NXT Energy Solutions Inc 6-K, filed Jul 7, 2023

NXT Energy Solutions Inc. (NSFDF)

6-K 2023-07-07 For: 2023-07-06

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Added on April 07, 2026

About this 6-K

NXT Energy Solutions Inc filed this 6-K on July 7, 2023.

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99.1	NXT ENERGY SOLUTIONS INC. NOTICE OF ANNUAL AND SPECIAL MEETING OF SHAREHOLDERS AND MANAGEMENT INFORMATION CIRCULAR DATED JUNE 30, 2023
99.2	NXT ENERGY SOLUTIONS INC. NOTICE OF ANNUAL AND SPECIAL MEETING OF SHAREHOLDERS
99.3	Form of Proxy

	NXT Energy Solutions Inc.
	(Registrant)

Dated: July 6, 2023	/s/ Eugene Woychyshyn
	Eugene Woychyshyn
	Vice President of Finance & CFO

1.	to receive and consider the audited financial statements of the Company for the year ended December 31, 2022, the accompanying notes thereto, and the auditor’s report in respect thereof;

2.	to elect six directors of the Company;

3.	to appoint MNP LLP, Chartered Professional Accountants, as the auditors of the Company for the ensuing year at a remuneration to be determined by the Board of Directors of the Company (the “Board”);

4.	to consider and approve the Employee Share Purchase Plan Resolution (as defined in the accompanying management information circular), the full text of which is reproduced as Schedule “A” to the accompanying Information Circular;

5.	to consider and approve the Unallocated Entitlements Resolution (as defined in the accompanying management information circular), the full text of which is reproduced as Schedule “B”;

6.	to consider and approve the Preferred Share Resolution (as defined in the accompanying management information circular); and

7.	to transact such other business as may be properly brought before the Meeting.

MANAGEMENT INFORMATION CIRCULAR		1

GENERAL INFORMATION		1

Solicitation of Proxies		1

Exercise of Discretion by Proxyholders		1

Signing of Proxy		2

Voting by Internet		2

Revocability of Proxies		2

Advice to Beneficial Shareholders		2

VOTING SECURITIES AND PRINCIPAL HOLDERS OF VOTING SECURITIES		4

PARTICULARS OF MATTERS TO BE ACTED UPON		4

Financial Statements		4

Election of Directors		4

Appointment of Auditor		5

Employee Share Purchase Plan Resolution		5

Unallocated Entitlements Resolution		6

Preferred Share Resolution		7

INTEREST OF CERTAIN PERSONS OR COMPANIES IN MATTERS TO BE ACTED ON		10

INFORMATION ON THE BOARD AND DIRECTOR NOMINEES		10

Director Nominees		10

Cease Trade Orders, Bankruptcies and Insolvencies		13

Penalties or Sanctions		14

EXECUTIVE COMPENSATION		14

Compensation Discussion and Analysis		14

Summary Compensation Table		18

Incentive Plan Awards		19

Employment Agreements		20

DIRECTOR COMPENSATION		20

Summary Compensation Table		20

Incentive Plan Awards		21

SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS		22

INDEBTEDNESS OF DIRECTORS AND EXECUTIVE OFFICERS		23

INTEREST OF INFORMED PERSONS IN MATERIAL TRANSACTIONS		23

CORPORATE GOVERNANCE		23

Corporate Governance Committee		23

Disclosure Committee		24

Strategic Planning Committee		24

Audit Committee		24

Compensation Committee		26

ADDITIONAL INFORMATION		26

Schedule “A” EMPLOYEE SHARE PURCHASE PLAN RESOLUTION		27

Schedule “B” UNALLOCATED ENTITLEMENTS RESOLUTION		28

Schedule “C” PREFERRED SHARE TERMS		29

Schedule “D” EMPLOYEE SHARE PURCHASE PLAN SUMMARY		32

Schedule “E” RESTRICTED SHARE UNIT PLAN SUMMARY		33

Schedule “F” AMENDED AND RESTATED STOCK OPTION PLAN SUMMARY		35

Schedule “G” DEFERRED SHARE UNIT PLAN SUMMARY		38

Schedule “H” STATEMENT OF CORPORATE GOVERNANCE PRACTICES		41

Schedule “I” AUDIT COMMITTEE CHARTER		45

Schedule “J” BOARD MANDATE		48

Schedule “K” EMPLOYEE SHARE PURCHASE PLAN		51

Schedule “L” RESTRICTED SHARE PLAN		67

		BY ORDER OF THE BOARD OF DIRECTORS
		“Charles Selby”
		Lead Director

	(i)	the offices of the Company at Suite 302, 3320 – 17th Avenue S.W., Calgary, AB, T3E 0B4; or

