Advisory Vote on the Company’s Executive Compensation.    The proposal regarding the approval, on an advisory basis, of the Company’s executive compensation requires the approval of a majority of the common shares represented and cast in respect of such matter.

No votes may be taken at the meeting, other than a vote to adjourn, unless a quorum has been constituted consisting of the representation of at least thirty-three and one-third percent (33 1/3%) of the outstanding shares as of the Record Date. Votes will be tabulated by the Company’s transfer agent, Computershare Investor Servicesrepresentatives of Broadridge Financial Solutions, Inc., which is also serving as the inspectors of election for the meeting.

The enclosed form of proxy confers discretionary authority on the persons named therein with respect to amendments to or variations of matters identified in the notice of meeting and such other matters that may properly come before the meeting or any postponement, continuation or adjournment thereof. As of the date of this management proxy circular, the management of the Company knows of no such amendments, variations or other matters to be presented at the meeting.

Voting for the Election of Directors

Section 65(1) of the Business Corporations Act (New Brunswick) provides for cumulative voting for the election of directors so that each shareholder entitled to vote at an election of directors has the right to cast an aggregate number of votes equal to the number of votes attached to the shares held by such shareholder multiplied by the number of directors to be elected, and may cast all such votes in favor of a single candidate or distribute them among the candidates in any manner the shareholder decides. The statute

further provides, in section 65(2), that a separate vote of shareholders shall be taken with respect to each candidate nominated for director unless a resolution of the shareholders is passed unanimously permitting two or more persons to be elected by a single resolution. Where a shareholder has voted for more than one candidate without specifying the distribution of votes among such candidates, the shareholder shall be deemed to have divided the votes equally among the candidates for whom such shareholder voted. If a shareholder desires to distribute votes otherwise than equally among the nominees for whom such shareholder has directed the persons in the enclosed form of proxy to vote, such shareholder must do so personally at the meeting or by another form of proxy. On any ballot for the election of directors, the persons named in the proxy will be deemed to have cast their votes equally among all the proposed nominees, unless: (a) any nominee is excluded by the shareholder in their proxy; or (b) the shareholder has directed that the shares be withheld from voting for the election of directors. If the number of candidates nominated for director exceeds the number of positions to be filled, the candidates who receive the least number of votes shall be eliminated until the number of candidates remaining equals the number of positions to be filled.

Counting of Votes

For purposes of determining the presence or absence of a quorum, abstentions and broker non-votes will be counted as present. With respect to the approval of any particular proposal, abstentions and broker non-votes will not be counted in determining the number of votes cast. A broker non-vote occurs when a broker submits a proxy form with respect to common shares held in a fiduciary capacity (typically referred to as being held in “street name”), but declines to vote on a particular matter because the broker has not received voting instructions from the beneficial owner. Brokers will return your proxy as a broker non-vote if the broker does not receive voting instructions from you and if, under applicable stock exchange or other rules, the broker does not have the discretion to vote those shares on one or more of the matters that come before the meeting.

Virtual Meeting Considerations

As part of our efforts to maintain a safe and healthy environment for our directors, members of management and shareholders who wish to attend the 2020 Annual Meeting, in light of the COVID-19 pandemic, we believe that offering shareholders the opportunity to attend and participate in the 2020 Annual Meeting via remote participation this year is in the best interest of the Company and its shareholders. A virtual meeting also enables increased shareholder attendance and participation because shareholders can participate from any location around the world. You will be able to attend the Annual Meeting online and submit your questions by visiting www.virtualshareholdermeeting.com/NOVT2020. If you are a shareholder of record, you also will be able to vote your shares electronically at the Annual Meeting by following the instructions above.

As part of the Annual Meeting, we will hold a live Q&A session, during which we intend to answer questions that are pertinent to the Company and the meeting matters, as time permits. All participants will have the ability to be heard by others if they dial in by phone using the toll-free conference call number for the 2020 Annual Meeting.

ITEM 1–ELECTION OF DIRECTORS

The Articles of the Company provide that our Board is to be comprised of a minimum of five (5) and a maximum of fifteen (15) directors, as determined from time to time by resolution of the Board. The Board has resolved that the entire Board shall consist of seven (7)nine (9) directors.

Each nominee presented below, if elected, will serve as a director until the next annual meeting of shareholders, until his or her successor is elected or appointed, or until his or her earlier death, resignation or removal. All of the nominees listed below have given their consent to be named as nominees for election and have indicated their intention to serve if they are elected. The Board does not anticipate that any of the nominees will be unable to serve as a director, but in the event that a nominee is unable to serve or for good cause will not serve, the Board may either propose an alternate nominee, in which case the proxies will be voted for the alternative nominee unless directed to withhold from voting, or elect to reduce the size of the Board.

The names of the nominees presented for election as directors at the 20162020 Annual and Special Meeting are listed below, along with information regarding when they joined the Board (to the extent applicable), their present principal occupation, recent business experience and their service on other companies’ boards of directors.

All of the nominees, except for Maxine L. Mauricio, currently serve on the Board. There are no family relationships between any of the nominees or between the nominees and any of ourthe Company’s officers.

Director Nominees

THE BOARD RECOMMENDS THAT SHAREHOLDERS VOTE “FOR” ALL OF THE NOMINEES NAMED BELOW.

Mr. Bershad has been a Director of the Company since July 23, 2010 and Chairman of the Board of Directors since July 30, 2010. Mr. Bershad was Chairman of the Board of Directors and Chief Executive Officer of Axsys Technologies, Inc. (“Axsys”), a manufacturer of surveillance and imaging equipment, from 1986 until 2009. Prior thereto, heMr. Bershad was a Managing Director of Lehman Brothers, Inc., an investment banking firm, and its predecessor firms, where he held a series of senior management positions in private equity and mergers and acquisitions. Mr. Bershad iswas the Chairman of the Board of Directors of EMCOR Group, Inc., a Fortune 500^® leader in mechanical and electrical construction, energy infrastructure and facilities services for a diverse range of businesses.businesses (“EMCOR”) until May 2018. Mr. Bershad has a Bachelor of Science Degreedegree from the University of Southern California and a Juris Doctorate from the University of California at Los Angeles. As a senior executive with Lehman Brothers for more than 15 years and the Chief Executive Officer of Axsys for more than 20 years, Mr. Bershad has an invaluable background in investment banking, finance and business.

Mr. Carpenter has been a Director of the Company since May 10, 2018. Mr. Carpenter served as the Group President, Global Quality and Business Operations for Stryker Corporation (“Stryker”), a medical devices and equipment manufacturing company, from January 2016 to March 2019. In this role, Mr. Carpenter was responsible for setting company-wide direction for quality, manufacturing, procurement and logistics strategies, as well as oversight of Stryker’s commercial business operations in Europe, Canada, Eastern Europe, Middle East, Latin America and Africa. Mr. Carpenter served at Stryker as the Group President, Global Quality and Operations from 2011 to 2016, as the Group President, Instruments and Medical from 2008 to 2011, and as the President, Medical Division from 2006 to 2008. Mr. Carpenter began his career with Stryker in 1989, including serving as the Vice President, Global Operations. Mr. Carpenter holds a Bachelor of Science degree from the United States Military Academy at West Point. Mr. Carpenter’s significant executive operating and commercial experience in the medical technology industry, as well as his broad business background in global manufacturing, engineering, supply chain, quality assurance, and regulatory affairs, provides the Board with greater insight into the healthcare industry.

Ms. DiSanzo has been a Director of the Company since May 9, 2019. Ms. DiSanzo has served as a Harvard University Advanced Leadership Initiative Fellow since December 2018. From September 2015 to December 2018, Ms. DiSanzo served as General Manager of IBM Watson Health at International Business Machines Corporation (“IBM”), the IBM business unit dedicated to health and healthcare analytics and artificial intelligence. From 2001 to December 2014, Ms. DiSanzo held various roles at Koninklijke Philips N.V. (“Philips”), a technology company, most recently as Chief Executive Officer of the Philips’ Healthcare division (“Philips Healthcare”) from April 2012 to December 2014 and prior to that as Executive Vice President over several business units within Philips Healthcare. Prior to Philips Healthcare, Ms. DiSanzo held senior roles at Heartstream, Incorporated (now part of Philips Healthcare), a medical device company, and Hewlett-Packard Company, an information technology company. Ms. DiSanzo currently serves on the Board of Directors of AstraZeneca PLC where she is a member of the Audit Committee and previously served on the Board of Directors of ReWalk Robotics Ltd. from 2015 to 2018. Ms. DiSanzo also serves on the Board of Directors of Project Hope where she is a member of the Audit Committee. Ms. DiSanzo has a Bachelor of Science degree from Merrimack College and an MBA from Babson College. As a senior executive in the healthcare industry for more than 25 years, Ms. DiSanzo brings significant leadership, operational and healthcare industry experience that is valuable to the Board as the Company continues to execute its plan to increase sales to medical end markets. Ms. DiSanzo’s presence on the Board also enhances the Board’s gender diversity.

