DEF 14A of Uranium Energy Corp
Filed Jun 5, 2024 · FY20230001437749-24-019336
ELECTION OF DIRECTORS TO OUR BOARD OF DIRECTORS
ELECTION OF DIRECTORS TO OUR BOARD OF DIRECTORS
Election of Directors
Election of Directors Each of our directors is elected annually at the annual meeting of our stockholders and, upon the director’s election, will hold office until our next annual meeting or until his or her successor is elected and qualified. The persons named in the enclosed form of proxy as proxyholders intend to vote FOR the election of the nominees listed below as directors unless instructed otherwise, or unless a nominee is unable or unwilling to serve as a director of the Company. Our Board of Directors has no reason to believe that any nominee is unable or unwilling to serve, but if a nominee should determine not to serve, the persons named in the form of proxy as proxyholders will have the discretion and intend to vote for another candidate that would be nominated by our Board of Directors. The affirmative vote of a plurality of the votes present in person or by proxy at the Annual Meeting and entitled to vote on the election of directors is required for the election of each nominee as a director. Our constating documents do not provide for cumulative voting in the election of directors.
Nominees for Election as Directors
Nominees for Election as Directors Amir Adnani, Spencer Abraham, David Kong, Vincent Della Volpe, Gloria Ballesta and Trecia Canty, each of whom is a current director, have been nominated for election as directors. It is the intention of the persons named in the accompanying form of proxy as proxyholders to vote proxies for the election of each of the nominees as a director and each of the nominees has consented to being named in this Proxy Statement and to serve as a director, if elected. Our Board of Directors has conducted an extensive board effectiveness assessment with regard to each director nominee, and it has determined that each director nominee meets a high standard in terms of meeting attendance, preparation and engagement with the Company. All nominees are highly effective and bring a diverse set of backgrounds and expertise to the Board of Directors.
Directors and Executive Officers
Directors and Executive Officers Our current directors and executive officers and their respective ages as of May 28, 2024, are as follows:
Directors and Executive Officers
| Name | Age | Position with the Company | | Amir Adnani | 46 | President, Chief Executive Officer, Principal Executive Officer and a director | | Spencer Abraham | 71 | Chairman (non-executive) and a director | | David Kong | 77 | A director | | Vincent Della Volpe | 81 | A director | | Gloria Ballesta | 48 | A director | | Trecia Canty | 54 | A director | | Pat Obara | 68 | Secretary, Treasurer, Chief Financial Officer and Principal Accounting Officer | | Scott Melbye | 61 | Executive Vice President | | Brent Berg | 52 | Senior Vice President, U.S. Operations |
Directors and Executive Officers
The following describes the business experience of each of our current directors and each nominee for election to our Board of Directors, including other directorships held in reporting companies: Amir Adnani. Amir Adnani is a founder of Uranium Energy Corp. and has served as President, Chief Executive Officer and a director since January 2005. Under his leadership, the Company has developed into the largest diversified North American focused uranium company with low-cost, environmentally friendly in-situ recovery (“ISR”) uranium projects in the United States and high-grade conventional projects in Canada. In the U.S., UEC controls the largest portfolio of fully permitted ISR projects, anchored by two operational processing plants in Wyoming and Texas. In Canada, UEC controls one of the largest portfolios of exploration and development holdings in the prolific Athabasca basin, including the world-class, 100% owned Roughrider Project. Mr. Adnani has given a variety of presentations at prominent industry conferences organized by the International Atomic Energy Agency, World Nuclear Fuel Market and the Milken Institute. He is a frequent contributor to the business media, including CNBC, The Wall Street Journal, Bloomberg, and Fox Business News. Fortune magazine distinguished Mr. Adnani on their “40 Under 40, Ones to Watch” list of North American executives. He was selected as one of “Mining’s Future Leaders” by Mining Journal, a UK-based global industry publication. He was also a nominee for Ernst & Young’s “Entrepreneur of the Year” distinction. Mr. Adnani is the founder and Co-Chairman of GoldMining Inc., a publicly listed gold acquisition and development company and is the Chairman of Uranium Royalty Corp., the first and only publicly listed royalty company in the uranium sector. Mr. Adnani is also a founder of Gold Royalty Corp., a publicly listed gold royalty company where he served as a director from November 2020 to March 2023. Mr. Adnani holds a Bachelor of Science degree from the University of British Columbia and was a director of the university’s Alumni Association from 2015 to 2021. The Board of Directors has concluded that Mr. Adnani should serve as a director given his involvement with the Company since its inception and his experience in the uranium industry. Spencer Abraham. Spencer Abraham has served as Chairman (non-executive) of our Board of Directors since March 2017. Mr. Abraham served as Executive Chairman from October 2015 to March 2017 and as the Chairman of our Advisory Board from December 2012 to October 2015. Mr. Abraham is the Chairman and Chief Executive Officer of The Abraham Group LLC, an international strategic consulting firm based in Washington, D.C. President George W. Bush selected Mr. Abraham as the tenth Secretary of Energy of the United States in 2001. During his tenure at the Energy Department from 2001 to 2005, Mr. Abraham developed policies and regulations to ensure the nation’s energy security, was responsible for the U.S. Strategic Petroleum Reserve, oversaw domestic oil and gas development policy and nuclear energy policy, developed relationships with international governments, including members of the Organization of the Petroleum Exporting Countries, and led the landmark nuclear nonproliferation HEU program between the United States and Russia. Mr. Abraham served as a United States Senator for the State of Michigan from 1995 to 2001. At a time when the Biden Administration and U.S. Congress are considering significant issues pertaining to the U.S. uranium mining sector, Mr. Abraham’s expertise in the public policy arena is especially valuable and he is very actively involved in working with the Company to address these matters. Mr. Abraham has served as a director of Two Harbors Investment Corp. (NYSE: TWO) since May 2014, as a director of PBF Energy Inc. (NYSE: PBF) since October 2012 and as a director of NRG Energy, Inc. (NYSE: NRG) since December 2012. Mr. Abraham served as a director of GenOn Energy, Inc. from January to December 2012, when it was acquired by NRG Energy, Inc. Previously, Mr. Abraham served as a director of Occidental Petroleum Corporation (NYSE: OXY) from 2005 to May 2020, as the non-executive Chairman of the Board of Directors of AREVA Inc., the North American subsidiary of AREVA, and on the boards of several other public and private companies. Mr. Abraham holds a Juris Doctor degree from Harvard Law School and is an alumnus of Michigan State University. The Board of Directors has concluded that Mr. Abraham should serve as a director given his extensive experience in the energy sector, including directing key aspects of energy strategy as Secretary of Energy of the United States from 2001 to 2005, and as a board member of various public companies in the oil, gas and power sectors. David Kong. David Kong has served on our Board of Directors since January 2011 and served as our lead independent director from June 2016 to May 2024. Mr. Kong serves as Chairperson of our Audit Committee and our Sustainability Committee and is a member of our Compensation Committee and our Corporate Governance and Nominating Committee. Mr. Kong has also served as a director of GoldMining Inc., a public company listed on the Toronto Stock Exchange (the “TSX”) and the NYSE American since October 2010, as a director of Silvercorp Metals Inc., a public company listed on the TSX and the NYSE American, from November 2011 to September 2023, and as a director of New Pacific Metals Corp., a public company listed on the TSX and the NYSE American, from November 2010 to December 2022. Mr. Kong holds a Bachelor in Business Administration and earned his Chartered Accountant designation (CPA, CA) in British Columbia, Canada, in 1978. Mr. Kong was a partner at Ellis Foster, Chartered Accountants, from 1981 to 2004, before merging with EY (formerly Ernst & Young LLP), Chartered Professional Accountants, in 2005, where he was a partner until 2010. Mr. Kong is a certified director (ICD.D) of the Institute of Corporate Directors. The Board of Directors has concluded that Mr. Kong should serve as a director given his business experience and specialized expertise in finance and accounting. Vincent Della Volpe. Vincent Della Volpe has served on our Board of Directors since July 2007 and also serves as Chairperson of our Compensation Committee and our Corporate Governance and Nominating Committee and is a member of our Audit Committee. Mr. Della Volpe has served as a professional money manager for over 35 years, including as a senior portfolio manager of pension funds for Honeywell Corporation and as Senior Vice President of the YMCA Retirement fund in New York. Throughout his career, Mr. Della Volpe has particularly focused on the management of energy and utility equity portfolios, and he also has experience managing venture capital investments. Mr. Della Volpe holds a Bachelor of Arts in Accounting and an MBA in finance, both from Seton Hall University. The Board of Directors has concluded that Mr. Della Volpe should serve as a director given his involvement with the Company since 2007 and his specialized expertise in finance.
