DEF 14A of Lightbridge Corp
Filed Mar 8, 2024 · FY20230001477932-24-001110
Executive Summary
| • | Significant Variable Compensation. A significant portion of NEO target compensation is granted in equity (e.g. stock options, restricted stock units (RSUs) and restricted stock awards (RSAs) with vesting provisions) and is “at-risk”. Actual cash short-term incentive compensation and equity grants in any year are made based on the Compensation Committee’s assessment of Lightbridge and individual executive performance in that year. Additionally, the value of equity awards closely tracks Lightbridge’s shareholder experience by being denominated in the Company's common shares, providing further, long-term alignment with stockholder value. The majority of pay delivered to NEOs is performance based (49% salary, 25% short-term incentive compensation and 26% equity for the NEOs). The realizable pay analysis, provided below, illustrates the at-risk nature of Lightbridge’s executive pay programs for the CEO (and by extension, the other NEOs). | | • | Short-Term Incentive Compensation. The short-term incentive compensation component of our compensation program includes an annual short-term incentive program, payable in cash and/or equity awards, upon the achievement of specific planned performance goals pursuant to a corporate performance scorecard approved by the Compensation Committee in the first quarter of each year, that is then ratified by the full Board. Such short-term incentive compensation serves as a vehicle for incentivizing and motivating our employees towards achieving annual strategic performance objectives. | | • | Long-Term Incentive Compensation. The long-term incentive compensation component of our compensation program was delivered as RSAs in 2023. RSAs vest ratably over three years. RSAs were granted to provide long-term retention of NEOs, while building executive outright ownership of the Company's common shares to further align the economic interests of our officers with stockholders. | | • | Fixed Compensation. The fixed compensation elements of our compensation program include a base salary and retirement, health, life, and disability insurance benefits. | | • | No Perquisites. We do not provide any perquisites, whether cash or otherwise, to our NEOs. |
Executive Summary
Pay for Performance and Realizable Compensation One way to demonstrate our pay-for-performance alignment is to review “realizable pay,” which is an updated valuation of the compensation that could be realized by our executives, as compared to the value of compensation awarded as reported in our Summary Compensation Table or “Compensation Actually Paid” as reported in the Pay Versus Performance section, both of, which immediately follows this Compensation Discussion and Analysis. Because a significant amount of our executive compensation includes long-term equity incentive compensation, the amount of compensation that an executive can “realize” based on prior awards fluctuates over time based on our stock price. The accompanying compensation chart illustrates the 5-year aggregate realizable pay for Mr. Grae, our Chief Executive Officer, valued at the end of 2023, in contrast to the five-year aggregate total direct compensation amount reflected under the reporting requirements for the Summary Compensation Table. The value of equity awards included in the Summary Compensation Table is based on the grant date fair value of such awards, which is highly dependent on the price of our common stock at the time of grant. Due to the significant at-risk nature of historical equity awards made to Mr. Grae, “realizable” compensation for Mr. Grae is 10% lower than the amounts shown in the Summary Compensation Table and long-term incentive realizable value is 37% lower than the grant-date fair value over the aggregate 2019-2023 period. Most of Lightbridge's equity awards are currently valued below their grant-date value but provide significant incentive to create stockholder value as Lightbridge works to commercialize its next generation nuclear fuel technology. We believe the chart below provides a useful supplemental perspective to assist our stockholders in understanding our executive compensation program, as it demonstrates how the value of compensation realizable by our CEO is tied to the performance of the Company.