Mr. Glastra was appointed the Company’s Chief Executive Officer on September 1, 2016. Mr. Glastra joined Novanta Inc. in 2012 as Group President, and was appointed the Company’s Chief Operating Officer in February 2015. Prior to Novanta, Mr. Glastra led and grew global technology businesses in advanced industrial and medical end markets during an 18-year career with Philips, both in Europe and in Silicon Valley. At Philips, Mr. Glastra served as Chief Executive Officer of Philips Entertainment Lighting in 2012 and as Chief Operating Officer of Philips Lumileds from 2007 to 2012. Prior to that, Mr. Glastra held multiple General Manager and Vice President positions at the Philips Healthcare, Semiconductor and Lighting divisions from 1994 to 2007. Mr. Glastra also served as Director of Corporate Strategy in the Philips corporate headquarters. Mr. Glastra, a Dutch citizen, holds a Master of Science degree in Applied Physics from Delft University of Technology, an Advanced Engineering Degree from ESPCI in Paris, France, and an MBA from INSEAD in Fontainebleau, France. Mr. Glastra’s 25 years of leadership and executive operating experience in Original Equipment Manufacturer based technology businesses in advanced industrial and medical end markets, and his intimate knowledge of the Company’s businesses provide valuable insight to the Board in formulating and executing the Company’s strategy.

Mr. BoscoKing has been a Director of the Company since June 14, 2012.May 10, 2017. Mr. Bosco served as President and Chief Executive Officer of Opnext, Inc. (“Opnext”),King is a senior advisor to Viant Medical, LLC, a private global leader inservices provider to the design and manufacture of optical modules, components and subsystems for the telecommedical device industry, from December 9, 2010 to July 23, 2012, and previouslywhere he served as the President and Chief Executive Officer of Opnext from November 2000 untilMay 2017 to July 2019. From June 2015 to March 31, 2009.2017, Mr. Bosco alsoKing served as an Operating Advisor for Thomas H Lee Partners, a Director of Opnext from November 2000 andprivate equity firm. From June 2014 to June 2015, Mr. King served as Chairman of the Board of Opnext from April 1, 2009 until July 23, 2012. On July 23, 2012, Opnext merged with Oclaro, Inc., a tier-one provider and innovator of optical communications and laser solutions and Mr. Bosco stepped down as President, Chief ExecutiveTransformation Officer and Chairman of OpnextChief Operating Officer at DePuy Synthes, a Johnson & Johnson company, which designs and became a Director of Oclaro until January 2014.manufactures orthopedic and neurological devices and supplies. From 2004 to 2014, Mr. BoscoKing served in various management, engineering and executive positions at Lucent Technologies, AT&TCovidien, formerly Tyco Healthcare, a global healthcare products company and Bell Laboratories from 1965 until October 2000, includingmanufacturer of medical devices and supplies, which was later acquired by Medtronic. At Covidien, Mr. King served as Optical Networking Group President.President, Emerging Markets (2010-2014), President, Covidien Asia (2008-2010), Senior Vice President, Global Operations and Quality (2005-2008), and Vice President, Operational Excellence (2004-2005). Mr. BoscoKing previously served on the board of directors of PCI Pharma Services, Houston Street Exchange, Inc., and B&C Research Corporation, all privately held entities. Mr. King holds an AssociateMBA from Harvard Business School, Master of Science from the Pennsylvania State University, and Bachelor of Science in Electrical Engineering from Pennsylvania State University/Monmouth University and a Master’s degree in Electrical Engineering from Polytechnic Institute of New York. Mr. Bosco also served as a Director of Arris, Inc., a global communications technology company specializing in the design and supply of broadband equipment, from 2002 to May 2016. Mr. Bosco brings to the Board a strong technical background in the optical industry, extensive operational experience, and significant experience as a CEO and Director of a public high technology company.

Mr. Fortino has been a Director of the Company since July 23, 2010. Mr. Fortino is a business consultant specializing in the development of business rationalization and growth plans for companies and also serves as an executive coach. Prior to becoming a business consultant in 2006, Mr. Fortino served as the Executive Vice President of the Lithography & Parametric Solutions Group at KLA-Tencor Corporation (“KLA-Tencor”), a supplier of process control and yield management solutions for the semiconductor and related microelectronics industries between September 2000 and November 2005. From August 1997 to September 2000, he served as Vice President and General Manager of the Surfscan Division of KLA-Tencor and from November 1995 to July 1997 as the Vice President and General Manager of the Surface Metrology Division of KLA-Tencor. Mr. Fortino served as Vice President and General Manager for Spectra-Physics Lasers from July 1991 to October 1995. Mr. Fortino has a Bachelor of Science Degree in Industrial Engineering from the University of Illinois, at Urbana and MBA from Loyola University Chicago.  Mr. Fortino has more than 20 years of experience in the semiconductor and related microelectronics industries as well as a deep understanding of the Company’s products and related technologies. Mr. Fortino brings to the Company’s Board of Directors significant technology, operating experience, business acumen and insight into current and emerging business trends.  United States Naval Academy.

Mr. Lamel has been a Director of the Company since July 23, 2010. Mr. Lamel has served as Chief Financial Officer of Act II Global Acquisition Corp., a special purpose acquisition company, since December 2018.  Mr. Lamel was Senior Advisor to the CEO from(from September 1, 2013 to August 31, 2014, prior to which he was2014) and Executive Vice President and Chief Financial Officer from(from October 1, 2001 to August 31, 20132013) of The Hain Celestial Group, Inc. (“Hain”), a leading natural and organic food and personal care products company operating in North America and Europe. Prior to joining Hain onin October 1, 2001, Mr. Lamel was an audit partner in the New York area practice of Ernst & Young LLP. He retired from Ernst & Young LLP after a 29-year career serving clients in various industries, one of which included Excel Technology, Inc. (“Excel”), that was acquired by the Company in August 2008. Mr. Lamel served as the audit partner on Excel beginning with the audit for the year ended December 31, 2000 and through the review for the quarter ended June 30, 2001. In addition, Mr. Lamel served on the Board of Directors of Excel between 2004 and 2008. Mr. Lamel also served on the Board of Directors of Harvey Electronics (“Harvey”) between 2004 and 2007. On each such board at Excel and Harvey, Mr. Lamel was the chairman of the Audit Committee and a member of the Compensation Committee.career. Mr. Lamel brings to the Company’s Board of Directors extensive financial, accounting and auditing expertise, including an understanding of accounting principles, internal controls, financial reporting rules and regulations and financial reporting processes acquired over the course of his 41-year career. In addition, Mr. Lamel’s prior service

Ms. Mauricio is a nominee for Director of the Company. Ms. Mauricio has served as the Senior Vice President, General Counsel and Secretary of EMCOR since January 2016. From January 2012 to December 2015, Ms. Mauricio was Vice President and Deputy General Counsel of EMCOR, and from May 2002 to December 2011, she served as EMCOR’s Assistant General Counsel. Prior to joining EMCOR, Ms. Mauricio was an associate at Ropes & Gray LLP. Ms. Mauricio brings to the Company’s Board of Directors extensive corporate governance, legal, cybersecurity leadership and compliance expertise acquired at a global Fortune 500 company. Ms. Mauricio’s presence on the Board of Directorsalso enhances the Board’s gender and as Chairman of the audit committee at Excel Technology, Inc. provides him with invaluable experience.ethnic diversity.  

Mr. Romeo has been a Director of the Company since June 14, 2012. Mr. Romeo served as Senior Vice President and Chief Financial Officer of Thor Industries, Inc. (NYSE: THOR), a leading manufacturer of recreational vehicles, commercial buses and ambulances, from February 2013 to October 2013. From 2004 to 2011, Mr. Romeo served as Vice President and Chief Financial Officer of IDEX Corporation (NYSE: IEX), a leading global manufacturer of pump products, dispensing equipment, and other engineered products. Prior to joining IDEX, Mr. Romeo served in several financial leadership positions at Honeywell International, Inc., a diversified technology and manufacturing company that services customers globally, including Vice President and Chief Financial Officer of Honeywell Aerospace from 2001 to 2004; Vice President and Chief Financial Officer of Honeywell International’s Engine Systems and Services divisions from 1999 to 2001; and various other senior finance positions from 1994 to 1999. Mr. Romeo also served as Vice President of Finance for AAR Trading, an aircraft products and services provider, from 1992 to 1994, and held multiple financial roles in audit and financial planning for GE Aircraft Engines, a subdivision of the General Electric Company, from 1987 to 1992. Mr. Romeo currently serves on the board of Spartan Motors, Inc. (NASDAQ: SPAR), a global leader in specialty chassis and vehicle design, manufacturing and assembly. Mr. Romeo served on the Board of Directors of BBB Industries, an automotive parts manufacturer and Charter NEX Films, a manufacturer of packaging films, which are both held by Pamplona Capital Management. Mr. Romeo servedManagement, from 2015 to 2018; and on the Board of Directors and as a member of the Audit Committee of Federal Signal Corporation, a leading global designer and provider of safety and security products and solutions, from 2010 to April 2013. Mr. Romeo has a Bachelor of Arts Degreedegree in both Accounting and Business Administration from Manchester University. Mr. Romeo brings to the Company’s Board of Directors extensive expertise in finance and accounting for several global industrial manufacturers, as well as experience in efficiently adapting company operations to changing market conditions.