Directors and Executive Officers
Gloria Ballesta. Gloria Ballesta has served on our Board of Directors since July 2018 and is a member of our Audit Committee, our Compensation Committee, our Corporate Governance and Nominating Committee and our Sustainability Committee. Ms. Ballesta has served as the Chief Executive Officer of Camglo Management SAS, a private company providing software security solutions, since December 2023, and serves as a director of GoldMining Inc., a public company listed on the TSX and the NYSE American since August 2010. Ms. Ballesta served as the Chief Executive Officer of Content Mode SAS, a contact center based in Colombia, from January 2016 to December 2023. Ms. Ballesta has experience managing administrative and compliance procedures for spin-offs, take-overs and financings of various public companies. Ms. Ballesta holds an LLB (Hons.) from the CEU Cardenal Herrera University in Spain and a Master’s degree in Marketing and Business Management from ESIC School of Business in Spain. The Board of Directors has concluded that Ms. Ballesta should serve as a director given her significant international experience and experience serving as an independent director for other reporting companies. Trecia Canty. Trecia Canty has served on our Board of Directors since March 2023 and is a member of our Sustainability Committee. Ms. Canty has over 25 years of experience in finance, strategic transactions, corporate governance, compliance, enterprise risk and ESG and has extensive energy industry experience, including exploration and production, public utilities, pipelines and related businesses in the United States and Canada. Since 2015, Ms. Canty has served as the Senior Vice President, General Counsel and Corporate Secretary and a member of the Executive Committee of PBF Energy Inc. (NYSE: PBF), a Fortune 200 company that is one of the largest independent petroleum refiners and suppliers of unbranded transportation fuels, heating oil, petrochemical feedstocks, lubricants and other petroleum products in the United States. Ms. Canty is a graduate of Dartmouth College and received a Masters degree in Public Affairs from Princeton University’s School of International and Public Affairs and a Juris Doctor from Columbia University’s School of Law. The Board of Directors has concluded that Ms. Canty should serve as a director given her extensive legal, regulatory and senior leadership experience in the energy industry. The following describes the business experience of each of the non-director executive officers of the Company: Pat Obara. Pat Obara has served as our Secretary, Treasurer and Chief Financial Officer since October 2015, and served as our Chief Financial Officer from August 2006 to January 2011 and as our Vice President Administration from January 2011 to October 2015. Mr. Obara currently serves as the Chief Financial Officer and Secretary of GoldMining Inc., a public company listed on the TSX and the NYSE American, and served as a director of GoldMining Inc. from September 2009 to May 2018. Mr. Obara holds a degree in Building Technology, Land and Construction Economics from the British Columbia Institute of Technology. Scott Melbye. Scott Melbye has served as our Executive Vice President since September 2014. Mr. Melbye is a 40-year veteran of the nuclear energy industry having held key leadership positions in major global uranium mining companies and various industry organizations. He has passionately promoted the growth and competitiveness of the nuclear fuel cycle in supporting nuclear power as a clean, affordable and reliable source of energy to meet the world’s ever-expanding needs. As our Executive Vice President, Mr. Melbye is responsible for the uranium marketing and sales function and is a key contributor towards the achievement of the Company’s strategic growth objectives. Mr. Melbye currently serves as the Chief Executive Officer, President and a director of Uranium Royalty Corp., a public company listed on the TSX and the Nasdaq Capital Market. Previously, Mr. Melbye served as the Vice President, Commercial at Uranium Participation Corporation (now Sprott Physical Uranium Trust) from 2014 to 2018, and concurrently served as an advisor, to the Chairman of Kazatomprom, the world’s leading uranium producer in Kazakhstan, guiding their business transformation process as it related to marketing and sales strategy. Through June 2014, Mr. Melbye was Executive Vice President, Marketing for Uranium One, responsible for global sales activities, where he expanded that company’s forward book, particularly in the emerging markets of the United Arab Emirates and China. He also supported the global investor-relations efforts of the Chief Executive Officer during the time that Uranium One was publicly traded on the TSX. Prior to this, Mr. Melbye spent 22 years with the Cameco Group of companies, both at their Saskatoon head office and with their U.S. subsidiaries. He most recently served as President of Cameco Inc., the subsidiary responsible for managing that company’s world-wide uranium marketing and trading activities (achieving annual sales exceeding 30 million pounds U3O8 through established relationships with most global nuclear utilities). Mr. Melbye’s previous experience includes uranium brokerage and trading at Nukem Inc. in New York, and nuclear fuel procurement at the Palo Verde Nuclear Generating Station in Arizona. Mr. Melbye is currently the President of the Uranium Producers of America (“UPA”). The UPA is the domestic mining organization that advocates for U.S. Government policies supportive of national energy, and security and interests of a strong and competitive American uranium industry. He is also a past Chair of the Board of Governors of the World Nuclear Fuel Market. Mr. Melbye is a frequent speaker at nuclear industry conferences and has participated in numerous high-level, United States and Canadian trade missions to markets such as Central Europe, China, India, the United Arab Emirates and Mexico. Mr. Melbye has provided expert testimony before the U.S. House Oversight Committee on Department of Energy inventory dispositions, and the U.S. Senate Energy and Natural Resources Committee on regaining American nuclear leadership and foreign critical minerals dependency. In addition, he testified before the U.S. International Trade Commission on uranium imports from Kazakhstan following the dissolution of the Soviet Union. Mr. Melbye received a Bachelor of Science in Business Administration with degree specialization in International Business from Arizona State University in 1984. Brent Berg. Brent Berg has served as our Senior Vice President, U.S. Operations since March 2024. Mr. Berg is a highly qualified mining and mineral processing professional with over 27 years of experience in the minerals industry, including more than 21 years in uranium production in the United States and Canada. Mr. Berg is the former President of Cameco Resources, where he led Cameco’s U.S. uranium ISR operations in Wyoming and Nebraska. This experience included management and oversight of Cameco’s ISR facilities and the successful start-up and operation of its North Butte satellite ISR operation in Wyoming. Under his management, U.S. production reached over 2.6 million pounds prior to Cameco curtailing production due to market conditions. Mr. Berg also has extensive open pit and underground mining experience, including Cameco’s Key Lake, McArthur River and Rabbit Lake operations.
Directors and Executive Officers
Most recently, Mr. Berg was the President and CEO of Rare Element Resources Ltd., where he was responsible for overall day-to-day management and operation of that company, including its strategic, financial and operational leadership. Mr. Berg is a Professional Engineer with a B.A.Sc. in Regional Environmental Systems Engineering from the University of Regina and an MBA from the University of Regina. In 2023, Mr. Berg completed a Master of Legal Studies, Magna Cum Laude, from the University of Arizona, with a focus on mining law and policy.