Objectives of Our Compensation Plan
| Objective | Description | | Attraction and Retention | We provide competitive compensation to our NEOs and tie a significant portion of compensation to time-based vesting requirements, helping to ensure that we can continue to attract key management personnel and retain such personnel. | | Pay for Performance | A significant portion of each NEO’s compensation is “at-risk” or variable, based on our performance and stock price. | | Pay Mix | We use a variety of fixed-pay and incentive compensation forms, including cash, stock, and options. | | Competitive Packages | We evaluate our compensation program in an effort to provide a competitive compensation package to each NEO that takes into account their responsibilities, performance, and organization. |
How Executive Compensation is Determined
Role of Compensation Consultant Pursuant to its charter, the Compensation Committee is authorized to engage, retain, and terminate any consultant, as well as approve the consultant’s fees, scope of work, and other terms of engagement. For both 2022 and 2023, the Compensation Committee retained Pay Governance LLC as its independent advisor. Pay Governance advises and consults with the Compensation Committee on compensation issues and the composition of the Company’s peer group and keeps the Compensation Committee apprised of competitive practices related to executive compensation. In 2023 Pay Governance assisted the Compensation Committee in the design, structure, and implementation of the current annual executive compensation program, review of the compensation peer group, and director compensation program. Pay Governance does not determine the exact amount or form of executive compensation for any executive officers. Pay Governance reports directly to the Compensation Committee, and a representative of Pay Governance, when requested, attends meetings of the Compensation Committee, is available to participate in executive sessions and communicates directly with the Compensation Committee Chair or its members outside of meetings. Pay Governance does no other work for the Company. Role of Management The Compensation Committee considers input from the CEO when making executive compensation decisions for the other officers and employees of the Company. The CEO’s input is useful because the CEO reviews and observes the performance of the officers and employees at the Company. The Compensation Committee and Board review and approve the compensation of the CEO separately, without the participation or involvement of the CEO. Performance Goals The Compensation Committee believes that a significant portion of each NEO’s compensation should be tied to the Company’s performance. The Company considers overall corporate performance based on certain operational and financial objectives as described above to broadly inform compensation decisions. The Company considered the following performance milestones in determining the short-term incentive payouts relating to 2023 performance: keep spending on corporate general and administrative expenses, including outside professional fees, on budget; execute on key fuel development milestones; secure additional government funding support for our project; complete one or more pre-determined strategic corporate initiatives; and meet certain individual goals. Performance goals have changed from time to time and will continue to change as the condition of the Company and its fuel technology evolve. Peer Group Analysis The Company has historically evaluated its compensation program against the programs at similarly-situated companies in order to ensure its compensation program is competitive. Acknowledging that we have very few direct publicly-traded competitors, with the assistance of Pay Governance, the peer companies were reviewed and updated based on (i) revenue scope within a reasonable range, (ii) market capitalization within a reasonable range of the Company’s market capitalization, (iii) research and development expenditure within a reasonable range of the Company’s research and development expenditure, and (iv) companies focused on nuclear, energy, or renewable energy technologies and services. In 2023, again with the assistance of Pay Governance, the peers were reviewed for continued appropriateness and the composition of the peer group was revised. The 2023 peer group consist of the following companies:
How Executive Compensation is Determined
In 2023, under advisement from Pay Governance, the Company removed Capstone Green Energy Corporation from its peer group due to the fact that Capstone Green Energy has filed for Chapter 11 bankruptcy. The Compensation Committee reviewed compensation data for the peer group at the 25th, 50th, and 75th percentiles and considers the competitive data as one factor in setting compensation levels for the NEOs.
Executive Compensation Elements
| Pay Element | Characteristics | Primary Objective | | Base Salary | Annual fixed cash compensation | Attract and retain qualified and high performing executives | | Short-Term Compensation | Annual performance-based compensation payable in cash or equity awards | Incentivize our NEOs to achieve short-term goals | | Long-Term Compensation | Restricted Stock Awards | Retain our NEOs, build stock ownership, and align their interests with the interests of our stockholders |
Target Compensation Mix for CEO and other Named Executive Officers
For more information about the 2023 base salaries for each of our NEOs, please see the 2023 Summary Compensation Table below. Short-Term Incentive Compensation The Compensation Committee has established a short-term incentive (STI) program pursuant to which each of the NEOs may earn cash or stock-based compensation upon the achievement of individualized or Company-wide performance expectations. The target value of the award was established at 50% of base salary in the case of each of Mr. Grae, Dr. Mushakov, and Mr. Goldman. The Compensation Committee annually determines the actual payout of STI awards based on pre-determined weighted specific performance goals for Lightbridge and each individual’s contribution to the Company’s development milestones. In 2023, the Company had the following performance milestones, based on pre-determined performance target metrics with the maximum performance target metric increasing the STI scorecard weight by 150%+, subject to the Compensation Committee’s discretion and approval.
Target Compensation Mix for CEO and other Named Executive Officers
| Goal | Scorecard Weight | 2023 Actual Payout % | | Keep spending to budget on corporate general and administrative expenses | 25% | 37.5% | | Execute on key fuel development milestones | 40% | 35.0% | | Enter into an agreement to conduct a feasibility study related to the production of Lightbridge fuel rods | 5% | 7.5% | | Meet certain individual goals | 30% | 30.0% |
Target Compensation Mix for CEO and other Named Executive Officers
Long-Term Incentive Compensation Historically, Lightbridge has delivered long-term incentives to NEOs through stock option awards and restricted stock units. In both 2022 and 2023, Lightbridge delivered long-term incentive compensation as restricted stock awards vesting ratably over three years. RSAs were granted to provide long-term retention of NEOs, while building executive outright ownership of Lightbridge shares to further align the economic interests of Lightbridge’s officers with its stockholders. Lightbridge’s 2022 and 2023 RSA grant values represent a percentage of executive pay, with the number of RSAs granted calculated on the Company’s share price performance.
