco Resource Corp.

Non-current: none.

Overall Attendance
N/A

Securities Held

Board / Committee Membership

Regular Meeting

Common Shares
#

Stock Options
#

RSUs
#

N/A

1,476,874

1,650,000

Meetings of the Board and Board Member Attendance at Annual Meeting

Since December 1, 2019, the beginning of the Company’s most recently completed financial year, the Board held eight meetings. All of the incumbent directors attended more than 90% of the aggregate total number of Board meetings and meetings of the committees on which he or she serves.

Board members are not required to attend the annual general meeting.

Cease Trade Order, Bankruptcy, Penalties and Sanctions

No proposed director of the Company is, as of the date hereof or was within 10 years before the date hereof, a director, chief executive officer or chief financial officer of any company (including the Company) that:

(a)

was subject to a cease trade order, an order similar to a cease trade order or an order that denied the relevant company access to any exemption under securities legislation, that was in effect for a period of more than 30 consecutive days, that was issued while the director or executive officer was acting in the capacity as director, chief executive officer or chief financial officer; or

(b)

was subject to a cease trade order, an order similar to a cease trade 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, that was issued after the director or executive officer ceased to be a director, chief executive officer or chief financial officer and which resulted from an event that occurred while that person was acting in the capacity as director, chief executive officer or chief financial officer.

Except as disclosed below, no proposed director of the Company:

(a)

is, as of the date hereof or was within 10 years before the date hereof, a director or executive officer of any company (including the Company) that, while that person was acting in that capacity, or within a year of that person ceasing to act in that capacity, became bankrupt made a proposal under any legislation relating to bankruptcy or insolvency, or was subject to or instituted any proceedings, arrangement or compromise with creditors or had a receiver, receiver manager or trustee appointed to hold its assets; or

(b)

has, within 10 years before the date hereof, become bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency, or become subject to or instituted any proceedings, arrangement or compromise with creditors or had a receiver, receiver manager or trustee appointed to hold the assets of the proposed director.

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James Gowans was a director of Gedex Systems Inc. (“Gedex”), a company based in Mississauga, Ontario. On August 9, 2019, Gedex filed a notice of application in the Ontario Superior Court of Justice (the “Court”) under the Companies’ Creditors Arrangement Act (“CCAA”) requesting an order approving a sale and investor solicitation process (“SISP”) in respect of the property, assets and undertakings of Gedex. The notice of application also sought an order appointing Zeifman Partners Inc. (“Zeifman”) as monitor in the proceedings (in such capacity, the “Monitor”). On August 12, 2019, the Court made an order authorizing and approving, among other things, the commencement of the SISP and a stay of proceedings until September 11, 2019. On the same date, the Court made an additional order granting Gedex protection from its creditors pursuant to the CCAA and appointing Zeifman as the Monitor of Gedex. On August 28, 2019, the first report of the Monitor was issued and, on September 3, 2019, the Court issued a further order granting, among other things, an extension of the stay period until December 10, 2019. On December 5, 2019, the Court certified that all matters to be attended to in connection with these CCAA proceedings have been completed and Zeifman filed its discharge notice on December 23, 2019, terminating the CCAA proceedings.

Diana Walters was a director of Alta Mesa Resources, Inc. ("Alta") and certain of its subsidiaries. On September 11, 2019, Alta, Alta Mesa Holdings, LP and certain of Alta's subsidiaries filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code ("Chapter 11") in the U.S. Bankruptcy Court for the Southern District of Texas (the "Bankruptcy Court"). On January 12, 2020, additional subsidiaries of Alta filed voluntary petitions for reorganization under Chapter 11 in the Bankruptcy Court. The Bankruptcy Court held a hearing to consider the reorganization on May 27, 2020 and the reorganization was consummated on June 8, 2020.