Oversight of Executive Compensation Program
| ● | peer group review; |
Oversight of Executive Compensation Program
| ● | review and design our annual non-equity incentive plan; |
Oversight of Executive Compensation Program
| ● | director compensation review; and |
Overview of Executive Compensation Program
| | What We Do ✓ | | What We Do NOT Do | | ✓ | DO align annual incentive pay and performance by linking annual incentive compensation to the achievement of performance goals tied to Company strategic objectives. | × | NO guaranteed cash incentives, equity compensation or salary increases for executives except in limited scenarios in connection with their hiring. | | ✓ | DO align long-term incentive pay and performance by linking a portion of long-term compensation to the achievement of relative and absolute TSR goals. | × | NO full single trigger acceleration of annual equity awards granted to executives. | | ✓ | DO cap payouts for annual incentive and LTIP awards. | × | NO acceleration of performance based equity awards without regard to performance goals, with any acceleration upon a qualifying termination of employment subject to proration as well as the attainment of performance goals measured through the date of the acceleration event. | | ✓ | DO maintain rigorous stock ownership guidelines (3x base compensation for the CEO and 1x base compensation for other executive officers). | × | NO executive retirement plans for any of our executives. | | ✓ | DO maintain a clawback policy with respect to cash and equity incentive compensation. | × | NO compensation or incentives that encourage unnecessary or excessive risk taking. | | ✓ | DO conduct annual compensation review and approval of our compensation philosophy and strategy. | × | NO tax gross ups. | | ✓ | DO appoint a Compensation Committee comprised entirely of independent directors. | × | NO pledging of any of our securities by directors, executive officers or other employees. | | ✓ | DO use an independent compensation consultant engaged by our Compensation Committee. | × | NO hedging or derivative transactions by directors, executive officers or other employees involving our securities. | | ✓ | DO have a majority of executive compensation at risk based on corporate performance. | × | NO perquisites for executives. |
Benchmarking Compensation and Peer Groups
Benchmarking Compensation and Peer Groups In Fiscal 2023 the Compensation Committee commissioned a peer group review from GGA as part of a competitive compensation market update review of executive and director compensation in order to stay abreast of changes in the external market and to ensure that the Company continued to benchmark compensation with appropriate market comparators. In addition to external market trends, the Compensation Committee considered the complexity of the Company and the range of size of several of the appropriate comparable companies and, with the GGA Recommendations provided to them, revised the peer group from the prior year to address changes in the external market and to better reflect our Company’s business (collectively, the “Peer Group”). The Peer Group remained relatively consistent with the prior year and included publicly traded uranium and precious metals mining and oil and gas companies headquartered in North America of similar size and having a market capitalization and/or total assets generally ranging between 0.25 times and four times that of the Company’s. The companies identified below were removed from or added to the Peer Group based on whether they met or continued to meet this selection criteria. The companies removed from the Peer Group were smaller than the Company from a market capitalization perspective and were deemed to be less relevant to the Company. The companies added to the Peer Group aligned better to the Company based on their market capitalization and/or total assets. The Company’s market capitalization was positioned slightly above the median of the Peer Group at the time of the GGA Recommendations. The Peer Group was used by the Compensation Committee to establish the compensation levels for the Company’s executive officers and its Board of Directors. In Fiscal 2023, with the GGA Recommendations, the Company’s compensation philosophy aimed to align both our executive officers’ and Board of Directors’ compensation around the median of the Peer Group. As it relates to executive compensation as a result of the annual compensation review process, executive base compensation and target short-term incentive compensation levels are benchmarked generally below the median levels of comparable roles and experience and the long-term incentive award is benchmarked at or above the median to provide a stronger link of realizable compensation that is tied to longer-term shareholder value creation. At the time of the Peer Group review, the Company was positioned at the 51st percentile on a market capitalization basis, and at the 52nd percentile on a total assets basis compared with the Peer Group. In Fiscal 2023 the following companies were removed from or added to the Peer Group:
Benchmarking Compensation and Peer Groups
| Removed from the Peer Group | Added to the Peer Group | | Global Atomic Corporation | Coeur Mining, Inc. | | IsoEnergy Ltd. | enCore Energy Corp. | | NACCO Industries, Inc. | Filo Corp. (formerly Filo Mining Corp.) | | PolyMet Mining Corp. | K92 Mining Inc. | | Ur-Energy Inc. | Osisko Mining Inc. | | | Seabridge Gold Inc. | | | Torex Gold Resources Inc. |
Benchmarking Compensation and Peer Groups
The adjustments made for the Peer Group were completed to address the Company’s operational and overall year over year total asset growth. When examining peer alternatives, a balanced approach that examined shareholder and other uranium mining company peer groups was used to ensure that the Peer Group aligned within market norms. In Fiscal 2023 the Peer Group was comprised of the following companies:
Benchmarking Compensation and Peer Groups
| Peer Group | | | | Centrus Energy Corp. | Energy Fuels Inc. | NexGen Energy Ltd. | | Coeur Mining, Inc. | Filo Corp. (formerly Filo Mining Corp.) | Northern Oil and Gas, Inc. | | Comstock Resources, Inc. | Fission Uranium Corp. | Osisko Mining Inc. | | Denison Mines Corp. | Gulfport Energy Corporation | Seabridge Gold Inc. | | enCore Energy Corp. | K92 Mining Inc. | Torex Gold Resources Inc. |
Compensation Elements and Rationale
The base compensation paid to our executive officers is more particularly described below under “Executive Services Agreements”. Short-Term Incentive Awards The Company’s short-term incentive plan (the “STIP”) is a variable component of compensation and has the objective of motivating the executive officers to achieve corporate objectives over a one-year period and to provide a means to reward the achievement of corporate milestones and fulfillment of the Company’s annual business plan. The STIP provides an opportunity for an annual cash payout based on performance relative to the achievement of corporate and individual performance goals and metrics. The STIP has a maximum payout opportunity, which is 200% of each executive officer’s target STIP. The Compensation Committee establishes STIP performance goals, metrics, weightings and targets in the first quarter of each fiscal year. Each of our executive officers has a target STIP set as a percentage of their base compensation (each, a “Target Award”), with payouts based on a performance multiplier dependent on corporate and individual performance. The performance multiplier and payouts achieved can range between 0% and 200% of each Target Award. No payout is awarded if the Compensation Committee deems that the Company failed to achieve performance goals. To determine Target Awards our Compensation Committee considers the breadth, scope and complexity of each executive officer’s role, internal equity and whether the executive officer’s incentive compensation is competitive relative to similarly situated executives at companies in our Peer Group. The following sets forth the formula for payment of STIP awards. The following sets forth the Target Awards expressed as a percentage of executive officer base compensation along with the corresponding corporate and individual performance weightings for Fiscal 2023. The performance weightings vary by position within the Company, with corporate performance having a higher weighting for more senior executive officers.
Compensation Elements and Rationale
Performance Scorecard The Compensation Committee establishes a performance scorecard in the first quarter of each fiscal year that sets out performance goals and metrics to guide and motivate the executives to execute on our strategy. At the end of each fiscal year, the Compensation Committee evaluates actual performance relative to the performance goals and metrics and recommends to the Board of Directors the payment of STIP awards. The Compensation Committee and the Board of Directors may exercise discretion to pay cash bonuses outside of the STIP and to not pay STIP awards even if performance awards are earned. In the first quarter of Fiscal 2023, the Compensation Committee selected performance goals and metrics within a performance scorecard. At the end of Fiscal 2023, the Compensation Committee evaluated the performance achieved relative to the performance goals and metrics and assigned each of Messrs. Adnani and Obara an award at breakthrough for corporate and individual performance and assigned Mr. Melbye an award at breakthrough and above threshold for corporate and individual performance, respectively. Messrs. Adnani, Obara and Melbye achieved awards at 200%, 200% and 130% of target, respectively. The following sets forth the performance scorecard for Fiscal 2023.
Compensation Elements and Rationale
| | Weight | | | Performance Levels | | | | | | Performance Metrics | Chief Executive Officer | Chief Financial Officer | Executive Vice President | Threshold (50% of Target Award) | Target (100% of Target Award) | Breakthrough (200% of Target Award) | Result | Payout | | S-K 1300 Reporting | 10% | 7.5% | 6% | Roughrider | Roughrider plus one TRS report | Roughrider plus two TRS reports | S-K 1300: Six TRS reports filed | Breakthrough | | Accretive Acquisitions | 30% | 22.5% | 19% | Increase resources with accretive acquisitions | | | Acquisitions: Completed | Breakthrough | | Balance Sheet | | | | Strengthen the balance sheet to support growth initiatives with at least $50 million of liquid assets comprised of cash and the fair value of physical uranium and equity holdings | | | Balance Sheet: Exceeded $70 | Breakthrough | | | 10% | 7.5% | 6% | $50 million | $60 million | $70 million | million | | | | | | | Increase licensed capacity to four million pounds of U3O8 annually at our Hobson Processing Facility (“Hobson Capacity”) and project milestones | | | | | | Texas Production Growth | 7.5% | 6% | 5% | Increase Hobson Capacity to four million pounds | Increase Hobson Capacity plus define Production Area 2 at our Burke Hollow Project | Increase Hobson Capacity plus define Production Area 2 at our Burke Hollow Project and commence development drilling at our Palangana Mine Production Area 4 | Texas Production Growth: Completed | Breakthrough | | | | | | De-risk and complete a plan for resumption of operations at Christensen including start-up plan preparation, wellfield preparation, plant and pump stations preparation, testing and mobilizing human resources to commence delineation and resource growth drilling | | | | | | Wyoming | 7.5% | 6% | 5% | Complete a plan for resumption of operations at Christensen including mobilizing human resources to commence delineation and resource growth drilling | Complete drilling at Irigaray Mine Unit 15 | Complete drilling at Irigaray Mine Unit 15 and Christensen Mine Unit 12 south | Wyoming: Completed | Breakthrough | | | | | | Goal 1: Conduct a climate risk assessment to prepare for disclosure aligned with recommendations of the Task Force on Climate-related Financial Disclosures Goal 2: Measure GHG emissions at all Texas operations for Fiscal 2023 Goal 3: Measure GHG emissions at all Wyoming operations for Fiscal 2023 Goal 4: Measure GHG emissions at all Saskatchewan operations for Fiscal 2023 | | | ESG Program: Four of four goals completed | | | ESG Program | 7.5% | 6% | 5% | Two of four goals | Three of four goals | Four of four goals | | Breakthrough | | Total Recordable Injury and Illness Incidence Rate | 7.5% | 6% | 5% | Promote high performing safe environments with no recordable injuries | | | Rate: Zero | Breakthrough | | | | | | Rate below 4.8 | Rate below 3.2 | Rate below 1.6 and no fatalities | | | | | | | | Chief Executive Officer: Exceeded Expectations | | | Individual | | | Individual Performance | 20% | -- | -- | Below Expectations | Met Expectations | Exceeded Expectations | Performance: Exceeded Expectations | Breakthrough | | | | | | Chief Financial Officer: Exceeded Expectations | | | Individual | | | Individual Performance | -- | 40% | -- | Below Expectations | Met Expectations | Exceeded Expectations | Performance: Exceeded Expectations | Breakthrough | | | | | | Executive Vice President: Met Expectations | | | Individual | | | Individual Performance | -- | -- | 50% | Below Expectations | Met Expectations | Exceeded Expectations | Performance: Met Expectations | Above Threshold |
Compensation Elements and Rationale
Performance Goals and Metrics The Compensation Committee selected the following performance goals and metrics within the Company’s performance scorecard on the belief that these performance goals and metrics were aligned with our corporate strategy and could be impacted by our executive officers. In Fiscal 2023, the payout opportunities for threshold, target and breakthrough performance levels were set at 50%, 100% and 200% of each Target Award, respectively, with interpolation between performance levels. SEC S-K 1300 Reporting: The Compensation Committee selected this metric based on the belief that adopting the reporting requirements of SEC Regulation S-K 1300 (“S-K 1300”) in technical report summaries (each, a “TRS”) is important to the Company’s organizational development and is required for compliance with SEC regulations to provide our stockholders with a more comprehensive understanding of our mineral holdings. This metric represented 10%, 7.5% and 6% of the STIP weighting for Messrs. Adnani, Obara and Melbye, respectively. Publication of a TRS report for the Roughrider Project plus one additional TRS report represented the target level of performance, publication of a TRS report for the Roughrider Project represented the threshold level of performance and publication of a TRS report for the Roughrider Project plus two additional TRS reports represented the breakthrough level of performance. The result was breakthrough performance at 200%. As of July 31, 2023, the Company had completed and filed six TRS reports respecting each of our Texas ISR Hub and Spoke, updated Wyoming ISR Hub and Spoke, Shea Creek, Horseshoe-Raven, Workman Creek and Roughrider Projects on August 11, 2022, September 14, 2022, January 13, 2023, January 24, 2023, March 16, 2023 and May 2, 2023, respectively. Accretive Acquisitions: The Compensation Committee selected this metric based on the belief that the acquisition of additional accretive uranium deposits is aligned to the Company’s growth objectives. This metric represented 30%, 22.5% and 19% of the STIP weighting for Messrs. Adnani, Obara and Melbye, respectively. The acquisitions of UEX Corporation (“UEX”) and the Roughrider Project represented opportunities to acquire multiple assets located in Canada’s Athabasca Basin, a premier uranium mining jurisdiction. The acquisitions build on our strategic objectives to create the leading western supplier of secure and 100% unhedged uranium with near-term, fully permitted and low-cost U.S. ISR production; and a Canadian high-grade conventional pipeline. Completion of the acquisitions represented the breakthrough level of performance. No threshold or target award opportunities were established for this metric. The result was breakthrough performance at 200%. The Company completed its acquisitions of UEX and the Roughrider Project on August 19, 2022 and October 14, 2022, respectively. Balance Sheet: The Compensation Committee selected this metric based on the belief that strengthening the Company’s balance sheet with at least $50 million of liquid assets comprised of cash and the fair value of physical uranium and equity holdings is important to support the Company’s growth initiatives. This metric represented 10%, 7.5% and 6% of the STIP weighting for Messrs. Adnani, Obara and Melbye, respectively. $60 million of liquid assets represented the target level of performance, $50 million of liquid assets represented the threshold level of performance and $70 million of liquid assets represented the breakthrough level of performance. The result was breakthrough performance at 200%. As of July 31, 2023, the Company had liquid assets of approximately $107 million. Texas Production Growth: The Compensation Committee selected this metric based on the belief that increasing Hobson Capacity and achieving project milestones will support additional production capacity and create stockholder value through higher production levels and lower production costs. This metric represented 7.5%, 6% and 5% of the STIP weighting for Messrs. Adnani, Obara and Melbye, respectively. Our fully-licensed and 100%-owned Hobson Processing Facility forms the basis for our hub and spoke strategy in the State of Texas. Increasing Hobson Capacity plus defining Production Area 2 at our Burke Hollow Project represented the target level of performance, increasing Hobson Capacity represented the threshold level of performance and increasing Hobson Capacity plus defining Production Area 2 at our Burke Hollow Project and commencing development drilling at our Palangana Mine Production Area 4 represented the breakthrough level of performance. The result was breakthrough performance at 200%. As of July 31, 2023, the Company had increased Hobson Capacity, defined Production Area 2 at our Burke Hollow Project and completed development drilling at our Palangana Mine Production Area 4. Wyoming: The Compensation Committee selected this metric on the belief that de-risking and completing a plan for the resumption of operations at its Christensen Ranch Mine including start-up plan preparation, wellfield preparation, plant and pump stations preparation, testing and mobilizing human resources to commence delineation and resource growth drilling will advance the Company’s ability to resume uranium production at the central focus of our hub and spoke operations in the State of Wyoming. This metric represented 7.5%, 6% and 5% of the STIP weighting for Messrs. Adnani, Obara and Melbye, respectively. Completing drilling at the Company’s Irigaray Mine Unit 15 represented the target level of performance, completing a plan for the resumption of operations at the Christensen Ranch Mine including mobilizing human resources to commence delineation and resource growth drilling, represented the threshold level of performance, and completing drilling at our Irigaray Mine Unit 15 and Christensen Mine Unit 12 south represented the breakthrough level of performance. The result was breakthrough performance at 200%. As of July 31, 2023, the Company had completed a plan for the resumption of operations at its Christensen Ranch Mine and completed drilling at its Irigaray Mine Unit 15 and Christensen Mine Unit 12 south. ESG Program: The Compensation Committee selected this metric to support the Company’s commitment to being a responsible steward of our environment and the communities where we operate. This metric required the Company to: (i) conduct a climate risk assessment to prepare for disclosure aligned with recommendations of the Task Force on Climate-related Financial Disclosures; (ii) measure GHG emissions at all Texas operations for Fiscal 2023; (iii) measure GHG emissions at all Wyoming operations for Fiscal 2023; and (iv) measure GHG emissions at all Saskatchewan operations for Fiscal 2023. This metric represented 7.5%, 6% and 5% of the STIP weighting for Messrs. Adnani, Obara and Melbye, respectively. The target level of performance required the Company to achieve any three of the four goals, the threshold level of performance required the Company to achieve any two of the four goals and the breakthrough level of performance required the Company to achieve all of the four goals. The result was breakthrough performance at 200%. As of July 31, 2023, the Company had achieved all of the four goals.
Compensation Elements and Rationale
Total Recordable Injury and Illness Incidence Rate: The Compensation Committee selected this metric based on the belief that the total recordable injury and illness incidence rate (“IIR”) is critical to the Company’s overall approach to promoting high performing safe environments. The Company’s IIR is calculated by multiplying the total number of Occupational Safety and Health Administration (“OSHA”) recordable injuries and illnesses at our operations by 200,000 and dividing that result by the total number of hours worked by all employees at our operations. In this formula, 200,000 represents the number of hours that would be worked by 100 employees working 40 hours per week, 50 weeks per year, and provides the standard base for calculating incidence rates for a year pursuant to OSHA guidance. This metric represented 7.5%, 6% and 5% of the STIP weighting for Messrs. Adnani, Obara and Melbye, respectively. An IIR below 3.2 represented the target level of performance, an IIR below 4.8 represented the threshold level of performance and an IIR below 1.6 and no work-related fatalities represented the breakthrough level of performance. The result was breakthrough performance at 200%. The Company achieved an IIR of zero for Fiscal 2023, having no work-related fatalities, recordable injuries or illnesses among employees at our operations. Individual Performance: The Compensation Committee made a subjective determination of individual performance for each executive officer to determine whether the executive officer earned an award for performance in Fiscal 2023. For Fiscal 2023, this metric represented 20%, 40% and 50% of the STIP weighting for Messrs. Adnani, Obara and Melbye, respectively. Individual performance goals included maintaining a high performing leadership team, strategic planning and advancing growth objectives. Performance that qualified for an award at the threshold level was expected in normal operating circumstances, performance that qualified for an award at the target level was believed to be achievable only with additional efforts and results and performance that qualified for an award at the breakthrough level was determined to be achievable only with extraordinary efforts and results. The result was performance achieved at 200%, 200% and 60% for Messrs. Adnani, Obara and Melbye, respectively.