Target Compensation Mix for CEO and other Named Executive Officers
| Name and Title | 2023 LTI Grant (shares) | | Seth Grae, President and CEO | 71,775 | | Andrey Mushakov, EVP, Nuclear Operations | 44,766 | | Larry Goldman, CFO | 41,415 |
Target Compensation Mix for CEO and other Named Executive Officers
For 2023, Lightbridge is reporting 5-year realizable pay for the CEO on page 19 of the Compensation Discussion and Analysis, which illustrates that the equity awards granted to the CEO in the past five years currently have lower realizable value than when they were granted, which is consistent with the shareholder experience. This supports the pay-for-performance orientation of Lightbridge’s compensation program as equity awards continue to align executive equity value with shareholder value. Retirement, Health, Life, and Disability Insurance Benefits The Company offers a variety of health and other insurance and retirement programs to all eligible employees. The NEOs generally are eligible for the same benefit programs on the same basis as the rest of the Company’s employees. The Company’s health insurance programs include medical, dental, and vision coverage. In addition to the foregoing, the NEOs are eligible to participate in a defined contribution profit sharing plan (the “401(k) plan”) that is administered by a committee of trustees appointed by the Company. All employees are eligible to participate in the 401(k) plan. In 2023, the Company made 100% matching contributions for all full-time employees with immediate vesting. Perquisites We do not provide any perquisites, whether cash or otherwise, to our NEOs. We feel that our executive compensation program, particularly given the Company’s capital needs, provides our NEOs with competitive compensation such that we do not need to provide any perquisites to achieve the goals of our executive compensation program.
Employment Agreements
Employment Agreements On August 8, 2018, the Company entered into employment agreements with each of Mr. Grae, Dr. Mushakov, and Mr. Goldman, which in the case of Mr. Grae and Dr. Mushakov replaced employment agreements entered into during 2006, and which in the case of Mr. Goldman became effective September 1, 2018. The employment agreements provide for an initial annual base salary of $459,268, $286,443 and $265,000 for each of Mr. Grae, Dr. Mushakov and Mr. Goldman, respectively, and establish a target annual bonus of 50% of base salary for each executive with the amount of any such bonus to be determined by the Compensation Committee on the achievement of performance goals that are established by the Compensation Committee. In addition, each of Mr. Grae, Dr. Mushakov, and Mr. Goldman is eligible to earn an annual long-term incentive award, subject to the Compensation Committee’s discretion to grant such awards, based upon a target award opportunity equal to 50% of base salary, and subject to attainment of such goals, criteria, or targets established by the Compensation Committee in respect of each such calendar year.
Employment Agreements
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Employment Agreements
Each employment agreement provides that if the executive’s employment is terminated or not extended by the Company without “cause,” or terminated by the executive for “good reason” (each as defined in the employment agreement), then, subject to the terms and conditions of the employment agreement, the executive will be entitled to certain severance payments and benefits. In the case of Mr. Grae, the employment agreement provides for payments equal to two times Mr. Grae’s base salary and target bonus for the calendar year in which the termination occurs, payable over 12 months, plus an amount equal to the prorated target bonus for the current year, payable in a lump sum. However, if such termination occurs upon or within 24 months of a “change of control” (as defined in the employment agreement), Mr. Grae will receive a lump sum payment equal to three times his base salary and target bonus for the calendar year in which the termination occurs, plus an amount equal to the prorated target bonus for the current year, and all of Mr. Grae’s equity awards will immediately vest in full, with any outstanding performance-based equity awards becoming fully vested based on the target level of performance. In the case of Dr. Mushakov and Mr. Goldman, the employment agreements provide for payments equal to the executive’s base salary and target bonus for the calendar year in which the termination occurs, payable over 12 months, plus an amount equal to the prorated target bonus for the current year, payable in a lump sum. However, if such termination occurs upon or within 24 months of a “change of control,” each of Dr. Mushakov and Mr. Goldman will receive a lump sum payment equal to two times his base salary and target bonus for the calendar year in which the termination occurs, plus an amount equal to the prorated target bonus for the current year, and all of the executive’s equity awards will immediately vest in full, with any outstanding performance based equity awards becoming fully vested based on the target level of performance. Each employment agreement has an initial five-year term and will automatically be extended for additional one-year terms upon the expiration of the initial term unless either party provides notice of non-renewal to the other. The employment agreements provide standard benefits and contain routine confidentiality, non-competition, non-solicitation and non-disparagement provisions. Each of Mr. Grae, Dr. Mushakov, and Mr. Goldman will also be entitled to continued benefits under the Company’s medical, dental and vision plans for a period of up to 12 months upon termination outside of a change of control and for a period of up to 18 months upon termination within 24 months following a change of control.
2023 Summary Compensation Table
2023 Summary Compensation Table The following table sets forth information concerning all cash and non-cash compensation awarded to, earned by, or paid to our NEOs for services rendered in all capacities during the noted periods.