Mr. Roush was appointed the Company’s Chief Executive Officer and elected as a member of the Board of Directors on December 14, 2010. Mr. Roush joined the Company after a twelve year career with PerkinElmer, Inc. (“PerkinElmer”), a provider of technology and services to the diagnostics, research, environmental, safety and security, industrial and laboratory services markets, where he was a corporate officer and served in several senior leadership positions. From 2009 to December 2010, Mr. Roush served as president of PerkinElmer’s Environmental Health business. From 2004 to 2009, Mr. Roush led PerkinElmer’s Optoelectronics business unit, which supplies specialty photonics products to biomedical and industrial OEMs. From 1999 to 2004, Mr. Roush served in various general management roles within the Optoelectronics business unit. Prior to joining PerkinElmer, Mr. Roush held management positions with Outboard Marine Corporation, AlliedSignal, Inc., now Honeywell International, McKinsey & Company Inc. and General Electric. Mr. Roush also serves as a director of Lemaitre Vascular, Inc. (NASDAQ: LMAT), a global provider of medical devices and implants for the treatment of peripheral Vascular disease, and as a member of its Audit Committee. Mr. Roush holds a Bachelor of Science degree in Electrical Engineering from Tufts University and M.B.A. from Harvard University. As the Company’s Chief Executive Officer, Mr. Roush provides an insider’s perspective in Board discussions about the business and strategic direction of the Company.

Mr. Secor has been a Director of the Company since June 14, 2012. Mr. Secor has been Managing Director of Morningside Heights Capital, an investment firm, since March 2012. From April 2007 until March 2012, Mr. Secor was employed by Goldman Sachs & Co, where he worked with Liberty Harbor, an absolute-return investment fund. While at Liberty Harbor, Mr. Secor focused on the fund’s fundamental investment strategies, including debt and equity transactions. From 2005 until March 2007, Mr. Secor was a Director and member of the legal group at Amaranth Advisors, an investment advisor. From 1998 until 2005, Mr. Secor was an attorney with Cleary, Gottlieb, Steen & Hamilton where he specialized in corporate and securities law. Mr. Secor currently serves on the board of directors of The Great Atlantic and Pacific Tea Company (A&P). Mr. Secor received his B.A., cum laude, from Pomona College and his J.D., cum laude, from the University of Chicago Law School. Mr. Secor brings to the Company’s Board of Directors more than 1520 years of experience in strategic transactions, corporate finance and profit management across a wide range of industries, as well as extensive corporate governance experience.

ITEM 2–aDVISORY VOTE ON THE

COMPANY’S EXECUTIVE COMPENSATION

Background

The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 provides our shareholders with the opportunity to vote to approve, on an advisory (non-binding) basis, the compensation of our named executive officers (which currently consist of our Chief Executive Officer, Chief Financial Officer and Chief Operating Officer, and former Vice President, Human Resources)Resources Officer), as disclosed in this management proxy circular in accordance with the SEC’s rules. The Company has determined to holdheld a “say-on-pay” advisory vote every year. Accordingly,year since 2013 and following the advisory vote regarding the frequency of future “say-on-pay” votes held in 2019, the Company has determined to continue to hold the “say-on-pay” advisory vote every year until the next such advisory “say-on-pay” frequency advisory vote. The next “say-on-pay” advisory vote following this one will occur at the 20172021 annual meeting of shareholders.

Summary

In accordance with Section 14A of the Securities and Exchange Act of 1934, as amended (the “Exchange Act”), we are asking our shareholders to provide advisory approval of the compensation of our named executive officers as such compensation is described in the “Compensation Discussion and Analysis” section, the tabular disclosure regarding such compensation and the accompanying narrative disclosure set forth in this management proxy circular, beginning on page 21.22.

Our executive compensation programs are designed to provide a compensation package that incentivizes and retains a highly qualified executive team and rewards both short-term and long-term sustainable performance as measured against established goals. Our executive compensation program seeks to promote this philosophy primarily through a combination of the following types of compensation: base salary, cash bonus incentive awards and long-term equity-based incentive awards in the form of both service-based vesting restricted stock units.units (“restricted stock units” or “RSUs”) and performance-based vesting performance stock units (“performance stock units” or “PSUs”). The following is a summary of some of the key points of our executive compensation program. We urge our shareholders to review the “Compensation Discussion and Analysis” section of this management proxy circular and the tabular disclosuredisclosures following such section for more information.

The Compensation Committee believes that the policies and procedures articulated in the “Compensation Discussion and Analysis” are effective in achieving the Company’s goals and that the compensation of the Company’s named executive officers reported in this management proxy circular reflects and supports these compensation policies and objectives. We encourage shareholders to review the “Compensation Discussion and Analysis” beginning on page 2122 of this management proxy circular. The Company has retained the services of Pearl Meyer & Partners, LLC to assess 2016 executive compensation. The 2016 executive compensation will include changes to long-term compensation provided to the Company’s executives.  

Recommendation

Our Board of Directors believes that the information provided above and within the “Compensation Discussion and Analysis” section of this management proxy circular demonstrates that our executive compensation program was designed appropriately and is working to ensure that management’s interests are aligned with our shareholders’ interests to support long-term value creation.

The following resolution will be submitted for a shareholder vote at the 20162020 Annual and Special Meeting:

RESOLVED, that the shareholders of GSI GroupNovanta Inc. approve, on an advisory basis, the compensation of GSI GroupNovanta Inc.’s named executive officers, as disclosed pursuant to the compensation disclosure rules of the Securities and Exchange Commission (“SEC”), including the “Compensation Discussion and Analysis”, compensation tables and narrative discussion set forth in thisthe management proxy circular.

This vote on our executive compensation is advisory, and therefore not binding on the Company, the Compensation Committee or the Board of Directors. However, the Compensation Committee will consider the outcome of the vote when making future compensation decisions for the named executive officers.

Required Vote

The affirmative vote of a majority of the common shares represented and cast in respect of this matter at the 20162020 Annual and Special Meeting is required to approve, on an advisory (non-binding) basis, the compensation of our named executive officers. Abstentions and broker non-votes will not be counted in determining the number of votes cast, and thus will not affect the voting results of this proposal.

THE BOARD RECOMMENDS THAT SHAREHOLDERS VOTE “FOR” THE ADOPTION OF THE RESOLUTION APPROVING THE COMPANY’S COMPENSATION OF THE NAMED EXECUTIVE COMPENSATION.

OFFICERS.

ITEM 3–appointment of independent

registered public accounting firm

At the 20162020 Annual and Special Meeting, the shareholders will be asked to approve the appointment of PricewaterhouseCoopers LLP (“PricewaterhouseCoopers”) as the Company’s independent registered public accounting firm and to authorize the Audit Committee to fix the auditors’ remuneration.remuneration for PricewaterhouseCoopers. PricewaterhouseCoopers has served as the Company’s independent registered public accounting firm since 2013.

We expect a representative of PricewaterhouseCoopers to be present at the meeting to answer appropriate questions and to have an opportunity to make a statement if desired.

Required Vote

The affirmative vote of a majority of the common shares represented and cast in respect of this matter at the 20162020 Annual and Special Meeting is required to approve the appointment of PricewaterhouseCoopers as the Company’s independent registered public accounting firm to serve until the 20172021 annual meeting of shareholders. Abstentions will not be counted in determining the number of votes cast, and thus will not affect the voting results of this proposal. Because brokers have discretionary authority to vote on the appointment of PricewaterhouseCoopers, we do not expect any broker non-votes in connection with this proposal.

THE BOARD RECOMMENDS THAT SHAREHOLDERS VOTE “FOR” THIS APPOINTMENT.

Independent Registered Public Accounting Firm Fees and Services

Set forth below are the fees paid by the Company to its independent registered public accounting firm, PricewaterhouseCoopers, for the fiscal years ended December 31, 20152019 and 2014.2018.

(1)Consists

(1)

Consist of fees billed for professional services rendered for the audit of the Company’s annual consolidated financial statements, review of the Company’s interim consolidated financial statements included in quarterly reports and services that are normally provided in connection with statutory and regulatory filings or engagements. (2)Consists principally of fees for services related to financial due diligence associated with acquisition targets. (3)Consists of fees billed for professional services rendered for tax compliance, tax advice and tax planning. (4)Represents fees billed for professional services rendered for the audit of the Company’s annual consolidated financial statements and internal control over financial reporting, review of the Company’s interim consolidated financial statements included in quarterly reports, and services that are normally provided in connection with statutory and regulatory filings or engagements.

Pre-Approval Policies and Procedures

The Audit Committee has adopted policies and procedures relating to the approval of all audit and non-audit services that are to be performed by the Company’s independent registered public accounting firm. This policy generally provides that the Company will not engage its independent registered public accounting firm to render audit or non-audit services unless the Audit Committee specifically approves the service in advance, or the engagement is entered into pursuant to the pre-approval procedure described below.

Pursuant to the Audit Committee Charter, the Audit Committee may delegate pre-approval authority to an individual member of the Audit Committee. The decisions of any individual Audit Committee member to whom pre-approval authority is delegated must be presented to the full Audit Committee at its next scheduled meeting. The Audit Committee has delegated to the Chairman of the committee the authority to pre-approve any audit, non-audit or other service provided to the Company by the Company’s independent registered public accounting firm, except for the annual audit engagement and fees, which must be approved by the committee.full Audit Committee. The prior approval of the Audit Committee or the pre-approval of the designated memberChairman of the Audit Committee was obtained for all services provided by PricewaterhouseCoopers in fiscal year 2015.2019.