Compensation and Risk
| ● | our STIP has a cap on the total amount of payment any position may receive; |
Compensation and Risk
| ● | the use of performance based long-term incentive compensation to encourage a focus on long-term corporate performance; |
Compensation and Risk
| ● | established a clawback policy applicable to all cash and equity incentive compensation; and |
Summary Compensation Table
Summary Compensation Table The following table sets forth the compensation paid to our Chief Executive Officer, Chief Financial Officer and those executive officers that earned in excess of $100,000 during the fiscal years ended July 31, 2023, 2022 and 2021 (each, a “Named Executive Officer”):
Summary Compensation Table
| Name and Principal Position | Year | Salary (1) | Bonus (2) | Stock Awards (3) | Option Awards (4) | Non-Equity Incentive Plan Compensation (5) | Non-Qualified Deferred Compensation Earnings | All Other Compensation | Total | | Amir Adnani | 2023 | $478,000 | $- | $2,026,264(6) | $240,516 | $956,000 | $- | $- | $3,700,780 | | President and | 2022 | 449,167 | 22,000 | 964,705(7) | - | 880,000 | - | - | 2,315,872 | | Chief Executive Officer | 2021 | 440,000 | 300,000 | 895,553(8) | - | - | - | - | 1,635,553 | | Pat Obara (9) | 2023 | 152,023 | - | 280,229(6) | 33,262 | 186,462 | - | - | 651,977 | | Secretary, Treasurer and | 2022 | 156,877 | 7,087 | 201,820(7) | - | 150,011 | - | - | 515,795 | | Chief Financial Officer | 2021 | 141,309 | 50,000 | 255,292(8) | - | - | - | - | 446,601 | | Scott Melbye | 2023 | 277,644 | - | 344,894(6) | 40,939 | 170,000 | - | - | 833,476 | | Executive Vice President | 2022 | 263,862 | 12,500 | 264,893(7) | - | 150,000 | - | - | 691,255 | | | 2021 | 250,000 | 50,000 | 255,292(8) | - | - | - | - | 555,292 |
Summary Compensation Table
| (1) These amounts represent fees paid by us to our Named Executive Officers during the year pursuant to various executive services agreements, between us and the Named Executive Officers, which are more particularly described below. For Fiscal 2021, these amounts include the following restitution payments: to Mr. Adnani: $71,507; to Mr. Obara: CA$25,112; and to Mr. Melbye: $27,944. | | (2) For Fiscal 2022, these amounts represent discretionary bonuses paid in the fiscal year. | | (3) These amounts represent the aggregate grant date fair value of RSUs and PRSUs. For Fiscal 2023, the grant date fair value of each RSU is $3.32 per share based on the most recent closing price of our common stock as of the grant date of July 31, 2023, and the grant date fair value of each PRSU is $3.347257 per unit, which incorporates the potential to vest, depending on the performance, from 0% to 200% of the number of PRSUs. The fair value of each PRSU was calculated using the Monte Carlo simulation model. The following assumptions were used to value the PRSUs granted on July 31, 2023: expected risk free interest rate: 4.52%; expected volatility: 84.56%; expected dividend yield: 0%; expected life in years: 3.0; and correlation: 81.22%. For Fiscal 2022, the grant date fair value of each RSU is $3.98 per share based on the most recent closing price of our common stock as of the grant date of July 29, 2022, and the grant date fair value of each PRSU is $4.8033 per unit, which incorporates the potential to vest, depending on the performance, from 0% to 200% of the number of PRSUs. The fair value of each PRSU was calculated using the Monte Carlo simulation model. The following assumptions were used to value the PRSUs granted on July 29, 2022: expected risk free interest rate: 2.80%; expected volatility: 90.90%; expected dividend yield: 0%; expected life in years: 3.0; and correlation: 76.89%. For Fiscal 2021, the grant date fair value of each RSU is $2.15 per share based on the most recent closing price of our common stock as of the grant date of July 21, 2021, and the grant date fair value of each PRSU is $2.48 per unit, which incorporates the potential to vest, depending on the performance, from 0% to 200% of the number of PRSUs. The fair value of each PRSU was calculated using the Monte Carlo simulation model. The following assumptions were used to value the PRSUs granted on July 21, 2021: expected risk free interest rate: 0.39%; expected volatility: 78.03%; expected dividend yield: 0%; expected life in years: 3.0; and correlation: 66.02%. | | (4) These amounts represent the aggregate grant date fair value of PSOs which was estimated using the Black-Scholes option pricing model. The following assumptions were used to value the PSOs granted on July 31, 2023: exercise price: $3.98; expected risk free interest rate: 4.137%; expected annual volatility: 79.457%; expected life in years: 5.0; expected annual dividend yield: $Nil; and Black-Scholes value: $2.092991. | | (5) These amounts represent cash awards under our STIP. The payments for Fiscal 2023 and Fiscal 2022 were made after our year-end results were evaluated in August 2023 and August 2022, respectively. | | (6) This amount represents the aggregate grant date fair value of RSUs and PRSUs granted on July 31, 2023. | | (7) This amount represents the aggregate grant date fair value of RSUs and PRSUs granted on July 29, 2022. | | (8) This amount represents the aggregate grant date fair value of RSUs and PRSUs granted on July 21, 2021. | | (9) For each of Fiscals 2023, 2022 and 2021, the Company paid Mr. Obara in Canadian currency. For the purpose of reporting the base compensation paid to Mr. Obara, the compensation was converted from Canadian currency to U.S. currency at the Bank of Canada rate for the years ended July 31st. |
Grants of Plan Based Awards
Grants of Plan Based Awards We granted awards to the Named Executive Officers in Fiscal 2023, as follows:
Grants of Plan Based Awards
| | | | Estimated Future Payouts Under Non-Equity Incentive Plan Awards (2) | | | Estimated Future Payouts Under Equity Incentive Plan Awards | | | All Other Stock Awards: Number of Shares | All Other Option Awards: Number of Securities | Exercise Price of Option | Grant Date Fair Value of Stock and Option | | Name | Award Type (1) | Grant Date | Threshold ($) | Target ($) | Maximum ($) | Threshold | Target | Maximum | of Stock or Units | Underlying Options | Awards ($) | Awards ($) | | Amir Adnani | STIP | August 1, 2022 | 167,300 | 334,600 | 956,000 | - | - | - | - | - | - | - | | President and | PSO | July 31, 2023 | - | - | - | - | - | - | - | 114,915 | 3.98 | 240,516(3) | | Chief Executive | RSU (6) | July 31, 2023 | - | - | - | - | - | - | 397,692 | - | - | 1,320,337(4) | | Officer | PRSU (6) | July 31, 2023 | - | - | - | 105,449 | 210,897 | 421,795 | - | - | - | 705,926(5) | | Pat Obara | STIP | August 1, 2022 | 36,127 | 72,254 | 186,462 | - | - | - | - | - | - | - | | Secretary, | PSO | July 31, 2023 | - | - | - | - | - | - | - | 15,892 | 3.98 | 33,262(3) | | Treasurer and | RSU | July 31, 2023 | - | - | - | - | - | - | 55,000 | - | - | 182,600(4) | | Chief Financial Officer | PRSU | July 31, 2023 | - | - | - | 14,584 | 29,167 | 58,333 | - | - | - | 97,629(5) | | Scott Melbye | STIP | August 1, 2022 | 53,320 | 106,640 | 262,500 | - | - | - | - | - | - | - | | Executive Vice | PSO | July 31, 2023 | - | - | - | - | - | - | - | 19,560 | 3.98 | 40,939(3) | | President | RSU | July 31, 2023 | - | - | - | - | - | - | 67,692 | - | - | 224,737(4) | | | PRSU | July 31, 2023 | - | - | - | 17,949 | 35,897 | 71,795 | - | - | - | 120,156(5) |
Grants of Plan Based Awards
| (1) STIP – refers to awards under our STIP. PSO – refers to performance stock options granted under our 2023 Stock Incentive Plan. RSU – refers to restricted stock units granted under our 2023 Stock Incentive Plan. PRSU – refers to performance based restricted stock units granted under our 2023 Stock Incentive Plan. | | (2) These figures represent possible payouts pursuant to the STIP for Fiscal 2023. | | (3) These amounts represent the aggregate grant date fair value of PSOs which was estimated using the Black-Scholes option pricing model. The following assumptions were used to value the PSOs granted on July 31, 2023: exercise price: $3.98; expected risk free interest rate: 4.137%; expected annual volatility: 79.457%; expected life in years: 5.0; expected annual dividend yield: $Nil; and Black-Scholes value: $2.092991. | | (4) The grant date fair value of each RSU is $3.32 per share based on the most recent closing price of our common stock as of the grant date of July 31, 2023. | | (5) The grant date fair value of each PRSU is $3.347257 per unit, which incorporates the potential to vest, depending on the performance, from 0% to 200% of the number of PRSUs. The fair value of each PRSU was calculated using the Monte Carlo simulation model. The following assumptions were used to value the PRSUs granted on July 31, 2023: expected risk free interest rate: 4.52%; expected volatility: 84.56%; expected dividend yield: 0%; expected life in years: 3.0; and correlation: 81.22%. | | (6) Indirectly held by the Named Executive Officer. |