William Hensley was a director of Andover Mining Corp. ("Andover") from 2011 to 2015. On August 22, 2013, Andover filed a Notice of Intention to make a proposal with the Office of the Superintendent of Bankruptcy (Canada) in accordance with the Bankruptcy and Insolvency Act (Canada). After a number of extensions granted by the Supreme Court of British Columbia, Andover filed a proposal with its creditors on January 22, 2014 (the “Proposal”) and Abakhan & Associates Inc. (“AAI”) was named as trustee in the Proposal. On February 12, 2014, the Proposal failed due to not receiving the requisite creditor approval. As a result, Andover was deemed bankrupt and Grant Thornton Limited (“Grant Thornton”) was concurrently substituted for AAI as trustee in the bankruptcy. On March 16, 2015 Grant Thornton completed the sale of Andover’s material assets.

No proposed director of the Company has been subject to:

(a)

any penalties or sanctions imposed by a court relating to securities legislation or by a securities regulatory authority or has entered into a settlement agreement with a securities regulatory authority; or

(b)

any other penalties or sanctions imposed by a court or regulatory body that would likely be considered important to a reasonable securityholder in deciding whether to vote for a proposed director.

Family and Certain Other Relationships

There are no family relationships among the members of the Board or the members of senior management of our Company. There are no arrangements or understandings with major Shareholders, customers, suppliers or others, pursuant to which any member of the Board or member of senior management was selected or any proposed director to be elected.

Interest of Certain Persons or Companies in Matters to be Acted Upon

Except as described in this Circular, no (i) person who has been a director or executive officer of the Company at any time since the beginning of the Company’s last financial year, (ii) proposed nominee for director, or (iii) associate or affiliate of any of the foregoing persons, has any material interest, direct or indirect by way of beneficial ownership of securities or otherwise, in any matter to be acted upon at the Meeting.

Independence of Directors

The Board has determined that the following directors qualify as independent , including any additional committee independence requirements, under the applicable standards of the NYSE American, U.S. Securities and Exchange Commission (“SEC”) rules and National Instrument 52-110 – Audit Committees: Messrs. Gowans, Hayden, Hensley, Lang, Madhavpeddi, and Mmes. Stairs and Walters. Tony Giardini does not presently qualify as independent as he is currently the President and Chief Executive Officer of the Company.

-24-

STATEMENT OF EXECUTIVE COMPENSATION

Compensation Committee Report

The Compensation Committee has reviewed and discussed with management the Company's Compensation Discussion and Analysis included herein. Based on such review and discussions, the Compensation Committee has recommended to the Board of Directors that the Compensation Discussion and Analysis be included in the Company's Annual Report on Form 10-K for the year ended November 30, 2020 and the Company's 2021 Circular.

The Company’s compensation strategy recognizes the need to attract and retain high calibre executives by providing reasonably competitive salaries, rewarding performance for achieving pre-determined objectives by providing bonus awards and motivating executives to remain with the Company and enhance shareholder value with long term incentive stock options and restricted share units. The Compensation Committee engaged an independent advisor to review and recommend changes to executive compensation, including a review of annual salaries and recommended short term and long-term incentives. An important element of company performance revolves around the creation of shareholder value, measured as total shareholder return or TSR, of which the Compensation Committee considered one, two and three- year TSR as part of its decision making for executive performance.

The executive team’s performance was reviewed by the Board relative to the accomplishments for the year and the current operating environment and the Board approved a discretionary cash bonus and annual long-term stock option grants to the executive officers.

Submitted by the following members of the Compensation Committee of the Board of Directors:

James Gowans (Chair)

William Hayden

William Hensley

Compensation Discussion and Analysis

This Compensation Discussion and Analysis describes and explains the significant elements of the Company’s executive compensation program for the 2020 fiscal year to attract, retain and incentivize the Company’s named executive officers (“NEOs” or “Named Executive Officers”).

The Company’s current NEOs are:

Mr. Tony Giardini, President and CEO, and

Ms. Elaine Sanders, Vice President and CFO.

Objectives of Compensation Program

The objectives of the Company’s compensation program are to attract, retain and incentivize highly qualified executive officers with the talent and experience necessary for the success of the Company. The Company’s compensation program is designed to recruit and retain key individuals and reward individuals with compensation that has long-term growth potential while recognizing that the executives work as a team to achieve corporate results and should be rewarded accordingly.

