<PAGE>
Getchell Gold Corporation
5460 South Quebec Street
Suite 240
Englewood, Colorado 80111
Dear Shareholder:
You are cordially invited to attend the Company's annual meeting on Friday,
May 2, 1997. The meeting will begin promptly at 10:00 a.m. local time at Embassy
Suites Hotel, 10250 E. Costilla Avenue, Englewood, Colorado.
You are urged to consider the enclosed materials and to sign and return
your proxy promptly in the enclosed, postage prepaid envelope, even if you plan
to attend the meeting. Any stockholder giving a proxy has a right to revoke it
at any time before it is voted.
The official Notice of Meeting, proxy statement and form of proxy are
included with this letter. The matters listed in the Notice of Meeting are
described in detail in the proxy statement.
The vote of every shareholder is important. Please sign, date and
promptly mail your proxy. The Board of Directors and management look forward to
greeting those shareholders who are able to attend.
Sincerely,
Donald S. Robson
Secretary
<PAGE>
Getchell Gold Corporation
5460 South Quebec Street
Suite 240
Englewood, Colorado 80111
March 20, 1997
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
The annual meeting of shareholders of Getchell Gold Corporation will be
held at Embassy Suites Hotel, 10250 E. Costilla Avenue, Englewood, Colorado, on
Friday, May 2, 1997, at 10:00 a.m. local time, for the following purposes:
(1) To elect three Directors of Getchell Gold Corporation to serve for a term
of three years and until their successors are duly elected and qualified;
(2) To amend the Company's Certificate of Incorporation to increase authorized
common share capital from 50,000,000 shares to 100,000,000 shares;
(3) To ratify the appointment of KPMG Peat Marwick LLP as independent auditors
for 1997; and
(4) To transact such other business as may be properly brought before the
meeting.
By Order of the Board of Directors,
Donald S. Robson
Secretary
<PAGE>
Getchell Gold Corporation
Proxy Statement
March 20, 1997
This proxy statement is furnished in connection with the solicitation
of proxies on behalf of the Board of Directors of Getchell Gold Corporation
("the "Company") for the annual meeting of shareholders (the "Annual Meeting")
to be held on Friday, May 2, 1997. Only shareholders of record at the close of
business on March 12, 1997 are entitled to notice of and to vote at the meeting.
Returning your completed proxy will not prevent you from voting in
person at the meeting should you be present and wish to do so. Stockholders may
revoke their proxies by delivering a written notice of revocation to the
Secretary of the Company at any time prior to the exercise thereof, by the
execution of a later-dated proxy by the same person who executed the prior proxy
with respect to the same shares or by attendance at the Annual Meeting and
voting in person by the person who executed the prior proxy.
The enclosed proxy is being solicited by the Board of Directors of the
Company. The solicitation will be primarily by mail but may also include
telephone, telegraph or oral communication by officers or regular employees of
the Company. Officers and employees will receive no additional compensation in
connection with the solicitation of proxies. Morrow and Co. Inc. will perform
services related to distribution of proxy materials to banks, brokerage houses
and other nominee holders for an approximate fee of $6,000. All costs of
soliciting proxies will be borne by the Company.
All proxies will be voted as specified. In the absence of specific
instructions, proxies will be voted FOR:
(1) the election of three Directors of the Company to serve for a term of three
years and until their successors are duly elected and qualified;
(2) the amendment of the Company's Certificate of Incorporation to increase
authorized common share capital from 50,000,000 shares to 100,000,000
shares;
(3) ratification of the appointment of KPMG Peat Marwick LLP as independent
auditors of the Company for 1997; and
(4) approval of all other matters by the persons named in the proxies in
accordance with their judgment.
* PLEASE SIGN YOUR NAME EXACTLY AS IT APPEARS ON THE PROXY. STOCKHOLDERS
RECEIVING MORE THAN ONE PROXY BECAUSE OF SHARES REGISTERED IN DIFFERENT NAMES OR
ADDRESSES MUST COMPLETE AND RETURN EACH PROXY IN ORDER TO VOTE ALL SHARES TO
WHICH ENTITLED.
<PAGE>
OUTSTANDING SHARES AND VOTING RIGHTS
Record Date. Stockholders of record at the close of business on March 12, 1997
(the "Record Date"), are entitled to notice of and to vote at the Annual Meeting
or any adjournment thereof.
Shares Outstanding. As of March 12, 1997, a total of 25,765,871 shares of the
Company's Common Stock (the "Common Stock") were outstanding and entitled to
vote.
Voting Rights and Procedures. Each outstanding share of Common Stock is entitled
to one vote on all matters submitted to a vote of stockholders. The Company's
Bylaws require the presence, in person or by proxy, of a majority of the
outstanding shares of Common Stock entitled to vote to constitute a quorum to
convene the Annual Meeting. Shares represented by proxies that reflect
abstentions or "broker non-votes" (i.e., shares held by a broker or nominee
which are represented at the meeting, but with respect to which such broker or
nominee is not empowered to vote on a particular proposal) will be counted as
shares that are present and entitled to vote for purposes of determining the
presence of a quorum.
Stockholder Proposals for the 1998 Annual Meeting. Proposals from stockholders
intended to be included in the Company's proxy statement for the 1998 Annual
Meeting must be received by the Secretary of the Company on or before September
30, 1997, and may be omitted unless the submitting stockholder meets certain
requirements. It is suggested that the proposal be submitted by certified mail,
return-receipt requested.
ELECTION OF DIRECTORS
(Proposal No. 1)
The Company's Certificate of Incorporation and Bylaws authorize a Board
comprised of not less than one nor more than fifteen members. Within the limits
specified above, the number of Directors is determined by a resolution of the
Board or by the stockholders at the Annual Meeting. Pursuant to a resolution
adopted by the Board, the authorized number of members of the Board has been set
at ten. The Bylaws provide that no person would be elected to serve on the Board
after attaining the age of sixty-nine and that any Director elected after June
13, 1996 would be required to tender his resignation upon attaining the age of
70. The Board is divided into three classes designated as Class 1, Class 2 and
Class 3, each of which is to be as nearly equal in number as possible. Normally,
each Director serves for a term ending on the date of the third Annual Meeting
following the meeting at which such Director was elected. However, if a Director
is being elected to replace a Director who has resigned for any reason, the
newly elected Director will be elected to serve the remainder of the replaced
Director's term.