	(ii)	the offices of Computershare Trust Company of Canada (“Computershare”), at 8th Floor, 100 University Avenue, Toronto, ON, M5J 2Y1 (facsimile: 1-866-249-7775)

	(i)	the offices of the Company at Suite 302, 3320 – 17th Avenue S.W., Calgary, AB, T3E 0B4; or

	(ii)	the offices of Computershare at 8th Floor, 100 University Avenue, Toronto, ON, M5J 2Y1

Name	Approximate Number of Common Shares Beneficially Owned, or Controlled or Directed, Directly or Indirectly	Percentage of Issued and Outstanding Common Shares
MCAPM, LP	12,035,000	15.49%
Michael P. Mork	2,886,233	3.72%
Michael P. Mork Total Beneficial Ownership	14,921,233	19.21%
Estate of George Liszicasz	14,005,168	18.03%

	a.	the articles of the Corporation be amended to (i) delete in their entirety the Series 1 Preferred Shares and (ii) create a new series of voting preferred shares designated as “Series 2 Preferred Shares”, in an unlimited number, such Series 2 Preferred Shares having attached thereto the rights, privileges, restrictions and conditions as set out in Schedule C;

	b.	any one director or officer of the Corporation be and is hereby authorized and directed to do all things and to execute and deliver all documents and instruments as may be necessary or desirable to carry out the terms of this resolution; and

	c.	notwithstanding the passing of this resolution by the Shareholders, the Board of Directors of the Corporation may revoke this resolution before it is acted upon, without further approval of the shareholders of the Corporation, if the Board of Directors of the Corporation determined, in its sole and absolute discretion, that such revocation is in the best interests of such shareholders.”

Name and Municipality of Residence	Office(s) Currently Held	Principal Occupation or Employment for the Last Five Years	# of Shares Beneficially Owned ⁽¹⁾	Year became a Director

Theodore Patsellis Athens, Hellenic Republic	Director^2,6	Mr. Patsellis is a Greek attorney admitted to the Athens Bar Association in 1996, a Greek Ministry of Justice certified Mediator, and the Owner of a Law firm since 2013. He holds a Bachelor Degree from the National and Kapodistrian University of Athens - Law Faculty and an LL.M. degree from the Ludwig-Maximilian University of Munich. Having worked for many years with Ernst & Young, Hill International Inc. and other renowned law firms, Mr. Patsellis has acquired extensive experience working in diversified environments and a variety of business cultures. With a strong German background and the experience of having lived and worked in Germany, Greece, Serbia and Romania as a lawyer and tax professional, he was able to lead a team of professionals involved in large business transactions in the South-East European region. His expertise comprises M&A, Corporate, Transaction Law, Local and International taxation, Corporate Governance and Compliance. His industry knowledge ranges from the Telecommunications and Energy sectors to the Retail, Hospitality and Consumer Products, Pharmaceuticals, and Real Estate. He is currently sitting on the Board of Directors of PANA Holdings in Mauritius and Vivid Living Co. S.A. in Greece. Mr. Patsellis is a member of the Audit, and the Strategic Planning Committees.	Nil	2023

Charles Selby Calgary, AB Canada	Lead Director^2,3,5	Mr. Selby obtained a Bachelor of Science (Hons.) degree in Chemical Engineering from Queen’s University, a Juris Doctorate degree from the University of Calgary, and is a registered Professional Engineer and lawyer in the Province of Alberta. He previously practiced law for two large Canadian law firms, specializing in securities and international transactions primarily in the energy business. Mr. Selby served as Vice President of Pengrowth Corporation for almost 20 years participating in the growth of that entity to an enterprise value of more than $4 billion. He also has served as a director and officer of a number of reporting issuers in the oil and natural gas industry including Arakis Energy Corp., with operations in the Sudan. Since 2017 he is President and Director of Caledonian Midstream Corporation, a company that has natural gas and oil production together with a sour natural gas plant and infrastructure in the Alberta foothills and is also the CEO and a director of Wildcat Royalty Corporation. Recently Mr. Selby also became a board member of Innova Hydrogen Corp, a private company engaged in the pyrolysis of methane to manufacture hydrogen. Mr. Selby is the Lead Director of NXT. He is also Chair of the Compensation and Disclosure Committees and a member of the Strategic Planning Committee.	408,161 Common Shares	2006