The Compensation Committee evaluates each executive officer position to establish and enumerate skill requirements and levels of responsibility. The Compensation Committee, after referring to market information recommends compensation for the executive officers. The Compensation Committee engages an outside compensation advisor, Roger Gurr & Associates (the “Compensation Consultant”), to review the market information and complete an analysis. The main elements of the engagement include reviewing the peer comparator group of mining companies, reviewing and confirming the compensation strategy and reviewing compensation data of the peer comparators. Typically, the CEO makes a recommendation to the Compensation Committee regarding base salary increases, annual incentives and long-term incentives for executive officers other than the CEO. These recommendations are based on the individual’s salary in relation to guidepost, their actual individual and company performance and market conditions. The Compensation Committee holds an in-camera meeting to review these recommendations and then puts forward their recommendation to the Board for approval.

-25-

Executive Compensation Policies and Programs

In establishing compensation objectives for executive officers, the Compensation Committee seeks to accomplish the following goals:

incentivize executives to achieve important corporate and personal performance objectives and reward them when such objectives are met;

recruit and subsequently retain highly qualified executive officers by offering overall compensation that is competitive with that offered for comparable positions at Peer Group (as defined below) companies; and

align the interests of executive officers with the long-term interests of Shareholders through participation in the Company’s stock-based compensation plans.

Currently, the Company’s executive compensation package consists of the following principal components: base salary, annual incentive bonus, various health plan benefits, registered retirement savings plan (“RRSP”) matching for Canadian NEOs, and long-term incentives in the form of stock options and restricted share units.

The following table summarizes the different elements of the Company’s total compensation package.

COMPENSATION ELEMENT	OBJECTIVE	KEY FEATURE
Base Salary	Provide a fixed level of cash compensation for performing day-to-day responsibilities.	Actual increases are based on individual performance.
Annual Incentive Plan	Reward for short-term performance against corporate, and individual goals.	Actual payout depends on performance against corporate and individual goals. Minimum Company performance needs to be met before a payout occurs.
Stock Options	Align management interests with those of Shareholders, encourage retention and reward long-term Company performance.	Stock option grants generally vest over 2 years, with one-third vesting on the date of grant and one-third on each of the first and second anniversaries of the date of grant. Stock option grants generally have a 5-year life.
Restricted Share Units (“RSUs”)	Align management interests with those of Shareholders, encourage retention and reward long-term Company performance.	RSU grants generally vest over a period of 2 years with one-third of the RSUs vesting on the date of grant and one-third on each of the first and second anniversaries of the date of grant.
Retirement Plans: RRSP (Canadian employees)	Provide retirement savings.	RRSP – Company matches 100% of the employee’s contribution up to 5% of base salary.
Health Plan Benefits	Provide security to employees and their dependents pertaining to health and welfare risks.	Coverage includes medical and dental benefits, short- and long-term disability insurance, life insurance and employee assistance plan.

Annual Compensation Decision-Making Process

Each year, the executive team establishes goals and initiatives for the upcoming year that include key priorities. The CEO presents these goals and initiatives to the Board for approval. Similarly, the CEO and the Chair of the Compensation Committee work together to establish goals for the CEO for the upcoming fiscal year and the CEO follows a process similar to the other NEOs.

-26-

Performance relative to these goals is reviewed at year-end and performance ratings are determined for the Company by the Board, for the CEO by the Compensation Committee and for each of the other NEOs by the CEO. These performance ratings are used in making decisions and calculations related to base salary increases, annual incentive payouts and stock-based grants.

The Board can exercise discretion in determining the appropriate performance rating for the Company and executive officers based on their evaluation of performance against goals set at the beginning of the year.

The Compensation Committee makes a recommendation to the Board regarding the CEO’s base salary, annual incentive payout and stock-based grant. The Compensation Committee also reviews the performance and compensation recommendations for the NEOs by the CEO and makes the final determination regarding the same. In 2019, the Compensation Committee reviewed the performance of both the CEO and CFO given the small size of the executive team and made a recommendation to the Board.

Base salary increases are effective January 1^st of each year and annual incentive payments are usually paid out shortly after each performance cycle. The Company’s performance cycle is aligned with its fiscal year end.