Set forth below for each nominee for election as a Director and for
each continuing Director who is not a nominee, based on information supplied by
him, are his name, age as of the date of the Annual Meeting, any presently held
positions with the Company, principal occupation now and for the past five
years, other Directorships in public companies and tenure of service with the
Company as a Director.
<PAGE>
Nominees for Election as Directors
R. Michael Summerford is Vice President and Chief Financial Officer of
ChemFirst Inc. (formerly First Mississippi Corporation) ("ChemFirst") and has
been since 1988. He is a member of the Audit, Budgeting and Finance Committee.
Mr. Summerford is also a Director of Melamine Chemicals, Inc.
Director Since: 1987
Term of Office: Three Years
Age: 48
J. Kelley Williams is Chairman of the Board of the Company and has been
since October 1987. He is the Chairman of the Board and Chief Executive Officer
of ChemFirst and has been since November 1988. He is also a Director of Deposit
Guaranty Corporation and Deposit Guaranty National Bank.
Director Since: 1987
Term of Office: Three Years
Age: 63
Allen S. Winters is a consultant for various mining companies. He retired
in 1995 as Vice President of Homestake Mining Company and General Manager of
Homestake Mine. From 1988-1992, he was Vice President U.S. Operations of
Homestake Mining Company. He is a member of the Audit, Budgeting and Finance
Committee.
Director Since: 1996
Term of Office: Three Years
Age: 56
Continuing Directors
Walter A. Drexel is a private investor. From September 1987 to June 1996,
he was part owner of the Chicago Central and Pacific Railroad. Mr. Drexel
retired in 1987 as Vice-Chairman, Burlington Northern Inc. He is a member of the
Audit, Budgeting and Finance Committee.
Director Since: 1995
Term Expires: 1999
Age: 66
Robert C. Horton is a self-employed mining consultant. He is the Associate
Dean Emeritus of the Mackay School of Mines at the University of Nevada, Reno.
He is a member of the Compensation, Human Resource and Director Affairs
Committee.
Director Since: 1988
Term Expires: 1998
Age: 70
<PAGE>
Pete Ingersoll is the principal partner of Ingersoll, Parker & Longabaugh,
a mining consulting firm. From July 1987 to December 1992, he was Senior Vice
President, Metals and Mining, in the Equity Research Department of Lehman
Brothers Inc. He is a member of the Compensation, Human Resource and Director
Affairs Committee.
Director Since: 1994
Term Expires: 1998
Age: 66
John Racich retired in 1989 as Senior Vice President and Chief Financial
Officer of Placer Dome Inc., a gold mining company. He is Chairman of the Audit,
Budgeting and Finance Committee.
Director Since: 1996
Term Expires: 1999
Age: 61
Charles E. Stott, Jr. is a mining consultant. From 1994-1995, he was
President and Chief Executive Officer of Gold Capital Corporation, a gold mining
company. From 1993-1994, he was Executive Vice President, American Mine Services
Inc., a mining contracting and engineering firm. From 1990-1993, he was
President and Chief Executive Officer of Horizon Resources Corporation, a gold
mining company. He is a member of the Compensation, Human Resource & Director
Affairs Committee.
Director Since: 1996
Term Expires: 1999
Age: 63
G. W. Thompson has been President and Chief Executive Officer of the
Company since September 1994. He was a private investor and consultant in the
mining business from May 1992 until September 1994. He was President and Chief
Executive Officer of Meridian Minerals Company, a subsidiary of Burlington
Resources Inc., from 1983 to May 1992.
Director Since: 1994
Term Expires: 1998
Age: 55
Robert L. Zerga has been self-employed since January 1995. From July 1990
to November 1994, he served as Chief Executive Officer and Chairman of the Board
of Independence Mining Company Inc., a gold mining company which is an indirect
wholly-owned subsidiary of Minorco Inc. During the same time period, he served
as Vice President and director of Minorco (U.S.A.) Inc., a gold mining company
and subsidiary of Minorco Inc. He is Chairman of the Compensation, Human
Resource and Director Affairs Committee.
Director Since: 1995
Term Expires: 1999
Age: 56
<PAGE>
Director Compensation
In 1996, the Chairman of the Board was compensated for his services
with an annual retainer of $22,500. Other Directors who are not employees of the
Company (together with the Chairman, "Outside Directors") were compensated for
their services with an annual retainer of $7,500. In addition, all Outside
Directors received $750 per day for attendance at board meetings, and an
additional $500 per day of attendance at committee meetings, $750 per day for
special service requests made by the Chairman of the Board or the Chief
Executive Officer and $250 per day for travel. No compensation in addition to
his regular salary and benefit is payable to the Chief Executive Officer for his
services as a Director.
On November 16, 1995 the Board of Directors adopted, and on June 13,
1996 the stockholders approved, a new Stock Option Plan for Outside Directors
(the "Directors' Stock Option Plan"). Each person who is elected or appointed as
an Outside Director automatically receives on the date of such election or
appointment a non-qualified stock option ("NQSO") grant to purchase the number
of shares of Common Stock equal to $22,500 divided by one-third of the closing
price of the Common Stock on such date. Individuals who were Outside Directors
at the time the Directors' Stock Option Plan was adopted by the Board of
Directors received such an NQSO on the date of adoption by the Board, subject to
stockholder approval. Following such initial grant, each such Outside Director
who serves until the third, sixth and ninth anniversaries of the initial date of
grant will automatically receive an NQSO to purchase an additional number of
shares of Common Stock equal to $22,500 divided by one-third of the closing
price of the Common Stock on the date of grant on each such anniversary at an
aggregate option price equal to the fair market value of the Common Stock on the
date of grant, so long as the person is an Outside Director at the close of
business on the date of such anniversary. An option will be exercisable with
respect to one-third of the shares subject to the option on the anniversary of
the date of grant and an additional one-third on each of the two succeeding
anniversaries. Options granted under the Directors' Stock Option Plan shall
expire five years after the date of grant.