Report of the Audit Committee

The primary purpose of the Audit Committee is to assist the Board of Directors in its oversight of the accounting and financial reporting processes of the Company and the audits of the consolidated financial statements of the Company.

In conjunction with the specific activities performed by the Audit Committee in its oversight role, it issued the following report:

Based on the review and discussions referred to in paragraphs (1) through (3) above, the Audit Committee recommended to the Board of Directors that the audited consolidated financial statements be included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 20152019 for filing with the SEC.

Mr. Ira J. Lamel (Chairperson)

Mr. Dominic A. Romeo

Mr. Thomas N. Secor

The foregoing Report is not soliciting material, is not deemed filed with the SEC and is not to be incorporated by reference in any filing of the Company under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing.

ITEM 4–Adoption of resolution approving ARTICLES OF AMENDMENT
TO CHANGE NAME OF COMPANY TO NOVANTA INC.confirmation

of an amendment to Section 52

of the Company’s By-Law Number 1

At the 2020 Annual Meeting, the shareholders will be asked to confirm an amendment to Section 52 of the Company’s By-Law Number 1 to allow the Company to hold meetings of shareholders by means of remote participation. On February 24, 2016,April 8, 2020, the Board of Directors adopted a resolution approving, and recommending thatamending Section 52 of the Company’s By-Law Number 1 to add the following:

“52.  Remote Participation: Meetings of shareholders approve, Articlesmay be held by means of any telephonic, electronic or other communication facility, including teleconferencing, video conferencing, computer link, webcasting and other similar means, that permits all participants to hear each other during the meeting.  Any person entitled to attend a meeting of shareholders may participate in the meeting by means of such a telephonic, electronic or other communication facility, if the Corporation makes available such a facility.  A person participating in a meeting by such means shall be deemed to be present at the meeting.”

We refer to this amendment as the Remote Participation Amendment. The Remote Participation Amendment was effective immediately upon the Board’s approval. At the 2020 Annual Meeting, the shareholders will be asked to changeconfirm the nameRemote Participation Amendment as set forth above, the full text of which is set out at Schedule A to this management proxy circular. If the shareholders confirm the Remote Participation Amendment at the 2020 Annual Meeting, the amendment will continue in effect. If the shareholders reject the Remote Participation Amendment at the 2020 Annual Meeting, the amendment will cease to be effective.

The Company’s Board of Directors approved the Remote Participation Amendment in order to permit the Company to Novanta Inc. (the “Name Change Amendment”). The full texthold meetings of shareholders, including the 2020 Annual Meeting, by means of remote participation. In light of the Name Change AmendmentCOVID-19 pandemic, we believe it is as follows: “The new namein the interests of our directors, members of management and shareholders who wish to attend the corporation is: NOVANTA INC.”

The following resolution will be submitted for a shareholder vote at the 20162020 Annual Meeting and, Special Meeting:

RESOLVED, that the shareholders of GSI Group Inc. approve Articles of Amendment to change the name of the Company to Novanta, Inc. (the “Name Change Amendment”), and thatwhere determined by the Board of Directors, future meetings of shareholders, to allow the Company may revoke this special resolutionto hold such meetings by remote participation in order to protect the health and abandonsafety of those attending the Name Change Amendment herein authorized without further approval of the shareholders at any time prior to the filing of the Name Change Amendment.

If the foregoing resolution is adopted2020 Annual Meeting and when otherwise deemed appropriate by the Company’s shareholders at the 2016 Annual and Special Meeting, the Name Change Amendment will become effective upon the Company’s filing of the Name Change Amendment with the New Brunswick Director of Corporations.  Notwithstanding approval of the Name Change Amendment by the Company’s shareholders, the Board of DirectorsDirectors. Remote participation may abandon the Name Change Amendment without further approval of the shareholdersalso facilitate shareholder attendance at such meetings by enabling participation from any time prior to the filing of the Name Change Amendment with the New Brunswick Director of Corporations.  location and at no additional cost.

Reason for the Name Change

The Company has made a significant strategic transformation since 2011.  The Company has positioned itself as a leading provider of precision component and subsystem technologies to Original Equipment Manufacturers in the medical and advanced industrial markets, while shifting away from its legacy focus on the semiconductor capital equipment market.  The Company is proposing to rebrand itself to emphasize this new strategic direction.  The name Novanta stands for The Innovation Advantage, as innovation and technical collaboration with customers are at the core of the Company’s value proposition.  The Company believes that the Novanta name reinforces the Company’s new strategy.  

Ticker Symbol Change

We have reserved the ticker symbol “NOVT” on the NASDAQ Global Select Market.  If the Name Change Amendment is approved by shareholders, we intend to request that the ticker symbol under which our common shares are listed and traded be changed from “GSIG” to “NOVT” or another symbol selected by us. We expect the ticker symbol change to become effective, if at all, on or about the same time as effectiveness of the Name Change Amendment.

Effects of the Name Change

If the resolution approving the Name Change Amendment is adopted by the Company’s shareholders and the Name Change Amendment is filed with the New Brunswick Director of Corporations, the voting and other rights that accompany the Company’s common shares will remain unchanged. The name change will not affect the validity or transferability of any currently outstanding stock certificates nor will it be necessary for shareholders with certificated shares to surrender or exchange any stock certificates they currently hold as a result of the name change. Uncertificated shares currently held in direct registration accounts and any new stock certificates that are issued after the effectiveness of the name change will bear the name Novanta Inc.

If the resolution approving the Name Change Amendment is not adopted by the Company’s shareholders, or if such resolution is adopted but the Board of Directors chooses to abandon the Name Change Amendment, the name change described above will not be made and the Company’s name and ticker symbol will remain unchanged.

Required Vote

The affirmative vote of not less than two-thirdsa majority of the common shares represented and cast in respect of this matter at the 2020 Annual Meeting is required to adoptconfirm the resolution approving the Articles of Amendmentamendment to change the nameSection 52 of the Company to Novanta Inc.Company’s By-Law Number 1. Abstentions and broker non-votes will not be counted in determining the number of votes cast, and thus will not affect the voting results of this proposal. Because brokers have discretionary authority to vote on the resolution approving the Name Change Amendment, we do not expect any broker non-votes in connection with this proposal.

THE BOARD RECOMMENDS THAT SHAREHOLDERS VOTE “FOR” THE ADOPTIONCONFIRMATION OF AN AMENDMENT TO SECTION 52 OF THE RESOLUTION APPROVING ARTICLES OF AMENDMENT TO CHANGE THE NAME OF THE COMPANY TO NOVANTA INC. AS DESCRIBED ABOVE.

COMPANY’S BY-LAW NUMBER 1.

EXECUTIVE OFFICERS

Set forth below is information regarding the Company’s current executive officers who are not also directors. Information concerning John A. Roush,Matthijs Glastra, our Chief Executive Officer, may be found above in the section entitled “Item 1–Election of Directors” on page 65 of this management proxy circular.

Age:    4245

Executive Officer Since:since March 2011

Mr. Buckley was appointed the Company’s Chief Financial Officer on March 31, 2011. Prior to joining the Company in February 2011, Mr. Buckley had a ten-year career with PerkinElmer, Inc. (“PerkinElmer”), a provider of technology and services to the diagnostics, research, environmental, safety and security, industrial and laboratory services markets, where he served in several financial positions of increasing responsibilityresponsibilities. From September 2008 to February 2011, Mr. Buckley served as Vice President and Chief Financial Officer of PerkinElmer’s Environmental Health business. From September 2005 to September 2008, Mr. Buckley was Chief Financial Officer of PerkinElmer’s Asian operations. From April 2001 to August 2005, Mr. Buckley served in various financial management roles at PerkinElmer. Prior to joining PerkinElmer, Mr. Buckley held management positions with Honeywell International, Inc. (formerly AlliedSignal, Inc.), a diversified technology and manufacturing company that services customers globally, and Georgeson & Company, Inc. Mr. Buckley holds a B.A.Bachelor of Arts degree in Finance from Manhattanville College and an M.B.A. from University of California at Los Angeles (U.C.L.A.).

AgeAge:    :    4751

Executive Officer Since: October 2012since December 2016

Mr. Glastra was appointed the Company’s Chief Operating Officer on February 26, 2015.  Prior to that, he served as the Company’s Vice President and Group President of Laser Products and Vision Technologies from March 1, 2014 to February 26, 2015, and as Vice President and Group President of Laser Products from October 15, 2012 to March 1, 2014.