(1)	The information as to shares beneficially owned as at the date of this Information Circular, not being within the knowledge of the Company, has been obtained from information provided by the directors to the Company. Includes any shares beneficially owned, controlled or directed, directly or indirectly, voting securities of the Company.
(2)	Member of the Audit Committee.
(3)	Member of the Compensation Committee.
(4)	Member of the Corporate Governance Committee.
(5)	Member of the Disclosure Committee.
(6)	Member of the Strategic Planning Committee.
(7)	Corporate Secretary

	·	been a director, chief executive officer or chief financial 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

	·	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.

	(i)	a base salary;

	(ii)	non-equity incentives, consisting of a cash bonus linked to corporate and individual performance;

	(iii)	equity incentives, comprised of Restricted Share Units granted pursuant to the RSU Plan (“RSUs”), Options, and Common Shares issued or acquired pursuant to the ESP Plan (“ESP Shares”), as well as DSUs to executives that are also directors of the Company; and

	(iv)	other elements of compensation, including benefits and other perquisites.

	·	recognize and reward the impact of longer-term strategic actions undertaken by management;

	·	align the interests of the Company’s executive and employees with the interests of the Shareholders;

	·	focus management on developing and successfully implementing the continuing growth strategy of the Company;

	·	foster the retention of key management personnel; and

	·	attract talented individuals to the Company.

Name and Municipality of Residence	Office(s) Currently Held	Principal Occupation or Employment for the Last Five Years	# of Shares Beneficially Owned ⁽¹⁾	Year became a Director

John Tilson Montecito, CA USA	Director^2,3,4	After obtaining his Master of Business Administration degree from the University of Southern California and his Chartered Financial Analyst designation, Mr. Tilson had a distinguished career as an analyst, portfolio manager, and advisor in the US investment and financial industry with firms such as Sutro & Company and EF Hutton & Company. Mr. Tilson joined Roger Engemann & Associates, Inc. (“RE&A”) in 1983 when assets under management were roughly US$160 million. During his tenure at RE&A, the Pasadena Group of Mutual Funds was started, with Pasadena Capital Corporation (“Pasadena”) formed as the holding company for the mutual funds and investment management business. After working as an Analyst and Portfolio Manager of Pasadena, Mr. Tilson became Executive Vice President & Managing Director. Assets under Pasadena’s management had grown to over US$5 billion by the time the firm was sold to Phoenix Companies in 1997. Mr. Tilson later retired in 2005. From 2006 to 2012, Mr. Tilson was a member of the Board of Trustees of Lotusland, a Santa Barbara non-profit organization established by Madame Ganna Walska, serving as Vice President and Chairman of the Long-Range Planning Committee for three of those years. Mr. Tilson is a member of the Audit, Compensation, and Corporate Governance Committees.	6,887,490 Common Shares	2015

Thomas E. Valentine Calgary, AB Canada	Director^3,4,7	Mr. Valentine is a Partner with Norton Rose Fulbright Canada LLP, where he has practiced law, both as a barrister and a solicitor, since being admitted to the Law Society of Alberta in 1987. He is a member of the firm’s Energy and Infrastructure Practice Group and is involved in energy-related matters throughout the Middle East, North Africa, the Commonwealth of Independent States, Asia and South America. Mr. Valentine is Corporate Secretary of Touchstone Exploration Inc., and formerly was a director of two other Canadian public companies, Calvalley Petroleum Inc. (to May 2015) and Veraz Petroleum Ltd. (to December 2012). Mr. Valentine holds a Bachelor of Arts degree from the University of British Columbia, a Bachelor of Laws degree from Dalhousie University, and a Master of Laws degree from the London School of Economics. Mr. Valentine is NXT’s Corporate Secretary. He is Chair of the Governance Committee and a member of the Compensation Committee.	Nil Common Shares	2007

	·	the number of DSUs, RSUs and Options already outstanding on an individual and aggregate basis, as well as the terms thereof and the number of ESP Shares reserved for issuance under the ESP Plan;

	·	the limits imposed by the TSX on the total number of DSUs, RSUs, Options and ESP Shares that may be issued and outstanding;

	·	the expected impact of the role of the executive on the Company’s performance and strategic development; and

	·	market benchmarking.

