UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934
Filed by the Registrant ☒ | ||
Filed by a Party other than the Registrant ☐ | ||
Check the appropriate box: | ||
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| Preliminary Proxy Statement |
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| Confidential, for Use of the Commission Only (as permitted by Rule 14a–6(e)(2)) |
| ☒ | Definitive Proxy Statement |
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| Definitive Additional Materials |
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| Soliciting Material Pursuant to §240.14a–12 |
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UR-ENERGY INC. | ||||
(Name of Registrant as Specified In Its Charter) |
(Name of Person(s) Filing Proxy Statement, if other than the Registrant) |
Payment of Filing Fee (Check the appropriate box): | ||
| ☒ | No fee required. |
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| Fee computed on table below per Exchange Act Rules 14a–6(i)(1) and 0–11. |
| (1) | Title of each class of securities to which transaction applies:
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| (2) | Aggregate number of securities to which transaction applies:
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| (3) | Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0–11 (set forth the amount on which the filing fee is calculated and state how it was determined):
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| (4) | Proposed maximum aggregate value of transaction:
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| (5) | Total fee paid:
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Fee paid previously with preliminary materials. | ||
Check box if any part of the fee is offset as provided by Exchange Act Rule 0–11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. | ||
| (1) | Amount Previously Paid:
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| (2) | Form, Schedule or Registration Statement No.:
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| (3) | Filing Party:
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| (4) | Date Filed:
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UR-ENERGY INC.
10758 West Centennial Road, Suite 200
Littleton, Colorado 80127
NOTICE OF ANNUAL AND SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON MAYJUNE 2, 20192022
To the Shareholders of Ur-Energy Inc.:
The Annual and Special Meeting of Shareholders of Ur-Energy Inc. (the “Company”), will be held in person at the Hampton Inn & Suites, 7611 Shaffer Parkway, Littleton, Colorado 80127 on Thursday, MayJune 2, 20192022 at 1:00 p.m. local timeMountain Time to receive the audited consolidated financial statements of the Company for the year ended December 31, 2018,2021, together with the report from the auditors thereon, and for the purpose of considering and voting upon proposals to:
1. Elect seven (7) directors, each to serve until the next annual meeting of shareholders of the Company or until their successors are elected and appointed; 2. Re-appoint PricewaterhouseCoopers LLP, Chartered Professional Accountants, as the independent auditors of the Company and to authorize the directors to fix the remuneration of the auditors; 3. Approve, in an advisory (non-binding) vote, the compensation of the Company’s named executive officers (“say-on-pay”); 4. Ratify, confirm, and approve the renewal Ur-Energy Inc. Amended and Restated Restricted Share Unit and Equity Incentive Plan (the “RSU&EI Plan”) and approve and authorize for a period of three years all unallocated share units and shares issuable pursuant to the RSU&EI Plan; and 5. Transact such other business as may lawfully come before the meeting or any adjournment(s) or postponement(s) thereof. The Board of Directors recommends a vote “FOR” each of the 1.ElectCompany or until their successors are electeddirector nominees and appointed;
2.Re-appoint PricewaterhouseCoopers LLP, Chartered Professional Accountants, as the independent auditors of the Company“FOR” Proposals 2, 3 and to authorize the directors to fix the remuneration of the auditors;
3.Approve, in an advisory (non-binding) vote, the compensation of the Company’s named executive officers (“say-on-pay”);
4.Ratify, confirm and approve the renewal of the Ur-Energy Inc. Amended Restricted Share Unit Plan (the “RSU Plan”), and approve and authorize for a period of three years all unallocated restricted share units issuable pursuant to the RSU Plan; and
5.Transact such other business as may lawfully come before the meeting or any adjournment(s) or postponement(s) thereof.
4. The Board of Directors has fixed the close of business on March 26, 2019April 8, 2022,as the record date for determination of the shareholders entitled to vote at the meeting and any adjournment(s) or postponement(s) thereof. This Notice of Annual and Special Meeting of Shareholders and related proxy materials are first being distributed or made available to shareholders beginning on or about April 5, 2019.21, 2022.
We cordially invite you to attend the Annual and Special Meeting of Shareholders.Shareholders either in person or to listen by toll-free access as described in the Management Proxy Circular. Whether or not you plan to attend, it is important that your shares be represented and voted at the meeting. Please refer to your proxy card and the Management Proxy Circular for more information on how to vote your shares at the meetingMeeting and return your voting instructions as promptly as possible.
Important Notice Regarding Availability of Proxy Materials for the 2022 Annual and Special Meeting of Shareholders: The attached Management Proxy Circular, proxy card or voter information form, and the Company’s Annual Report to Shareholders (including financial statements) for the fiscal year ended December 31, 20182021 are available at http:www.envisionreports.com/URGQ2022 or can be found at https://www.ur-energy.com/annual-general-meeting-info/.www.ur-energy.com.
Thank you for your support.
| BY ORDER OF THE BOARD OF DIRECTORS, | ||
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| /s/ Jeffrey T. Klenda, Chairman |
MANAGEMENT PROXY CIRCULAR
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Approval, on an Advisory Basis, of the Compensation of the Company’s Named Executive Officers | 10 | ||||
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SCHEDULE A |
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UR-ENERGY INC.
10758 West Centennial Road, Suite 200
Littleton, Colorado 80127
MANAGEMENT PROXY CIRCULAR
ANNUAL AND SPECIAL MEETING OF SHAREHOLDERS
MAYJUNE 2, 20192022
This Management Proxy Circular (the “Circular”) is furnished in connection with the solicitation by the management of Ur-Energy Inc. (“we,” “us,” the “Company” or “Ur-Energy”) of proxies for use at the annual and special meeting of shareholders of the Company (the “Meeting”) to be held in person at the Hampton Inn & Suites, 7611 Shaffer Parkway, Littleton, Colorado 80127 on Thursday, MayJune 2, 20192022 commencing at 1:00 p.m. local time,Mountain Time, and at any adjournment thereof, for the purposes set forth in the accompanying Notice of Meeting (the “Notice”). The solicitation will be primarily by mail, but proxies may also be solicited personally or by telephone by directors, officers, employees, or representatives of the Company. All costs of solicitation will be borne by the Company. This Circular and related proxy materials are first being first distributed or made available to shareholders beginning on or about April 5, 2019.21, 2022. The information contained herein is given as at March 26, 2019April 8, 2022, unless otherwise indicated.
We plan to hold our annual meeting in person on June 2, 2022. We remain mindful of the public health and travel concerns our shareholders may have and recommendations that public health and governmental officials may issue between the time of this Circular and our Meeting in light of the continuing COVID-19 situation. As a result, if the current public health conditions in Colorado deteriorate, we may impose additional procedures or limitations to assure the safety of Meeting attendees or we may decide to hold the Meeting in a different location or solely by means of remote communication (i.e., a virtual-only meeting). We currently plan to address travel and general health concerns relating to the Meeting by having our out-of-town directors and other Meeting participants whose physical presence at the Meeting is not essential attend and participate in the Meeting via teleconference.
In addition (i) shareholders and others who might otherwise attend in person may instead listen to the Meeting in real-time by calling toll-free 888-506-0062 (international: 973-528-0011) and use participant code 782613 and/or logging on to https://agm.issuerdirect.com/urg and (ii) shareholders who have questions they would like to pose at the Meeting may send those questions to our Corporate Secretary in advance of the Meeting at legaldept@Ur‑Energy.com. Please include your name and return email address when you convey your questions. We believe that these procedures will reduce risk and provide many of the benefits of a virtual-only meeting while minimizing associated costs of a virtual meeting.
As set forth below, if you are a registered shareholder and wish to vote the day of the Meeting or are a proxy appointee voting the day of the Meeting, you must do so in person. If COVID-19 related restrictions create changes to our current plan for an in-person meeting, we will disclose the updated plan on our website and by press release. We encourage you to check our website prior to the Meeting if you plan to attend in person.
All dollar amounts in this Circular are in U.S. dollars, except where indicated otherwise. On March 26, 2019,April 8, 2022, the noon exchange rate of Canadian currency in exchange for United States currency, as reported by the Bank of Canada, was US$1.00 = C$1.33861.2589.
This Circular, the proxy card or voter information form, and the Company’s Annual Report to Shareholders (including financial statements) for the fiscal year ended December 31, 20182021, are available at http:https://www.ur-energy.com/annual-general-meeting-info/.www.ur-energy.com.
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The persons named in the enclosedour form of proxy are the Chairman of the Board/Ur-Energy’s Chief Executive Officer, Mr. Klenda,John W. Cash, and our independent Lead Director of the Company, Mr. Parker. Corporate Secretary, Penne A. Goplerud. Each shareholder has the right to appoint a person other than the persons named in the enclosed form of proxy, who need not be a shareholder of the Company, to represent such shareholder at the Meeting or any adjournment thereof. Such right may be exercised by inserting such person’s name in the blank space provided in the form of proxy and striking out the other names or by completing another proper form of proxy.
Registered Shareholders
There are two methods by which registered shareholders (“Registered Shareholders”), whose names are shown on the books or records of the Company as owning common shares no par value of the Company (“Common Shares”), can vote their Common Shares at the Meeting either in person at the Meeting or by proxy. Should a Registered Shareholder wish to vote in person at the Meeting, the Registered Shareholder should attend the Meeting where his or her vote will be taken and counted. Although we are making a toll-free number available to listen to the Meeting, if you wish to vote the day of the Meeting, you must do so in person. Should the Registered Shareholder not wish to attend the meeting or not wish to vote in person, his or her vote may be votedcast by proxy through one of the methods described below and the Common Shares represented by the proxy will be voted or withheld from voting, in accordance with the instructions as indicated in the form of proxy, on any ballot that may be called for, and if a choice was specified with respect to any matter to be acted upon, the shares will be voted accordingly.
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A Registered Shareholder may vote by proxy by using one of the following methods: (i) the paper form of proxy to be returned by mail or delivery; (ii) by Internet; or (iii) by telephone. The methods of using each of these procedures are as follows:
Voting by Mail. A Registered Shareholder may vote by mail or delivery by completing, dating and signing the enclosed form of proxy and depositing it with Computershare Investor Services Inc. (the “Transfer Agent”) using the envelope provided or by mailing it to Computershare Investor Services Inc., Attention: Proxy Department, 100 University Avenue, 8th Floor, Toronto, Ontario M5J 2Y1 or to the Corporate Secretary of the Company at 10758 West Centennial Road, Suite 200, Littleton, Colorado 80127 for receipt no later than 1:0011:59 p.m. (MDT)(ET) on Tuesday, AprilMonday, May 30, 20192022, or if the Meeting is adjourned, by no later than 48 hours (excluding Saturdays, Sundays and holidays) before any adjourned1:00 p.m. Mountain Time on the last business day preceding the reconvened Meeting.
Voting by Internet. A Registered Shareholder may vote by Internet by accessing the following website: www.investorvote.com.www.envisionreports.com/URGQ2022, and going to “vote now.” When you log on to the site you will be required to input a control number as instructed on the form of proxy. Please see additional information enclosed with the Circular on the form of proxy. Registered Shareholders may vote by Internet up to 1:00for receipt no later than 11:59 p.m. (MDT)(ET) on Tuesday, AprilMonday, May 30, 20192022, or if the Meeting is adjourned, no later than 48 hours (excluding Saturdays, Sundays and holidays) before any adjourned1:00 p.m. Mountain Time on the last business day preceding the reconvened Meeting.
Voting by Telephone. A Registered Shareholder may vote by telephone by calling the toll freetoll-free number 1‑866-732-8683 from a touch tone phone. When you telephone you will be required to input a control number as instructed on the form of proxy. Please see additional information enclosed with the Circular on the form of proxy. Registered Shareholders may vote by telephone up to 1:00for receipt no later than 11:59 p.m. (MDT)(ET) on Tuesday, AprilMonday, May 30, 20192022, or if the Meeting is adjourned, no later than 48 hours (excluding Saturdays, Sundays and holidays) before any adjourned1:00 p.m. Mountain Time on the last business day preceding the reconvened Meeting.
Voting by mail or the Internet are the only methods by which a Registered Shareholder may choose an appointee other than the management appointees named on the proxy and must be completed by the Registered Shareholder or by an attorney authorized in writing or, if the Registered Shareholder is a corporation or other legal entity, by an authorized officer or attorney.
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Non-Registered Shareholders (Beneficial Owners)
In this Circular and the enclosed form of proxy and Notice, all references to shareholders are to Registered Shareholders of Common Shares. Only Registered Shareholders of Common Shares,If you hold shares through a broker, bank or the person they appoint as their proxy, are permittedother nominee, you will receive material from that firm asking how you want to vote at the Meeting. However, in many cases, Common Shares beneficially owned by a holder (a “Non-Registered Shareholder” or “Beneficial Owner”) are registered either:
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Common Shares held by your broker or its nominee can only be voted upon your instructions. Beneficial Owners should ensure that instructions respecting the voting of their Common Shares are communicated to the appropriate person.
There are two kinds of Beneficial Owners, those who object to their name being made known to the Company, referred to as objecting beneficial owners (“OBOs”), and those who do not object to the Company knowing who they are, referred to as non-objecting beneficial owners (“NOBOs”). In accordance with the requirements of National Instrument 54-101 Communication with Beneficial Owners of Securities of a Reporting Issuer (“NI 54-101”), the Company has opted this year to distribute copiesinstructing you of the Notice, Circular, the form of proxy and our annual reportprocedures to follow in order for the fiscal year ended December 31, 2018 (including financial statements) (collectively, the “Meeting Materials”) to all NOBOs directly through the Transfer Agent. Whereas, the Meeting Materials will continue to be distributed to
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OBOs through clearing agencies and Intermediaries, who often use a service company (such as Broadridge Financial Solutions, Inc. (“Broadridge”)) to forward meeting materials to Non-Registered Shareholders. The Company is not relying on the notice-and-access delivery procedures of NI 54-101 or the corresponding rules of the U.S. Securities and Exchange Commission (“SEC”) to distribute copies of the Meeting Materials.
The Meeting Materials are being sent to both Registered and Non-Registered Shareholders of the Common Shares. If you are a Non-Registered Shareholder, and the Company or its agent has sent these Meeting Materials directly to you, your name and address and information about your holdings of Common Shares, have been obtained in accordance with applicable securities regulatory requirements from the Intermediary holding on your behalf.