Outstanding Equity Awards
Outstanding Equity Awards The following table sets forth information as at July 31, 2023, relating to equity awards that have been granted to the Named Executive Officers:
Outstanding Equity Awards
| | | | Option Awards | | | | Stock Awards | | | | | Name | Award Type (1) | Grant Date | Number of Securities Underlying Unexercised Options Exercisable (#) | Number of Securities Underlying Unexercised Options Unexercisable (#) | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) (2) | Market Value of Shares or Units of Stock That Have Not Vested ($) (3) | Equity Incentive Plan Awards: Number of Unearned Shares or Units of Stock That Have Not Vested (#) (4) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares or Units of Stock That Have Not Vested ($) (5) | | Amir Adnani | Option | July 30, 2019 | 550,000 | - | 0.9421 | July 30, 2029 | - | - | - | - | | President and | Option | July 16, 2020 | 150,000 | - | 0.91 | July 16, 2030 | - | - | - | - | | Chief Executive | PSO | July 16, 2020 | 850,000 | - | 1.10 | July 16, 2030 | - | - | - | - | | Officer | PSO | July 31, 2023 | - | 114,915 | 3.98 | July 31, 2033 | - | - | - | - | | | RSU | July 21, 2021 | - | - | - | | 78,489 | 282,560 | - | - | | | RSU | July 29, 2022 | - | - | - | | 96,081 | 345,892 | - | - | | | RSU (6) | July 31, 2023 | - | - | - | | 397,692 | 1,431,691 | - | - | | | PRSU | July 21, 2021 | - | - | - | | - | - | 156,977 | 389,303 | | | PRSU | July 29, 2022 | - | - | - | | - | - | 81,424 | 391,104 | | | PRSU (6) | July 31, 2023 | - | - | - | | - | - | 210,897 | 705,926 | | Pat Obara | Option | July 30, 2019 | 200,000 | - | 0.9421 | July 30, 2029 | - | - | - | - | | Secretary, | Option | July 16, 2020 | 125,000 | - | 0.91 | July 16, 2030 | - | - | - | - | | Treasurer and | PSO | July 16, 2020 | 250,000 | - | 1.10 | July 16, 2030 | - | - | - | - | | Chief Financial | PSO | July 31, 2023 | - | 15,892 | 3.98 | July 31, 2033 | - | - | - | - | | Officer | RSU | July 21, 2021 | - | - | - | | 22,375 | 80,550 | - | - | | | RSU | July 29, 2022 | - | - | - | | 20,101 | 72,364 | - | - | | | RSU | July 31, 2023 | - | - | - | | 55,000 | 198,000 | - | - | | | PRSU | July 21, 2021 | - | - | - | | - | - | 44,749 | 110,978 | | | PRSU | July 29, 2022 | - | - | - | | - | - | 17,034 | 81,819 | | | PRSU | July 31, 2023 | - | - | - | | - | - | 29,167 | 97,629 | | Scott Melbye | Option | July 30, 2019 | 125,000 | - | 0.9421 | July 30, 2029 | - | - | - | - | | Executive Vice | Option | July 16, 2020 | 125,000 | - | 0.91 | July 16, 2030 | - | - | - | - | | President | PSO | July 16, 2020 | 225,000 | - | 1.10 | July 16, 2030 | - | - | - | - | | | PSO | July 31, 2023 | - | 19,560 | 3.98 | July 31, 2033 | - | - | - | - | | | RSU | July 21, 2021 | - | - | - | | 22,375 | 80,550 | - | - | | | RSU | July 29, 2022 | - | - | - | | 26,382 | 94,975 | - | - | | | RSU | July 31, 2023 | - | - | - | | 67,692 | 243,691 | - | - | | | PRSU | July 21, 2021 | - | - | - | | - | - | 44,749 | 110,978 | | | PRSU | July 29, 2022 | - | - | - | | - | - | 22,358 | 107,392 | | | PRSU | July 31, 2023 | - | - | - | | - | - | 35,897 | 120,156 |
Outstanding Equity Awards
| (1) Option – refers to stock options granted under our 2023 Stock Incentive Plan. PSO – refers to performance stock options granted under our 2023 Stock Incentive Plan. RSU – refers to restricted stock units granted under our 2023 Stock Incentive Plan. PRSU – refers to performance based restricted stock units granted under our 2023 Stock Incentive Plan. | | (2) RSUs granted on July 21, 2021 vest in substantially equal installments on each of July 21, 2022, 2023 and 2024. RSUs granted on July 29, 2022 vest in substantially equal installments on each of July 29, 2023, 2024 and 2025. RSUs granted on July 31, 2023 vest in substantially equal installments on each of July 31, 2024, 2025 and 2026. | | (3) The value shown is based on the closing price of our common stock of $3.60 per share on July 31, 2023. | | (4) Represents unearned shares under target PRSUs granted on July 21, 2021, July 29, 2022 and July 31, 2023. The PRSUs granted on July 21, 2021 cliff vest on July 21, 2024 depending on a three-year relative TSR performance. The PRSUs granted on July 29, 2022 cliff vest on July 29, 2025 depending on a three-year relative TSR performance. The PRSUs granted on July 31, 2023 cliff vest on July 31, 2026 depending on a three-year relative TSR performance. | | (5) The grant date fair value of each PRSU granted on July 21, 2021 is $2.48 per unit, which incorporates the potential to vest, depending on the performance, from 0% to 200% of the number of PRSUs. The fair value of each PRSU was calculated using the Monte Carlo simulation model. The following assumptions were used to value the PRSUs granted on July 21, 2021: expected risk free interest rate: 0.39%; expected volatility: 78.03%; expected dividend yield: 0%; expected life in years: 3.0; and correlation: 66.02%. The grant date fair value of each PRSU granted on July 29, 2022 is $4.8033 per unit, which incorporates the potential to vest, depending on the performance, from 0% to 200% of the number of PRSUs. The fair value of each PRSU was calculated using the Monte Carlo simulation model. The following assumptions were used to value the PRSUs granted on July 29, 2022: expected risk free interest rate: 2.80%; expected volatility: 90.90%; expected dividend yield: 0%; expected life in years: 3.0; and correlation: 76.89%. The grant date fair value of each PRSU granted on July 31, 2023 is $3.347257 per unit, which incorporates the potential to vest, depending on the performance, from 0% to 200% of the number of PRSUs. The fair value of each PRSU was calculated using the Monte Carlo simulation model. The following assumptions were used to value the PRSUs granted on July 31, 2023: expected risk free interest rate: 4.52%; expected volatility: 84.56%; expected dividend yield: 0%; expected life in years: 3.0; and correlation: 81.22%. | | (6) Indirectly held by the Named Executive Officer. | | (7) Stock options granted on July 30, 2019 and July 16, 2020 vest as to one-eighth on each day which is three and six months, respectively, from the date of grant and one-quarter on each day which is 12, 18 and 24 months, respectively, from the date of grant. PSOs granted on July 16, 2020 vest in substantially equal installments on each of July 16, 2021, 2022 and 2023. PSOs granted on July 31, 2023 vest in substantially equal installments on each of July 31, 2024, 2025 and 2026. |
Option Exercises and Stock Vested
Option Exercises and Stock Vested The following table sets forth the value realized on stock options exercised and stock awards vested for the Named Executive Officers for Fiscal 2023:
Option Exercises and Stock Vested
| | Option Awards | | Stock Awards | | | Name | Number of Shares Acquired on Exercise | Value Realized on Exercise (1) ($) | Number of Shares Acquired on Vesting | Value Realized on Vesting (2) ($) | | Amir Adnani, President and Chief Executive Officer | 236,964 | 1,115,250 | 259,861 | 827,438 | | Pat Obara, Secretary, Treasurer and Chief Financial Officer | 77,541 | 366,000 | 71,590 | 227,383 | | Scott Melbye, Executive Vice President | 75,000 | 126,000 | 63,898 | 204,014 |
Option Exercises and Stock Vested
Notes:
Option Exercises and Stock Vested
| (1) This amount represents the difference between the closing price of our common stock on the date of exercise and the exercise price of the stock option. | | (2) These amounts represent the number of RSUs vested multiplied by the closing price of our common stock on each of the vesting dates and is calculated before payment of any applicable withholding taxes. |
No Pension Benefits
No Pension Benefits The Company does not maintain any plan that provides for payments or other benefits to its executive officers at, following or in connection with their retirement and including, without limitation, any tax-qualified defined benefit plans or supplemental executive retirement plans.
No Nonqualified Deferred Compensation
No Nonqualified Deferred Compensation The Company does not maintain any defined contribution or other plan that provides for the deferral of compensation on a basis that is not tax-qualified.