2023 Summary Compensation Table
| Name | Year | Salary ($) | Bonus(1) ($) | Stock Awards(2) ($) | Non-Equity Incentive Plan Compensation(1) ($) | All Other Compensation(3) ($) | Total ($) | | Seth Grae | 2023 | 547,279 | 87,273 | 284,947 | 232,727 | 30.000 | 1,182,226 | | CEO, President and Director | 2022 | 521,217 | 206,250 | 407,071 | 123,750 | 27,000 | 1,285,288 | | | 2021 | 504,364 | 155,073 | 516,910 | 213,225 | 26,000 | 1,415,572 | | Andrey Mushakov | 2023 | 341,334 | 57,273 | 177,720 | 152,727 | 22,500 | 751,554 | | EVP, Nuclear Operations | 2022 | 325,081 | 131,250 | 253,888 | 78,750 | 20,500 | 809,468 | | | 2021 | 314,569 | 96,718 | 322,394 | 132,988 | 19,500 | 886,169 | | Larry Goldman | 2023 | 315,783 | 51,818 | 164,416 | 138,182 | 30,000 | 700,199 | | CFO and Corporate Secretary | 2022 | 300,745 | 118,750 | 234,883 | 71,250 | 27,000 | 752,628 | | | 2021 | 291,021 | 89,478 | 298,260 | 123,032 | 26,000 | 827,791 |
2023 Summary Compensation Table
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2023 Summary Compensation Table
| (1) Consists of payments under our STI program for the year indicated, with payments relating to the achievement of individual goals set forth in the bonus column and payments relating to the achievement of all other performance criteria set forth in the non-equity incentive plan compensation column. The Company considers payments relating to the achievement of individual goals to qualify as bonus payments because of the holistic assessments used by the Compensation Committee in evaluating the progress of the NEOs towards their individual goals, as compared to achievement of definitive metrics for the other performance criteria under the STI program. | | (2) Restricted stock awards vesting ratably over three years. The amounts reported in the Stock Awards column reflects aggregate grant date fair value computed in accordance with ASC Topic 718, Compensation-Stock Compensation. These amounts reflect our calculation of the value of these awards at the grant date and do not necessarily correspond to the actual value that may ultimately be realized by the NEO. For a discussion of the assumptions and methodologies used in calculating the grant date fair value of the stock awards, please see Note 8 to the Company’s consolidated financial statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023. | | (3) Consists of the Company’s 401(k) matching contributions. |
2023 Summary Compensation Table
The 2023 stock awards consist of restricted stock awards granted to each of Mr. Grae, Dr. Mushakov, and Mr. Goldman relating to 71,775, 44,766, and 41,415 shares, respectively. These RSAs have a service-based vesting provision. These awards were granted November 20, 2023, and vest ratably over a three-year period commencing on the grant date. The 2022 stock awards consist of restricted stock awards granted to each of Mr. Grae, Dr. Mushakov, and Mr. Goldman relating to 86,427, 53,904, and 49,869 shares, respectively. These RSAs have a service-based vesting provision. These awards were granted December 15, 2022, and vest ratably over a three-year period commencing on the grant date. The 2021 stock awards consist of restricted stock awards granted to each of Mr. Grae, Dr. Mushakov, and Mr. Goldman relating to 48,355, 30,158, and 27,901 shares, respectively. These RSAs contain a performance-based accelerated vesting provision and a service-based vesting provision. These awards were granted November 18, 2021, and vest ratably over a three-year period commencing on the grant date. The Compensation Committee decided to grant RSAs to the NEOs in 2021, rather than RSUs as had been done historically, to build share ownership levels among management and promote retention, and the Compensation Committee intends to continue granting RSAs and performance based RSAs going forward.