By choosing to send the Meeting Materials to NOBOs directly, the Company (and not the Intermediary holding on your behalf) has assumed responsibility for (i) delivering these Meeting Materials to you, and (ii) executing your proper voting instructions. Please return your voting instructions as specified in the request for voting instructions.
Objecting Beneficial Owners
Intermediaries are required to forward Meeting Materials to OBOs unless an OBO has waived the right to receive them. Generally, OBOs who have not waived the right to receive Meeting Materials will usually receive a voting instruction form (“VIF”) from their applicable Intermediary in lieu of the form of proxy from the Company. The VIF will name the same persons as the proxy to represent the shareholder at the Meeting. A shareholder has the right to appoint a person (who need not be a shareholder of Ur-Energy) other than persons designated in the VIF, to represent the shareholder at the Meeting. To exercise this right, the shareholder should insert the name of the desired representative in the blank space provided in the VIF. You are asked to complete and return the VIF to your applicable Intermediary by mail or facsimile. Alternatively, you may be able to call the toll free telephone number or access the Internet website listed on your VIF to vote your Common Shares. shares. If you receive a VIF from your Intermediary, it cannot be used as a proxy to vote Common Shares directly at the Meeting as the VIF must be returned to your Intermediary well in advance of the Meeting in order to have the Common Shares voted or to appoint an alternative representative to attend at the Meeting in person to vote such Common Shares.
Non-Objecting Beneficial Owners
NOBOs can expect to receive the Meeting Materials with a VIF from the Transfer Agent. These VIFs are to be completed and returned to the Transfer Agent by mail or by following the instructions contained on the VIF for telephone or Internet voting. The Transfer Agent will tabulate the results of the VIFs received from NOBOs and will provide appropriate instructions at the Meeting with respect to the shares represented by the VIFs received. If you receive a VIF from the Transfer Agent, it cannot be used as a proxy to vote Common Shares directly at the Meeting as the VIF must be returned to the Transfer Agent well in advance of the Meeting in order to have the Common Shares voted or to appoint an alternative representative to attend at the Meeting in person to vote such Common Shares.
The purpose of these procedures is to permit Non-Registered Shareholders to direct the voting of the shares they beneficially own. Should a Non-Registered Shareholder who receives either a proxy or a VIF wish to attend and vote at the Meeting in person (or have another person attend and vote on behalf of the Non-Registered Shareholder), the Non-Registered Shareholder should strike out the names of the persons named in the proxy and insert the Non-Registered Shareholder’s (or such other person’s) name in the blank space provided or, in the case of a VIF, follow the corresponding instructions on the form.
In any event, Non-Registered Shareholders should carefully follow the instructions of their Intermediaries and Broadridge or other service company, or the Transfer Agent, as the case may be.
Broker Non-Votes
A “broker non-vote” occurs when an Intermediary holding shares for a Beneficial Owner votes on one proposal, butnominee does not receive voting instructions from you, it may vote only on another proposal because the Intermediary does not have discretionary voting power and has not received instructions to do so from the Beneficial Owner. The nomineeproposals that holds your shares may generally vote on
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“routine”are considered “routine” matters but cannot vote on “non-routine” matters.under applicable rules. Each of the proposals at the Meeting, other than Proposal No. 2, are “non-routine” matters and therefore an Intermediaryintermediary holding shares for a Beneficial Ownerbeneficial owner will not have the authority to vote on those matters in the absence of instructions from the Beneficial Owner.beneficial owner. A nominee’s inability to vote on some proposals because it lacks discretionary authority to do so is commonly referred to as a “broker non‑vote.” Broker non-votes are not counted in the tabulation of votes cast on a particular proposal and therefore will not have an effect on the approval of that proposal.
Notice and Access
We distribute our proxy materials to shareholders via the Internet under the “Notice and Access” approach permitted by rules of the SEC. This approach conserves natural resources and reduces our distribution costs, while providing a timely and convenient method of accessing the materials and voting. On or before April 21, 2022, we mailed a Notice of Internet Availability of Proxy Materials to participating shareholders, containing instructions on how to access the proxy materials on the Internet to vote your shares over the Internet or by telephone. You will not receive a printed copy of the proxy materials unless you request them. If you would like to receive a printed copy of our proxy materials, including a printed proxy card on which you may submit your vote by mail, then you should follow the instructions for obtaining a printed copy of our proxy materials contained in the Notice of Internet Availability of Proxy Materials.
A shareholder who has given a proxy has the power to revoke it as to any matter on which a vote shall not already have been cast pursuant to the authority conferred by such proxy and may do so (i) by delivering another properly executed proxy bearing a later date and depositing it as aforesaid, including within the prescribed time limits noted above; (ii) by depositing an instrument in writing revoking the proxy executed by the shareholder or by the shareholder’s attorney authorized in writing (A) at our head office with the Corporate Secretary at 10758 West Centennial Road, Suite 200, Littleton, Colorado 80127 at any time up to and including the last business day preceding the day of the Meeting, or any adjournment thereof, at which the proxy is to be used, or (B) with the Chair of the Meeting, prior to its commencement, on the day of the Meeting, or at any adjournment thereof; (iii) by attending the Meeting in person and so requesting; or (iv) in any other manner permitted by law.
A Non-Registered Shareholder mayIf you hold your shares through a broker, bank, or other nominee, you must follow their instructions to revoke a VIFyour initial proxy vote or a waiver of the right to receive Meeting Materials and tootherwise vote given to an Intermediary at any time by written notice to the Intermediary, except that an Intermediary is not required to act on a revocation of a VIF or a waiver of the right to receive Meeting Materials and to vote that is not received by the Intermediary at least seven days prior to the Meeting.
VOTING AND DISCRETION OF PROXIES
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On any ballot that may be called for, the shares represented by proxies in favor of the persons named by management of the Company will be voted for or against, or voted for or withheld from voting on,in the mattersmanner identified in the proxy, in each case in accordance with the instructions of the shareholder. In the absence of any instructions on the proxy, it is the intention of the persons named by management in the accompanying form of proxy to vote
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(1) | FOR the election of all of management’s nominees as directors; | |
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(2) | FOR the re-appointment of PricewaterhouseCoopers LLP, Chartered Professional Accountants, as our independent auditors and the authorization of the directors to fix the remuneration of the auditors; | |
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(3) | FOR the advisory resolution to approve, on an advisory (non-binding) basis, the compensation of our Named Executive Officers; | |
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(4) | FOR the resolution to approve the renewal of our Amended and Restated Restricted Share Unit and Equity Incentive Plan (the “RSU&EI Plan”) and to approve and authorize all unallocated | |
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(5) | In accordance with management’s recommendations with respect to amendments or variations of the matters set out in the Notice or any other matters which may properly come before the Meeting. |
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The accompanying form of proxy confers discretionary authority upon the persons named therein with respect to amendments or variations of the matters identified in the Notice or any other matters that may properly come before the Meeting. As at the date of this Circular, management of the Company knows of no such amendments, variations or other matters that may properly come before the Meeting other than the matters referred to in the Notice.
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COMMON SHARES ENTITLED TO VOTE
As at March 26, 2019,April 8, 2022, the authorized capital of the Company consisted of an unlimited number of Common Shares, of which 159,729,403218,622,828 Common Shares were issued and outstanding, and an unlimited number of Class A Preference Shares, issuable in series, of which none has been issued. A holder of record of Common Shares as at the close of business on March 26, 2019April 8, 2022 (the “Record Date”) is entitled to one vote for each Common Share held by the shareholder. The directors nominated for election pursuant to Proposal No. 1 will be elected by plurality vote, meaning that the seven nominees who receive the most votes, whether in person or by proxy, will be elected; however, the Company has adopted a majority voting policy pursuant to which any director who fails to receive a majority of the votes cast will be required to tender his resignation. See “Statement of Corporate Governance – Majority Voting Policy.” With respect to Proposal Nos. 2, 3, 4 and 5, the affirmative vote of a majority of the votes cast at the Meeting, whether in person or by proxy, is required for approval of such matter.
In accordance with the Canada Business Corporations Act, the Company will prepare a list of holders of Common Shares on the Record Date. Each holder of Common Shares named in the list at the close of business on the Record Date will be entitled to vote the Common Shares shown opposite his or her name on the list at the Meeting.
The directors nominated for election pursuant to Proposal No. 1 will be elected by plurality vote, meaning that the seven nominees who receive the most votes, whether in person or by proxy, will be elected. Broker non‑votes will have no effect on the election of Directors. The Company has adopted a majority voting policy pursuant to which any director who fails to receive a majority of the votes cast will be required to tender their resignation. See “Statement of Corporate Governance – Majority Voting Policy.”
With respect to Proposal No. 2, the affirmative vote of a majority of the votes cast at the meeting (either in person or by proxy) will be required for approval.
With respect to Proposal No. 3, the affirmative vote of a majority of the Common Shares present at the meeting (either in person or by proxy) and entitled to vote on this matter will be required for approval. Broker non‑votes will have no effect on the vote on Proposal No. 3. Because your vote on this proposal is advisory, it will not be binding on the Board of Directors or the Company. However, the Board will review the voting results and take them into consideration when making future decisions regarding executive compensation.
With respect to Proposal No. 4, the affirmative vote of a majority of the votes cast at the meeting (either in person or by proxy) will be required for approval, however, rules of the Toronto Stock Exchange (“TSX”) provide that all eligible insiders in order to participate in the RSU&EI Plan may not vote on the resolution. Accordingly, the RSU&EI Plan resolution must be passed by a majority of votes cast at the meeting (either in person or by proxy), excluding 6,201,821 Common Shares held by certain insiders of the Company and their affiliates. Broker non‑votes will have no effect on the outcome of this proposal.
The presence, in person or by proxy, of two shareholders holding not less than 10% of the Common Shares entitled to vote as of the Record Date constitutes a quorum for the transaction of business at the Meeting. In the event there is not a quorum present to approve any proposals at the time of the Meeting, the Meeting shall be adjourned to a date no less than seven days later than the scheduled Meeting date in order to permit further solicitation of proxies. The scrutineer will treat Common Shares represented by a properly signed and returned proxy as present at the Meeting for purposes of determining a quorum, without regard to whether the proxy is marked as casting a vote or abstaining.
Pursuant to the Canada Business Corporations Act, there are no rights of dissent in respect of the resolutions to be voted on by the shareholders at this Meeting.
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CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Security Ownership of Management
As of March 26, 2019,April 8, 2022, our Record Date, we had 159,729,403218,622,828 Common Shares issued and outstanding, and 6,184,173 5,767,461 stock options which may be exercised currently or within the sixty (60) days following March 26, 2019. April 8, 2022.
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| Number of | Percentage of Issued and |
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Name of Holder | Ur-Energy | Ur-Energy |
Directors and Named Executive Officers (1)(2) |
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Jeffrey T. Klenda (3) | 3,520,596 | 2.12% |
W. William Boberg(4) | 1,047,829 | * |
James M. Franklin | 958,321 | * |
Gary Huber | 582,300 | * |
Kathy E. Walker | 129,600 | * |
Rob C. Chang | 66,000 | * |
Thomas Parker | 443,114 | * |
Roger L. Smith | 801,854 | * |
Penne A. Goplerud | 638,610 | * |
Steven M. Hatten | 537,295 | * |
John W. Cash | 525,508 | * |
James A. Bonner | 496,267 |
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All Directors and executive officers, as a group (12 persons) | 9,747,295 | 5.87% |
| Number of Common Shares of | Percentage of Issued and Outstanding Common Shares |
Name of Holder | Ur-Energy | of Ur-Energy |
Directors and Named Executive Officers (1)(2) |
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W. William Boberg (3) | 1,369,295 | * |
John W. Cash | 640,603 | * |
Rob Chang | 545,048 | * |
James M. Franklin(4) | 1,057,609 | * |
Penne A. Goplerud | 764,642 | * |
Steven M. Hatten | 557,780 | * |
Gary C. Huber | 660,013 | * |
Jeffrey T. Klenda(5) | 3,544,838 | 1.58% |
Thomas H. Parker | 678,827 | * |
Roger L. Smith | 939,192 | * |
Kathy E. Walker | 755,473 | * |
All Directors and executive officers, as a group (11 persons) | 11,513,320 | 5.13% |
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* Less than one percent
(1) | Address for each of our directors and executive officers: 10758 West Centennial Road, Suite 200, Littleton, Colorado 80127. |
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(2) | The beneficial ownership shown for all holders in this table represents Common Shares and all options which may be exercised currently or within sixty (60) days following |
(3) | Of the shares identified, Mr. Boberg holds 118,796 Common Shares jointly with his wife. |
(4) | Of the shares identified, Dr. Franklin holds 50,000 Common Shares indirectly through his ownership in Franklin Geosciences Ltd. |
(5) | Of the total number of Common Shares held by Mr. Klenda, he has pledged 1,706,640 Common Shares on a multi-purpose equity line of credit. |
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Security Ownership of Certain Beneficial Owners
As of March 26, 2019,at April 8, 2022, no person (other than the Directors and executive officers of the Company) owned of record, or was known to own beneficially, more than 5% of the outstanding voting shares of Common Shares.
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PARTICULARS OF MATTERS TO BE ACTED UPON
Proposal No. 1: Election of Directors
The articles of the Company provide that the Board of Directors of the Company (the “Board of Directors” or the “Board”) shall consist of a minimum of one and a maximum of ten directors, the number of which is currently fixedwill be seven as elected at seven.the Meeting. Election of directors will be conducted on an individual basis, as seen on the proxy or VIF you receive and will include Jeffrey T. Klenda,W. William Boberg, John W. Cash, Rob Chang, James M. Franklin, W. William Boberg,Gary C. Huber, Thomas H. Parker, Gary C. Huber,and Kathy E. Walker and Rob Chang.Walker. As discussed in the description of the Company’s Majority Voting Policy, below, each Director must receive a majority of the votes cast (in person or by proxy) as to his or her election or will be required to submit his or her resignation pursuant to the policy.