Director Compensation
Director Compensation Our non-executive directors receive an annual retainer consisting of cash and equity compensation for their annual service. The value and form of equity awards granted to each director is based on the experience of the director, time spent on Company matters and the compensation paid to directors of other companies in the industry. In Fiscal 2023 RSU and stock options were awarded to our non-executive directors. The RSUs vest over 36 months. The stock options vest over 24 months. The following table sets forth information relating to compensation paid to our directors for Fiscal 2023:
Director Compensation
| Name (1) | Fees Earned Or Paid In Cash | Stock Awards (2) | Option Awards (3) | Non-Equity Incentive Plan Compensation | Non-Qualified Deferred Compensation Earnings | All Other Compensation | Total | | Spencer Abraham | $157,500 | $127,694 | $127,876 | $- | $- | $- | $413,070 | | David Kong | 23,474 | 51,078 | 51,151 | - | - | - | 125,703 | | Vincent Della Volpe | 31,500 | 51,078 | 51,151 | - | - | - | 133,729 | | Ganpat Mani (4) | 26,250 | - | - | - | - | - | 26,250 | | Gloria Ballesta | 23,474 | 51,078 | 51,151 | - | - | - | 125,703 | | Trecia Canty (5) | 11,768 | 51,078 | 51,151 | - | - | - | 113,997 |
Director Compensation
Notes:
Director Compensation
| (1) Information for Mr. Adnani is disclosed above in the “Summary Compensation Table” and is not reported in the “Director Compensation” table of this Proxy Statement. | | (2) These amounts represent the grant date fair value of RSUs. The grant date fair value of each RSU is $3.32 per share based on the most recent closing price of our common stock as of the grant date of July 31, 2023. RSUs granted on July 31, 2023 vest in substantially equal installments on each of July 31, 2024, 2025 and 2026. | | (3) These amounts represent the grant date fair value of the stock options which was estimated using the Black-Scholes option pricing model. The following assumptions were used to value the stock options granted on July 31, 2023: exercise price: $3.32; expected risk free interest rate: 4.137%; expected annual volatility: 79.457%; expected life in years: 5.0; expected annual dividend yield: $Nil; and Black-Scholes value: $2.20. | | (4) Mr. Mani ceased serving as a director of the Company on July 20, 2023. | | (5) Ms. Canty was appointed as a director of the Company on March 17, 2023. |
Director Compensation
As at July 31, 2023, our directors held stock options to acquire an aggregate of 2,559,004 shares of our common stock as follows: Spencer Abraham: 127,967 stock options; Amir Adnani: 1,664,915 stock options including PSOs; David Kong: 213,995 stock options; Vincent Della Volpe: 210,954 stock options; Gloria Ballesta: 217,954 stock options; and Trecia Canty: 123,219 stock options. Spencer Abraham has served as Chairman (non-executive) of our Board of Directors since March 2, 2017. Mr. Abraham served as Executive Chairman from October 14, 2015 to March 2, 2017, and as Chairman of our Advisory Board from December 2012 to October 2015. Mr. Abraham became an independent director in May of 2024. Mr. Abraham is retained according to an appointment letter with our Company. In Fiscal 2023, Mr. Abraham was compensated at a rate of $10,500 per month, paid in monthly installments, and $31,500 per year, paid in quarterly installments, for his services as a director of the Company. Effective on August 1, 2023, the monthly fee payable to Mr. Abraham was increased to $14,166.67. All monthly and annual fees payable by the Company to Mr. Abraham are considered directors’ fees and have been accounted for as such by the Company. As at August 1, 2023 Mr. Abraham has only received directors’ fees on a monthly basis. The compensation paid to Mr. Abraham is more particularly described below under “Director Services Agreement”. Amir Adnani serves as the Company’s Chief Executive Officer, President and a director. Within his capacity as President and Chief Executive Officer, and through an executive services agreement with a private company, Adnani Corp., controlled by Mr. Adnani, he provides various consulting services to the Company. Mr. Adnani does not receive additional compensation in connection with his service as a director of the Company. Mr. Adnani’s direct and indirect compensation as an executive officer of the Company is disclosed above in the “Summary Compensation Table”. In Fiscal 2023 David Kong, Vincent Della Volpe, Ganpat Mani, Gloria Ballesta and Trecia Canty served as independent directors of the Company and Mr. Kong served as the Company’s lead independent director. Mr. Kong serves as Chairperson of each of the Company’s Audit Committee and Sustainability Committee. Mr. Della Volpe serves as Chairperson of each of the Company’s Compensation Committee and Corporate Governance and Nominating Committee. Ms. Canty was appointed as a director of the Company on March 17, 2023. Mr. Mani did not stand for re-election at the Company’s 2023 annual meeting of stockholders. In Fiscal 2023 the annual retainer fees paid to our independent directors were as follows: David Kong: CA$31,500 per year; Vincent Della Volpe: $31,500 per year; Ganpat Mani: $26,250 per year; Gloria Ballesta: CA$31,500 per year; and Trecia Canty: $31,500 per year. The amounts listed above were all-inclusive retainer fees and there were no additional Board of Directors’ Committee Chairperson or member retainer fees or meeting attendance fees in Fiscal 2023. In addition to such retainers, our directors may, from time to time, receive equity compensation, which is granted on a discretionary basis. The value and form of equity compensation granted is based on the experience of the director, time spent on Company matters and a comparison of the compensation paid to directors of other companies in the industry. Standard retainer amounts paid to directors, as well as any equity compensation, is determined by the Company’s Compensation Committee and ratified by the Board of Directors. Effective from August 1, 2023, the annual retainer fees paid to our non-executive directors increased and additional annual retainer fees are paid for serving as Chairperson and/or member of each of the standing Board of Directors’ Committees. Effective from August 1, 2023, the annual retainer fees paid to our non-executive directors are as follows:
Director Compensation
| Board Position | Retainer | | Chairperson (non-executive) | $170,000 | | Non-Executive Director | $33,000 | | Audit Committee Chairperson | $10,000 | | Committee Chairperson other than Audit (1) | $5,000 | | Committee Members including the Chairperson (2) | $5,000 |
Director Compensation
| (1) Board of Directors’ Committee Chairperson retainers applicable to the Compensation Committee, the Corporate Governance and Nominating Committee and the Sustainability Committee. | | (2) Committee member retainers applicable to the Audit Committee, the Compensation Committee, the Corporate Governance and Nominating Committee and the Sustainability Committee. Each Committee Chairperson also receives the base Committee member retainer. |
Pay Ratio
Pay Ratio As required by the Dodd-Frank Wall Street Reform and Consumer Protection Act, and Item 402(u) of Regulation S-K, we are providing the following information about the relationship of the annual total compensation of our employees and the annual total compensation of Amir Adnani, our President and Chief Executive Officer (“CEO”; and the “CEO Pay Ratio”). For Fiscal 2023, our last completed fiscal year:
Pay Ratio
| ● | the median of the annual total compensation of all employees of our Company (other than our CEO) was $81,061; and |
Pay Ratio
| ● | the annual total compensation of our CEO, as reported in the “Summary Compensation Table” above, was $3,700,780. |
Pay Ratio
Based on this information, for Fiscal 2023 the ratio of the annual total compensation of our CEO to the median of the annual total compensation of all employees was approximately 46 to 1. We believe our CEO Pay Ratio for Fiscal 2023 demonstrates our pay-for-performance philosophy. Our compensation program consists of both fixed and variable components and is designed to motivate all employees to produce superior short and long-term corporate performance. The ratio of our CEO’s base compensation to the base compensation of our median employee was approximately 46 to 1 because our compensation philosophy aims to position the fixed portion of our CEO’s compensation near the 50th percentile of his position per the Peer Group review conducted by GGA. Given our CEO’s level of responsibility, experience and potential, the Compensation Committee awards the CEO a mix of compensation with a higher variable component (i.e., annual bonus, PSOs, RSUs and PRSUs) that is based upon individual performance. As a result, a substantial percentage of our CEO’s total compensation is at risk every year, providing our CEO with greater incentive to increase shareholder value and improve corporate performance over the long term. To identify the median of the annual total compensation of all our employees, we took the following steps:
Pay Ratio
| ● | we selected July 31, 2023 as the date upon which we would identify the median employee to allow sufficient time to identify the median employee given the global scope of our operations; |
Pay Ratio
| ● | we determined that, as of July 31, 2023, our employee population consisted of approximately 82 individuals working for us and our consolidated subsidiaries, with approximately 52% of these individuals located in the United States, 31% in Canada and 17% in Paraguay. This population consisted of our full-time employees. We do not have part-time, temporary and seasonal employees; |
Pay Ratio
| ● | to identify the median employee from our employee population, we examined the annual base compensation and annual bonus target for Fiscal 2023 for all full-time, part-time and temporary employees employed by us and our consolidated subsidiaries at the start of business on July 31, 2023. We believe that these pay elements are appropriate because it was impractical to gather actual data from multiple payroll systems utilized to pay our worldwide workforce, and the actual achievement of the variable portion of compensation can vary widely from year to year; |
Pay Ratio
| ● | we annualized compensation for any permanent employees that were only employed for part of Fiscal 2023; |
Pay Ratio
| ● | no adjustments were made for cost-of-living differences; |
Pay Ratio
| ● | an average exchange rate for the U.S. dollar for Fiscal 2023 was applied to compensation reported in a foreign currency; and |
Pay Ratio
| ● | all employees except for our CEO were ranked from lowest to highest with the median determined from this list. |
Pay Ratio
Once we identified our median employee, we combined all of the elements of such employee’s compensation for Fiscal 2023 in accordance with the requirements of Item 402(c)(2)(x) of Regulation S-K, resulting in annual total compensation of $81,061. With respect to the annual total compensation of our CEO, we used the amount reported in the “Total” column of our “Summary Compensation Table” included above. The CEO Pay Ratio reported above is a reasonable estimate calculated in a manner consistent with SEC rules, based on our internal records and the methodology described above. The SEC rules for identifying the median compensated employee allow companies to adopt a variety of methodologies, to apply certain exclusions and to make reasonable estimates and assumptions that reflect their employee populations and compensation practices. Accordingly, the pay ratio reported by other companies may not be comparable to the CEO Pay Ratio reported above, as other companies have different employee populations and compensation practices and may use different methodologies, exclusions, estimates and assumptions in calculating their own pay ratios.