Board Meetings and Committees
The Board of Directors met six times during the year ended December 31,
1996. All Directors of the Company attended at least 75% of the meetings of the
Board of Directors and committees on which they served. The Board of Directors
has the following two committees:
The AUDIT, BUDGETING AND FINANCE COMMITTEE, which met six times during
the year ended December 31, 1996, consists of four Outside Directors and has
broad latitude for inquiry into all operations of the Company. Its primary
responsibilities include recommendation to the Board on the selection of
independent auditors; review of audit reports prepared by independent auditors,
internal auditors, independent engineers, insurance auditors and other
consultants engaged by the Company to examine specific areas of corporate
operations; examination of the adequacy of compliance with various governmental
regulations and corporate policies and procedures; and review and approval of
quarterly financial statements. The members of the Audit, Budgeting and Finance
Committee are: Walter Drexel, John Racich (Chairman), R. Michael Summerford and
Allen Winters.
<PAGE>
The COMPENSATION, HUMAN RESOURCE & DIRECTOR AFFAIRS COMMITTEE, which
met nine times during the year ended December 31, 1996, consists of four Outside
Directors and is charged with the responsibility of recommending to the Board of
Directors a program of overall compensation for executive officers and other key
employees, setting broad human resources policy, nominating directors for
service and handling corporate governance issues. The members of the
Compensation, Human Resource & Director Affairs Committee are: Robert Horton,
Pete Ingersoll, Charles Stott Jr. and Robert Zerga (Chairman).
Vote and Recommendation
Directors are elected by vote of a plurality of the shares of voting
stock present and entitled to vote, in person or by proxy, at the Annual
Meeting. Abstentions or broker non-votes as to the election of Directors will
not affect the election of the candidates receiving the plurality of votes.
Unless instructed to the contrary, the shares represented by the proxies will be
voted FOR the election of the nominees named above as Directors. Although it is
anticipated that each nominee will be able to serve as a Director, should any
nominee become unavailable to serve, the proxies will be voted for such other
person or persons as may be designated by the Company's Board of Directors.
THE BOARD RECOMMENDS A VOTE "FOR" THE NOMINEES.
INCREASE IN AUTHORIZED COMMON SHARE CAPITAL
(Proposal No. 2)
Presently, the Company's authorized capital stock consists of
50,000,000 shares of Common Stock, par value $0.0001 per share and 10,000,000
shares of Preferred Stock, par value $0.0001 per share. As of the Record Date,
the Company had outstanding 25,780,871 shares of Common Stock and no shares of
Preferred Stock. As of the Record Date, a total of 1,615,129 shares of Common
Stock were reserved for issuance upon the exercise of options granted pursuant
to the Company's long-term incentive plans.
In February 1997, the Board of Directors of the Company authorized an
amendment to Article IV Section (1) of the Company's Certificate of
Incorporation to increase the authorized number of shares of Common Stock from
50,000,000 to 100,000,000, subject to stockholder approval. The text of Article
IV Section (1) as so amended is set forth in Appendix A to this Proxy
Statement.
Under the proposed amendment, the number of authorized shares of Common
Stock would be increased from 50,000,000 to 100,000,000 shares which would leave
the Company with 72,604,000 Shares of Common Stock authorized, unissued and not
reserved for issuance. The Board of Directors believes it is advisable for the
Company to have an increased number of shares of Common Stock which would be
available for future issuance for various corporate purposes at the discretion
of the Board of Directors and without further authorization by the stockholders.
While the Board of Directors has no present arrangements, agreement or plan to
issue any of the proposed additional authorized shares of Common Stock, it may
<PAGE>
use the additional Common Stock for a variety of corporate purposes. Such
purposes might include, without limitation, the issuance and sale of Common
Stock (i) in connection with stock splits and dividends, (ii) as part or all of
the consideration required to be paid for acquisition of ongoing businesses or
other assets, (iii) in public or private offerings as a means of obtaining
additional capital to strengthen the Company and expand its business, (iv) to
satisfy current or future obligation of the Company, whether or not relating to
financings or (v) with respect to existing or new employee benefit or stock
ownership plans or employment agreements. The proposed increase in the number of
shares of Common Stock will not change the number of shares of stock outstanding
or the rights of the holders of such stock. Stockholders do not have preemptive
rights to acquire the Common Stock authorized by this amendment.
Although the Board of Directors believes that it is in the best
interest of the stockholders for the Board of Directors to have the flexibility
to issue additional shares of Common Stock in any or all of the above
circumstances, the issuance of additional shares of Common Stock could, in
certain instances, discourage an attempt by another person or entity to acquire
control of the Company. The issuance of additional Common Stock, whether or not
in connection with a contest for control, would, in most instances, dilute the
voting power of each stockholder, and may dilute earnings and book value on a
per share basis.
THE BOARD RECOMMENDS A VOTE "FOR" THE INCREASE IN AUTHORIZED COMMON SHARE
CAPITAL.
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
(Proposal No. 3)
The accounting firm of KPMG Peat Marwick LLP ("Peat Marwick") has been
approved by the Board of Directors, upon recommendation by the Audit, Budgeting
and Finance Committee, to serve as independent auditors of the Company for 1997,
subject to approval by the stockholders by an affirmative vote of a majority of
the outstanding shares of the Company's Common Stock represented at the Annual
Meeting.
Peat Marwick has served as independent auditors of the Company for the
past nine years. The Company has been advised that neither Peat Marwick nor any
of its members or associates has any relationship with the Company or any of its
affiliates, except in the firm's capacity as the Company's independent auditors.
Representatives of Peat Marwick will be present at the Annual Meeting, will be
afforded an opportunity to make a statement if they desire and will be available
to respond to appropriate questions from stockholders.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE RATIFICATION OF THE
APPOINTMENT OF KPMG PEAT MARWICK LLP.