Nominees: Each of the seven persons named above is a nominee for election as a Directordirector at the Annual and Special Meeting for a term of one year or until his or her successor is elected and qualified. Unless authority is withheld, the proxies will be voted for the election of such nominees. Each of the nominees is currently serving as a Directordirector of the Company. AllEach of the nominees werewas elected to the Board of Directors at the last annual meeting of shareholders.shareholders except for Mr. Cash, who was appointed as a Director of the Company March 1, 2022, when he was named Chief Executive Officer of Ur-Energy Inc. Management does not anticipate that any of the nominees for election as directors will be unable to serve as a director, but if that should occur for any reason prior to the Meeting, the persons named in the accompanying form of proxy reserve the right to vote for another nominee in their discretion or for the election of only the remaining nominees.
The Board of Directors has delegated to the Corporate Governance and Nominating Committee the responsibility for reviewing and recommending nominees for director. The Board determines which candidates to nominate or appoint, as appropriate, after considering the recommendation of the Corporate Governance and Nominating Committee.
Certain of our directors have historically and do currently serve on boards of directors of other companies. We view this to be beneficial to the Company, provided there is no conflict of interest, nor restrictions on time which are disadvantageous to our Board’s interests. Current service on the boards of other public companies is set forth, below, under “Service on Additional Boards.” The Company believes that service on other boards allows for broader experience and expertise which benefits the individual and the companies served, including Ur-Energy. None of our directors sits on more than three public company boards or, alternatively, is the CEO of a public company and sits on the board of more than two public companies besides the one for which he/she is the CEO (i.e., none of our directors is “overboarded”).
Qualifications: In evaluating a director candidate, the Corporate Governance and Nominating Committee considers the candidate’s independence, character, corporate governance skills and abilities, business experience, industry-specific experience including technical expertise, corporate governance skills and abilities, training and education, commitment to performing the duties of a director, and other skills, abilities, or attributes that fill specific needs of the Board or its committees. Each nominee brings a strong and unique background and set of skills to the Board, giving the Board, as a whole, competence and experience in a wide variety of areas, including natural resources exploration and development, mining operations, executive management, board service, corporate governance, finance, financial markets, government, employment, and international business. These varied and substantial backgrounds, skills, and qualifications, as described in more detail below, and the contributions of each to the development and current operations of the Company as described below under the heading “Board Composition – Including Tenure, Diversity, and Outlook on Set Retirement Age,” led the Corporate Governance and Nominating Committee and the Board of Directors to the conclusion that each of the nominees should serve as a Director.
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Recommendation of Ur-Energy’s Board of Directors
The Board of Directors recommends that the shareholders vote FOR the election of all of the named nominees for director and, unless a shareholder gives instructions on the proxy card to the contrary, the proxies named thereon intend to so vote.
W. William (Bill) Boberg, 82, M.Sc., P. Geo | Director |
Mr. Boberg has served as a director of the Company since January 2006. Mr. Boberg served as the Company’s President and Chief Executive Officer (2006 to 2011). Prior to that time, Mr. Boberg was the Company’s senior U.S. geologist and Vice President U.S. Operations (2004 to 2006). Before his initial involvement with the Company, he was a consulting geologist having over 40 years’ experience investigating, assessing, and developing a wide variety of mineral resources in diverse geologic environments in western North America, South America, and Africa. Mr. Boberg worked for Gulf Minerals, Hecla Mining, Anaconda, Continental Oil Minerals Department, Wold Nuclear, Kennecott, Western Mining, Canyon Resources and Africa Mineral Resource Specialists. Mr. Boberg has over 30 years of experience exploring for uranium in the continental U.S. He discovered the Moore Ranch Uranium Deposit and the Ruby Ranch Uranium Deposit as well as several smaller deposits in Wyoming’s Powder River Basin. He received his Bachelor’s Degree in Geology from Montana State University and his Master’s Degree in Geology from the University of Colorado. He is a registered Wyoming Professional Geologist and fellow of the Society of Economic Geologists. He is a member of the Society for Mining, Metallurgy & Exploration Inc., American Institute of Professional Geologists (for which he is a Certified Professional Geologist), the Denver Regional Exploration Society and the American Association of Petroleum Geologists. Mr. Boberg is also a director for Gold79 Mines Ltd. (formerly, Aura Resources Inc.) (since June 2008).
The Board of Directors has concluded that Mr. Boberg is well qualified and should serve as a director on the basis of his contributions to the Company since 2004 (since 2006 as a director and, from 2006 until 2011, as the President and CEO), as well as his more than 40 years of experience in mineral resources exploration and development.
John W. Cash, 49, M.Sc. | Director, Chief Executive Officer of Ur-Energy |
Mr. Cash was named Ur-Energy’s Chief Executive Officer and appointed as a Director on March 1, 2022. Mr. Cash joined Ur-Energy in 2007 and was appointed as Vice President Regulatory Affairs in 2011. He has led the permitting and licensure of both the Lost Creek and Shirley Basin uranium mines, while managing the environmental, health and safety (“EHS”) and geology departments and contributing to the development and growth of the Company. During his tenure with Ur-Energy, Mr. Cash has gained a well-deserved reputation for developing impactful solutions for industry related to water management, EPA aquifer exemptions, technical design, and environmental matters. Mr. Cash has nearly 30 years of diverse experience in the uranium industry, from which he has acquired broad-reaching expertise in exploration, EHS including radiation safety, regulatory and legislative affairs, and uranium recovery operations, as well as extensive management experience. He is a respected industry leader and has served as a past president of the Uranium Producers of America.
Prior to joining Ur-Energy, Mr. Cash worked for established uranium mining companies, including BHP, Rio Algom Mining, and Crow Butte Resources, a subsidiary of Cameco, in various roles in mineral exploration, as Operations Superintendent and EHS Manager. As Operations Superintendent, Mr. Cash managed all aspects of wellfield production and plant processing at the 800,000 lbs. U3O8 per year Crow Butte ISR facility. Mr. Cash is a Fellow of the inaugural World Nuclear Summer Institute. Mr. Cash received B.Sc. and M.Sc. degrees in Geology and Geophysics from the University of Missouri-Rolla.
The Board of Directors has concluded that Mr. Cash is well qualified and should serve as a director on the basis of his contributions to the Company since 2007, as an employee, executive officer and most recently as Chief Executive Officer and a member of the Board of Directors. Additionally, the Board of Directors believes that Mr. Cash’s lengthy tenure and diverse expertise in the uranium industry will benefit the Board.
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Rob Chang, 44, MBA | Director |
Mr. Chang has 26 years of experience in the financial services industry and is a sought-after expert in uranium markets. An experienced senior executive, he currently sits on the boards of publicly traded mineral resource companies. He is the Co-Founder and Chief Executive Officer of Gryphon Digital Mining currently, while his past roles include serving as the Managing Director and Head of Metals & Mining at Cantor Fitzgerald where he provided research coverage in precious metals, base metals, lithium, and uranium. He is well familiar with the uranium mining industry and is considered a subject matter expert by several media outlets. He was recognized by Bloomberg as the “Best Precious Metals Analyst” in Q1 2016. Mr. Chang is frequently quoted by and a regular guest of several media outlets including Bloomberg, Reuters, CNBC, and the Wall Street Journal. Mr. Chang previously served as a Director of Research and Portfolio Manager at Middlefield Capital, a Canadian investment firm which managed $3 billion in assets. He was also on a five-person multi-strategy hedge fund team where he specialized in equity and derivative investments. Mr. Chang completed his MBA at the University of Toronto’s Rotman School of Management. Mr. Chang also serves as a director on the boards of Fission Uranium Corp. (since April 2018) and Shine Mineral Corp. (since November 2018).
The Board of Directors has concluded that Mr. Chang is well qualified and should serve as a director of the Company on the basis of his contributions to the Board since 2018, and his extensive knowledge of the financial markets and financial services industry, as well as his knowledge of the uranium mining industry.
James M. Franklin, 79, PhD, FRSC, P.Geo | Director & Chair of the HSE & Technical Committee |
Dr. Franklin has over 50 years’ experience as a geologist. He is a Fellow of the Royal Society of Canada. Since 1998, he has been an Adjunct Professor at Queen’s University, since 2001, at Laurentian University and since 2006 at the University of Ottawa. He is a past President of the Geological Association of Canada and of the Society of Economic Geologists. He retired in 1998 as Chief Geoscientist of the Geological Survey of Canada, Earth Sciences Sector. Since that time, he has been a consulting geologist and is currently a director of Gold79 Mines Ltd. (formerly, Aura Resources Inc.) (since October 2003), and Nuinsco Resources Ltd. (since June 2018). Dr. Franklin’s lifetime achievements have been honored by several professional organizations: among his honors, Dr. Franklin has been awarded GAC’s Logan and Duncan R. Derry medals, CIM’s Selwyn Blaylock, A.O. Dufresne, Distinguished Lecturer and Julian Boldy Memorial awards and the Society of Economic Geologists Thayer Lindsley and Distinguished Lecturer awards. He has also received the R.A.F. Penrose Gold Medal from SEG for his many contributions to a broad cross section of geosciences. In 2017 he was made a Fellow of Lakehead University, honoring his contributions to education and economic development in northern Ontario. Dr. Franklin was inducted into the Canadian Mining Hall of Fame in 2019 for his many contributions to the mining industry.
The Board of Directors has concluded that Dr. Franklin is well qualified and should serve as a director on the basis of his contributions as a director to the Company since its inception and his more than 50 years of experience in geosciences and mineral resource work in industry, governmental service, and academia.
Gary C. Huber, 70, PhD, P.Geo | Director, Chair of Compensation Committee & Chair of Corporate Governance and Nominating Committee |
Dr. Huber is a mining executive with over 40 years of natural resources experience. Previously, Dr. Huber served as a director for Ur‑Energy during 2007. Dr. Huber returned to serve as a director for Ur-Energy in 2015. In the interim, Dr. Huber served as President and CEO of Neutron Energy, Inc. (2007-2012), a privately held uranium company which was conducting project feasibility analyses as well as permitting of two uranium mines and a mill complex. Dr. Huber is the founder, in 2006, and managing member of Rangeland E&P, LLC, a private company established for oil and gas exploration. Dr. Huber served as an independent director of Gold Resource Corporation, a precious metal mining company. He was chairman of its audit committee and a member of the compensation committee. He also has served as an independent director of Capital Gold Corp., a gold mining company with operations in Mexico, and served on its audit and corporate governance committees. Dr. Huber was one of the founders of Canyon Resources Corporation in 1979, and served in various capacities there until 2006, including as director, chief financial officer, vice president of finance, treasurer, and secretary. He also served as the president and chief executive officer of CR Minerals Corporation, an industrial minerals subsidiary of Canyon Resources, from 1987 to 1998. Dr. Huber holds a PhD in geology from Colorado School of Mines and received a Bachelor of Science in geology from Fort Lewis College. He is a fellow of the Society of Economic Geologists, where he previously served as the chairman of its audit and investment committees; and a member of the Society for Mining, Metallurgy and Exploration, where he previously served as the chairman of the audit committee. Dr. Huber served as a director and treasurer of The Society of Independent Professional Earth Scientists, a not-for-profit professional group. He also has served as President of the Society of Independent Earth Scientists Foundation, which awards scholarships to undergraduate and graduate students majoring in the earth sciences fields. Dr. Huber formerly was a director of the Denver Gold Group, a not-for-profit industry association for publicly traded precious metal companies. Dr. Huber is a Utah registered Professional Geologist.
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The Board of Directors has concluded that Dr. Huber is well qualified and should serve as a director of the Company on the basis of his contributions to the Company as a director (in 2007, and since his return to the Board in 2015), and because of his extensive mining industry experience including in areas of natural resources development and mining operations, and executive management and finance, developed by serving as an executive officer and director of publicly-traded natural resource companies.
Thomas H. Parker, 79, M.Eng., P.E. | Lead Director, Chair of Audit Committee & Chair of Treasury & Investment Committee |
Mr. Parker has worked extensively in senior management positions in the mining industry, having begun his career in the mining industry 57 years ago. Mr. Parker is a mining engineer graduate from South Dakota School of Mines, with a Master’s Degree in Mineral Engineering Management from Penn State. Mr. Parker was President and CEO, and a director of U.S. Silver Corporation until his retirement in 2012. Prior to that, Mr. Parker was President and CEO of Gold Crest Mines, Inc., before which he was the President and CEO of High Plains Uranium, Inc., a junior uranium mining company acquired by Energy Metals in 2007. Mr. Parker also served for 10 years as Executive Vice President of Anderson and Schwab, a management consulting firm. Prior to Anderson and Schwab, Mr. Parker held many executive management positions including with Costain Minerals Corporation, ARCO, Kerr McGee Coal Corporation and Conoco. He also has worked in the potash, limestone, talc, coal, and molybdenum industries and has extensive experience working in Niger, France, and Venezuela.
The Board of Directors has concluded that Mr. Parker is well qualified and should serve as a director on the basis of his contributions to the Company as a director since 2007 and, most recently, as our Lead Director since 2014, as well as his more than 55 years of experience in the mining industry and in executive management positions.
Kathy E. Walker,63, MBA | Director |
Ms. Walker is the founder and CEO of the eKentucky Advanced Manufacturing Institute, a high-tech workforce training center. She is also the CEO of Elm Street Resources Inc., an energy marketing company. Both companies are based in Painstville, Kentucky. She brings more than 35 years of experience in various energy, financial, and manufacturing related business endeavors to our Board. Ms. Walker holds an MBA from Xavier University. Prior to starting Elm Street Resources, she served as Secretary and Controller of Agip Coal, USA, a subsidiary of the Italian National Energy Agency ENI. Ms. Walker, former Chair of the Morehead State University Board of Regents, was a founder and board member of First Security Bank, Lexington, Kentucky and of Great Nations Bank, Norman, Oklahoma. She is a member of several regional economic development boards.
The Board of Directors has concluded that Ms. Walker is well qualified and should serve as a director of the Company on the basis of her contributions to the Company as a director since 2017, and because of her extensive energy-related business experience including in areas of sales and marketing, and executive management and finance expertise, developed by serving as an executive officer and director of various entities.
Appointment of Auditor
The Audit Committee selected and has recommended the independent accounting firm of PricewaterhouseCoopers LLP with respect to the audit of our financial statements for the year ended December 31, 2022. At the Meeting, it is proposed to re-appoint PricewaterhouseCoopers LLP, Chartered Professional Accountants, as auditors of the Company, to serve until the next annual meeting of shareholders with their remuneration to be fixed by the Board of Directors.