(1)	Mr. Liszicasz passed away on January 21, 2023.
(2)	Amounts disclosed in the column for “Salary” in 2022 include salary accrued, but not paid to the NEOs.
(3)	Amounts disclosed in the column for “Salary” include amounts contributed by the NEOs to the ESP Plan during the applicable year.
(4)	Amounts disclosed in the column for “Salary” pertain to cash compensation received for director services ($35,000) during the applicable year.
(5)	Amounts disclosed in the column for “Share-based awards” are calculated as the aggregate grant date fair values of the vested and unvested RSUs and ESP Shares granted or issued to, or acquired for, the NEOs under the RSU Plan and ESP Plan during the applicable year.
(6)	Amounts disclosed in the column for “Option-based awards” are calculated as the grant date fair value determined using a Black-Scholes model. This methodology is consistent with the method used to estimate the fair value of Options in NXT’s financial statements.
(7)	Amounts disclosed in the column for “All other compensation” pertain to benefits related to standard health and life insurance premiums, car allowances, and other miscellaneous compensation paid by the Company on behalf of the eligible NEO of the Company. It also includes amounts related to severance pay, consulting fees and any cash payout in the year of unused vacation pay entitlements.

	Option-based Awards								Share-based Awards
Name	Number of securities underlying unexercised options (#)		Option exercise price ($)		Option expiration date		Value of unexercised in-the-money options ($)⁽¹⁾		Number of shares or units of shares that have not vested (#)		Market or payout value of share-based awards that have not vested ($)⁽¹⁾		Market or payout value of vested-share based awards not paid out or distributed ($)⁽²⁾
George Liszicasz⁽³⁾		-		-		-		-		51,666		10,850		-
Eugene Woychyshyn		150,000		0.59	Nov. 1, 2023			-		41,666		8,750		-

(1)	Amounts disclosed in the columns for “Value of unexercised in-the-money options” and “Market or payout value of share-based awards that have not vested” are in respect of all vested and unvested option-based awards, including Options, and all unvested share-based awards, including RSUs, respectively, held by the NEOs as at December 31, 2022. These amounts were calculated using $0.21, which was the closing trading price of the Common Shares on the TSX on December 31, 2022, the last day of trading of the year.
(2)	Amounts disclosed in the column for “Market or payout value of vested share-based awards not paid out or distributed” are in respect of all vested share-based awards, including DSUs, which the NEOs are entitled to receive but which were not yet paid out or distributed as at December 31, 2022. These amounts were calculated using $0.21, which was the closing trading price of the Common Shares on the TSX on December 31, 2022, the last day of trading of the year.
(3)	Mr. Liszicasz passed away on January 21, 2023.

(1)	Amounts disclosed in the column for “Option-based awards – Value vested during the year” represent the aggregate dollar value that would have been realized if any option-based awards, including Options, were in-the-money as at the vesting date, and if they had been exercised on the vesting date, based on the difference between the closing price of the Common Shares on the vesting date and the exercise price of those awards.
(2)	Amounts disclosed in the column for “Share-based awards – Value vested during the year” represent the aggregate dollar value of vested share-based awards, including ESPs, RSUs and DSUs, as at the vesting date.
(3)	The Company’s non-equity plan compensation reflects annual bonus amounts earned in the year, and payable in cash.
(4)	Mr. Liszicasz passed away on January 21, 2023.

Name⁽¹⁾	Fees earned ($)			Share-based awards ($)		Option-based awards ($)		Total compensation ($)
Frank Ingriselli⁽²⁾		30,000			-		-		30,000
Charles Selby		30,000	⁽³⁾		-		-		30,000
Gerry Sheehan		30,000			-		-		30,000
John Tilson		30,000	⁽³⁾		-		-		30,000
Thomas E. Valentine		30,000	⁽³⁾		-		-		30,000
Bruce G. Wilcox		35,000	⁽³⁾		-		-		35,000

(1)	Information for Mr. Liszicasz is documented under the heading “Executive Compensation”.
(2)	Mr. Ingriselli resigned as a director on January 20, 2023.
(3)	The following directors elected to receive some or all or part of their 2022 director fees in the form of options: Mr. Selby $30,000; Mr. Tilson $30,000, Mr. Valentine, $15,000; and Mr. Wilcox, $8,750.