<PAGE>
SECURITY OWNERSHIP OF MANAGEMENT AND PRINCIPAL STOCKHOLDERS
The following table sets forth as of December 31, 1996, the number and
percentage of the outstanding shares of Common Stock which, according to the
information supplied to the Company, were beneficially owned by (i) each person
who is currently a Director of the Company, (ii) each Named Executive Officer
(as defined below), (iii) all current Directors and Executive Officers of the
Company as a group and (iv) each person who, to the knowledge of the Company, is
the beneficial owner of more than 5% of the outstanding Common Stock. Except as
otherwise indicated, the persons named in the table have sole voting and
dispositive power with respect to all shares beneficially owned, subject to
community property laws where applicable.
<PAGE>
<TABLE>
<CAPTION>
Debenture
Options
and/or Total Common
NQSOs Stock
Beneficially Percent Common Stock Beneficially Percent
Name and Address of Beneficial Owned (1) of Owned (2) of
Owner Class Class
----------------------------------- ----------- -------- ------------- -------------- --------
<S> <C> <C> <C> <C> <C>
Directors and Named
Executive Officers (3):
Walter Drexel 1,000 *
Robert C. Horton 1,500 (4)
1989-B Series 1,000 100%
1990-C Series 1,000 100%
1991-B Series 1,000 100%
1992-A Series 1,000 100%
1993-A Series 1,000 100%
NQSOs 1,110 7,610 *
Pete Ingersoll
1994-A Series 1,000 100%
NQSOs 1,110 2,110 *
Donald O. Miller - NQSOs 16,000 16,000 *
Richard F. Nanna 191
1988-A Series 3,500 100%
1989-A Series 1,000 100%
1990-A Series 2,000 100%
NQSOs 20,427 27,118 *
John Racich 300 300 *
Donald S. Robson - NQSOs 24,800 24,800 *
R. David Russell - NQSOs 43,000 43,000 *
Charles E. Stott, Jr. 250 250 *
R. Michael Summerford 20,735
NQSOs 1,110 21,845 *
G. W. Thompson 10,000
NQSOs 111,000 121,000 *
J. Kelley Williams 610,685 (5)
NQSOs 1,110 611,795 2.4%
Allen S. Winters 100 100 *
Robert L. Zerga - NSQOs 1,110 1,110 *
All Current Directors and
Executive Officers as a Group (15
persons) (6) 665,161
1988-A Series 3,500 100%
1989-A Series 1,000 100%
1989-B Series 1,000 100%
1990-A Series 2,000 100%
1990-C Series 1,000 100%
1991-B Series 1,000 100%
1992-A Series 1,000 100%
1993-A Series 1,000 100%
1994-A Series 1,000 100%
NQSOs 225,174 902,835 3.5%
5% Beneficial Holders:
FMR Corp. (7) 3,860,445 3,860,445 14.98%
82 Devonshire Street
Boston, MA 02109
</TABLE>
* Represents less than one percent of class.
<PAGE>
(1) Numbers represent shares of Common Stock of the Company underlying the
Convertible Subordinated Debentures and NQSOs beneficially owned by the
Directors and Named Executive Officers that are exercisable within 60
days of December 31, 1996. Since more than the six months has elapsed
from date of grant, the Debentures are immediately convertible into the
specified number of shares of Convertible Preferred Stock of the same
series and then immediately convertible into the specified number of
shares of Common Stock of the Company.
(2) In connection with the Stockholder Rights Plan amended and restated on
December 31, 1996, Preferred Stock Purchase Rights are deemed to attach
to the outstanding shares of Common Stock of the Company, including
outstanding shares of Common Stock reported above as being owned by
Directors and Named Executive Officers. Under certain conditions each
right may be exercised to purchase one share of Series A Junior
Participating Preferred Stock convertible into one share of Common Stock
at an exercise price of $150 (subject to adjustment). The rights may be
exercised only after commencement of a public announcement of a tender or
exchange offer if, upon its consummation, the offeror would beneficially
own 15% or more of the Company's Common Stock. An "Acquiring Person"
trigger was also provided, making the rights exercisable if a person
holds at least 15% of the shares of Common Stock without the prior
approval of a majority of the Outside Directors of the Board. The rights,
which do not have voting rights, expire in December 2006 and may be
redeemed by the Company at a price of $0.0001 per right prior to a
specified period of time after the occurrence of certain events. In
certain events, without the consent of the majority of the Outside
Directors of the Board, including certain acquisitions of an Acquiring
Person, each right (except certain rights which are or were beneficially
owned by 15% or more owners, or an Acquiring Person, which rights are
voided) will entitle its holder to purchase shares of Junior
Participating Preferred Stock convertible into one share of Common Stock
with a value of twice the then current exercise price. If, following an
acquisition of 20% or more of the shares of Common Stock, the Company is
acquired in a merger or other business combination or sells 50% of its
assets or earnings power, each right (other than rights voided as above)
will entitle its holder to purchase stock of the acquiring company with a
value of twice the then current exercise price.
(3) A mailing address for Messrs. Drexel, Horton, Ingersoll, Miller, Nanna,
Racich, Robson, Russell, Summerford, Thompson, Williams, Winters and
Zerga is c/o Getchell Gold Corporation, 5460 S. Quebec Street, Suite 240,
Englewood, Colorado 80111.
(4) Included are 500 shares owned by Mrs. Horton, of which Mr. Horton has no
voting and investment power and disclaims beneficial ownership.
(5) Includes 43,747 shares held by the Jean Pittman Williams Revocable Trust,
of which Mr. Williams' wife is trustee and of which Mr. Williams
disclaims beneficial ownership and has no voting or investment power; and
116,895 shares held by JKW Holdings, Inc. of which Mr. Williams has
shared voting and investment power.
(6) Except as otherwise indicated in these notes, the shares beneficially
owned by the persons indicated in the table represent sole voting and
investment power.
(7) Based on a Schedule 13G filed by the investor with the Securities and
Exchange Commission.
<PAGE>
EXECUTIVE OFFICERS OF GETCHELL GOLD CORPORATION
The following sets forth certain information with respect to the
Executive Officers of the Company, including age as of the date of the Annual
Meeting. All Executive Officers are elected by the Board of Directors and hold
office until the next Annual Meeting of Stockholders and until their successors
are elected and qualify.