2023 Summary Compensation Table
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Outstanding Equity Awards at Fiscal Year End
Outstanding Equity Awards at Fiscal Year End
Outstanding Equity Awards at Fiscal Year End
| | Option Awards | | | | Stock Awards | | | Name | 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 That Have Not Vested (#) | Market Value of Shares or Units or Other Rights That Have Not Vested(1) ($) | | Seth Grae | 6,303 | — | 75.60 | 04/08/2025 | | | | | 772 | — | 75.60 | 08/12/2025 | | | | | 17,430 | — | 55.20 | 11/20/2025 | | | | | 18,199 | — | 18.48 | 11/09/2026 | | | | | 40,233 | — | 12.60 | 10/26/2027 | | | | | 28,216 | — | 10.80 | 08/06/2028 | | | | | 16,146 | — | 3.82 | 12/02/2029 | | | | | | | | | 145,512 | 467,094 | | Andrey Mushakov | 3,069 | — | 75.60 | 04/08/2025 | | | | | 650 | — | 75.60 | 08/12/2025 | | | | | 10,067 | — | 55.20 | 11/20/2025 | | | | | 11,351 | — | 18.48 | 11/09/2026 | | | | | 25,093 | — | 12.60 | 10/26/2027 | | | | | 17,598 | — | 10.80 | 08/06/2028 | | | | | 10,070 | — | 3.82 | 12/02/2029 | | | | | | | | | 90,754 | 291,320 | | Larry Goldman | 1,104 | — | 75.60 | 04/08/2025 | | | | | 231 | — | 75.60 | 08/12/2025 | | | | | 5,449 | — | 55.20 | 11/20/2025 | | | | | 4,469 | — | 18.48 | 11/09/2026 | | | | | 13,785 | — | 12.60 | 10/26/2027 | | | | | 16,281 | — | 10.80 | 08/06/2028 | | | | | 9,317 | — | 3.82 | 12/02/2029 | | | | | | | | | 83,962 | 269,518 |
Outstanding Equity Awards at Fiscal Year End
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Outstanding Equity Awards at Fiscal Year End
| (1) Restricted stock awards with service-based vesting provisions that provide for one-third vesting on each of the first three anniversaries of the date of grant. The market value of restricted stock awards reported is calculated by multiplying the number of shares by the closing price of our common stock on December 29, 2023 ($3.21 per share), the last trading day of 2023. |
Potential Payments upon Termination or Change in Control
Potential Payments upon Termination or Change in Control A Change in Control will take place when either the Company is sold directly or indirectly, other than by way of merger or consolidation, to anybody that is not a subsidiary of the Company; or the incumbent directors do not constitute at least a majority of the Board; or 10 business days prior to a complete liquidation; or dissolution of the Company; or the acquisition of beneficial ownership of more than 50% outstanding shares of common stock of the Company. Please see above under “—Employment Agreements” for a description of potential payments upon termination or a change in control to each of Mr. Grae, Dr. Mushakov and Mr. Goldman pursuant to their employment agreements. Each of Mr. Grae, Dr. Mushakov, and Mr. Goldman will also be entitled to continued benefits under the Company’s medical, dental and vision plans for a period of up to 12 months upon termination outside of a change of control and for a period of up to 18 months upon termination within 24 months following a change of control.
Potential Payments upon Termination or Change in Control
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Pay Versus Performance
Pay Versus Performance In accordance with rules adopted by the SEC pursuant to Section 953(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, the Company provides the following disclosure for its three most recent fiscal years. The Board and the Compensation Committee did not consider the pay versus performance disclosure below in making their pay decisions for any of the years presented. See “Compensation Discussion and Analysis” beginning on page 16 for information about the decisions made by the Board and the Compensation Committee with respect to NEO compensation for the years discussed. The following table sets forth information about the relationship between executive compensation actually paid (CAP) and certain financial performance metrics of our Company.
Pay Versus Performance
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Pay Versus Performance
| Year | Summary Compensation Table Total for PEO(1) | Compensation Actually Paid to PEO(2) | Average Summary Compensation Table Total for Non-PEO Named Executive Officers(3) | Average Compensation Actually Paid to Non-PEO Named Executive Officers(4) | Value of Initial Fixed $100 Investment Based on Total Shareholder Return (TSR)(5) | Net Income (Loss)(6) | | (a) | (b) | (c) | (d) | (e) | (f) | (g) | | 2023 | $1,182,226 | $1,067,058 | $725,878 | $656,737 | $75.89 | $(7,908,646) | | 2022 | $1,285,288 | $1,096,593 | $781,048 | $667,766 | $91.96 | $(7,497,857) | | 2021 | $1,415,572 | $1,503,336 | $856,980 | $928,505 | $156.74 | $(7,835,665) |
Pay Versus Performance
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Pay Versus Performance
| (1) Reflects compensation amounts reporting in the “2023 Summary Compensation Table” for our CEO, Seth Grae, for the respective years shown. | | (2) Reflects the respective amounts set forth in column (b) of the table above, adjusted as set forth in the table below, as determined in accordance with SEC rules. The dollar amounts reflected in column (b) of the table above do not reflect the actual amount of compensation earned by or paid to our CEO during the applicable year. For information regarding the decisions made by our Compensation Committee in regard to the CEO’s compensation for each fiscal year, please see the Compensation Discussion & Analysis sections of the proxy statements reporting pay for the fiscal years covered in the table above. |
Pay Versus Performance
| Year | Reported Summary Compensation Table Total for PEO(1) | Reported Value of Equity Awards $ | Equity Award Adjustments $ | Compensation Actually Paid to PEO $ | | (a) | (b) | (c) | (d) | (e) | | 2023 | $1,182,226 | $(284,947) | $169,779 | $1,067,058 | | 2022 | $1,285,288 | $(407,071) | $218,376 | $1,096,593 | | 2021 | $1,415,572 | $(516,910) | $604,674 | $1,503,336 |
Pay Versus Performance
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Pay Versus Performance
| (1) The grant date fair value of equity awards represents the total amounts reported in the “Stock Awards” column in the “2023 Summary Compensation Table” for our CEO, Seth Grae, for the respective years shown. |
Pay Versus Performance
The amounts deducted or added in calculating the equity award adjustments are as follows.