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In light of ongoing travel concerns due to COVID-19 and in the interests of safety, we currently expect that our Audit Partner from PricewaterhouseCoopers LLP will participate in our Meeting by telephone.
Independent Accountant Fees and Services
PricewaterhouseCoopers LLP Chartered Professional Accountants, and its affiliates have been the auditors of Ur‑Energy since December 2004. The fees accrued for audit and audit-related services performed by PricewaterhouseCoopers LLP Chartered Professional Accountants, in relation to our financial years ended December 31, 2021 and 2020, paid and shown below in C$, were as follows:
| December 31, 2021 | December 31, 2020 |
Audit fees (1) | $176,600 | $171,200 |
Audit related fees (2) | $57,245 | $55,300 |
All other fees (3) | $66,105 | $59,810 |
Total | $299,950 | $286,310 |
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(1) | Audit fees consisted of audit services, reporting on internal control over annual financial reporting and review of such documents filed with the securities regulators. |
(2) | Audit related fees were for services in connection with quarterly reviews of the consolidated financial statements and review of such documents filed with the securities regulators. |
(3) | All other fees include fees related to financing activities, if any, and our shelf registration and at-market sales agreement. We have not incurred audit fees billed for tax compliance, tax advice, and tax planning services during either 2020 or 2021. |
Audit Committee’s Pre-Approval Practice
All services reflected in the preceding table for 2021 and 2020 were pre-approved in accordance with the policy of the Audit Committee of the Board of Directors
It is proposed to approve an ordinary resolution to re-appoint the firm of PricewaterhouseCoopers LLP, Chartered Professional Accountants, as auditors of the Company to hold office until the close of the next annual meeting of shareholders or until PricewaterhouseCoopers LLP is removed from office or resigns, and to authorize the Board of Directors of the Company to fix the remuneration of PricewaterhouseCoopers LLP as auditors of the Company.
Recommendation of Ur-Energy’s Board of Directors
The Board of Directors recommends that the shareholders vote FOR the re-appointment of PricewaterhouseCoopers LLP, Chartered Professional Accountants, and to authorize the Board of Directors of the Company to fix the remuneration of PricewaterhouseCoopers LLP as auditors and, unless a shareholder gives instructions on the proxy card to the contrary, the proxies named thereon intend to so vote.
The approval of Proposal No. 2 requires the approval of a majority of the votes cast by shareholders (either in person or by proxy) at the Meeting.
Advisory Vote on Named Executive Officer Compensation
In accordance with SEC rules, our shareholders will be asked at the Meeting to cast a non-binding advisory vote on the compensation of our Named Executive Officers as disclosed in this Circular, including the disclosures under “Compensation Program” and “Executive Compensation” and the compensation tables and related narrative disclosure. This vote is not intended to address any specific item of compensation, but rather the overall compensation of our Named Executive Officers and the policies and practices described in this Circular.
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We conducted a similar advisory vote in 2021 and approximately 80% of the votes cast at that meeting voted in favor of the compensation of our Named Executive Officers. For the past five years, our advisory “say on pay” vote has averaged approximately 90%. This vote is advisory, which means that its outcome is not binding on the Company, the Board of Directors, or the Compensation Committee of the Board of Directors.
We are continuing our practice of having an annual say-on-pay advisory vote, so the next advisory vote will occur at our annual meeting in 2023.
The Compensation Committee and the Board of Directors believe that our compensation policies and procedures are effective in achieving our goals. As described under “Compensation Program” our compensation program is designed to motivate executive officers and employees to achieve pre-determined objectives without taking excessive risks; provide competitive compensation and benefit programs to attract and retain highly qualified executives and employees; encourage an ownership mentality; and, fundamentally, to support the achievement of results. We believe that the Company’s compensation program, with its balance of (i) short-term incentives (including cash bonus awards and performance conditions for such awards), (ii) long-term incentives (including equity awards of stock options and restricted share units which vest over varied periods of two to three years), and (iii) share ownership guidelines for executive officers, reward sustained performance that is aligned with long-term shareholder interests. Shareholders are encouraged to read both “Compensation Program” and “Executive Compensation” sections below, as well as the compensation tables and related narrative disclosure. Shareholders will be asked to approve the following ordinary resolution (the “Advisory Vote on Named Executive Officer Compensation Resolution”) at the Meeting:
BE IT RESOLVED THAT the Company’s shareholders approve, on an advisory basis, the compensation of the Named Executive Officers, as disclosed in the Company’s Management Proxy Circular for this annual and special meeting of shareholders, including the “Compensation Program” and “Executive Compensation” sections and the compensation tables and related narrative disclosure.
Recommendation of Ur-Energy’s Board of Directors
The Board of Directors recommends that shareholders vote FOR approval of the Advisory Vote on Named Executive Officer Compensation Resolution.
The approval of the advisory vote on Proposal No. 3 requires the affirmative vote of a majority of the Common Shares present at the meeting (either in person or by proxy). Although the advisory vote is non-binding, the Board will review the results of the vote and will take the results of the vote into account in determinations concerning executive compensation.
At the Meeting, shareholders will be asked to consider and pass a resolution substantially in the form set out below, to approve, confirm and ratify the renewal of the Ur-Energy Inc. Amended and Restated Restricted Share Unit and Equity Incentive Plan (the “RSU&EI Plan”), which was last approved by shareholders on May 2, 2019. Under the policies of the TSX, the RSU&EI Plan must be reconfirmed every three years by a majority of the Company’s directors and shareholders excluding the votes cast by, or in behalf of, the insiders of the Company who are eligible to participate in the RSU&EI Plan, and their affiliates. Therefore, a resolution will be placed before the shareholders to approve the renewal of the RSU&EI Plan and the unallocated share units and shares under the RSU&EI Plan. This approval will be effective for three years from the date of the Meeting. If approval is not obtained at the Meeting, RSUs and other units and shares under the RSU&EI Plan which have not been allocated and RSUs which are outstanding and are subsequently cancelled or terminated will not be available for a new grant of share units or shares under the RSU&EI Plan. Previously allocated RSUs will continue to be unaffected by the approval or disapproval of the resolution.
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The Board of Directors wishes to renew the RSU&EI Plan, which was previously ratified, confirmed and approved at meetings of shareholders of the Company in 2010, 2013, 2016 and 2019. The RSU&EI Plan continues to include directors and employees, including executive officers, of Ur‑Energy as possible eligible participants. The Board of Directors is of the view that it is in the best interests of the Company to renew the RSU&EI Plan as it contributes to our ability to maintain a strong compensation program, and specifically our bonus programs. Approval will allow the Board of Directors to grant the various share units and Common Shares permitted under the plan, and to utilize the RSU&EI Plan and the overall compensation program to support our ongoing efforts to attract and retain highly qualified directors and employees, including executive officers, in a highly competitive market. As part of our long-term incentive plan, the RSU&EI Plan encourages share ownership in the Company by directors and employees, including officers, and further motivates these individuals towards the overall success of the Company.
No modifications are proposed to be made to the RSU&EI Plan. There is no request to increase the percentage number of shares available for issuance under the RSU&EI Plan. Because the RSU&EI Plan participants and the amounts of any awards are determined in the absolute discretion of the Board of Directors, the benefits to be delivered under the amended RSU&EI Plan at this time are indeterminable at this time.
At April 8, 2022, there are 11 employees and six non-executive directors who are eligible to participate in the plan. As at April 8, 2022, the closing price of our Common Shares on the NYSE American was $1.78 and on the TSX was C$2.23.
The RSU&EI Plan, as approved and ratified by the Board of Directors, is summarized in more detail under the heading “Stock Options and Amended and Restated Restricted Share Unit and Equity Incentive Plan,” below. A copy of the RSU&EI Plan is attached to this Circular as Schedule A. A shareholder may also obtain a copy of the plan from the Secretary of the Company upon request at 10758 West Centennial Road, Suite 200, Littleton, Colorado, 80127, telephone 720-981-4588 (ext. 250).
Ur-Energy Inc. Restricted Share Unit and Equity Incentive Plan Resolution
BE IT RESOLVED THAT:
1. | The renewal of the Ur-Energy Inc. Amended and Restated Restricted Share Unit and Equity Incentive Plan, as set forth fully in Schedule A to this Circular (the “RSU&EI Plan”), be and is hereby ratified, confirmed and approved; and | |
2. | All unallocated share units and shares issuable pursuant to the RSU&EI Plan be and hereby are approved and authorized until June 2, 2025; and | |
3. | Any director or officer of the Company be and each of them is hereby authorized, for and on behalf of the Company, to take such actions and to sign, execute and deliver all such documents that such director or officer may, in their discretion, determine to be necessary or useful in order to give full effect to the intent and purpose of this resolution. |
Recommendation of Ur-Energy’s Board of Directors
After careful consideration, the Board of Directors has determined that the Amended and Restated Restricted Share Unit and Equity Incentive Plan continues to be in the best interests of the Company’s shareholders. The Board of Directors approved the Amended and Restated Restricted Share Unit and Equity Incentive Plan Resolution and recommends approval of the resolution by the Company’s shareholders.
The TSX rules provide that all eligible insiders in order to participate in the RSU&EI Plan may not vote on the approval of the renewal of the RSU&EI Plan. Accordingly, the RSU&EI Plan Resolution must be passed by a majority of votes cast by shareholders present in person or represented by proxy at the Meeting, excluding 6,201,821 Common Shares held by certain insiders of the Company and their affiliates.
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Identification of Executive Officers
John W. Cash, 49, M.Sc. | Chief Executive Officer, Director |
Mr. Cash was named Ur-Energy’s Chief Executive Officer and appointed as a Director on March 1, 2022. Mr. Cash joined Ur-Energy in 2007 and was appointed as Vice President Regulatory Affairs in 2011. He has led the permitting and licensure of both the Lost Creek and Shirley Basin uranium mines, while managing the environmental, health and safety (“EHS”) and geology departments and contributing to the development and growth of the Company. During his tenure with Ur-Energy, Mr. Cash has gained a well-deserved reputation for developing impactful solutions for industry related to water management, EPA aquifer exemptions, technical design, and environmental matters. Mr. Cash has nearly 30 years of diverse experience in the uranium industry, from which he has acquired broad-reaching expertise in exploration, EHS including radiation safety, regulatory and legislative affairs, and uranium recovery operations, as well as extensive management experience. He is a respected industry leader and has served as a past president of the Uranium Producers of America.
Prior to joining Ur-Energy, Mr. Cash worked for established uranium mining companies, including BHP, Rio Algom Mining, and Crow Butte Resources, a subsidiary of Cameco, in various roles in mineral exploration, as Operations Superintendent and EHS Manager. As Operations Superintendent, Mr. Cash managed all aspects of wellfield production and plant processing at the 800,000 lbs. U3O8 per year Crow Butte ISR facility. Mr. Cash is a Fellow of the inaugural World Nuclear Summer Institute. Mr. Cash received B.Sc. and M.Sc. degrees in Geology and Geophysics from the University of Missouri-Rolla.
Jeffrey T. Klenda, | President and current Chairman |
Mr. Klenda graduated from the University of Colorado in 1980 and began his career as a stockbroker specializing in venture capital offerings. Prior to founding Ur-Energy in 2004, he worked as a Certified Financial Planner and was a member of the International Board of Standards and Practices. In 1986, he started Klenda Financial Services, an independent financial services company providing investment advisory services to high-end individuals and corporate clients as well as providing venture capital to corporations seeking entry to the U.S. securities markets. In the same year, Mr. Klenda formed Independent Brokers of America, Inc., a national marketing organization. He also served as President of Security First Financial, a company he founded to provide consultation to individuals and corporations seeking investment management and early stageearly-stage funding. For more than 30Over the last 35 years, Mr. Klenda has acted as an officer and/or director for numerous publicly-tradedpublicly traded companies, having taken his first company public at 28 years of age. Currently, Mr. Klenda is a director of Organto Foods Inc. (since November 2013). Mr. Klenda has served as the
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Chairman of the Board of Directors of the Company since 2006. He served as Executive Director from January 2006 to May 2015. Thereafter, he served as Acting Chief Executive Officer until being named President and Chief Executive Officer by our Board of Directors in December 2016.
The Board of Directors has concluded that Mr. Klenda is well qualified and should serve as a director on the basis of his numerous contributions to the Company since its inception, his 35 years of experience in the financial markets and in service to numerous publicly-traded companies as an officer and director.
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Dr. Franklin has over 50 years’ experience as a geologist. He is a Fellow of the Royal Society of Canada. Since 1998, he has been an Adjunct Professor at Queen’s University, since 2001, at Laurentian University and since 2006 at the University of Ottawa. He is a past President of the Geological Association of Canada and of the Society of Economic Geologists. He retired in 1998 as Chief Geoscientist of the Geological Survey of Canada, Earth Sciences Sector. Since that time, he has been a consulting geologist and is currently a director of Aura Silver Resources Inc. (since October 2003) and of Anconia Resources Corp. (since June 2012). Dr. Franklin’s lifetime achievements have been honored by several professional organizations: among his honors, Dr. Franklin has been awarded GAC’s Logan and Duncan R. Derry medals, CIM’s Selwyn Blaylock, A.O. Dufresne, Distinguished Lecturer and Julian Boldy Memorial awards and the Society of Economic Geologists Thayer Lindsley and Distinguished Lecturer awards. He has also received the R.A.F. Penrose Gold Medal from SEG for his many contributions to a broad cross section of geosciences. In 2017 he was made a Fellow of Lakehead University, honoring his contributions to education and economic development in northern Ontario. Dr. Franklin was inducted into the Canadian Mining Hall of Fame in January 2019, for his many contributions to the mining industry.
The Board of Directors has concluded that Dr. Franklin is well qualified and should serve as a director on the basis of his contributions as a director to the Company since its inception and his more than 50 years of experience in geosciences and mineral resource work in industry, governmental service and academia.