J. Kelley Williams is the Chairman of the Board. (See "Election of Directors"
for further information).
G. W. Thompson is the President and Chief Executive Officer. (See "Election of
Directors" for further information).
R. David Russell has been Vice President and Chief Operating Officer since
February 1995. He was General Manager of Lac Minerals U.S.A. Ltd., a gold mining
company and wholly owned subsidiary of Lac Minerals Ltd., from April 1994 to
February 1995. From June 1993 to April 1994, he was a Manager at Independence
Mining Company, a gold mining company and a subsidiary of Minorco Inc. From
September 1992 to June 1993, he was a Manager at Hecla Mining Company, a
diversified mining company. From August 1988 to April 1992, he was General
Manager at the Lincoln Mine, owned by Meridian Minerals.
Age: 40
Donald S. Robson is Vice President and Chief Financial Officer of the Company
and has been since March 1995 and has been Corporate Secretary since October
1995. From May 1990 to September 1994, he was Vice President, Finance of Lac
Minerals Ltd., a gold mining company.
Age: 44
Donald O. Miller is the Vice President - Human Resources & Administration and
has been since April 1995. From January 1993 to April 1995, Mr. Miller had his
own consulting firm, GEM 2000, at which he consulted on human resources issues,
primarily in the mining industry. From May 1991 to January 1993, he was the Vice
President, Human Resources at Newmont Mining Company, a mining company. From
November 1988 to May 1991, he was the Manager, Compensation and Benefits at
Cyprus Minerals Company, a major producer of copper, coal and molybdenum.
Age: 50
Richard F. Nanna is the Vice President, Exploration of the Company and has been
since August 1991.
Age: 48
Roger D. Palmer is the Controller of the Company and has been since April 1995.
From June 1992 to December 1993, Mr. Palmer held the positions of Assistant
Controller and Manager, Financial Planning and Analysis with the Company. From
June 1989 to June 1992, Mr. Palmer was a Division Controller at OESI Power
Corporation, a geothermal energy company.
Age: 47
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth certain information regarding the annual
and long-term compensation for services in all capacities to the Company for the
year ended December 31, 1996 ("1996"), the six months ended June 30, 1995 (the
"1995IP" or "Interim Period"), and the years ended June 30, 1995 ("1995") and
June 30, 1994 ("1994") of those persons who were either (I) the chief executive
officer of the Company during the last completed fiscal year or (ii) one of the
other four most highly compensated executive officers of the Company as of the
end of the last completed fiscal year whose annual salary and bonuses exceeded
$100,000 (collectively, the "Named Executive Officers").
<TABLE>
<CAPTION>
Summary Compensation Table
Annual Compensation Long-Term
Compensation
--------------------------------------- ---------------------
Other Restricted Securities
Annual Stock Underlying All Other
Salary Bonus Compensation Awards Option Compensation
Name and Principal Year ($) ($) (1) ($) ($) Awards (3) ($)
Position (2)
- - ----------------------- ----------- ---------- ------------ ------------- --------- --------- ----------------
<S> <C> <C> <C> <C> <C> <C> <C>
G.W. Thompson 1996 300,000 127,500 - - - 104,384(8)(9)(10)
President and Chief 1995 IP (4) 100,000 133,000 (6) - - 105,000 32,633 (8)(9)(10)
Executive Officer 1995 (4) 167,000 - (6) - 65,000(7) 90,000 3,008 (8)(9)
R. David Russell 1996 175,000 - (5) - - - 32,993 (8)(9)(10)
Vice President and 1995 IP (4) 69,996 63,000 (6) - - 45,000 21,585 (8)(9)(10)
Chief Operating 1995 (4) 55,321 - (6) - - 34,000 218 (9)
Officer
Donald S. Robson 1996 140,000 - (5) 42,914 (11) - - 13,277 (8)(9)(10)
Vice President and 1995 IP (4) 62,500 50,000 (6) - - 24,000 23,666 (8)(9)(10)
Chief Financial 1995 (4) 33,654 - (6) - - 22,059 216 (9)
Officer
Donald O. Miller 1996 110,000 - (5) 24,267 (12) - - 3,591 (9)
Vice President, 1995 IP (4) 49,998 30,000 (6) - - 15,000 705 (9)
Human Resources 1995 (4) 20,512 - (6) - - 13,954 351 (9)
Richard F. Nanna 1996 92,947 - 317,779 (13) - 15,000 4,198 (8)(9)
Vice President, 1995 IP (4) 45,114 13,950 - - - 2,403 (8)(9)
Exploration 1995 90,228 27,200 - - 8,187 4,804 (8)(9)
1994 88,920 55,300 - - 7,300 4,765 (8)(9)
</TABLE>
<PAGE>
(1) Other Annual Compensation included direct cash payments related to tax
reimbursement payments, tax planning and tax return preparation services
provided to the Named Executive Officer at the Company's expense, and tax
reimbursements paid on imputed income resulting from the personal use of
Company automobiles and club dues and memberships, including imputed
income on the same, but only if such payments exceed the lessor $50,000
or 10% of the total salary and bonus of the Named Executive Officer. Tax
reimbursement payments are pursuant to a plan providing for payment to
eligible employees of thirty-seven percent of the Company's federal
income tax deduction resulting from the exercises of Convertible
Subordinated Debentures and NQSOs.
(2) Represents NQSOs granted under the Company's Long-Term Equity
Incentive Plans.
(3) All Other Compensation is comprised of Company contributions related to
the 401(k) Plan, relocation expenses and executive life insurance paid by
the Company on the Executive Officer's behalf.
(4) In September 1995, the Company converted from a fiscal year ended June 30
to a fiscal year ended December 31. For Messrs. Thompson, Russell, Robson
and Miller 1995 amounts represent compensation from the date of hire
through June 30, 1995. These dates were September 1, 1994 for Mr.
Thompson, February 6, 1995 for Mr. Russell, March 21, 1995 for Mr. Robson
and April 17, 1995 for Mr. Miller. For all Name Executive Officers the
1995 IP amounts represent compensation from July 1, 1995 through December
31, 1995.