Pay Versus Performance
| CEO | 2023 | 2022 | 2021 | | The fair value as of fiscal year-end of any equity awards granted during the covered year that are unvested at the end of the year | $230,398 | $336,201$ | $320,594 | | The change, measured from the end of the prior fiscal year to the end of the most recently completed fiscal year, in the fair value of any equity awards granted in prior years that are unvested as of the end of the covered year | (50,141) | (88,329) | — | | The fair value as of the end of the prior fiscal year for any awards granted in any prior fiscal year that fail to meet the applicable vesting conditions during the covered year | — | — | — | | For awards that are granted and vest in the same year, the fair value as of the vesting date | — | — | — | | The change, measured from the end of the prior fiscal year to the vesting date, in fair value of equity awards granted in prior years that vested during the covered year | (10,478) | (29,496) | 284,080 | | The dollar value of any dividends or earnings paid on equity awards in the fiscal year prior to the vesting date that are not otherwise included in total compensation for the year | — | — | — | | Total Equity Award Adjustments | $169,779 | $218,376 | $604,674 |
Pay Versus Performance
| (3) Reflects the average of the amounts reported for our Company’s NEOs, Mr. Mushakov and Mr. Goldman, as a group, (excluding Mr. Grae) in the “2023 Summary Compensation Table” for the respective years shown. | | (4) Reflects the average amount of “compensation actually paid” to the NEOs, Mr. Mushakov and Mr. Goldman, as a group, as determined in accordance with SEC rules. The dollar amounts do not reflect the actual average amount of compensation earned by or paid to the NEOs, Mr. Mushakov and Mr. Goldman, as a group, during the applicable year. |
Pay Versus Performance
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Pay Versus Performance
| Year | Average Reported Summary Compensation Table Total for Non-PEO NEOs | Average Reported Value of Equity Awards $ | Average Equity Award Adjustments $ | Average Compensation Actually Paid to Non- PEO NEOs $ | | (a) | (b) | (c) | (d) | (e) | | 2023 | $725,878 | $(171,069) | $101,928 | $656,737 | | 2022 | $781,048 | $(244,385) | $131,103 | $667,766 | | 2021 | $856,980 | $(310,327) | $381,852 | $928,505 |
Pay Versus Performance
The amounts deducted or added in calculating the equity award adjustments are as follows.
Pay Versus Performance
| Non-PEO NEOs | 2023 | 2022 | 2021 | | The fair value as of fiscal year-end of any equity awards granted during the covered year that are unvested at the end of the year | $138,321 | $201,838 | $192,465 | | The change, measured from the end of the prior fiscal year to the end of the most recently completed fiscal year, in the fair value of any equity awards granted in prior years that are unvested as of the end of the covered year | (30,102) | (53,027) | — | | The fair value as of the end of the prior fiscal year for any awards granted in any prior fiscal year that fail to meet the applicable vesting conditions during the covered year | — | — | — | | For awards that are granted and vest in the same year, the fair value as of the vesting date | — | — | — | | The change, measured from the end of the prior fiscal year to the vesting date, in fair value of equity awards granted in prior years that vested during the covered year | (6,290) | (17,708) | 189,387 | | The dollar value of any dividends or earnings paid on equity awards in the fiscal year prior to the vesting date that are not otherwise included in total compensation for the year | — | — | — | | Total Equity Award Adjustments | $101,928 | $131,103 | $381,852 |
Pay Versus Performance
| (5) The TSR for 2023, 2022 and 2021 each reflect the cumulative value of $100 invested in Lightbridge stock on December 31, 2020. | | (6) Reflects the amount of net income (loss) reflected in our consolidated audited financial statements for the applicable year. |
Analysis of the Information Presented in the Pay Versus Performance Table
Analysis of the Information Presented in the Pay Versus Performance Table We generally seek to incentivize long-term performance, and therefore do not specifically align our performance measures with “compensation actually paid” (as computed in accordance with Item 402(v) of Regulation S-K) for a particular year. In accordance with Item 402(v) of Regulation S-K, we are providing the following descriptions of the relationships between information presented in the Pay Versus Performance table. Compensation Actually Paid and Net Income (Loss) Because we are not a commercial-stage company, we did not have any revenue during the periods presented. Consequently, our Company has not historically looked to net income (loss) as a performance measure for our executive compensation program. In 2023, 2022 and 2021, our net income (loss) has largely remained the same, and the compensation actually paid for both our PEO and non-PEO NEOs decreased in 2023 from 2022 and in 2022 from 2021. Compensation Actually Paid and Cumulative TSR TSR decreased in 2023 from 2022 and in 2022 from 2021, and the compensation actually paid for both the PEO and non-PEO NEOs also decreased in 2023 from 2022 and in 2022 from 2021.