	Option-based Awards							Share-based Awards
Name⁽¹⁾⁽⁴⁾	Number of securities underlying unexercised options (#)		Option exercise price ($)		Option expiration date	Value of unexercised in-the-money options ($)⁽¹⁾		Number of shares or units of shares that have not vested (#)		Market or payout value of share-based awards that have not vested ($)⁽¹⁾		Market or payout value of vested-share based awards not paid out or distributed ($)⁽²⁾
John Tilson		16,000		0.51	Sept. 30, 2025		-		-		-		-
		21,360		0.44	June 30, 2026		-		-		-		-
		14,750		0.68	Sept. 30, 2026		-		-		-		-
		18,050		0.62	Dec. 31, 2026		-		-		-		-
		24,460		0.72	May 31, 2027		-		-		-		-
		17,500		0.68	June 30, 2027		-		-		-		-
		69,200		0.17	Nov. 21, 2027	$	2,768		-		-		-

Name⁽¹⁾	Option-based awards – Value vested during the year ($)⁽²⁾		Share-based awards – Value vested during the year ($)⁽³⁾
Frank Ingriselli⁽⁴⁾		-		-
Charles Selby		-		-
John Tilson		-		-
Thomas E. Valentine		-		-
Bruce G. Wilcox		-		-

Plan Category	Number of securities to be issued upon exercise of outstanding options, warrants and rights⁽¹⁾		Weighted-average exercise price of outstanding options, warrants and rights			Number of securities remaining available for future issuance under equity compensation plans
Equity compensation plans approved by security holders
Option Plan		461,320	$	0.51	⁽³⁾		3,030,013
RSU Plan⁽¹⁾		348,334	$	0.45	⁽³⁾		1,079,326
DSU Plan⁽¹⁾		37,354	$	0.40	⁽³⁾		962,646
ESP Plan⁽¹⁾		-		-			975,918
Total		847,008	$	0.48			6,047,903

(1)	RSUs, DSUs and ESP Shares are issued automatically once vested and do not require the holder thereof to exercise.
(2)	Number of securities remaining available for future issuance under security-based compensation plans calculated at December 31, 2022 as 10% of 68,949,109 Common Shares issued and outstanding, less: (i) 461,320 Options outstanding; (ii) 348,334 RSUs outstanding; and (iii) 37,354 DSUs outstanding.
(3)	Average price of the Common Shares on the TSX on the date the Options, RSUs, and DSUs were granted or issued, as applicable.

											Burn Rate
Fiscal Year	Options Granted (#)		RSUs Granted (#)		DSUs Granted (#)		ESPs Issued (#)		Basic Weighted Average of Issued and Outstanding Common Shares as at December 31 (#)		Options			RSUs			DSUs			ESPs			Total
2022		134,060		-		-		188,633		65,602,875		0.20	%		0.00	%		0.00	%		0.29	%		0.49	%
2021		62,660		-		-		304,550		64,658,380		0.09	%		0.00	%		0.00	%		0.47	%		0.56	%
2020		46,000		1,200,000		37,354		30,899		64,409,170		0.07	%		1.86	%		0.06	%		0.05	%		2.04	%
									Average Three-year Burn Rate			0.12	%		0.62	%		0.02	%		0.27	%		1.03	%

Plan Category	Meetings (#)		Attended (#)		Attended (%)
Frank Ingriselli⁽¹⁾		13		10		77
George Liszicasz (Chairman)⁽²⁾		13		8		62
Gerry Sheehan		13		13		100
Charles Selby		13		11		85
John Tilson		13		12		92
Thomas E. Valentine		13		11		85
Bruce G. Wilcox		13		13		100

	·	the Audit Committee will review annually a list of audit, audit related, recurring tax and other non-audit services and recommend pre-approval of those services for the upcoming year. Any additional requests will be addressed on a case-by-case specific engagement basis;

	·	for engagements not on the pre-approved list, the Audit Committee has delegated to the Chair of the Audit Committee the authority to pre-approve individual non-audit service engagements with expected annual aggregate costs of up to $50,000 subject to reporting to the Audit Committee, at its next scheduled meeting; and

	·	for engagements not on the pre-approved list and with expected costs greater than an annual aggregate of $50,000, the entire Audit Committee must approve this service, generally at its next scheduled meeting.