Mr. GlastraYoung joined the Company in 2012 after an 18-year career with Philips, a technology company, where he most recently servedApril 2015 as Chief Executive Officer of Philips Entertainment Lighting. He previously served as Chief Operating Officer and Executive Vice President of Worldwide OperationsHuman Resources and was appointed Chief Human Resources Officer by the Board of Philips Lumileds from 2007Directors in December 2016. Mr. Young brings more than 20 years of human resources leadership experience in both public and private companies serving Original Equipment Manufacturers (“OEMs”) of Class I, II & III medical devices, industrial control technologies and advanced materials. From July 2014 to 2012, and held multiple general manager positions at various Philips business units, including Philips LCD Backlighting and Philips Semiconductors, from 2001March 2015, Mr. Young served as Global Human Resource Leader for Hollingsworth & Vose Company, a global manufacturing company. From September 2011 to 2007. He alsoNovember 2013, Mr. Young served as Vice President & Human Resource Officer for CIRCOR International, Inc. (“CIRCOR”), a global environmental products manufacturing company. From September 2010 to August 2011, Mr. Young served as Director of Corporate StrategyTotal Rewards for CIRCOR. In addition, from June 2003 to August 2010, Mr. Young served in the Philips corporate headquarters from 1999 to 2001. He started hisvarious leadership roles with Lake Region Medical (formerly Accellent, Inc.), a medical device manufacturing company. Mr. Young’s early career at Philips as product manager of Computed Tomographyexperience was in the Philips Healthcare divisionGeneral Human Resource Management with a specialization in October 1994.training and development. Mr. GlastraYoung holds a MasterBachelor of Science Degreedegree in Applied PhysicsAdministration of Justice from Delft University of Technology, as well as an Advanced Engineering Degree in Applied Physics and Electronics from ESPCI in Paris, France, and an MBA from INSEAD in Fontainebleau, France.Pennsylvania State University.

CORPORATE GOVERNANCE

The Board of Directors

The Board is elected annually and each of our directors stands for election every year. Presently, theThe Board is currently comprised of seveneight directors, and all except Mr. RoushGlastra have been determined by the Board to be independent under the rules of The NASDAQNasdaq Stock Market LLC or NASDAQ.(“Nasdaq”). In making this determination, the Board has affirmed that each of the independent directors meets the objective requirements for independence set forth by NASDAQ.Nasdaq. The independent directors are Stephen W. Bershad, Harry L. Bosco, DennisLonny J. Fortino,Carpenter, Deborah DiSanzo, Brian D. King, Ira J. Lamel, Dominic A. Romeo and Thomas N. Secor. Mr. RoushGlastra is not independent because he is the Company’s Chief Executive Officer. In addition, the Board has determined that director nominee Maxine L. Mauricio is independent under the rules of Nasdaq.

In evaluating and determining the independence of the directors, the Board considered that in the ordinary course of business, transactions may occur between the Company and its subsidiaries and entities with which some of the directors are or have been affiliated and that the Company may have other relationships with its directors. Specifically,The Company engages in ordinary course business transactions with Mr. Carpenter’s former employer. In 2019, Mr. Carpenter’s former employer purchased products from the Board considered that Mr. Bershad is a significant shareholderCompany, which constituted more than 5%, but less than 10%, of the Company.Company’s revenues for the year. The Board determined that this relationship did not impair Mr. Bershad’sCarpenter’s independence.

Please see the biography of each director under the section entitled “Item 1–Election of Directors” for the public company boards on which each director serves.

Board Leadership Structure and Role in Risk Oversight

The Board is responsible for the overall stewardship of the Company. The Board discharges this responsibility directly and through delegation of specific responsibilities to its committees, the Chairman of the Board and officers of the Company. The Board has established three standing committees to assist with its responsibilities: the Audit Committee, the Compensation Committee and the Nominating and Corporate Governance Committee. Each of the Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee has a charter defining its responsibilities. The Board of Directors does not have an executive committee.

The Company’s By-Laws require the Chairman of the Board to be a director and provide the Board with the ability to appoint the Chief Executive Officer of the Company as the Chairman of the Board. This approach gives the Board the necessary flexibility to determine whether these positions should be held by the same person or by separate persons based on the leadership needs of the Company at any particular time. We recognize that different board leadership structures may be appropriate for companies in different situations.

Based on the Company’s present circumstances, the Board believes that the Company and its shareholders are best served by having Mr. Bershad serve as itsthe Chairman of the Board and Mr. RoushGlastra serve as itsthe Chief Executive Officer. Our current leadership structure permits Mr. RoushGlastra to focus his attention on managing ourthe Company and permits Mr. Bershad to manage the Board. Accordingly, we believe our current leadership structure is the optimal structure for us at this time.

The Board recognizes the importance of appropriate oversight of potential business risks in running a successful operation and meeting its fiduciary obligations to our business, our shareholders, and our other stakeholders. While our senior executives, including the Chief Executive Officer, Chief Operating Officer, and Chief Financial Officer, have responsibility for the day-to-day assessment and management of business risks, the Board maintains responsibility for creating an appropriate culture of risk management and setting a proper “tone at the top.” In this role, the Board, directly and through its committees, takes an active role in overseeing our aggregate risk potential and in assisting our executives with addressing specific risks, including competitive, legal, regulatory, operational and financial risks. The Board does not believe that its role in the oversight of the Company’s risks affects the Board’s leadership structure.

Corporate Governance Highlights

The following table summarizes our board structure and key elements of our corporate governance framework:

Board Committees and Meetings

The Board has a responsibility for establishing broad corporate policies and for reviewing overall performance, rather than day-to-day operations of the Company. The Board’s primary responsibility is to oversee the management of the Company and, in so doing, the Board serves the best interests of the Company and its shareholders. The Board selects, evaluates and provides for the succession of our executive officers. It reviews and approves corporate objectives and strategies and evaluates significant policies and major proposed commitments of corporate resources. It participates in decisions that have a potential major economic impact on the Company. Management keeps the directors informed of Company business activities through regular written reports and presentations at Board and committee meetings.

The Board maintains three standing committees whose functions are described below. All members of the Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee are independent directors. The following table sets forth the membership of the Board’s standing committees:

Each standing committee maintains a written charter detailing its authority and responsibilities. These charters are reviewed and updated periodically as legislative and regulatory developments and business circumstances warrant. The committee charters are available in their entirety on our website at http:https://www.gsig.cominvestors.novanta.com inon the Investors Relations section,page, under the Corporate Governance tab.

Meetings

The Board and standing committees met as follows during the year ended December 31, 2015:

2019:

The independent directors also meet routinely in executive sessionsessions in connection with regular meetings of the Board. Mr. Bershad presides over all executive sessions at which he is present.

During 2015,2019, each director attended all meetings of the Board and all meetings of the committees on which the director served, except forthat one director who attended 94%89% of such meetings. Members of ourthe Board of Directors are strongly encouraged to attend ourthe Company’s annual meeting of shareholders. In 2015,2019, all of ourthe directors attended ourthe annual meeting of shareholders.

The Audit Committee

The Audit Committee consists of Mr. Lamel, Mr. Romeo and Mr. Secor, with Mr. Lamel serving as Chairman. All members of the Audit Committee meet the membership requirements of NASDAQ,Nasdaq, including the requirements regarding financial literacy and

financial sophistication, and the Board has determined that each member of the Audit Committee is independent under the listing standards of NASDAQNasdaq and the rules of the SEC regarding audit committee membership. The Board has further determined that Mr. Lamel is an “audit committee financial expert” as defined by the SEC.

The Audit Committee is directly responsible for the appointment, compensation and oversight of the work of the independent registered public accounting firm, and is responsible for reviewing and discussing with management and the independent registered public accounting firm ourthe Company’s audited annual consolidated financial statements included in our Annual Report on Form 10-K and ourunaudited interim consolidated financial statements. The Audit Committee also reviews the independence and quality control procedures of the independent registered public accounting firm, reviews management’s assessment of the effectiveness of internal controls, and discusses with management the Company’s policies with respect to risk assessment and risk management.

The Compensation Committee

The Compensation Committee consists of Mr. Bershad, Mr. FortinoLamel, and Mr. Lamel,Romeo, with Mr. Bershad serving as Chairman. All members of the Compensation Committee meet the membership requirements of NASDAQ,Nasdaq, and each member of the Compensation Committee is independent under the listing standards of NASDAQNasdaq regarding compensation committee membership.

The Compensation Committee is responsible for assisting ourthe Board in fulfilling its fiduciary duties with respect to the oversight of the Company’s compensation plans, policies and programs, including assessing ourthe overall compensation structure, reviewing all executive compensation programs, incentive compensation plans and equity-based plans and determining executive compensation. Specifically, the Compensation Committee reviews and approves the compensation and benefits of ourthe Chief Executive Officer and ourthe other officers, oversees the performance evaluation of ourthe Chief Executive Officer and other named executive officers (“NEOs”), and reviews and approves ourthe Senior Management Incentive Plan (including grants of equity compensation and annual cash incentive compensation for ourthe officers and certain other key employees).

The Compensation Committee has the authority under its charter to directly retain and cause the Company to pay reasonable compensation for compensation consultants, legal counsel and other advisors as it deems necessary or appropriate. In 2015,2019, the Compensation Committee retained Towers Watson,Pearl Meyer and Korn Ferry, as its independent compensation consultantconsultants to assist the Compensation Committee with its responsibilities related to ourthe Company’s executive compensation programs.

For a discussion of the Compensation Committee’s processes and procedures for considering and determining compensation for our officers, please see the “Compensation Discussion and Analysis” section.

The Nominating and Corporate Governance Committee

The Nominating and Corporate Governance Committee (the “NCG Committee”) consists of Mr. Fortino, Mr. Bershad, Mr. BoscoKing, and Mr. Secor, with Mr. FortinoSecor serving as Chairman. All members of the NCG Committee meet the membership requirements of NASDAQ.Nasdaq.