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Mr. Boberg has served as a director of the Company since January 2006. Mr. Boberg served as the Company’s President and Chief Executive Officer (2006 to 2011). Prior to that time, Mr. Boberg was the Company’s senior U.S. geologist and Vice President U.S. Operations (2004 to 2006). Before his initial involvement with the Company, he was a consulting geologist having over 40 years’ experience investigating, assessing and developing a wide variety of mineral resources in diverse geologic environments in western North America, South America and Africa. Mr. Boberg worked for Gulf Minerals, Hecla Mining, Anaconda, Continental Oil Minerals Department, Wold Nuclear, Kennecott, Western Mining, Canyon Resources and Africa Mineral Resource Specialists. Mr. Boberg has over 20 years of experience exploring for uranium in the continental U.S. He discovered the Moore Ranch Uranium Deposit and the Ruby Ranch Uranium Deposit as well as several smaller deposits in Wyoming’s Powder River Basin. He received his Bachelor’s Degree in Geology from Montana State University and his Master’s Degree in Geology from the University of Colorado. He is a registered Wyoming Professional Geologist and fellow of the Society of Economic Geologists. He is a member of the Society for Mining, Metallurgy & Exploration, American Institute of Professional Geologists (for which he is a Certified Professional Geologist), the Denver Regional Exploration Society and the American Association of Petroleum Geologists. Mr. Boberg is also a director for Aura Silver Resources Inc. (since June 2008).
The Board of Directors has concluded that Mr. Boberg is well qualified and should serve as a director on the basis of his contributions to the Company since 2004 (since 2006 as a director and, from 2006 until 2011, as the President and CEO), as well as his more than 40 years of experience in mineral resources exploration and development.
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Mr. Parker has worked extensively in senior management positions in the mining industry for the past 53 years. Mr. Parker is a mining engineer graduate from South Dakota School of Mines, with a Master’s Degree in Mineral Engineering Management from Penn State. Mr. Parker was President and CEO, and a director of U.S. Silver Corporation until his retirement in 2012. Prior to that, Mr. Parker was President and CEO of Gold Crest Mines, Inc., before which he was the President and CEO of High Plains Uranium, Inc., a junior uranium mining company acquired
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by Energy Metals in January 2007. Mr. Parker also served for 10 years as Executive Vice President of Anderson and Schwab, a management consulting firm. Prior to Anderson and Schwab, Mr. Parker held many executive management positions including with Costain Minerals Corporation, ARCO, Kerr McGee Coal Corporation and Conoco. He also has worked in the potash, limestone, talc, coal and molybdenum industries and has extensive experience working in Niger, France and Venezuela.
The Board of Directors has concluded that Mr. Parker is well qualified and should serve as a director on the basis of his contributions to the Company as a director since 2007, most recently, as our Lead Director since 2014, as well as his more than 50 years of experience in the mining industry and in executive management positions.
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Dr. Huber is a mining executive with over 40 years of natural resources experience. Previously, Dr. Huber served as a director for Ur‑Energy during 2007. Dr. Huber returned to serve as a director for Ur-Energy in 2015. In the interim, Dr. Huber served as President and CEO of Neutron Energy, Inc. (2007-2012), a privately-held uranium company which was conducting project feasibility analyses as well as permitting of two uranium mines and a mill complex. He is currently a director of Gold Resource Corp. (since January 2013), and serves as the Chair of its Audit Committee and as a member of its Compensation Committee.
Dr. Huber is the founder, in 2006, and managing member of Rangeland E&P, LLC, a private company established for oil and gas exploration. From 2010 to 2011, Dr. Huber served as an independent director of Capital Gold Corp., a gold mining company with operations in Mexico which eventually merged into AuRico Gold Inc., including serving on its Audit and Corporate Governance Committees. Dr. Huber was one of the founders of Canyon Resources Corporation in 1979, and served in various capacities there until 2006, including as director, chief financial officer, vice president of finance, treasurer and secretary. He also served as the president and chief executive officer of CR Minerals Corporation, an industrial minerals subsidiary of Canyon Resources, from 1987 to 1998. Dr. Huber holds a PhD in geology from Colorado School of Mines and received a Bachelor of Science in Geology from Fort Lewis College. He is a fellow of the Society of Economic Geologists, where he previously served as the Chairman of its Audit and Investment Committees; a member of the Society for Mining, Metallurgy & Exploration, where he previously served as the Chairman of the Audit Committee. Dr. Huber is a Utah registered Professional Geologist. Dr. Huber served as a director and treasurer of The Society of Independent Professional Earth Scientists, a not-for-profit professional group. He also has served as President of the Society of Independent Earth Scientists Foundation, which awards scholarships to undergraduate and graduate students majoring in the earth sciences fields. Dr. Huber formerly was a director of the Denver Gold Group, a not-for-profit industry association for publicly-traded precious metal companies.
The Board of Directors has concluded that Dr. Huber is well qualified and should serve as a director of the Company on the basis of his contributions to the Company as a director (in 2007, and since his return to the Board in 2015), and as a result of his extensive mining industry experience including in areas of natural resources development and mining operations, and executive management and finance, developed by serving as an executive officer and director of publicly-traded natural resource companies.
Ms. Walker is the President and Chief Executive Officer of Elm Street Resources Inc., an energy marketing company based in Paintsville, Kentucky. Ms. Walker is also the Director of the eKentucky Advanced Manufacturing Institute, Inc., a workforce development training facility in Eastern Kentucky. She brings more than 30 years’ experience in various energy and financial related business endeavors to our Board. Ms. Walker holds an MBA from Xavier University. Prior to starting Elm Street Resources, she served as Secretary and Controller of Agip Coal, USA, a subsidiary of the Italian National Energy Agency ENI. She is currently a member of the National Coal Council; a member of the Kentucky Coal Association; a member of the Kentucky Judicial Campaign Conduct Committee; and a Chair of the Morehead State University Board of Regents. Ms. Walker was a founder and Board member of First Security Bank, Lexington, Kentucky and of Great Nations Bank, Norman, Oklahoma.
The Board of Directors has concluded that Ms. Walker is well qualified and should serve as a director of the Company on the basis of her contributions to the Company as a director since joining the Board in 2017, and as a result of her
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extensive energy-related business experience including in areas of sales and marketing, executive management and finance, developed by serving as an executive officer and director of various entities.
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Rob Chang has over 23 years of experience in the financial services industry. Mr. Chang is currently the Chief Financial Officer of Riot Blockchain, Inc. Prior to his current position, he served as the Managing Director and Head of Metals & Mining at Cantor Fitzgerald where he provided research coverage in precious metals, base metals, lithium, and uranium. He is well familiar with the uranium mining industry and is considered a subject matter expert by several media outlets. He was recognized by Bloomberg as the "Best Precious Metals Analyst" in Q1 2016. Mr. Chang is frequently quoted by and a regular guest of several media outlets including: Bloomberg, Reuters, CNBC, and the Wall Street Journal. Mr. Chang previously served as a Director of Research and Portfolio Manager at Middlefield Capital, a Canadian investment firm which managed $3 billion in assets. He was also on a five-person multi-strategy hedge fund team where he specialized in equity and derivative investments. Mr. Chang completed his MBA at the University of Toronto's Rotman School of Management. Mr. Chang also serves as a director for Fission Uranium Corp. (since April 2018), and for Shine Mineral Corp. (since November 2018)
The Board of Directors has concluded that Mr. Chang is well qualified and should serve as a director of the Company on the basis of his extensive knowledge of the financial markets and financial services industry, as well as his knowledge of the uranium mining industry.
Proposal No. 2: Re-Appointment of PricewaterhouseCoopers LLP, Chartered Professional Accountants, as our Independent Auditors and Approval for the Directors to Fix the Remuneration of the Auditors
Appointment of Auditor
The Audit Committee selected and has recommended the independent accounting firm of PricewaterhouseCoopers LLP with respect to the audit of our financial statements for the year ended December 31, 2019. At the Meeting, it is proposed to re-appoint PricewaterhouseCoopers LLP, Chartered Professional Accountants, as auditors of the Company, to serve until the next annual meeting of shareholders with their remuneration to be fixed by the Board of Directors.
We currently expect that our Audit Partner from PricewaterhouseCoopers LLP will attend the Meeting.
Independent Accountant Fees and Services
PricewaterhouseCoopers LLP and its affiliates have been the auditors of Ur-Energy since December 2004. The fees accrued for audit and audit-related services performed by PricewaterhouseCoopers LLP in relation to our financial years ended December 31, 2018 and 2017, paid and shown below in C$, were as follows:
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Years ending | Audit fees (1) | Audit-related Fees (2) | Tax Fees (3) | All Other Fees(4) |
December 31, 2018 | $ 244,438 | $ 68,256 | $ - | $ 38,588 |
December 31, 2017 | $ 225,750 | $ 140,341(4) | $ - | $ - |
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Audit Committee’s Pre-Approval Practice
All services reflected in the preceding table for 2018 and 2017 were pre-approved in accordance with the policy of the Audit Committee of the Board of Directors
It is proposed to approve an ordinary resolution to re-appoint the firm of PricewaterhouseCoopers LLP, Chartered Professional Accountants, as auditors of the Company to hold office until the close of the next annual meeting of shareholders or until PricewaterhouseCoopers LLP is removed from office or resigns, and to authorize the Board of Directors of the Company to fix the remuneration of PricewaterhouseCoopers LLP as auditors of the Company.
Recommendation of Ur-Energy’s Board of Directors
The Board of Directors recommends that the shareholders vote FOR the re-appointment of PricewaterhouseCoopers LLP, Chartered Professional Accountants, and to authorize the Board of Directors of the Company to fix the remuneration of PricewaterhouseCoopers LLP as auditors and, unless a shareholder gives instructions on the proxy card to the contrary, the proxies named thereon intend to so vote.
The approval of Proposal No. 2 requires the approval of a majority of the votes cast by shareholders present in person or represented by proxy at the Meeting.
Proposal No. 3: Approval, on an Advisory Basis, of the Compensation of the Company’s Named Executive Officers
Advisory Vote on Named Executive Officer Compensation
In accordance with SEC rules, our shareholders will be asked at the Meeting to approve the compensation of our Named Executive Officers as disclosed in this Circular, including the disclosures under “Compensation Discussion and Analysis,” the accompanying compensation tables, and the related narrative disclosure. This vote is not intended to address any specific item of compensation, but rather the overall compensation of our Named Executive Officers and the policies and practices described in this Circular.
We conducted a similar advisory vote in 2018, and approximately 99% of the votes cast at that meeting voted in favor of the compensation of our Named Executive Officers. This vote is advisory, which means that its outcome is not binding on the Company, the Board of Directors or the Compensation Committee of the Board of Directors.
The next advisory vote will occur at our annual meeting in 2020.
The Compensation Committee and the Board of Directors believe that our compensation policies and procedures are effective in achieving our goals. As described under “Compensation Discussion and Analysis” our compensation program is designed to motivate executive officers and employees to achieve pre-determined objectives without taking excessive risks; provide competitive compensation and benefit programs to attract and retain highly-qualified executives and employees; encourage an ownership mentality; and, fundamentally, to support the achievement of results. We believe that the Company’s compensation program, with its balance of (i) short-term incentives (including cash bonus awards and performance conditions for such awards), (ii) long-term incentives (including equity awards of stock options and restricted share units which vest over varied periods of two to three years), and (iii) share ownership guidelines for executive officers, reward sustained performance that is aligned with long-term shareholder interests. Shareholders are encouraged to read the “Compensation Discussion and Analysis,” the accompanying compensation tables, and the related narrative disclosure. Shareholders will be asked to approve the following ordinary resolution (the “Advisory Vote on Named Executive Officer Compensation Resolution”) at the Meeting:
BE IT RESOLVED THAT the Company’s shareholders approve, on an advisory basis, the compensation of the Named Executive Officers, as disclosed in the Company’s Management Proxy Circular for this annual and special meeting of shareholders, including the “Compensation Discussion and Analysis,” the accompanying compensation tables and the related narrative disclosure, pursuant to the compensation disclosure rules of the U.S. Securities and Exchange Commission.
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Recommendation of Ur-Energy’s Board of Directors
The Board of Directors recommends that shareholders vote FOR approval of the Advisory Vote on Named Executive Officer Compensation Resolution.
The approval of the advisory vote on Proposal No. 3 requires the affirmative vote of a majority of the votes cast at the meeting. Although the advisory vote is non-binding, the Board will review the results of the vote and will take them into account in determinations concerning executive compensation.
Proposal No. 4: Approval of the Renewal of the Ur-Energy Inc. Amended Restricted Share Unit Plan (the “RSU Plan”)
The Company will seek approval of shareholders at the Meeting to approve, confirm and ratify the RSU Plan which was last approved by shareholders on May 5, 2016. Under the policies of the TSX, the RSU Plan must be reconfirmed every three years by a majority of the Company’s directors and shareholders excluding the votes cast by, or in behalf of, the insiders of the Company who are eligible to participate in the RSU Plan and their affiliates. As the three-year term prescribed by the TSX will expire on May 5, 2019, a resolution will be placed before the shareholders to approve the unallocated RSUs under the RSU Plan. This approval will be effective for three years from the date of the Meeting. If approval is not obtained at the Meeting, RSUs which have not been allocated as of May 2, 2019 and RSUs which are outstanding as of May 2, 2019 and are subsequently cancelled or terminated will not be available for a new grant of RSUs. Previously allocated RSUs will continue to be unaffected by the approval or disapproval of the resolution.
The RSU Plan, as approved by the Board of Directors, is summarized in more detail under the heading “Stock Options and RSUs” below. A copy of the RSU Plan is attached to this Circular as Schedule A. Alternatively, a shareholder may obtain a copy of the RSU Plan from the Secretary of the Company upon request at 10758 West Centennial Road, Suite 200, Littleton, Colorado, 80127, telephone 720-981-4588 (ext. 250).
The Board of Directors wishes to renew the RSU Plan, which was previously ratified, confirmed and approved at meetings of shareholders of the Company in 2010, 2013, and 2016. No modifications are proposed to be made to the RSU Plan. The Board of Directors is of the view that it is in the best interests of the Company to renew the RSU Plan, and to continue to permit the Board to grant RSUs to directors and employees, including executive officers, of the Company and its subsidiaries as a means of attracting and retaining highly-qualified directors and employees, including executive officers, who will be motivated towards the success of the Company and to encourage share ownership in the Company by directors and employees, including officers, who work in behalf of the Company. Because the RSU Plan participants and the amounts of any RSU grants are determined in the absolute discretion of the Board of Directors, the benefits to be delivered under the RSU Plan at this time are indeterminable.