(5) The bonus earned for the year ended December 31,1996 to be paid in 1997,
had not been calculated as of February 27, 1997.
(6) Mr. Thompson's bonus was calculated for a 16-month period (September 1994
through December 1995), incorporating performance for the the year ended
June 30, 1995 and the Interim Period. The bonuses of Messrs. Russell,
Robson and Miller were based on a period from their respective dates of
hire in 1995 through December 31, 1995. These bonuses were all paid in
the year ended December 31, 1996.
(7) Includes 10,000 shares of restricted stock issued to Mr. Thompson upon
being named President and Chief Executive Officer, of which he has sole
voting and investment power. All of the shares vested on February 21,
1996.
(8) Company contributions related to the 401(k) Plan for the year ended
December 1995 were $10,053 for Mr. Thompson, $6,766 for Mr. Russell,
$9,627 for Mr. Robson and $3,718 for Mr. Nanna. For the Interim Period,
Company contributions were $3,078 for Mr. Thompson, $466 for Mr. Russell,
$1,155 for Mr. Robson and $1,828 for Mr. Nanna. For the year ended June
30, 1995, Company contributions were $2,000 for Mr. Thompson and $3,655
for Mr. Nanna. For the year ended June 30, 1994, Company contributions
were $3,557 for Mr. Nanna.
(9) Executive Life Insurance paid by the Company for the year ended December
31, 1996 was $16,547 for Mr. Thompson, $2,120 for Mr. Russell, $1,663 for
Mr. Robson, $3,591 for Mr. Miller and $480 for Mr. Nanna. Executive Life
Insurance paid by the Company for the Interim Period was $2,625 for Mr.
Thompson, $261 for Mr. Russell, $324 for Mr. Robson, $705 for Mr. Miller
and $575 for Mr. Nanna. Executive Life Insurance paid by the Company in
the year ended June 30, 1995 was $1,008 for Mr. Thompson, $218 for Mr.
Russell, $216 for Mr. Robson, $351 for Mr. Miller and $1,149 for Mr.
Nanna. Executive Life Insurance paid in year ended June 30, 1994 was
$1,208 on behalf of Mr. Nanna.
(10) Relocation expenses paid by the Company during the year ended December
31, 1996 on behalf of Mr. Thompson were $77,784, on behalf of Mr. Russell
were $24,107 and on behalf of Mr. Robson were $1,987. Relocation expenses
paid by the Company during the Interim Period on behalf of Mr. Thompson
were $26,930, on behalf of Mr. Russell were $20,858 and on behalf of Mr.
Robson were $22,187.
(11) Includes direct cash payments related to tax reimbursement payments of
$26,316, tax planning and tax return preparation services at the
Company's expense of $6,641, and tax reimbursements paid on imputed
income resulting from the personal use of Company automobiles of $4,560
and club dues and memberships of $5,397, including imputed income on the
same.
(12) Includes direct cash payments related to tax reimbursement payments of
$12,884, tax planning services at the Company's expense of $2,398, and
tax reimbursements paid on imputed income resulting from the personal use
of Company automobiles of $4,748 and club dues and memberships of $4,237,
including imputed income on the same.
(13) Includes direct cash payments related to tax reimbursement payments of
$316,674 and tax reimbursements paid on imputed income resulting from the
personal use of Company automobiles of $1,105, including imputed income
on the same.
<PAGE>
The following table sets forth certain information with respect to grants
of stock options to Named Executive Officers during the year ended December 31,
1996.
<TABLE>
<CAPTION>
Potential Realizable Value at
Number of % of Total Assumed Annual Rates of Stock
Securities Options Exercise Price Appreciation for Option
Underlying Granted to Price Expiration Term (3)
Options Granted All ($/Share) Date
(1) Employees (2)
--------------------------------
Name 5% 10%
-------------- ----------------- -------------- ----------- --------------- -------------- ---------------
<S> <C> <C> <C> <C> <C> <C>
R. F. Nanna 15,000 3% $30.75 April 30, 2006 $290,076 $735,113
</TABLE>
(1) All options granted represent NQSOs that vest over four years from the
date of grant at a rate of 20% in the first three years and 40% in the
final year. All options were granted for a term of ten years, subject to
earlier termination in certain events. The exercise price is equal to the
fair market value of the Company's Common Stock on the date of grant.
(2) Based on 559,800 total options granted in the year ended December 31,
1996.
(3) The amounts shown are for illustrative purposes only. Potential gains are
net of the exercise price. Amounts represent hypothetical gains that
could be achieved for the respective options if exercised at the end of
the option term. The assumed 5% and 10% rates of stock price appreciation
are provide in accordance with the rules of the Securities and Exchange
Commission and do not represent the Company's estimate or projection of
the future Common Stock price. Actual gains, if any, on stock option
exercises are dependent upon the future financial performance of the
Company, overall market conditions and the option holders' continued
employment through the vesting period. This table does not take into
account any appreciation in the price of the Common Stock from the date
of grant to the date of this Proxy Statement other than the columns
reflecting assumed rates of appreciation of 5% and 10%.
The following table sets forth certain information with respect to the
Named Executive Officers concerning the exercise of options in 1996 and
unexercised options held at December 31, 1996.
<TABLE>
<CAPTION>
Number of Securities
Shares Underlying Unexercised Value of Unexercised
Acquired Options at In-the-Money Options at
on Value December 31, 1996 (#) December 31, 1996 (1) ($)
-------------------------- --------------------------
Name Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
(#)
----------------- ----------- --------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
G.W. Thompson 0 0 111,000 84,000 3,221,475 1,522,500
R. David Russell 0 0 43,000 36,000 1,181,000 652,500
Donald S. Robson 2,059 71,150 24,800 19,200 684,500 348,000
Donald O. Miller 954 34,821 16,000 12,000 413,500 217,500
Richard F. Nanna 20,000 855,880 26,927 0 799,259 0
</TABLE>
(1) Value was computed as the difference between the individual option price
and the closing sales price of the Company's common Stock on December 31,
1996 ($38.375). Only options with fair market value in excess of the
exercise price are reflected in this column.