The NCG Committee is responsible for: (a) identifying individuals qualified to become Board members and recommending such individuals to the Board as director nominees; (b) developing and recommending to the Board a set of corporate governance principles applicable to the Company; (c) reviewing the qualifications of directors eligible to become members of the different committees of the Board and recommending to the Board director nominees for each committee; (d) overseeing periodic performance reviews of the Board; and (e) evaluating and making recommendations to ourthe Board regarding director compensation.

During its review of the composition of the Board, the NCG Committee considered that the Board and NCG Committee are committed to improving the diversity of the Board by actively seeking out highly qualified women and individuals from minority groups to serve on the Board. Following a search process, the NCG Committee recommended to the Board that Maxine L. Mauricio be nominated as director of the Company in light of her significant governance, legal, cybersecurity leadership and compliance experience at a global Fortune 500 company. The NCG Committee also considered that Ms. Mauricio’s presence on the Board would enhance the Board’s gender and ethnic diversity.

Selection and Evaluation of Director Candidates

In searching for qualified director candidates for election to the Board and to fill vacancies on the Board, the NCG Committee solicits current directors for the names of potentially qualified candidates and may ask directors to pursue their own business contacts for the names of potentially qualified candidates and to conduct due diligence on director candidates. In addition, the NCG Committee has retainedmay from time to time retain an outside search firm to assist in the search for qualified candidates. Director nominee Maxine L. Mauricio was recommended to the NCG Committee by our Chairman of the Board. In the event there is or is expected towill be a vacancy on the Board, the NCG Committee will consider suggestions from shareholders for nominees for election as directors and evaluate such suggested nominees on the same terms as candidates identified by directors, officers, outside advisors or search firms selected by the NCG Committee.

The criteria that the NCG Committee has established regardingfor selecting members of the minimum qualifications for nomineesBoard are contained in the Corporate Governance Guidelines, which are available on the Company’s website at http:https://www.gsig.cominvestors.novanta.com, inon the “Investor Relations” section,Investor Relations page, under the Corporate Governance tab,tab. The criteria include a consideration of the candidate’s independence, demonstrated ethical standards, experience at the policy-making level, ability to work constructively with the title of “New Director Selection Process.” The criteria focuses on finding candidates who haveother directors and the highest level of integrity, are financially literate, haveChief Executive Officer, capacity to evaluate strategy and reach sound conclusions, motivation and sufficient time to devote themselves to Company matters and who haveability to take into account and balance the legitimate needs of all shareholders and other stakeholders in reaching decisions. In February 2020, the Board amended the Corporate Governance Guidelines to add the following policy:

“The Board believes that maintaining a diverse membership with varying backgrounds, skills, that complementexpertise and other differentiating personal characteristics promotes inclusiveness, enhances the Board’s deliberations and enables the Board to better represent all of the Company’s constituents. Accordingly, the Board is committed to seeking out highly qualified

women and minority candidates as well as candidates with diverse backgrounds, skills and knowledgeexperiences as part of each Board search the current directors. Company undertakes.”

The Board and NCG Committee have not established a formalassesses the effectiveness of this policy on the considerationas part of diversity in director candidates.its annual self-evaluation.

Once potential candidates are identified, the NCG Committee reviews the backgrounds of those candidates, conducts interviews of candidates and establishes a list of final candidates. To the extent practicable, final candidates are then interviewed by

each member of the NCG Committee, the Chairman of the Board and the Chief Executive Officer. Reasonable efforts are made to have all remaining directors interview the final candidates.

The NCG Committee and the Board have not established a formal policy with regard to the consideration of director candidates recommended by shareholders. This is due to the following factors: (i) the limited number of such recommendations, (ii) the need to evaluate such recommendations on a case-by-case basis, and (iii) the expectation that recommendations from shareholders would be considered in the same manner as recommendations by directors, officers, outside advisors or search firms in the event there is or is expected to beof a vacancy on the Board.

Any shareholder who intends to recommend a candidate to the NCG Committee for nomination as a director should deliver a written notice to the Company with the following information: (a) the suggested candidate’s biographical data (including business experience, service on other boards, and academic credentials),; (b) all transactions and relationships, if any, between the recommending shareholder or such candidate, on the one hand, and the Company or its management, on the other hand, as well as any relationships or arrangements, if any, between the recommending shareholder and the candidate and any other transactions or relationships of which the Board should be aware in order to evaluate such candidate’s potential independence as a director,director; (c) details of whether the candidate or the recommending shareholder is involved in any on-going litigation adverse to the Company or is associated with an entity which is engaged in such litigation,litigation; and (d) whether the candidate or any company for which the candidate serves or has served as an officer or director is, or has been, the subject of any bankruptcy, SEC or criminal proceedings or investigations, any civil proceedings or investigations related to fraud, accounting or financial misconduct, or any other material civil proceedings or investigations. The notice must also contain a written consent confirming the candidate’s (a) consent to be nominated and named in the Company’s management proxy circular and, if elected, to serve as a director of the Company and (b) agreement to be interviewed by the NCG Committee and submit additional information if requested to do so. Any such notice should be delivered to the Company sufficiently in advance of the Company’s annual meeting to permit the NCG Committee, in the event that there is or is expected towill be a vacancy on the Board, to complete its review in a timely fashion.

Under the Company’s Articles, a shareholder may propose a director candidate for inclusion in the Company’s notice of meeting if the proposal is signed by one or more holders of shares representing in the aggregate not less than 5% of the common shares of the Company entitled to vote at the shareholders’ meeting at which the nomination is to be presented. Any shareholder, as described in the preceding sentence, wishing to propose a director candidate for inclusion in the Company’s notice of meeting must provide notice to the Company by February 9, 201725, 2021 and include the information about such nominee as discussed above with respect to director candidates recommended by shareholders.such shareholder(s).

Communications with the Board

The Board has not established a formal process for shareholders to send communications to the Board and/or individual directors due to the limited number of such communications historically. However, the Board will give appropriate attention to written communications on issues that are submitted by shareholders and other interested parties and will respond if and as appropriate. The names of all directors are available to shareholders in this management proxy circular and on the CompanyCompany’s website. If the Company receives any shareholder communication intended for the full Board or any individual director, the Company will forward all such communications to the full Board or such individual director, unless the communication is clearly of a marketing nature or is unduly hostile, threatening, illegal or similarly inappropriate. Any shareholder communications should be sent to: GSI GroupNovanta Inc., Attention: Stephen W. Bershad, Chairman of the Board, 125 Middlesex Turnpike, Bedford, Massachusetts 01730, Attention: Investor Relations.USA.

Board of Directors’ Role in Risk Oversight

The Board recognizes the importance of appropriate oversight of potential business risks in running a successful operation and meeting its fiduciary obligations to our business, our shareholders, and our other stakeholders. While our senior executives, including the Chief Executive Officer, the Chief Financial Officer, and the Chief Human Resources Officer, have the responsibility for the day-to-day assessment and management of business risks, the Board maintains a responsibility for creating an appropriate culture of risk management and setting a proper “tone at the top.” The Board has taken an active role in overseeing risks that could affect the Company, including operational, financial, legal and regulatory, and strategic and reputational risks. This oversight is conducted primarily through the Audit Committee, which has been assigned the oversight responsibility for enterprise risk management and reports regularly to the Board on such matters. Senior management, with the assistance of the Company’s outsourced Internal Audit service provider, carries out enterprise risk management activities. This process includes periodic reporting by management to the Audit Committee in order to systematically identify, analyze, prioritize and document potential business risks, their potential impact

on the Company’s performance, and the Company’s ability to detect, manage, control and prevent these risks. When the Audit Committee receives a report from senior management, the Chair of the Audit Committee reports on the discussion to the full Board during the next Board meeting. This enables the Board and its committees to coordinate the overall risk oversight role, particularly with respect to risk areas that may potentially impact more than one committee of the Board.

In addition to the role the Audit Committee plays in overseeing enterprise risk management activities, the Compensation Committee monitors the design and implementation of our compensation programs to ensure that these programs include the elements needed to motivate employees to take a long-term view of the business and to avoid encouraging unnecessary risk taking. Based on a functional review of our compensation policies and practices as performed by senior management in consultation with the Company’s independent compensation consultant and the Compensation Committee, the Company does not believe that any risks arising from its employee compensation programs are likely to have a material adverse effect on the Company. The Board does not believe that its role in the oversight of the Company’s risks affects the Board’s leadership structure.

Code of Ethics and Business Conduct

All of the Company’s directors, officers and employees must act in accordance with the Code of Ethics and Business Conduct, which has been adopted by the Company’s Board of Directors. A copy of the Code of Ethics and Business Conduct is available on the Company’s website at http:https://www.gsig.cominvestors.novanta.com inon the “About GSI Group” section.Investor Relations page, under the Governance tab, with the title “Code of Business Conduct - English”. The Company intends to satisfy the disclosure requirement under Nasdaq rules regarding waivers or under Item 5.05 of Form 8-K regarding disclosure of an amendment to, or waiver from, a provision of this Code of Ethics and Business Conduct with respect to its principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, by posting such information on the Company’s website discussed above, unless a Form 8-K is otherwise required by law or applicable listing rules.