The RSU Plan is a plan which includes directors and employees, including executive officers, of Ur-Energy as possible eligible participants. As of March 26, 2019, there are approximately 18 employees and six non-executive directors who would be eligible to participate in the RSU Plan. As at March 26, 2019, the closing price of our Common Shares on the NYSE American was $0.83 and on the TSX was C$1.11.
Ur-Energy Inc. Restricted Share Unit Plan Resolution
BE IT RESOLVED THAT:
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Recommendation of Ur-Energy’s Board of Directors
After careful consideration, the Board of Directors has determined that the Amended Restricted Share Unit Plan continues to be in the best interests of the Company’s shareholders. The Board of Directors approved the Amended Restricted Share Unit Plan Resolution and recommends approval of the resolution by the Company’s shareholders.
The TSX rules provide that all eligible insiders in order to participate in the RSU Plan may not vote on the approval of the renewal of the RSU Plan. Accordingly, the Restricted Share Unit Plan Resolution must be passed by a majority of votes cast by shareholders present in person or represented by proxy at the meeting, excluding 5,271,540 Common Shares held by certain insiders of the Company and their affiliates.
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Identification of Executive Officers
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Mr. Klenda graduated from the University of Colorado in 1980 and began his career as a stockbroker specializing in venture capital offerings. Prior to founding Ur-Energy in 2004, he worked as a Certified Financial Planner and was a member of the International Board of Standards and Practices. In 1986, he started Klenda Financial Services, an independent financial services company providing investment advisory services to high-end individuals and corporate clients as well as providing venture capital to corporations seeking entry to the U.S. securities markets. In the same year, Mr. Klenda formed Independent Brokers of America, Inc., a national marketing organization. He also served as President of Security First Financial, a company he founded to provide consultation to individuals and corporations seeking investment management and early stage funding. For more than 30 years, Mr. Klenda has acted as an officer and/or director for numerous publicly-traded companies, having taken his first company public at 28 years of age. Currently, Mr. Klenda is a director of Organto Foods Inc. (since November 2013). Mr. Klenda has served as the Chairman of the Board of Directors of the Company since 2006. He served as Executive Director January 2006 - May 2015. Thereafter, he served as Acting Chief Executive Officer until being named President and Chief Executive Officer by our Board of Directors in December 2016.
Roger L. Smith, | Chief Financial Officer and Chief Administrative Officer |
Mr. Smith has 3035 years of mining and manufacturing experience including finance, accounting, IT, ERP and systems implementations, mergers, acquisitions, audit, tax, and public and private reporting in international environments. Mr. Smith served as Ur-Energy’s Chief Financial Officer and Vice President Finance, IT and Administration until May 2011, when he assumed the title and responsibilities of Chief Administrative Officer as well as Chief Financial Officer. Mr. Smith joined Ur-Energy in May 2007, after having served as Vice President, Finance for Luzenac America, Inc., a subsidiary of Rio Tinto PLC and Director of Financial Planning and Analysis for Rio Tinto Minerals, a division of Rio Tinto PLC, from September 2000 to May 2007. Mr. Smith has also held such positions as Vice President Finance, Corporate Controller, Accounting Manager, and Internal Auditor with companies such as Vista Gold Corporation, Westmont Gold Inc., and Homestake Mining Corporation. He has a Master of Business Administration and Bachelor of Arts in Accounting from Western State Colorado University, Gunnison, Colorado.
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Steven M. Hatten, | Vice President Operations |
Prior to being namedMr. Hatten has served as Ur-Energy’s Vice President Operations in 2011,since 2011. Prior to that, Mr. Hatten served as ourwas Ur-Energy’s Engineering Manager from 2007 to 2010 and as Director of Engineering and Operations 2010 to 2011. He has over 25 years of experience with a strong background in in situ recovery uranium design and operations. He previously worked as a Project Engineer for Power Resources, Inc., the Manager, Wellfield Operations for Rio Algom Mining Corp., and Operations Manager at Cameco’s Smith Ranch – Highland Facility. Mr. Hatten has a Bachelor of Science in Petroleum Engineering from Texas Tech University.
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Mr. Cash has been our Vice President Regulatory Affairs since March 2014. Previously, he was named Vice President Regulatory Affairs, Exploration & Geology in 2011 and served in that capacity until March 2014. Prior to 2011, Mr. Cash was our Environment, Health, Safety and Regulatory Affairs Manager from 2007 to 2010 and Director of Regulatory Affairs 2010 to 2011. He previously worked for Crow Butte Resources, Inc. a subsidiary of Cameco, from 2002 to 2007, including as Senior Environmental/Safety Superintendent, Safety Director/Wellfield Supervisor and Operations Superintendent. Prior to that time, Mr. Cash also worked in uranium exploration. He is a Fellow of the World Nuclear University Summer Institute, 2005. Mr. Cash has a M.Sc. Geology and Geophysics from the University of Missouri-Rolla. Mr. Cash is currently the President of the Uranium Producers of America, a uranium industry lobbying group dedicated to the preservation and promotion of a healthy uranium mining and processing industry in the United States.
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Mr. Bonner is a Professional Geologist with 30 years in the uranium exploration and development industry, three years in the oil and gas industry and 13 years in environmental engineering consulting. He joined Ur-Energy as Vice President Geology in March 2014, having most recently served as Vice President of Exploration for Powertech (USA), Inc. He previously worked as a consulting geologist, was employed as a Senior Geologist for Gordon Environmental in Albuquerque, New Mexico, and worked for 16 years in uranium exploration for Rocky Mountain Energy Company throughout the western U.S. Mr. Bonner is a registered Professional Geologist and a Certified Professional Geologist and is a member of the Geological Society of America and the American Institute of Professional Geologists. Mr. Bonner received a Bachelor of Science in Geology from the University of Wyoming.
Penne A. Goplerud, | General Counsel & Corporate Secretary |
Ms. Goplerud has more than 25nearly 30 years of diverse legal experience in complex litigation, businessgeneral corporate matters, and natural resources transactions.transactions and complex litigation. She was named General Counsel and Corporate Secretary of the Company in 2011, having joined Ur‑Energy as its Associate General Counsel in 2007. While in private practice, she represented clients in commercialcomplex litigation, arbitration and mediation involving mining, oil and gas, commercial and corporate disputes, securities, and environmental law. She also has counseled business clients and represented clients in the negotiation of business transactions. Prior to joining Ur-Energy, as Associate General Counsel in 2007, much of Ms. Goplerud’s practice focused on natural resources work in the U.S. and transactional work.abroad. Ms. Goplerud obtained her JD from the University of Iowa College of Law.
COMPENSATION DISCUSSION AND ANALYSISPROGRAM
Our Compensation Committee is composed of independent directors and is responsible for matters of compensationWe are a “smaller reporting company” as they relatedefined by SEC regulations. As a result, we are not required to our employees and, more specifically, our executive officers including the Chief Executive Officer. The Compensation Committee discussed the followinginclude a comprehensive Compensation Discussion and Analysis (“CD&A”)in this Circular. We are providing, voluntarily, certain of the information that would typically be contained in a Compensation Discussion and Analysis section in an effort to provide our shareholders with management,additional information regarding our executive compensation policies, practices, and thereafter recommended itplans, and in order to the Board, which approved, this CD&A.provide context for your consideration of our advisory ‘say on pay’ proposal.
Compensation Program and Philosophy
Ur-Energy is committed to managing our human resources. We believe that the caliber and commitment of our executive officers are critical to our continued success and performance, and the overall commitment of all of our employees.
The Compensation Committee reviews and makes recommendations to the Board with respect to the overall approach to compensation for all of our employees, and specifically with respect to our executive officers, including the Chief Executive Officer, Jeffrey Klenda, and the remuneration of directors.
OurPursuant to our obligations of disclosure as a smaller reporting company, our named executive officers (“Named Executive Officers” or “NEOs”) for 20182021 were:
· | Jeffrey T. Klenda, Chairman, President and CEO |
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· | Roger L. Smith, Chief Financial Officer and Chief Administrative Officer |
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· | Penne A. Goplerud, General Counsel and Corporate Secretary |
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We maintain a compensation program in which both performance and compensation are routinely evaluated. Further, we maintain a program in which (a) pay for performance is supported by a significant percentage of executive pay being at risk (50% of CEO compensation; 45% of other executive officers); (b) motivating executive officers to create shareholder value by using total shareholder return as a part of the Company’s “Total Company” objectives; (c) performance by all employees on personal objectives and corporate objectives is evaluated, with executive officers’ short-term incentive bonus awards being more closely aligned to performance on corporate objectives (60%) based upon the greater opportunity, and responsibility, to shape corporate performance (hourly and non-managerial staff
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bonuses are more heavily weighted to their personal objectives), and with generally 80% of an executive’s long-term incentive is based upon stock options; (d) certain defined thresholds must be reached as a minimum level of performance, typically 80%50% of the target (or, a score of 2 on our 1-4 scale), before eligibility for payout on any objective and, by contrast, short-term incentive bonuses are effectively capped, as the maximum level of performance for each objective is typically set at 120%150% of the target (or, a score of 4 on our 1-4 scale); (e) reasonable salaries and overall compensation packages are based upon regularly updated compensation surveys and ongoing review of peer comparators’ practices; (f) compliance with executive stockshare ownership guidelines is routinely monitored; (g) we have no multi-year contracts with executive employees, and our employment agreements with executive officers protect specialized and proprietary information, and contacts with personnel obtained while employed with the Company; (h) we do not permit repricing of stock options; (i) we do not permit payment of dividends on unvested or redeemed equity awards of all types; (j) executives are not permitted to hedge their beneficially-held Company’s shares; and (k)(j) we have adopted a clawback policy, all as set forth in greater detaildiscussed further below.
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Our compensation program is designed to effectively link compensation to performance as demonstrated by the completion by our executive officers of corporate and personal objectives that are designed to drive creation of shareholder value. The Compensation Committee believes that it is important to maintain a clear linkdefined connection between the achievement of these objectives and compensation payout. Our first five years in operations at our Lost Creek uranium recovery project have permitted us an opportunity toThe Committee has thoughtfully reviewreviewed the metrics and priorities most appropriately used to establish and maintain that connection. In doing so, the following considerations havehas been taken into account:considered:
· | the selection of corporate and personal objectives that are measurable and tied to shareholder value creation, which is fundamental to our success as a company; |
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· | executive officers should be evaluated and paid based on performance and achievement of both corporate and personal objectives; and |
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· | executive officers should have a clear understanding of how their performance and the achievement of pre-determined objectives may influence their compensation. |
The objectives of theour compensation program are to:to support the achievement of results; motivate executive officers to achieve pre-determined objectives without taking excessive risks; provide competitive compensation and benefit programs to attract and retain highly qualified executives; and encourage an ownership mentality, which is further augmented through share ownership guidelines for all executive officers.
Our compensation program continues to follow the same progression throughout the year:
· | Setting Objectives: Establishment of department and corporate objectives, followed by personal objectives being approved, in conjunction with the approved budget, our key performance objectives and additional guidance from management set the stage for our year ahead. | |
· | LTIP Awards to Incentivize: As a part of setting objectives, and “looking ahead,” the Compensation Committee recommends, and the Board considers and approves the annual grant of stock options and RSUs and other share units or commons shares available to grant under the RSU&EI Plan to those eligible for consideration. See also “Equity Incentive Plans,” below. | |
· | Performance Review: Annually, in the first quarter, we review our performance during the past year, initially with a determination of performance on corporate objectives (reviewed by the Compensation Committee and our Board). Performance of all staff is reviewed; executive officers are evaluated by the Chief Executive Officer and the Compensation Committee; and the Chief Executive Officer is evaluated by the Compensation Committee and the Board of Directors. Based upon these performance assessments, bonuses are determined and awarded, in the discretion of the Compensation Committee and Board. See further discussion under “Short Term Incentive Plan” below. | |
· | COLA and Salary Reviews: Cost-of-living adjustments to salaries are typically considered mid-year when best data are available. Contemporaneously, a salary survey is completed, with staff salaries adjusted to the findings of the survey, as necessary, and/or for merit increases. | |
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The compensation program process begins in the fourth quarter each year as we look ahead and establish department objectives and corporate objectives. Our executives and all staff then prepare their personal objectives in conjunction with the establishment of the budget and our key performance indicators. As a part of this look ahead, the Compensation Committee recommends, and the Board considers and approves the annual grant of stock options and restricted share units (“RSUs”) to those eligible for consideration.
In the first quarter of each year we reflect on our performance during the past year, initially with a determination of performance on corporate objectives, which is reviewed with the Compensation Committee and the Board of Directors. Performance of all staff is reviewed and employee performance assessments are conducted by supervisors and managers. Executive officers are evaluated by the Chief Executive Officer and the Compensation Committee; the Chief Executive Officer is evaluated by the Compensation Committee and the Board of Directors. Based upon these performance assessments, the bonuses are determined and awarded. See further discussion under the heading “Short Term Incentive Plan” below. During the performance assessment process, and throughout each year, various aspects of succession planning are considered.
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Thereafter, typically during second or third quarter, cost-of-living adjustments are calculated. Contemporaneously, salary surveys are completed, with staff salaries adjusted to the findings of the survey, as necessary, and/or for merit increases. Throughout the year, employee development opportunities are implemented. As necessary and appropriate, a mid-year review of departmental and/or individual objectives is undertaken, with adjustments made as required to address and accommodate changed circumstances.
Compensation Structure
Our compensation program consists of base salary, short- and long-term incentives, and other perquisites. The components of total direct compensation relate to performance as follows:
Fixed Compensation |
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Based on skills, experience and market rates |
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Base Salary |
| Cash Bonus |
| Stock Options |
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Employment Agreements with Named Executive Officers
We have employment agreements with each of our executive officers. Traditionally, we have not maintained multi-year agreements. The agreements contain standard employment provisions, as well as salary, entitlement to a cash bonus to be determined in the discretion of the Board, and statements of eligibility for Company benefits (health(e.g., health and wellness benefits, paid time off, 401(k) plan), and equity compensation plans (stock option and RSU plans). The agreements also provide for post-termination obligations of the executives (one-year non-solicitation provisions applicable to all Named Executive Officers;executive officers; and one-year non-competition provisions in the agreements of Messrs. Hatten and Cash, as well as Mr. Bonner)Cash). Post-termination obligations of the Company with respect to the NEOs, including in an event of change of control, are discussed and summarized below under the heading “Potential Payments Upon Termination or Change of Control.” The Compensation Committee reviews the employment agreements of and compensation program for the executive officers on a periodic basis.