<PAGE>
Other Compensation
Employees participate in a noncontributory Retirement Plan established by
the Company. Employees become 100% vested after five years of employment. The
plan provides for normal retirement at age sixty-five with actuarially adjusted
provisions for early and postponed retirement dates. Retirement benefits are
based on years of service and average compensation (wage and salary) of the five
highest consecutive years during employment. Theoretical benefits payable under
the plan are reflected in the estimated retirement plan table below and are not
subject to any reduction for social security benefits or other offset amounts.
The following table shows the estimated annual retirement benefit payable
to participating employees including Named Executive Officers in earnings and
years of service classifications as indicated.
<TABLE>
<CAPTION>
Estimated Annual Benefits for Years of Credited
Service
Average Annual Compensation ---------------------------------------------------
(Five Highest Consecutive Years) 10 Years 20 Years 30 Years 40 Years
-------------------------------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
$25,000 $4,212 $8,424 $12,136 $16,848
$50,000 8,712 17,424 26,136 34,848
$100,000 17,712 35,424 53,136 70,848
$150,000 or greater 26,712 53,424 80,136 106,848
</TABLE>
Years of service for the Named Executive Officers are: G.W. Thompson, two
years; R. David Russell, Donald S. Robson, and Donald O. Miller, one year each;
and Richard F. Nanna, fifteen years.
During the year ended June 30, 1995, the Company entered into Termination
Agreements with G.W. Thompson, R. David Russell, Donald S. Robson and Donald O.
Miller and in May 1991, the Company entered into a Termination Agreement with
Richard F. Nanna (collectively, the "Termination Agreements"). The Termination
Agreements are contingent upon a Change of Control, as defined therein, and
provide for a three-year term. Each individual would be paid upon termination
without cause within three years of a Change of Control or upon resignation
within twelve months of a Change of Control, one and one-half times the sum of
the three-year average of his annual base salary (excluding bonuses) plus fringe
benefit costs equal to thirty-six percent of his annual base salary. Upon
termination, the individual would have the option, unless he notifies the
Company otherwise, to receive a cash payment equal to the cash value of all his
NQSOs, Debenture Options and Debentures, whether then exercisable or not. No
individual would receive payments in the event of death, disability or
termination for cause. The Termination Agreements also provide for, among other
things, an additional payment to be made by the Company to the individual if any
of the severance payments provided for the Termination Agreement or any other
payments made pursuant to a Change of Control of the Company (the "Total
Payments") become subject to an additional tax ("Excise Tax") imposed by Section
4999 of the Code, such that the net of all of the payments received by the
individual after the imposition of the Excise Tax on the Total Payments and the
federal income tax on the additional payment shall be equal to the Total
Payments.
COMPENSATION, HUMAN RESOURCE & DIRECTOR AFFAIRS COMMITTEE INTERLOCKS AND
INSIDER PARTICIPATION
Messrs. Horton, Ingersoll, Stott and Zerga who are members of the
Compensation, Human Resource & Director Affairs Committee, are not now and never
have been officers or employees of the Company.
<PAGE>
REPORT OF THE COMPANY'S COMPENSATION, HUMAN RESOURCE & DIRECTOR AFFAIRS
COMMITTEE ON EXECUTIVE COMPENSATION
Committee Members. The Compensation, Human Resource & Director Affairs Committee
(the "Compensation Committee") is composed of at least two outside members of
the Board, with one member serving as chairman.
Charter. The Compensation Committee serves at the direction of the Board of
Directors. The primary responsibility of the Compensation Committee is to assure
development, implementation and maintenance of competitive compensation and
benefits to attract, motivate and retain highly qualified officers, management
and employees.
Duties. The Compensation Committee's responsibilities include the following:
(a) To recommend to the Board of Directors compensation policies for the
Company;
(b) To recommend to the Board of Directors the base salary and annual
incentive awards of executive officers of the Company;
(c) To recommend Long Term Incentive Plan participation and awards.
Philosophy. The Company's compensation philosophy is designed to maximize
stockholder value and serve the best interest of its stockholders and employees.
The philosophy incorporates the following principles:
(a) Compensation should attract and retain qualified employees and
stimulate their useful and profitable efforts on behalf of the Company.
(b) Compensation should be internally equitable and externally competitive;
and
(c) Compensation should focus on "total" compensation which is defined as
base salary, annual incentive, long-term incentive (stock), and benefits.
Components of Executive Compensation
Base Salary. The Compensation Committee annually reviews and compares base
salaries and salary ranges for similar positions in other companies in relevant
markets defined by company size, industry and location. Executive, technical and
other highly compensated positions are valued in the national market using data
developed by nationally recognized compensation consulting firms. Base salary
for these positions is targeted at the median of a peer group of companies. The
peer group is reviewed annually and generally established on the basis of market
capitalization value. Peer companies are public companies with products, markets
and other mining characteristics comparable to the Company. The published
compensation data used by the Compensation Committee to establish base salary
range is not necessarily comprised of the same peer group of companies included
<PAGE>
in the Stock Performance Graph. The Compensation Committee annually recommends
to the Board of Directors adjustments to salary ranges and actual salaries,
taking into consideration position value, market pricing, operating results,
individual performance and other factors. For the year 1996, the Compensation
Committee incorporated the national consultant's base salary midpoint
recommendations.
Annual Incentive Awards. Annual incentive awards, in the form of cash
payments, are designed to achieve specific short-term results and to further
long-term objectives. Financial and other objectives for the Company and program
participants are set at the beginning of each fiscal year. The process involves
the Board of Directors, the Compensation Committee, the Chief Executive Officer
and program participants. Each participant in the plan establishes goals and
objectives at the beginning of the fiscal year. Performance is measured at
year-end against these pre-established objectives and annual incentive awards
are determined based on performance.
The Compensation Committee annually reviews potential incentive awards
for officers as a percentage of base salary and recommends adjustments to the
Board of Directors. At fiscal year end, the Compensation Committee recommends
incentive awards to the Board of Directors upon review of Company results and
performance versus objectives and personal performance of participants versus
objectives.
Base salary and annual incentive (cash compensation) is generally
targeted at the 50th percentile of the peer group of companies.