Analysis of the Information Presented in the Pay Versus Performance Table
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Director Compensation
Director Compensation The following table sets forth certain information concerning the compensation paid to our directors for services rendered to us during fiscal 2023. Mr. Grae was not compensated for his service as a director in 2023. Mr. Funches, who serves as chair of the Audit Committee, was paid $70,000 annually, and Dr. Chakraborty, Mr. Magraw, and Mr. Tobin were each paid $60,000 annually for their service on the Board. Mr. Graham, who served as Chairman of the Board, was paid $75,000 annually. Ms. Goodman, who became a board member in April 2023, was paid $45,000 in 2023. Directors are reimbursed for out-of-pocket expenses incurred as a result of their participation on our Board. For fiscal 2024 each director’s annual compensation increased by $5,000, except for Mr. Graham, which increased by $7,000 and Mr. Funches, which increased by $6,000. In addition, the directors were each awarded shares of stock with a grant date fair value of $40,000 in December 2023, which shares were issued on January 2, 2024.
Director Compensation
| Name | Fees Earned or Paid in Cash($) | Stock Awards (1) ($) | Total | Equivalent Share(1) | | Sweta Chakraborty | 60,000 | 40,000 | 100,000 | 10,076 | | Jesse Funches | 70,000 | 40,000 | 110,000 | 10,076 | | Thomas Graham, Jr. | 45,000 | 40,000 | 85,000 | 10,076 | | Sherri Goodman | 75,000 | 40,000 | 115,000 | 10,076 | | Daniel Magraw | 60,000 | 40,000 | 100,000 | 10,076 | | Mark Tobin | 60,000 | 40,000 | 100,000 | 10,076 |
Director Compensation
| (1) The value of stock awards is the aggregate grant date fair market value computed in accordance with FASB ASC Topic 718 - Compensation - Stock Compensation. Shares were valued on the grant date at $3.97 per share, which vested on January 2, 2024.For a discussion of the assumptions and methodologies used in calculating the grant date fair value of the stock awards, please see Note 8 to the Company’s consolidated financial statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023. As of December 31, 2023, the outstanding numbers of common stock were held by members of the Board: Dr. Chakraborty, 23,767 shares, Mr. Funches, 23,767 shares, Mr. Graham, 32,044 shares, Ms. Goodman, 10,076 shares, Mr. Magraw, 29,915 shares, Mr. Tobin, 22,267 shares. As of December 31, 2023, Mr. Graham, and Mr. Magraw each held stock options to purchase 11,388 shares of common stock. | | (2) Dr. Chakraborty’s cash payments are made directly to her company, Adapt to Thrive. |
Director Compensation
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Director Compensation
| SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT |
Director Compensation
The following table sets forth information known to us with respect to the beneficial ownership of our common stock as of February 28, 2024 for: (i) each person known by us to beneficially own more than 5% of our voting securities, (ii) each NEO, (iii) each of our directors and nominees, and (iv) all of our current executive officers and directors as a group. The percentage of beneficial ownership is based on 13,941,480 shares of common stock outstanding as of February 28, 2024. The address of each executive officer, director and nominee is care of Lightbridge Corporation, 11710 Plaza America Drive, Suite 2000, Reston, VA 20190 USA. Except as explained in the footnotes to the following table, each person listed, and the members of the group, had sole voting power and sole investment power with respect to the shares shown. None of the shares are subject to pledge.
Director Compensation
| Name | Common Stock Held Directly | Stock Options(1) | Total Beneficial Ownership | Percent of Common Stock | | Seth Grae | 270,813(2) | 127,299 | 398,112 | 2.8% | | Larry Goldman | 142,854 | 50,636 | 193,490 | 1.4% | | Andrey Mushakov | 161,223 | 77,898 | 238,121 | 1.7% | | Sweta Chakraborty | 23,767 | — | 23,767 | * | | Jesse Funches | 23,767 | — | 23,767 | * | | Thomas Graham, Jr. | 32,044(3) | 11,388 | 43,432 | * | | Sherri Goodman | 10,076 | — | 10,076 | * | | Daniel Magraw | 29,915 | 11,388 | 41,303 | * | | Mark Tobin | 22,267 | — | 22,267 | * | | Current Directors and Executive Officers as a Group (nine people) | 716,726 | 278,609 | 995,335 | 7.0% | | 5% Beneficial Owners | | | | | | AK Jensen Investment Management Limited(4) | 1,241,165 | — | 1,241,165 | 10.2% |