Objectives to be Met Through “Pay Mix”
The compensation program is designed to provide motivation and incentives to our executive officers and employees with a view toward enhancing shareholder value whileand successfully implementing our corporate objectives. The compensation program accomplishes this by rewarding performance that is designed to create shareholder value. The portion of variable, at-risk, performance-based compensation is commensurate to thean executive officer’s or employee’s position and increases as their respective level of responsibility increases. Further, the mix and structure of compensation is designed to strike an appropriate balance to achieve pre-determined objectives without motivating excessive risk taking.
Our share price may be heavily influenced by changes in uranium and other commodity prices, which are outside of our control. As a result, the compensation program is designed to focus on areas where the executive officers and employees have the most influence. To achieve this, a combination of operational, financial and share price criteria are utilized when selecting corporate and personal objectives and establishing an appropriate combination of pay.
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The compensation structure and “pay mix” in place for 20182021 for our CEO and other executive officers was as follows:
The characteristics of the compensation program’s mix of pay, as they relate to the executive officers, include:
· | a significant portion of executive pay is at-risk; |
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· | executive officers have a higher percentage of at-risk compensation relative to other employees, because they have the greatest ability to influence corporate performance; |
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| 60% of an executive’s short-term incentive is based on corporate performance; and |
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· | 80% of an executive’s long-term incentive is composed of stock options, which are highly leveraged to our share price performance. |
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The incentive compensation actually received by the executive officers varies based upon individual performance and the achievement of the pre-determined corporate and personal objectives and is ultimately subject to the discretion of the Compensation Committee and the Board.
Components of Compensation
Base Salary
Base salary is the fixed portion of cash compensation earned by and paid to our executive officers and employees. We provide our executive officers and employees withseek to identify levels of base salaries to compensate them for services rendered during the fiscal year and tosalary or wage which will aid in attracting and retaining quality employees. Base salaries for all employees are reviewed annually and theby management. The Compensation Committee reviews the base salary for each executive officer routinely or upon a promotion or other change in job responsibility, based on the individual’s level of responsibility, the importance of the position and the individual’s contribution to our overall performance. The Compensation Committee also assesses the base salaries of the executive officers relative to a group of peer companies with similar scope and operations to ensure that base salaries are positioned competitively with executive officers in similar roles at peer companies. Our overall objective remains to provide a competitive base salary designed to recruit and retain qualified, high-performing executives, while responsibly administering our budget and achieving our corporate objectives, including advancing our Lost Creek operations as well as hoping to advance Shirley Basin into production when market conditions warrant. objectives.
There was a cost of living adjustment of three percent provided to our executives in 2018. We did not retain an independent compensation consultant in 2018, instead utilizing our subscription to Equilar.
Short-Term Incentive Plan
Total cash compensation includes base salary and any variable (at risk) short-term cash incentive compensation. Bonus awards under our short termshort-term incentive plan (“STIP”) are typically calculated using a formula that is based upon performance in relation to corporate objectives, set by the Chief Executive Officer and executive management and approved by the Board, and in relation to personal objectives, also overseen by our Chief Executive Officerthe CEO and Board. The STIP program is designed to recognize and reward both corporate and individual performance results. A rebalancing of the weightingWeighting of corporate and personal objectives as related to the STIP program implemented in 2015, provides even greater personal responsibility of each executive officer for not only the corporate objectives, but also his or her personal objectives which are tied to that year’s corporate and departmental objectives. This too,portion of our compensation program was also developed by the Compensation Committee through its reviewconsideration of peer group practices and other standards.
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We continue to use corporate objectives to broadly measure our total corporate performance in consideration of our STIPs, as well as for other purposes. Health, safety, and environmental performance objectives are embedded repeatedly throughout our process. As well, we continue to ask each employee to focus on personal safety objectives. We continue to evaluate, broadly, Total Company, Lost Creek, Pathfinder Mines and Corporate Services objectives.
Each performance objective is measured on three performance levels (Threshold, Target and Maximum). Threshold, Target and Maximum performance-level values are based on quantifiable measures, when possible, where typically the Threshold value is 80% of Target and the Maximum value is 120% of Target. When quantifiable measures are not possible, or more than one measure is used, we use a four-point scale to measure results. The target level of performance is set at an aggressive level that represents a ‘reasonable stretch.’ For example, when using our four-point scale to measure results, a score of 3 (Fully Successful) is used as the Target. Achieving the Target would result in a 100% payout of the objective. The Threshold level of performance is the minimum performance that must be met before being eligible for any payout. The Threshold performance level is typically set at 80% of Target, or a score of 2 (Partially, but not Fully, Successful Performance) on the four-point scale. There is no payout if the Threshold is not met. Achieving the Threshold would result in a 50% payout. Maximum level of performance is typically set at 120% of Target, or a score of 4 (Superior Performance). Achieving or exceeding the Maximum would result in a 150% payout.
The following table shows the current target levels and weightings used to establish the 2018 STIP awards for 2021 for our NEOs:Executive Officers, including our CEO:
STIP Targets and Weights | |||
POSITION | STIP Target (% of | Corporate | Personal |
Chairman, President and CEO: Jeffrey T. Klenda | 40% | 60% | 40% |
Chief Financial Officer and Chief Administrative Officer: Roger L. Smith | 30% | 60% | 40% |
Corporate Secretary and General Counsel: Penne A. Goplerud | 30% | 60% | 40% |
Vice President Operations: Steven M. Hatten | 30% | 60% | 40% |
Vice President Regulatory Affairs: John W. Cash | 30% | 60% | 40% |
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We calculate the STIP awards as follows:
The following table provides a demonstrative example of the STIP award calculation that would result for a chief executive officer with a base salary of $100,000, if his or her corporate and personal objectives results were as shown in the weighted payout column.
STIP Targets and Weights | |||
POSITION | STIP Target (% of Base Salary) | Corporate Objectives Weight | Personal Objectives Weight |
Chairman, President and CEO: Jeffrey T. Klenda | 40% | 60% | 40% |
Other Executive Officers (CFO, Corporate Secretary, Vice President Operations and Vice President Regulatory Affairs) | 30% | 60% | 40% |
Actual STIP awards are based on performance for the year and are typically paid in the following year after our year-end results are released.evaluated. We calculate the STIP awards as follows:
Long-Term Equity Incentives
The long-term incentive plan (“LTIP”) includes our Option Plan and the Ur-Energy Amended Restricted Share UnitRSU&EI Plan (the “RSU Plan”(or, with the Option Plan, the “Plans”). The Option Plan and the RSU PlanPlans together form a long-term incentive plan for employees including executive officers and, in the case of the Option Plan, our consultants. Participation inEligibility for participation and awards under the Option Plan and the RSU Plan isPlans are determined by the Compensation Committee, taking into accountconsidering the recommendations of the Chief Executive Officer (and, for the Chief Executive Officer, the recommendations of the Compensation Committee)Committee to the Board). The purposepurposes of the Option Plan and the RSU Plan isPlans are to provide eligible participants with the opportunity to own Common Shares of the Company, enhance Ur-Energy’s ability to attract, retain and motivate key personnel, and align theeach participant’s interests with those of the Company’s shareholders. Awards made under the Option Plan and RSU PlanPlans are similarly based upon a pre-established formula tied to base salary and the compensation structure explained above (a percentage of base salary; 4:1 ratio between stock options and RSUs).structure. The LTIP target for our CEO is 60% of his base salary; the LTIP target for our other Named Executive Officersexecutive officers is 50% of his or her base salary. A more detailed discussion of the Option Plan and RSU PlanPlans can be found below under the heading “Stock Options and RSUs.Amended and Restated Restricted Share Unit and Equity Incentive Plan.”
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Perquisites Including Benefits
We provide employees, including our executive officers, with perquisites including personal benefits that we believe are reasonable and consistent with the overall compensation program to better enable us to attract and retain quality employees. We periodically review the types and levels of perquisites provided to the employees and executive officers to ensure competitiveness and value. Executive officers participate on the same terms as other employees in our healthcare and
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other benefit programs including a 401(k) Plan, medical, prescription drug, dental, vision, short-termshort- and long-term disability, life and supplemental life insurances; employee assistance program; and health and dependent care flexible spending accounts.
Compensation Risk Assessment
The charter for our Compensation Committee requires the Committee to review and consider the implications of the risks associated with our compensation policies and practices to avoid encouraging inappropriate risk taking by executive officers. The Compensation Committee has undertaken reviews of this type in conjunction with periodic reviews of the compensation program, including most recently in December 2018.2021. The Committee has implemented and maintained multiple practices to ensure that there are not incentives to take inappropriate or excessive risks, including: combining fixed and variable compensation, granting appropriate levels of equity compensation, and mandating equity ownership requirements for executive officers and directors which are routinely reviewed. Based upon the Compensation Committee’s review, we do not believe that the Company’s executive or non-executive compensation structure is reasonably likely to have a material adverse effect on the Company.
20182021 Review of Compensation Program and Establishment of Peer Group
The Compensation Committee from time to time undertakes a comprehensive review of our compensation program which includes competitive market data, pay grades, share ownership guidelines and short-termshort- and long-term incentives. Most recently, this review of the program and of the compensation of executive officers was completed in 2018. As we typically have done, the 2018 compensation program review began with the developmentEstablishment of our peer group(s) is among the first steps in any such review. Our 2021 peer group, to be utilized for multiple purposes. Asas with other peer comparator groupsothers before it, the peer group was used within our corporate objectives as a basefoundation from which we can compare our performance to otherpeer companies in the group for such things as total shareholder return. Itand is also used as afor comparison group when we evaluate our directorsdirectors’ and officersofficers’ total compensation. If the selected peer group has insufficient depth of data for a particular executive’s compensation, with additionalwe extend our review ofto companies outside the peer group which have similar executive positions where the peer group does not have sufficient depth of data.positions. Generally, we review and/or update our peer group annually. Once updated, the Compensation Committee reviews theand/or updates our peer group annually and then recommends it,the comparator group, with any changes or additions, to the Board for its approval. We subscribe to Equilar’s compensation services. Equilar’s tools assist us in the creation and evaluation of peer groups and in the evaluation of our directors and officers compensation.
The peer group approved by the Board includesfor 2021 included five uranium producers and explorers and six11 other mining companies (e.g., gold, silver) with similar revenues, total assets and market capitalization, with a focus on U.S. or North American based companies. Our most recent review reflects thecontinues to reflect a lack of similarly-situatedsimilarly situated uranium explorers and producers at this time and therefore reaches out into other sectors of the mining industry to operating companies. Generally, our ranking is in the middle of the peer group in terms of revenues, total assets and market capital. Also, we have nine of the 11 companies in our peer group in common with our peer’s peer groups. In other words, the companies in our peer group have also chosen many of the same companies to be in their peer groups. Our 20182021 peer group, as approved by the Board of Directors, is as follows:
ALEXCO Resource Corp. |
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| Denison Mines Corp. |
| Endeavour Silver Corp. | Energy Fuels Inc. |
| Fission Uranium Corp. |
| Gold Resource |
Corporation |
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Great Panther |
| Largo Resources Ltd. | NexGen Energy Ltd. |
| Seabridge Gold Inc. |
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| Uranium Energy Corp. | ||
Westwater Resources, Inc. |
As a result of our compensation program review and establishment of the peer group, no changes to ourthe structure of the Company’s compensation program were determined to be appropriateappropriate. Further review of the total compensation of the non-executive directors is discussed below at that time, but rather were deferred to 2019. The weighting“Compensation of personal andDirectors.”
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2021 Performance Highlights
During 2021 our corporate objectives remains as itremained focused on safe, compliant reduced operations at Lost Creek, while addressing the continuing challenges in the uranium recovery and fuel-cycle industries to be best prepared to ramp up production operations when market conditions warrant. Continuing to maintain our broader focus for objectives and having the ability to refine and adjust them in light of evolving conditions assisted greatly in the overall preparations toward ramp up through various financing activities, planning and maintenance at Lost Creek, additional training of staff and, in Q4, decisions to return to construction and development activities in Lost Creek’s Mine Unit 2 (MU2). In its review of corporate performance for 2021, our Board made the assessment that the Company’s performance, and the performance of each executive, generally met or exceeded the various performance objectives, effectively assessing performance of our executives to be between a “3” and a “4” in our compensation program. We are pleased to share highlights of our 2021 corporate performance below.
Growing international recognition of nuclear power’s role in achieving net-zero carbon emissions goals greatly renewed interest in the nuclear- and uranium-related equity markets throughout 2021. Additionally, this interest in all things nuclear prompted significant investment in physical uranium by financial funds, uranium ETFs, and uranium developers and producers. The Sprott Physical Uranium Trust (“SPUT”) began purchases of uranium mid-year and established the means in the equity markets to raise more than $3 billion for uranium purchases. At present, SPUT holds more than 52 million pounds U3O8. These events moved spot pricing more than 68 percent from the beginning of 2021 to mid-September. While the market retreated somewhat through 2021 Q4, active interest in the nuclear sector has been since 2015,sustained into 2022. Nuclear energy industries have also been affected by the geopolitical events and outlook including the invasion of Ukraine by Russia. Recent spot pricing has stayed in the upper $50s and above $60/lbs; term pricing is also increasing, although it continues to lag behind spot pricing increases.
We, too, were the beneficiary of this interest and investment in the sector in 2021. We raised $55.2 million during the year through an underwritten public offering in Q1, proceeds from expiring warrants, and strategic use of our At Market facility. The Company ended the year with executives’ personal objectives alignedcash and cash equivalents balance of $46.2 million. As a result, we have preserved our ready-to-sell inventory at the conversion facility (~284,000lbs U3O8) for sales at improved market pricing in the future. We stand well-funded and with great operational strength and leverage to ramp up at Lost Creek and construct Shirley Basin when “go” decisions are made.