In February 1997, the Board of Directors approved the Compensation
Committee's recommendations for annual incentive awards to three Executive
Officers, other than the Chief Executive Officer, based on their performance
versus objectives, including operating results compared to budget, reserve
addition, safety and specific Financial, Investor Relations and Human Resources
programs.
Long-Term Incentive Awards. Participation in the Company's Long-Term Incentive
Plan is generally limited to officers and key managers based on responsibility,
authority and potential impact on the Company. The Compensation Committee
annually reviews participants and potential award ranges. The opportunity range
for each participant is based on guidelines developed by nationally recognized
compensation consultants. At fiscal year end, the Compensation Committee reviews
Company condition and performance and individual performance versus long-term
goals and determines awards for officers and key managers. Awards may be in the
form of stock options, restricted stock, stock appreciation rights and
performance shares. In 1996, the Compensation Committee determined that it was
in the best interest of the Company to grant stock options to all employees as a
means of retaining and motivating individuals. This also allowed employees to
develop an ownership position, thus aligning them with the long-term goals of
both the Company and other stockholders.
In February, 1997, based on the Compensation Committee's performance
evaluations and the recommendations of a national consulting firm, the Board of
Directors approved a grant of 54,000 non-qualified stock options to three
executive officers other than the CEO.
<PAGE>
Chief Executive Officer Compensation. The Compensation Committee annually
reviews the Chief Executive Officer's performance and compensation and
recommends changes as appropriate to the Board of Directors. In its review, the
Compensation Committee considers the Company's condition, operating results,
performance versus short-term and long-term objectives, economic environment,
industry conditions and increased shareholder value. The Compensation Committee
also considers the Chief Executive Officer's performance against short-term and
long-term objectives, compensation versus peers, and other factors.
Mr. Thompson's annual incentive award objectives were compared to
performance for the year 1996. The Compensation Committee determined that the
Corporation had performed at 85% of its goal for the year. Based on the
Committee's evaluation of Mr. Thompson's performance, the Board of Directors
approved an incentive award equal to 85% of target or $127,500. The Committee
recommended, and the Board approved, an award of 58,340 non-qualified stock
options.
COMPENSATION, HUMAN RESOURCE & DIRECTOR
AFFAIRS COMMITTEE
Robert L. Zerga, Chairman
Robert C. Horton
Pete Ingersoll
Charles E. Stott, Jr.
The report of the Compensation, Human Resource & Director Affairs
Committee shall not be deemed incorporated by reference by any general statement
incorporating by reference this proxy statement into any filing under the
Securities Act of 1933, as amended, or under the Securities Exchange Act of
1934, as amended, (collectively the "Acts"), except to the extent the Company
specifically incorporates this information by reference and shall not otherwise
be deemed filed under such Acts.
<PAGE>
STOCK PERFORMANCE GRAPH
The following line graph compares the cumulative total stockholder
return on the Company's Common Stock during the five-year period ended December
31, 1996, to the Standard & Poor's Stock Index and that of peer issuers selected
by the Company for the same period. The graph assumes a one hundred dollar
investment on December 31, 1991, and reinvestment of dividends (if any) on a
quarterly basis.
[GRAPHIC OMITTED]
- - -------------------------------------------------------------------------------
12/31/91 12/31/92 12/31/93 12/31/94 12/31/95 12/31/96
- - -------------------------------------------------------------------------------
Getchell Gold $100 $188 $223 $265 $685 $1,181
- - -------------------------------------------------------------------------------
S&P 500 Index $100 $108 $118 $120 $165 $203
- - -------------------------------------------------------------------------------
Peers $100 $84 $166 $136 $151 $148
- - -------------------------------------------------------------------------------
(1) The peer group includes the following companies: Agnico-Eagle Mines,
Amax Gold Inc., Atlas Corporation, Battle Mountain Gold Co. Inc., Echo Bay
Mines, Ltd., FMC Gold Co. and Pegasus Gold Corp.
<PAGE>
OTHER INFORMATION
Section 16(a) of the Securities Exchange Act of 1934 requires Officers
and Directors of the Company and persons who own more than ten percent of a
registered class of the Company's equity securities to file reports of ownership
and changes in their ownership with the Securities and Exchange Commission and
the American Stock Exchange. Based on information provided by its Officers and
Directors, for the year ended December 31, 1996, its Officers and Directors were
in compliance with all applicable filing requirements.
FORM 10-K
The Company will provide without charge a copy of the Company's most
recent report on Form 10-K, as filed with the Securities and Exchange
Commission, upon written request to the Company's Secretary at:
Getchell Gold Corporation
5460 S. Quebec St., Suite 240
Englewood, Colorado 80111
OTHER MATTERS
As of the date of this Proxy Statement, the Board of Directors of the
Company know of no other matters which may come before the Annual Meeting.
However, if any matters other than those referred to herein should be presented
properly for consideration and action at the Annual Meeting, or any adjournment
or postponement thereof, the proxies will be voted with respect thereto in
accordance with the best judgment and in the discretion of the proxy holders.
Pleas sign the enclosed proxy and return it in the enclosed return
envelope.
Donald S. Robson
Secretary
Dated:
<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
Filed by Registrant [X]
Filed by Party other than the Registrant [ ]
Check the appropriate box:
[X] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14-6(e)(2)
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Sec. 240.14a-11(c) or 240.14a-12
Getchell Gold Corporation
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing by registration for which
the offsetting fee was paid previously. Identify the previous filing by
registration statement number, or the Form or Schedule and the date of
its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
<PAGE>
APPENDIX A
(1) Shares, Classes and Series Authorized
The total number of shares of all classes of capital stock which the
Corporation shall have authority to issue is 110,000,000 shares. Stockholders
shall not have any preemptive rights, nor shall stockholders have the right to
cumulative voting in the election of directors or for any other purpose. The
classes and the aggregate number of shares of stock of each class which the
Corporation shall have authority to issue are as follows:
A. 100,000,000 shares of Common Stock, $0.0001 par value ("Common Stock").
B. 10,000,000 shares of Preferred Stock, $0.0001 par value ("Preferred
Stock").