Director Compensation
_____________ * Denotes less than 1% of the outstanding shares of common stock.
Director Compensation
| (1) Consists of shares that may be acquired under stock options that are currently exercisable or will become exercisable within 60 days of February 28, 2024. | | (2) Includes 5,082 shares of common stock held by Mr. Grae’s spouse. | | (3) Includes 334 shares of common stock held by Mr. Graham’s spouse. | | (4) Based solely upon a Schedule 13G filed on February 10, 2023 by AK Jensen Investment Management Limited, Anders K. Jensen, and Duncan P. Saville (collectively, “AK Jensen”). AK Jensen beneficially owns 1,241,165 shares of our common stock and has sole dispositive power as to 1,241,165 shares of our common stock. The address of AK Jensen is 1 Cornhill, London EC3V 3ND, United Kingdom |
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| REPORT OF THE AUDIT COMMITTEE |
Director Compensation
The Audit Committee of the Board is comprised of three non-employee directors, each of whom has been determined by the Board to be “independent” within the meaning of Rule 10A-3(b)(1) under the Securities Exchange Act of 1934, as amended. The Board has determined that Mr. Funches qualifies as an “audit committee financial expert” within the meaning of Item 407(d) of SEC Regulation S-K, as Mr. Funches has past employment experience in finance or accounting, requisite professional certification in accounting, or any other comparable experience or background which results in his financial sophistication. The Audit Committee assists the Board’s oversight of the integrity of the Company’s financial reports, compliance with legal and regulatory requirements, the qualifications and independence of the Company’s independent registered public accounting firm, the audit process, and internal controls. The Audit Committee operates pursuant to a written charter adopted by the Board. The Audit Committee is responsible for overseeing the corporate accounting and financial reporting practices, recommending the selection of the Company’s registered public accounting firm, reviewing the extent of non-audit services to be performed by the auditors, and reviewing the disclosures made in the Company’s periodic financial reports. The Audit Committee also reviews and recommends to the Board that the audited financial statements be included in the Company’s Annual Report on Form 10-K. Following the end of the fiscal year ended December 31, 2023, the Audit Committee (1) reviewed and discussed the audited financial statements for the fiscal year ended December 31, 2023 with Company management; (2) discussed with the independent auditors the matters required to be discussed by the applicable requirements of the Public Company Accounting Oversight Board (“PCAOB”) and the SEC; and (3) received the written disclosures and the letter from the independent auditors required by applicable requirements of the PCAOB regarding the independent auditor’s communications with the Audit Committee concerning independence, and has discussed with the independent auditors their independence. Based on the review and discussions referred to above, the Audit Committee recommended to the Board that the audited financial statements be included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023 for filing with the SEC. Members of the Audit Committee: Jesse Funches Daniel B. Magraw Mark Tobin
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Director Compensation
| PROPOSAL 1 – ELECTION OF DIRECTORS |
Director Compensation
The Board is responsible for establishing broad corporate policies and monitoring the overall performance of the Company. It selects the Company’s executive officers, delegates authority for the conduct of the Company’s day-to-day operations to those officers and monitors their performance. Members of the Board keep themselves informed of the Company’s business by participating in Board and Committee meetings, by reviewing analyses and reports, and through discussions with the Chairman and other officers. See “Governance and Nominating Committee” above for a discussion of the process for selecting directors. There are currently seven directors serving on the Board. At the annual meeting, all six directors will be up for election. Thomas Graham, Jr. is not standing for re-election at the annual meeting. On February 27, 2024, the Board approved a reduction of the number of seats on the Board, effective as of the annual meeting, to six. The individuals who have been nominated for election to the Board at the annual meeting are listed in the table below. Each of the nominees is a current director of the Company. If, as a result of circumstances not now known or foreseen, any of the nominees is unavailable to serve as a nominee for director at the time of the annual meeting, the holders of the proxies solicited by this proxy statement may vote those proxies either (i) for the election of a substitute nominee who will be designated by the proxy holders or by the present Board or (ii) for the balance of the nominees, leaving a vacancy. Alternatively, the size of the Board may be reduced accordingly. The Board has no reason to believe that any of the nominees will be unwilling or unable to serve, if elected as a director. Directors are elected by plurality of the votes cast at the meeting. Proxies submitted on the accompanying proxy card will be voted for the election of the nominees listed below unless the proxy card is marked otherwise. The Board recommends a vote FOR the election of the nominees listed below.