	2022		2021
Audit fees⁽¹⁾	$	407,670	$	234,330
Tax fees	$	12,273	$	1,338
Other audit related fees	$	-	$	-
Total fees	$	419,943	$	235,668

	(a)	amendments to the number of Common Shares issuable under the Option Plan, including an increase to a fixed maximum number of Common Shares or a change from a fixed maximum number of Common Shares to a fixed maximum percentage;

	(b)	amendments which would result in the exercise price for any Option granted under the Option Plan being lower than the market price of the Common Shares at the time the Option is granted;

	(c)	amendments which reduce the exercise price of an Option;

	(d)	amendments extending the term of an Option held by an insider beyond its original expiry date except as otherwise permitted by the Option Plan;

	(e)	the adoption of any option exchange scheme involving Options; and

	(f)	amendments required to be approved by Shareholders under applicable law (including, without limitation, the rules, regulations and policies of the TSX).

	·	the maximum number of Common Shares reserved for issuance under the DSU Plan and all other security- based compensation arrangements of the Company is 10% of the aggregate number of issued and

	·	outstanding Common Shares, calculated on an undiluted basis. The number of Common Shares reserved for future awards does not include the dividend equivalent that will accumulate on the underlying grants.

	·	in addition: (i) no one Designated Participant may be granted any DSUs which, together with all DSUs then held by such Designated Participant, would entitle such Designated Participant to receive a number of Common Shares which is greater than 5% of the outstanding Common Shares, calculated on an undiluted basis; and (ii) the number of Common Shares (A) issued to a Designated Participant and any other insiders of the Company, within any one year period, and (B) issuable to a Designated Participant and any other insiders of the Company, at any time, in each case under the DSU Plan or when combined with all other security-based compensation arrangements of the Company, shall not exceed 10% of the Company’s total issued and outstanding Common Shares.

	·	to increase the maximum number of Common Shares issuable under the DSU Plan;

	·	to limit Designated Participant participation;

	·	that result in a material or unreasonable dilution in the number of outstanding Common Shares or any material benefit to a Designated Participant;

	·	that change the class of eligible participants to the DSU Plan which would have the potential of broadening or increasing participation by insiders of the Company;

	·	to the amendment provision of the DSU Plan; or

	·	to the DSU Plan that permits a Designated Participant to transfer DSUs to any person, other than in the case of the death of the Designated Participant.

Content of Provision	Governance Practices of the Company
*Board of Directors*
Disclose the identity of directors who are independent.	The Board has determined that five of the six current directors are “independent” within the meaning of NI 52-110. The five independent directors at the date of the Information Circular were Charles Selby, John Tilson, Theodore Patsellis, Gerry Sheehan, and Thomas E. Valentine.
Disclose the identity of directors who are not independent and describe the basis for that determination.
Disclose whether or not a majority of directors are independent. If a majority of directors are not independent, describe what the board of directors (the board) does to facilitate its exercise of independent judgement in carrying out its responsibilities.
If a director is presently a director of any other issuer that is a reporting issuer (or the equivalent) in a jurisdiction or a foreign jurisdiction, identify both the director and the other issuer.	Such other directorships have been disclosed in the Information Circular.
Disclose whether or not the independent directors hold regularly scheduled meetings at which non- independent directors and members of management are not in attendance. If the independent directors hold such meetings, disclose the number of meetings held since the beginning of the issuers most recently completed financial year. If the independent directors do not hold such meetings, describe what the board does to facilitate open and candid discussion among its independent directors.	The current Corporate Governance Committee membership is independent. The Corporate Governance Committee meets in person or by conference call at least monthly, or more frequently as required. Members of management are not in attendance at these meetings. The Corporate Governance Committee also meets on an ad hoc basis where circumstances warrant.
Disclose whether or not the chair of the board is an independent director. If the board has a chair or lead director who is an independent director, disclose the identity of the independent chair or lead director, and describe his or her role and responsibilities. If the board has neither a chair that is independent nor a lead director that is independent, describe what the board does to provide leadership for its independent directors.	Currently the position of Chairman of the Board is vacant. Charles Selby is the Lead Director and is independent. He is currently responsible for:
	·	facilitating the functioning of the Board independent of management and ensuring that directors have an independent leadership contact;
	·	ensuring that the Board has adequate resources, especially by way of full, timely and relevant information to support its decision-making requirements;
	·	assisting and providing input to the Chairman of the Board on preparation of agendas for Board meetings as required;
	·	consulting with the Chairman of the Board on the effectiveness of Board committees;
	·	ensuring that independent directors have adequate opportunities to meet to discuss issues without management of the Company present;
	·	chairing Board meetings when the Chairman of the Board and Chief Executive Officer of the Company are not in attendance;
	·	ensuring delegated committee functions are carried out and reported to the Board, for example, the Chief Executive Officer of the Company performance assessment, Chief Executive Officer of the Company and Board succession planning, and strategic planning; and
	·	acting as a liaison between the Board and management.
Disclose the attendance record of each director for all board meetings held since the beginning of the issuers most recently completed financial year.	The attendance records for all Board meetings has been disclosed in the Information Circular. Please see the section under the heading “Corporate Governance” in the Information Circular for more details.