Anti-Hedging Policy

Our Board of Directors has adopted an Insider Trading Policy, which applies to all of our directors, officers and employees. The policy prohibits our directors, officers and employees and their family members from buying or selling put or call options or entering into other derivative contracts or hedging transactions with respect to the Company’s securities. This includes options trading on any of the stock exchanges or futures exchanges, as well as customized derivative or hedging transactions with third parties.

Orientation and Continuing Education

The Company’s Corporate Governance Guidelines provide that directors are expected to participate in an orientation program within six months of the annual meeting at which new directors are elected or the date on which new directors are appointed. In addition, the Company may periodically make available to its directors continuing educational opportunities designed to assist them in performing their Board and committee functions.

Assessments

The NCG Committee is responsible for annually overseeing a review of the performance of the Board, and each of the NCG Committee, Audit Committee and Compensation Committee is responsible for annually reviewing such committee’s own

performance. In December 2015,January 2020, the NCG Committee adopted a self-evaluation questionnaire for the Board and each of the Board’s standing committees. Each director completed a questionnaire evaluating the performance of the Board as a whole and each committee on which such director served, and a summary of the results of these self-evaluations was discussed by the Board at its February 24, 201620, 2020 meeting.

Additional Governance Matters

The Board of Directors (acting on the recommendation of the NCG Committee) has approved the Company's Corporate Governance Guidelines, which include, among other items (in addition to those items described elsewhere in this proxy):

DIRECTOR COMPENSATION

In general, the Company uses a combination of cash and equity-based compensation to attract and retain candidates to serve on the Company’s Board of Directors. The Company does not compensate directors who are also employees for their service on the Board of Directors. Accordingly, during the year ended December 31, 2015,2019, Mr. Roush,Glastra, who served as the Company’s Chief Executive Officer and as a Director on the Board, did not receive any compensation for his service on the Board of Directors. TheCompensation for Board of Director compensationDirectors is overseen by the Nominating and Corporate Governance Committee rather than the Compensation Committee, which focuses on employee compensation. The Nominating and Corporate Governance Committee periodically reviews itsthe cash and equity-based compensation for non-employee directors and makes recommendations to the Board of Directors for any adjustments.

The Board of Directors approved the following fiscal year 2019 compensation for non-employee directors:

Fifty percent of the foregoingannual retainer for non-employee director compensation will bedirectors are paid in the form of cash and thecash. The remaining fifty percent of such compensation will be payableretainers are paid in the form of deferred stock units, which will beare convertible into shares of the Company’s common stock upon a holder’sretirement, resignation or termination of directorship withof the Company.non-employee directors. The restricted stock units will vest on the first anniversary of the date of grant.

As of the end of the Company’s fiscal year ended December 31, 2015,2019, each director was also a party to an indemnification agreement with the Company. Such indemnification agreements generally provide, among other things, that each director shall be indemnified to the fullest extent permitted by applicable law against all expenses, judgments, fines and amounts paid in settlement actually and reasonably incurred by such director in connection with any proceeding by reason of his or her relationship with the Company. In addition, such indemnification agreements provide for the advancement of expenses incurred by such director in connection with any proceeding covered by such indemnification agreements, subject to the conditions set forth therein and to the extent such advancement is not prohibited by law.

Director Compensation Table

The following table sets forth information regarding the compensation earned during the fiscal year ended December 31, 20152019 by the Company’s non-employee directors.

COMPENSATION DISCUSSION AND ANALYSIS

The following discussion and analysis contains statements regarding individual and Company performance targets and goals. These targets and goals are disclosed in the limited context of the Company’s compensation programs and should not be understood to be statements of management’s expectations or estimates of results or other guidance. The Company specifically cautions investors not to apply these statements to other contexts.

The following discussion and analysis details the Company’s philosophy and policies regarding executive compensation, the process that is used to set executive compensation within the Company, the elements of the executive compensation program, and the role of the Compensation Committee of the Board of Directors of GSI GroupNovanta Inc. and the executive staff in setting executive compensation. In this section, the terms, “we”, “our”, and “us” refer to the Company, and the “Board” and “Board of Directors” refer to the Board of Directors of GSI GroupNovanta Inc., unless otherwise specified.

Pursuant to SEC rules, this compensation discussion and analysis primarily addresses the Company’s fiscal year 2019 compensation policies and decisions.  The impact of the COVID-19 pandemic was not factored into fiscal year 2019 compensation policies and decisions, but the Company expects that its fiscal year 2020 compensation policies and decisions will consider the effect of the global pandemic and related economic challenges.

The Company uses certain non-GAAP financial measures, such as Organic Revenue Growth, Adjusted EBITDA and Adjusted EPS, to evaluate its operating performance, communicate financial results to the Board of Directors, benchmark results against historical performance and the performance of peers, and to determine incentive compensation for senior management and employees.  Non-GAAP financial measures should not be considered as substitutes for, or superior to, measures of financial performance prepared in accordance with GAAP. They are limited in value because they exclude charges that have a material effect on the Company’s reported results and, therefore, should not be relied upon as the sole financial measures to evaluate the Company’s financial results. Investors are encouraged to review the reconciliation of the non-GAAP financial measures to their most directly comparable GAAP financial measures as provided in the tables at the end of the Company’s annual report for the fiscal year 2019.

The following table shows ourthe Company’s named executive officers (collectively, the “named executive officers” or “NEOs”) for the fiscal year 2015:2019:

EXECUTIVE SUMMARY

2015Creating Shareholder Value

The creation of shareholder value is the foundation and driver of the Company’s executive compensation program.  The compensation of the named executive officers is closely aligned with the long-term interests of the shareholders.

Returns for Novanta Shareholders

The following graph compares the cumulative total return to shareholders for the Company’s common shares for the period from December 31, 2014 through December 31, 2019 with the Nasdaq Composite Index and Russell 2000 Index. The comparison assumes an investment of $100 is made on December 31, 2014 in the Company’s common shares and in the case of each of the indices it also assumes reinvestment of all dividends. The past performance shown is not necessarily indicative of future performance.

2019 Business and Compensation Highlights

Fiscal year 20152019 proved to be a year that tested the company with an unexpected and rapidly deepening industrial recession.  We are pleased that the effects of our strategy to invest in innovation and to increase our exposure to Medical end markets made the Company more resilient in an unpredictable year. The year included significant growth in our medical business with revenue from new products largely offsetting a significant pull back in micro-electronics and industrial markets. Despite the challenges that we faced in the industrial capital spending markets, we continued to invest in new product development during the year and accomplished the following:

Financially, we achieved many of the goals set forth by management and the Board at the outset of the year and made significant progress toward our long-term goals.

OurThe Company’s executive compensation program results for the fiscal year 20152019 reflected this strategic andour financial progress.performance. The cash component of ourthe Senior Management Incentive Plan (“SMIP”) for executives paid out abovebelow target for the fiscal year 20152019 based on the following:

Finally, we maintainedthe Company sought to maintain the strong governance of ourits executive compensation program. In particular, during the fiscal year 2015,2019, the Compensation Committee:

In addition, the Compensation Committee continually evaluates the Company’s compensation policies and practices to ensure that they are consistent with good governance principles. Below are highlights of what we do and what we do not do:

We feel that our executive compensation programs continue to provide a strong link between pay and performance, provide appropriate incentives and provide a fair and balanced total compensation opportunity to the executives.  Our shareholders agree, as evidenced by the approval of our executive compensation by 95% of the votes cast with respect to our 2015 say-on-pay proposal.

COMPENSATION PHILOSOPHY

The Company is a global leader and supplier of precision photonics and motion control components and subsystems to original equipment manufacturers (“OEM’s”) in thecore technology solutions that give medical equipment and advanced industrial technology markets.OEMs a competitive advantage. The Company operates in an ever-evolving and fast-paced environment in which the Companyand is moving aggressively to position itself in leading high growthhigh-growth medical and advanced industrial markets. Our ability to compete in this environment depends, to a large extent, on our success in identifying, recruiting, developing and retaining management talent.

In support of our goals, we have designed an executive compensation program that is a robust, highly performance-driven, programand intended to generate both long-term sustainable shareholder value and near-term focus on financial performance, operational excellence, quality and innovation. TheOur executive compensation program is based on the following principles:

The following graphs depict the average target pay mix of base salary, short-term cash bonus incentives and long-term equity-based incentives for our Chief Executive Officer and for our other named executive officers (other than Ms. Mulryan who resigned effective as of January 13, 2015).

officers.

(1)Based on annual base salary, annual target cash bonus and annual equity grant in the CEO’s 2015 compensation package.

(2)Based on: annual base salary, annual target cash bonus and annual equity grant in the 2015 compensation packages for Mr. Buckley and Mr. Glastra. Excludes compensation for Ms. Mulryan who resigned effective as of January 13, 2015.

Highlights of our 2015Our 2019 Executive Compensation Program

During 2015,2019, we continued to implement compensation practices and arrangements that reinforcereinforced our compensation philosophy. A summary of such compensation practices are set forth below:

In addition to the compensation practices described above, the Company has agreed to certain compensation terms and conditions that are set forth in employment or severance agreements or letters with the named executive officers.NEOs. For a full description of the Company’s executive compensation program, please also see “Executive Compensation Program Elements.” For a description of the employment and severance agreements, and letters, see “Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table” and “Potential Payments upon Termination or Change of Control”.