Consideration of Previous Advisory Vote on Executive Compensation

The Company conducted an advisory vote on executive compensation, commonly referred to as a “Say on Pay” proposal in 2019. The Shareholders voted in favour of a non-binding resolution approving the compensation of the Company’s Named Executive Officers. The Compensation Committee took this vote result into account when reviewing compensation for our executive officers. The Shareholders voted for the non-binding Shareholder vote on compensation of the Company’s NEOs to occur every three years. In accordance with Section 951 of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Section 14A of the Exchange Act and the vote by Shareholders as to frequency in 2019, the Company will conduct its next advisory vote on executive compensation in 2022.

Risk Assessment of Compensation Policies and Practices

Annually, the Compensation Committee conducts a risk assessment of the Company’s compensation policies and practices as they apply to all employees, including all executive officers. The design features and performance metrics of the Company’s cash and stock-based incentive programs along with the approval mechanisms associated with each were evaluated to determine whether any of these policies and practices would create risks that are reasonably likely to have a material adverse effect on the Company.

As part of the review, the following characteristics of the Company’s compensation policies and practices were noted as being characteristics that the Company believes reduce the likelihood of risk-taking by the Company’s employees, including the Company’s officers and non-officers:

The Company’s compensation mix is balanced among fixed components such as salary and benefits, annual incentive payments and long-term incentives, including RSUs and stock options.

The Compensation Committee, under its charter (which is available on the Company’s website at www.trilogymetals.com), has the authority to retain any advisor it deems necessary to fulfill its obligations and has engaged the Compensation Consultant. The Compensation Consultant assists the Compensation Committee in reviewing executive compensation and provides advice to the Committee on an as needed basis.

The annual incentive program for the executive management team, which includes each of the NEOs, is approved by the Board. Individual payouts are based on a combination of financial metrics as well as qualitative and discretionary factors.

Stock-based awards are all recommended by the Compensation Committee and approved by the Board.

The Board approves the compensation for the President and CEO based upon a recommendation by the Compensation Committee comprised of all independent directors.

A “Say on Pay” proposal is put before the Shareholders every three years.

The nature of the business in which the Company operates requires some level of risk taking to achieve reserves and development of mining operations in the best interest of all stakeholders. Consequently, the executive compensation policies and practices have been designed to encourage actions and behaviours directed towards increasing long term value while modifying and limiting incentives that promote excessive risk taking.

-27-

Based on this assessment, it was concluded that the Company’s compensation policies and practices do not create risks that are reasonably likely to have a material adverse effect on the Company.

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.

Peer Group

The Company retains the Compensation Consultant to assist the Compensation Committee in determining compensation levels for each of the three main components for the Company’s directors and NEOs. The Compensation Consultant’s work encompasses a review of the Company’s executive compensation philosophies against a comparable peer group of mining companies using the publicly available filings of peer companies.

A compensation comparator group of mining companies has been developed using the following ideal criteria:

head office in North America;

exploration/development phase;

market cap between C$175 - 700 million;

projects focused in North America (or low risk jurisdictions);

common shares listed on US and/or Canadian stock exchange; and

stand-alone company with full-time executives in leadership roles.

The Company considers the above selection criteria to be relevant because the criteria reflect the types of companies and the market in which the Company primarily competes for talent.

Based upon considerations of company size, stage of development and operating jurisdictions, the following peer comparators were selected.

Alexco Resource Corp.	Premier Gold Mines Ltd.
Corvus Gold Inc.	Polymet Mining, Inc.
Excelsior Mining Corp.	Sabina Gold & Silver Corp.
Gold Standard Ventures Corp.	Seabridge Gold Inc.
Josemaria Resources Inc. (formerly, NGEx Resources Inc.)	TMAC Resources Inc.
Nevada Copper Corp.	Victoria Gold Corp.
Osisko Mining Inc.	Wesdome Gold Mines Ltd.
Midas Gold Corp.

(collectively, the “Peer Group”)

Compensation Elements

After compiling information based on salaries, bonuses and other types of cash and equity-based compensation programs obtained from the public disclosure records of the Peer Group, the Compensation Consultant reported its findings to the Compensation Committee. The Compensation Consultant made recommendations to the Compensation Committee regarding compensation targets for NEOs.

SEC Form DEF 14A filed by Trilogy Metals Inc.