Content of Provision		Governance Practices of the Company
*Board Mandate*
Disclose the text of the board’s written mandate. If the board does not have a written mandate, describe how the board delineates its role and responsibilities.		The mandate of the Board is appended to the Information Circular as Schedule “J”.
*Position Descriptions*
Disclose whether or not the board has developed written position descriptions for the chair and the chair of each board committee. If the board has not developed written position descriptions for the chair and/or the chair of each board committee, briefly describe how the board delineates the role and responsibilities of each such position.		Written position descriptions have been developed for the Chief Executive Officer of the Company and the Chief Financial Officer of the Company. Current and newly elected members of the Board are provided a briefing note, prepared by the Corporate Governance Committee, which describes the roles and responsibilities of Board members, sub-committee chairs, and executives.
Disclose whether or not the board and CEO have developed a written position description for the CEO. If the board and CEO have not developed such a position description, briefly describe how the board delineates the role and responsibilities of the CEO.		A written position description has been developed for the Chief Executive Officer of the Company by the Corporate Governance Committee of the Board.
*Orientation and Continuing Education*
Briefly describe what measures the board takes to orient new directors regarding		New directors meet with the Board and senior management to discuss the business activities of the Company and are given the opportunity to familiarize themselves with the Company and gain insight into the Company’s business, business plans and operations by visiting the Company’s offices and reviewing SFD^® survey documentation and processes.
(i)	the role of the board, its committees and its directors, and	In addition, both current and newly elected members of the Board are provided a briefing note, prepared by the Corporate Governance Committee, which, among other things, serves as a both an orientation for new Board members and an update for existing Board members with respect to relevant topics in corporate governance.
(ii)	the nature and operation of the issuer’s business.
Briefly describe what measures, if any, the board takes to provide continuing education for its directors. If the board does not provide continuing education, describe how the board ensures that its directors maintain the skill and knowledge necessary to meet their obligations as directors.
*Ethical Business Conduct*
Disclose whether or not the board has adopted a written code for the directors, officers and employees. If the board has adopted a written code:		The Company has adopted a Code of Conduct and Business Ethics (the “Code”) for all directors, officers, employees and consultants. The Code is available on the Company’s intranet site. Additionally, the Code is available on the Company’s website at www.nxtenergy.com. The Code is also filed on SEDAR. Lastly, should anyone wish a hard copy of any of the Code, it may be obtained on request from the Corporate Secretary at 302, 3320 17th Avenue SW, Calgary, AB T3E 0B4. Compliance is monitored by the Audit Committee receiving, annually, certificates from NXT’s officers and senior management confirming their compliance with the Code. The Audit Committee reviews the certifications and reports to the Board. In addition to the annual certification of the officers, each employee and consultant receives annually a communication from management reiterating the need to comply with the Code.
(i)	disclose how a person or company may obtain a copy of the code;
(ii)	describe how the board monitors compliance with its code, or if the board does not monitor compliance, explain whether and how the board satisfies itself regarding compliance with its code; and
(iii)	provide a cross-reference to any material change report filed since the beginning of the issuers most recently completed financial year that pertains to any conduct of a director or executive officer that constitutes a departure from the code.
Describe any steps the board takes to ensure directors exercise independent judgement in considering transactions and agreements in respect of which a director or executive officer has a material interest.		Directors must disclose all interests and relationships of which the director is aware which may give rise to a conflict of interest. Directors are also required to disclose any actual or potential personal interest in a matter on which the Board is deciding and withdraw from deliberations and voting on the matter.
Describe any other steps the board takes to encourage and promote a culture of ethical business conduct.		All Board members as well as all employees have received a copy of the Code and have signed a Certification of Compliance Form acknowledging their understanding and compliance therewith. The Code provides guidance in a number of areas to ensure fair, ethical, lawful and consistent conduct by the Company and its employees. The Code specifically deals with business ethics, employment practices, insider trading and conflicts of interest.