Pay Versus Performance Table
Pay Versus Performance Table As required by Item 402(v) of Regulation S-K, we are providing the following information for the principal executive officer (the “PEO”; being Mr. Adnani) and the average for the Named Executive Officers excluding the PEO (the “Non-PEO NEOs”; being Messrs. Obara and Melbye) for the fiscal years ended July 31, 2023, 2022 and 2021.
Pay Versus Performance Table
| | Summary Compensation Table Total for PEO (1) ($) (b) | Compensation Actually Paid to PEO (2) ($) (c) | Average Summary Compensation Table Total for Non-PEO NEOs (1) ($) (d) | Average Compensation Actually Paid to Non-PEO NEOs (2) ($) (e) | Value of Initial Fixed $100 Investment Based On: | | Net Income (loss) (4) ($ in thousands) (h) | | Year (a) | | | | | Total Shareholder Return (3) ($) (f) | Peer Group Total Shareholder Return (3) ($) (g) | | | 2023 | 3,700,780 | 2,690,924 | 742,727 | 581,394 | 371.79 | 280.56 | (3,307) | | 2022 | 2,315,872 | 2,212,036 | 603,525 | 590,809 | 433.75 | 248.58 | 5,252 | | 2021 | 1,635,553 | 1,907,583 | 500,947 | 557,369 | 224.10 | 187.83 | (14,813) |
Pay Versus Performance Table
| (1) For column (b), the dollar amounts represent total compensation paid to our PEO, Amir Adnani, and are taken directly from the Summary Compensation Table included in the Company’s Annual Report for Fiscal 2023 that was filed with the SEC on September 29, 2023. For column (d), the dollar amounts represent the average total compensation paid to Pat Obara, our Secretary, Treasurer and Chief Financial Officer, and Scott Melbye, our Executive Vice President, and are taken directly from the Summary Compensation Table included in the Company’s Annual Report. | | (2) The following tables set forth the adjustments made to arrive at the compensation actually paid to our PEO and Non-PEO NEOs during each of the fiscal years reflected in this table. |
Compensation Actually Paid to PEO and Average Compensation Actually Paid to Non-PEO NEOs
Compensation Actually Paid to PEO and Average Compensation Actually Paid to Non-PEO NEOs
Compensation Actually Paid to PEO and Average Compensation Actually Paid to Non-PEO NEOs
| Adjustments to Determine Compensation Actually Paid | | 2023 | | 2022 | | 2021 | | | | | PEO ($) | Non- PEO NEOs ($) | PEO ($) | Non- PEO NEOs ($) | PEO ($) | Non- PEO NEOs ($) | | Total Reported in Summary Compensation Table | | 3,700,780 | 742,727 | 2,315,872 | 603,525 | 1,635,553 | 500,947 | | Less, Amounts Reported under “Stock Awards” in the Summary Compensation Table | | 2,026,264 | 312,562 | 964,705 | 233,357 | 895,553 | 255,292 | | Less, Amounts Reported under “Option Awards” in the Summary Compensation Table | | 240,516 | 37,101 | - | - | - | - | | Plus, the Fair Value of Equity Awards Granted during the Year that were Outstanding and Unvested as of Year-end | PRSUs | 705,936 | 108,894 | 391,104 | 94,606 | 389,586 | 111,058 | | | RSUs | 1,320,337 | 203,669 | 573,602 | 138,751 | 506,250 | 144,314 | | | Options | 240,517 | 37,101 | 791,059 | 191,353 | 697,762 | 198,909 | | Plus, the Change in Fair Value from Prior Year-end to Current Year-end of Equity Awards granted in any Prior Year that were Outstanding and Unvested as of Year-end | PRSUs | (79,036) | (19,118) | 242,948 | 69,257 | - | - | | | RSUs | (63,413) | (15,339) | 287,267 | 81,890 | 661,333 | 167,400 | | | Options | (125,321) | (30,315) | 478,727 | 136,469 | 546,683 | 186,567 | | Total Adjustments | | (1,009,856) | (161,333) | (103,836) | (12,716) | 272,030 | 56,422 | | Compensation Actually Paid | | 2,690,924 | 581,394 | 2,212,036 | 590,809 | 1,907,583 | 557,369 |
Compensation Actually Paid to PEO and Average Compensation Actually Paid to Non-PEO NEOs
| (3) Total shareholder return represents the value of a deemed fixed investment of $100 at market close on July 31, 2020, assuming the reinvestment of dividends, if any. Total shareholder return is calculated by dividing the sum of the cumulative amount of dividends for the measurement period, assuming dividend reinvestment, and the difference between the Company’s share price at the end and the beginning of the measurement period, by the share price at the beginning of the measurement period. For the purposes of this table the Peer Group consisted of the following companies: Centrus Energy Corp., Coeur Mining, Inc., Comstock Resources, Inc., Denison Mines Corp., enCore Energy Corp., Energy Fuels Inc., Filo Corp. (formerly Filo Mining Corp.), Fission Uranium Corp., Gulfport Energy Corporation, K92 Mining Inc., NexGen Energy Ltd., Northern Oil and Gas, Inc., Osisko Mining Inc., Seabridge Gold Inc. and Torex Gold Resources Inc. For the purposes of understanding the cumulative returns over time, this table should be read from bottom to top. | | (4) Net income (loss) represents the amounts reported in the Company’s audited financial statements included in our Annual Report. |
Analysis of the Information Presented in the Pay Versus Performance Table
Analysis of the Information Presented in the Pay Versus Performance Table Because we are not a Production Stage mining company (as defined by the SEC), we did not have any revenue from continuing operations during the periods presented. Consequently, we have not historically focused on net income (loss) as a performance measure for our executive compensation programs. In Fiscal 2021 we had a net loss of approximately $14.8 million, and in Fiscal 2022 we had net income of approximately $5.3 million followed by a net loss in Fiscal 2023 of approximately $3.3 million. Despite the volatility of net income, as the Company in this growth stage focused on building its pipeline of low-cost uranium projects, the Company’s shareholder returns relative to the Peer Group generated, on average, over 42% returns compared to the Peer Group. This average outperformance was achieved by the Company generating a 19.3%, 74.5% and 32.5% relative shareholder return outperformance in Fiscals 2021, 2022 and 2023, respectively. During the same period the compensation actually paid for our PEO increased to align actual pay with performance from $1.9 million in Fiscal 2021, to $2.2 million in Fiscal 2022 and finally to $2.7 million in Fiscal 2023. The average compensation actually paid to our other executive officers increased proportionately from $557,369 in Fiscal 2021 to $590,809 in Fiscal 2022. In Fiscal 2023 the average compensation actually paid to our other executive officers decreased slightly. The following graph shows the compensation actually paid to our PEO and the average amount of compensation actually paid to our non-PEO NEOs as a group (excluding the PEO) during the periods presented and total shareholder return over those periods. Total shareholder return increased from Fiscal 2021 to Fiscal 2022 by approximately 94%, and decreased from Fiscal 2022 to Fiscal 2023 by approximately 14%. Over the three-year period from Fiscal 2021 to Fiscal 2023, our total shareholder return increased by approximately 66%. Mr. Adnani’s compensation actually paid showed an increase year over year for the three years and the average amount of compensation actually paid to our non-PEO NEOs as a group (excluding Mr. Adnani) increased slightly over the three-year period. We utilize a blend of performance measures and Peer Group analysis to align executive compensation with performance. Performance, at the current stage of the business is tied to multiple criteria, which are reflected in our STIP performance scorecard and share price performance on both an absolute and relative to Peer Group basis. We believe in taking a balanced approach to long-term performance based compensation. Therefore, the Named Executive Officers receive a mix of performance vesting stock options, performance vesting PRSUs and time vesting RSUs. In totality, these form an integral part of our executive compensation program, are closely related to the Company’s performance, however, are not directly tied to total shareholder return because their value is directly correlated to the market price of our common shares and requires that the Named Executive Officers continue in our employment over the vesting period. As such, these performance vesting stock option awards and other equity awards strongly align our Named Executive Officers’ interests with those of our shareholders by providing a continuing financial incentive to maximize long-term value for our shareholders and by encouraging our Named Executive Officers to continue in our employment for the long-term.