THE EXECUTIVE COMPENSATION DECISION MAKING PROCESS

Compensation Committee Members and Independence

The Compensation Committee is comprised of Messrs. Bershad, FortinoLamel, and Lamel.Romeo. None of the current members were, at any time, officers or employees of the Company or its subsidiaries and thesubsidiaries. The Board has determined that each member of the Compensation Committee is an independent director under the applicable rules of NASDAQ.Nasdaq.

Role of the Compensation Committee, Management and Outside Advisors

The Compensation Committee is responsible for designing, implementing and evaluating the Company’s executive compensation plans and policies. Among its responsibilities, the Compensation Committee:

In performing the responsibilities above, the Compensation Committee receives advice and input, as applicable, from the Board of Directors, the CEO, members of management, outside consultants, human resources representatives and the Company’s outside legal counsel on compensation issues and regarding general compensation policies, including the appropriate level and mix of the compensation for executive officers.

The Compensation Committee meets in executive sessionsessions and, where appropriate, with members of management, including the CEO and Chief Human Resources Officer, outside consultants, human resources representatives and the Company’s outside legal counsel. Although the CEO is generally present during the non-executive sessions of the Compensation Committee meetings and provides input to the Compensation Committee with regard to his direct reports, the Compensation Committee makes all decisions with regard to CEO compensation in executive sessions and the CEO has no vote in the actual approval of compensation for any named executive officer.

Pursuant to the Charter,its charter, the Compensation Committee may form and delegate authority to subcommittees of the Compensation Committee, to the extent consistent with the Company’s Articles of Association,Continuance, Bylaws, Corporate Governance Guidelines, applicable law and NASDAQNasdaq rules, except that it may not delegate its responsibilities for any matters that involve executive compensation or any matters where it has determined such compensation is intended to comply with the grandfather provisions of Section 162(m) of the Internal Revenue Code (the “Code”(“the Code”), by virtue of being approved by a committee of “outside directors” or is intended to be exempt from Section 16(b) under the Securities Exchange Act of 1934 pursuant to Rule 16b-3 by virtue of being approved by a committee of “non-employee directors.”

Executive Compensation and Comparable Company Data

Generally, the Compensation Committee reviews each named executive officer’s total compensation each year and, in connection therewith, considers market data for similar positions at other public companies and other relevant sources. The Compensation Committee may retain the services of advisors and it has the budgetary authority to hire such advisors as it deems necessary for its compensation review. In 2015,2019, the Compensation Committee worked directly with its external advisor, Towers Watson, which helpsPearl Meyer to design the fiscal year 2019 executive compensation plans.  Pearl Meyer, helped the Compensation Committee assess whether the total compensation paid to the named executive officers is fair,

reasonable and competitive. The Company has assessed the independence of Towers Watson Pearl Meyer

and its representatives and has determined that no conflicts of interest exist. In order to avoid any conflict of interest, Towers WatsonPearl Meyer did not provide other executive compensation consulting services to the Company during 2015.2019.

Generally, the types of compensation and benefits provided to the named executive officers are intended to be similar to those provided to executive officers at other public companies. While the Compensation Committee does not believe it is appropriate to set executive compensation levels based exclusively on compensation surveys and comparable company data, the Compensation Committee uses publicly available surveys and comparable company data as tools for internally assessing whether the Company’s executive compensation program is, in the aggregate, reasonable in scope, market-competitive, and consistent from year to year. The surveys referenced by the Compensation Committee in 2015 include the 2014 Towers Watson’s Top Management Compensation Survey and the 2014 Mercer Executive Compensation Survey.

In addition to reviewing the general publicly available survey data described above, the Compensation Committee also develops a list of competitor companies for consideration as the Company’s peer group based on relevant factors, including: industry, fiscal year or trailing twelve-month revenue, market capitalization, total shareholder return and EBITDA. In early 2015, Towers Watson2019, Pearl Meyer was asked to develop a compensation report that identifies market-based compensation structures, pay practices and rates of compensation for targeted positions at the Company as compared to the Company’s peer group. The peer group is selected based on relevant factors, including industry, fiscal year or trailing twelve-month revenue, market capitalization, total shareholder return and EBITDA. The peer group used in this compensation report prepared by Towers Watson dated February 2015,Pearl Meyer in January 2019, which was used in establishing the 20152019 compensation of our named executive officers,NEOs, was comprised of the following companies:

The Company has retained the services of Pearl Meyer & Partners, LLC to assess 2016 executivealso provided compensation and, in connection with this review,data from market survey data published by third parties regarding companies outside of the Company’s peer group, was further reconstituted to include the following companies: Allied Motion Technologies Inc., American Science & Engineering Inc., Analogic Corporation, Astronics Corporation, Brooks Automation, Inc., Cognex Corporation, Coherent Inc., CTS Corporation, FARO Technologies Inc., II-VI Inc., IPG Photonics Corporation, LMI Aerospace Inc., MTS Systems Corporation, Newport Corp., NN Inc., Rofin-Sinar Technologies Inc., SL Industries Inc.,for use as a general indicator of relevant market conditions and Vishay Precision Group, Inc.pay practices and as a broader reference point.

Outside of survey and peer group information, other important factors that drive compensation decisions include individual qualifications and expertise, responsibilities, particular industry and market conditions, of a business segment, complexity of position and specific market factors in the locations in which our named executive officersthe NEOs are employed. The Compensation Committee also considers the performance of the Company’s named executive officers, the individual’s historical compensation and any retention concerns, and the CEO’s recommendations (in the case of named executive officers other than the CEO) before determining the compensation arrangement for each of them.

Shareholder Say-On-Pay Vote

At our 2015the 2019 annual meeting of shareholders, the Company provided ourthe shareholders with the opportunity to cast an annual advisory vote to approve the Company’s executive compensation. Approximately 95%Over 99% of the votes cast on this “2015the “2019 say-on-pay vote” were voted in favor of the proposal. We have considered the 20152019 say-on-pay vote and we believe that the overwhelming support of our shareholders for 20152019 say-on-pay vote indicates that our shareholders are generally supportive of our approach to executive compensation. The Company did not make any changes to its executive compensation arrangements in response to the 2015 say-on-pay vote.  In the future, the Company will continue to considerconsidered the outcome of the say-on-pay votes when making compensation decisions regarding its named executive officers.officers for 2020, and plans to continue to consider input from shareholders in future years. The following chart presents the voting results for the say-on-pay for the last three years:

Executive Compensation Program Elements

Executive compensation at the Company includes base salary, short-term cash bonus incentives, long-term equity-based incentives, employee benefits and, in certain situations, severance and other compensation. These elements (and the amounts of compensation and benefits thereunder) were selected because the Compensation Committee believes they are necessary to help us attract and retain executive talent which is fundamental to our success. The elements of compensation may vary among executives based on the Compensation Committee’s determination as to what is appropriate under the policies set forth above. Below is a summary of the current executive compensation programs as they relate to our named executive officers, excluding, in general, Ms. Mulryan who resigned effective as of January 13, 2015.officers.

Base Salary

Base salary levels for the named executive officers are generally determined based on the Compensation Committee’s evaluation of the named executive officer’s position, experience, qualifications, prior employment (including historical compensation), current and individual performance, industry knowledge, quality of leadership, scope of responsibilities (including potential growth in responsibilities), internal pay equity, tax deductibility, cost of living, and competitive external market data (which includes peer group information as described above). No specific weighting is applied to the factors. Generally, the Compensation Committee refers to the median of the relevant competitive market for the position as part of the base salary evaluation, but any individual named executive officer may have a base salary above or below the median of the market. The Compensation Committee’s philosophy is that base salaries are the minimum payment for satisfactory performance and should meet the objective of attracting and retaining the executive talent needed to run a complex business.

The annual base salaries for each of our named executive officers, effective on and after April 6, 20141, 2018 and April 5, 2015,March 31, 2019, respectively, are listed below: 

Short Term Cash Bonus Incentives

In 2015,2019, the SMIP included cash bonus incentives that were designed to motivate and reward the Company’s key management team members for driving short-term performance within their respective organizations and across the Company. The cash bonus incentives pursuant to the SMIP are earned semi-annuallyannually based on Company adjustedachievement against Adjusted EBITDA, Organic Revenue Growth, and NWC Ratio targets (the “Financial Objectives”). For purposesThe weighting of paymentthe Financial Objectives for the named executive officers is 80% of target cash incentive based on Adjusted EBITDA, 20% based on Organic Revenue Growth, and a NWC Ratio multiplier that can increase or decrease by up to 10% of the aggregate cash incentive amount based on Adjusted EBITDA and Organic Revenue Growth but cannot cause the total bonus incentives, adjusted EBITDA is defined as operating income from continuing operations before deducting depreciation, amortization, non-cash stock-based compensation and other non-recurring or non-operating charges.to exceed a 200% maximum payout. The target level of the Financial Objectives (provided below) is correlated with the Company’s annual growth objectives. Although the target financial metrics offor cash bonusincentives are intended to be achievable, a maximum bonus payout would require very high levels of performance. Actual performance against the Financial Objectives must be within an established range of the target to result in any payout for the respective Financial Objectives, as described in more detail below.