Decisions were made to further enhance our operational readiness with initiation of a development and construction program in MU2 at Lost Creek. In Q4, we began drilling and construction activities, including hiring staff, to construct the objectivesnext header house (HH2-4) and for the further development of the departmentmine unit through delineation drilling for which the executive officer is responsible;next four header houses. HH2-4 will soon be production ready and, together, these development activities will substantially shorten the executives’ personal objectives are also designedtime for the return to help the Company achieve its overall corporate objectives. The categories of corporate objectives remain as before: Total Company, full production operations when ramp up occurs.
Lost Creek Pathfinderoperated throughout 2021 with zero lost-time accidents, zero spills or environmental incidents, and Corporate Services on a weighted basis as set forth below. Following commencementzero regulatory violations arising from our operations. As in years past, we are pleased to report that Lost Creek received consistently strong inspection reports. We continue to operate in an environmentally sound fashion, notwithstanding reduced staffing, and will continue to remain stewards of the environment with our oversight of operations at Lost Creek we have maintained a more significant weighting forand all of our mineral properties. We continue to strengthen our robust safety culture at Lost Creek objectives (40%), for an even greater emphasisand throughout the Company. In addition to the Lost Creek zero lost-time accidents, we remained free from lost-time accidents throughout the Company. There has been no material impact on operational priorities.operations because of quarantine or isolation of staff due to COVID-19. We have remained vigilant in monitoring ongoing changes to public health guidance and look to safeguard our staff and operations during the pandemic.
2018 Performance on ObjectivesOn project-specific regulatory efforts, we enjoyed numerous successes with receipt of all remaining major authorizations to construct and Relationship to STIP Awards
We use corporate objectives to broadly measureoperate at our total corporate performance. Our corporate objectives are grouped into Key Performance Areas, whichShirley Basin project being received in turn include a number of compensable Key Performance Indicators (“KPIs”). For 2018, our corporate objectives are divided into four Key Performance Areas (“KPA”) that reflect our core reporting segments.2021 Q2. The following table showsBLM granted its approval in 2020 Q2; we had also received other state permits and authorizations for the KPAs and their respective weights.
Weightings for each KPA are established based on the reporting segment’s objectives in relation to the overall corporate strategy of the Company. Health, safety and environmental performance objectives are embedded within each KPA. Each KPA includes a number of compensable targets or KPIs. KPIs are a combination of financial and non-financial measures that are directly aligned with the reporting segment’s strategy. Each KPI is aimed at driving annual performance within the KPA.
KPIs are the result of a cooperative effort among the reporting segments, executive management and our Board of Directors to establish objectives that align with our corporate strategy as established by the Board. Reporting segment objectives that are considered to be most critical to corporate performance are selected to be KPIs. Selected KPIs, weightings and performance levels are presented to the Compensation Committee, and subsequently to the Board of Directors, for approval.
Each KPI has three performance levels (Threshold, Target and Maximum) that are used to measure results. Threshold, Target and Maximum performance-level values are based on quantifiable measures when possible, where typically the Threshold value is 80% of Target and the Maximum value is 120% of Target. When quantifiable measures are not possible, or more than one measure is used, we use a four-point scale to measure results as follows:
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The target level of performance for each KPI is set at an aggressive level that represents a 'reasonable stretch'. For example, when using our four-point scale to measure results, a score of 3 (Fully Successful Performance) is used as the Target. Achieving the Target would result in a 100% payout of the Weighted KPI.project throughout 2020-2021. Shirley Basin stands construction ready.
The Threshold level of performance isShirley Basin approvals were received only weeks after we received the minimum level of performance that must be met before being eligible for any payout on that KPI. The Threshold performance level is typically set at 80% of Target, or a score of 2 (Partially, but not Fully, Successful Performance) when using our four-point scale. There is no payout ifamendment to the Threshold is not met. Achieving the Threshold would result in a 50% payoutLost Creek license to include recovery of the Weighted KPI.uranium resource in the LC East Project (HJ and KM horizons) immediately adjacent to the Lost Creek Project and to add recovery from additional mine units at Lost Creek. This license amendment approved access to six planned mine units in addition to the already licensed three mine units at Lost Creek. The Maximum levelapproval also increased the license limit for annual plant production to 2.2 million pounds U3O8 which includes wellfield production of performance for each KPI is typically set at 120%up to 1.2 million pounds U3O8 and toll processing up to one million pounds U3O8. The Wyoming Department of Target, or a score of 4 (Superior Performance) when using our four-point scale. Achieving or exceeding the Maximum would result in a 150% payoutEnvironmental Quality, Land Quality Division, continues its review of the Weighted KPI.
A straight-line interpolation is used to calculate payouts when the result is between the Threshold (50%) and Maximum (150%) targets. The Weighted Payout is the result of multiplying (a) the Weighted KPI times (b) the Result Payout.
Together with the Compensation Committee, management regularly monitors the corporate results as they relateapplication for amendment to the KPIsLost Creek permit to determine ifmine which will add the Company is on-track to meet its objectives. After year end, aHJ and KM Horizon mine units at LC East and HJ mine units at Lost Creek. We anticipate that this final review of the corporate resultsLost Creek expansion will be complete in 2022. Additionally, we submitted our request for extension of our Lost Creek source material license; it is overseencurrently in timely review by the Compensation Committee and reported to the Board of Directors. In March 2019, the Board of Directors reviewed corporate performance based upon the selected KPI objectives established for 2018. Our corporate performance was evaluated as having generally met the performance objective targets, and exceeded the targets in several categories and specific objectives.URP.
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Results of performance based upon our 2018 corporate objectives, as approved by the Compensation Committeenew Casper, Wyoming operations headquarters. The facility will serve our current and Board of Directors, are set forth in the tables belowfuture Wyoming operations and explained in the textmineral exploration and development projects. The three-acre site includes a fully furnished 14,000 sq. ft. office building, and sufficient land to build a construction shop and warehouse facility, which follows each key performance areawill also house our shared services chemistry laboratory. In 2022 Q1, we selected a contractor, and anticipate construction of the corporate objectives.
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KPI / MEASURE | 2018 RESULTS | THRESHOLD | TARGET | MAXIMUM | KPI WEIGHT | KPI PAYOUT | WEIGHTED KPI PAYOUT |
Total Company |
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HSE Maintain/reduce LTIFR and TRIFR incidents and regulatory violations. Emphasize safety culture.
Score of 4.0 (Perfect safety record)
| 2 - No
| 3 - 25% Reduction
| 4 - 50% Reduction
| 3%
| 150%
| 4.5%
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TSR Achieve median one- and three-year return compared to peers.
Score of 3.8 1-year TSR – 87% 3-year TSR - 52%
| 25th Percentile
| 50th Percentile
| 75th Percentile
| 6%
| 140%
| 8.4%
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Average Realized Price Exceed the one-year average published spot price.
Score of 4.0 Average realized price $48.86 Average spot price $24.61
| 80% of Spot Price
| 100% of Spot Price
| 120% of Spot Price
| 3%
| 150%
| 4.5%
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Regulatory Defend against harmful, negative regulatory issues while working with industry and regulators on agreement state status (trade issues, EPA Part 192, Wyoming URP, etc.).
Score of 3.8
| 2/Threshold |
3/Target
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4/Outstanding
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4%
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140%
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5.6%
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Strategic Plans Implement 2018 strategic plan to positively position the company.
Score of 3.6
| 2/Threshold |
3/Target
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4/Outstanding
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4%
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130%
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5.2%
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| 28.2% |
Total Company:Our “Total Company” corporate objectives continuednew facility will be complete in 2022. Building, wiring and automating header houses in Casper, as well as other construction activities, will provide numerous safety, environmental and financial advantages to focus on safe, controlled-level production operations at Lost Creek. During 2018, we generated $11.3 million in gross profits, reported positive earnings of $0.03 per share, and built our inventory position to over 375,000 pounds of finished, ready-to-sell product. We achieved these results while at the same time maintaining a perfect safety record of no lost-time accidents at Lost Creek (which remains perfect at the date of this Circular).
In 2018, total U.S. uranium production remained at historic lows due in large part to uranium and nuclear fuel imported from state-subsidized foreign entities; indications are that 2019 domestic production is likely to be even lower. A
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healthy uranium mining industry is vital to U.S. national security, because it supplies fuel for nuclear power plants that are a key component of the nation’s critical energy infrastructure and essential defense needs. In January 2018, together with Energy Fuels, we filed a petition under Section 232 of the Trade Expansion Act of 1962 to the U.S. Department of Commerce (“DOC”) for relief from imports of uranium products that threaten national security requesting (1) the DOC to investigate the effects of uranium imports on U.S. national security and (2) the President of the United States to use his authority to adjust imports to ensure the long-term viability of the U.S. uranium mining industry. The petition proposes sensible remedies that will support a viable domestic uranium mining industry with a negligible impact on U.S. nuclear utilities. DOC initiated its investigation in July 2018
operations. Due to the market conditions, which remain depressed, we chose to do no further development work after the three new header houses in MU2 at Lost Creek (begun in 2017) were completed and operational. The inclusion of production from those wellfield areas permitted us to capture 302,164 pounds at Lost Creek, although, as to be expected, production began a decline later in the year. Lower head grade and reduced flowrate is a typical result as a mine matures and older operating patterns, particularly in MU1, remain in operations.
At year-end, we had captured in the wellfield approximately 2.7 million pounds, life-of-project. Additionally, with the continuing depressed uranium market in 2018, we sought to further de-risk our business through the creation of additional value in our term contracts, balancing production and purchased pounds to be delivered into the contractual obligations. During 2018, the Company sold 470,000 purchased pounds under term contracts at an average price of $49.39. From production, Lost Creek sold 10,000 pounds during 2018 in a tax-driven spot sale. The 470,000 pounds sold into term contracts were purchased at an average price of $24.42 per pound. Revenues from these sales permitted us again to timely make all payments in debt service during 2018, another accomplishment which continues to distinguish our Company.
As a result of our diligent cash-flow management, our free cash flow again exceeded our budget for the year. Even in the face of sustained depressed uranium pricing, our results on Total Shareholder Return (TSR), exceeded our targets for both one- and three-year results. See also discussion under heading “Total Shareholder Return,” below.
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KPI AND MEASURE | 2018 RESULTS | THRESHOLD | TARGET | MAXIMUM | KPI WEIGHT | KPI PAYOUT | WEIGHTED KPI PAYOUT |
Lost Creek |
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HSE Maintain/reduce LTIFR and TRIFR incidents and reduce number and severity of regulatory violations. Reduce number and volume of reportable spills.
Score of 3.9
| 2/Threshold |
3/Target
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4/Outstanding
| 12%
| 145%
| 17.4%
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Production Achieve budgeted production (312k) and cash cost per pound ($23.77).
Score of 2.8 302,164 pounds captured $25.18/lb. cash cost
| 2/Threshold |
3/Target
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4/Outstanding
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10%
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90%
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9.0%
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Resources Update internal resource estimates based on development drilling results.
Score of 3.0
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2/Threshold
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3/Target
| 4/Outstanding |
8%
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100%
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8.0%
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Operations Complete automated data compilation into database to allow for routine data analysis.
Score of 2.7
| 2/Threshold |
3/Target
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4/Outstanding
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6%
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85%
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5.1%
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Permitting Complete federal and state permitting of LC East by responding to RAIs within one month of receiving requests.
Score of 3.5
| 2/Threshold |
3/Target
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4/Outstanding
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4%
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125%
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5.0%
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| 40% |
| 44.5% |
Lost Creek: Our corporate objectives continued to focus on Lost Creek operations, with a weighting of 40% to the objectives directly related to Lost Creek; in 2018, this included advancing our operations on a limited production plan, while continuing to improve our safety standards. As described above, we continue to strive to improve our overall safety record and have demonstrated that commitment with the safety milestone of 12 months with no lost-time accidents (August 2018), which continues to date (591 days). The operational refinements implemented in the past several years continue to serve us well, as we continue to control our production rates at lower levels with good efficiencies. Throughout 2018, we steadily built our inventory of finished, ready-for-sale product.
Permitting advances made during the year were largely focused on the process to obtain all approvals for the amendments to existing permits and authorizations for recovery from mine units at LC East. Ultimately, the BLM Final Environmental Impact Statement and Record of Decision were issued just after the end of year, and we expect
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all remaining authorizations to follow in coming months, such that LC East should be fully permitted and licensed in 2019.
While we conducted an additional reduction in force in February 2018, we have been successful in maintaining a skilled and dedicated workforce, who are now proceeding with further operational refinements in order to be best prepared for the ramp upremote location of Lost Creek, operations.
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KPI AND MEASURE | 2018 RESULTS | THRESHOLD | TARGET | MAXIMUM | KPI WEIGHT | KPI PAYOUT | WEIGHTED KPI PAYOUT | |
Pathfinder |
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HSE Maintain/reduce LTIFR and TRIFR incidents and regulatory violations. Emphasize safety culture.
Score of 4.0 (Perfect safety record)
| 2/Threshold
| 3/Target
| 4/Outstanding
| 6%
| 150%
| 9.0%
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Shirley Basin Permitting Advance permitting and assist industry and regulators with establishment of Wyoming URP.
Score of 3.2
| 2/Threshold
| 3/Target
| 4/Outstanding
| 6%
| 110%
| 6.6%
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Data Development Monetize Pathfinder data through sale/JV of Excel Project and sale of other data.
Score of 3.0
| 2/Threshold
| 3/Target
| 4/Outstanding
| 4%
| 100%
| 4.0%
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Government and Community Relations Maintain and improve relations (government and community relations efforts).
Score 3.0
| 2 No
| 3 Good
| 4 Significant
| 4%
| 100%
| 4.0%
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| 20% |
| 23.6% |
Pathfinder: Performance relativeour staff have been provided rideshare arrangements by the Company to our corporate objectives for our Pathfinder Mines assets continued to be strongminimize the number of required commuter vehicles. We anticipate that the new facility will remove several of those vehicles from the routine daily commute when Lost Creek is in 2018. Our safety record for Pathfinder, includingfull production operations, and that the facility will similarly benefit the Shirley Basin Project remained perfect: no incidents. We continuedwhen it is constructed and operating. Fewer miles traveled by our staff and fewer vehicles on the road equates to advance our applicationa significantly lower risk of accident or injury, a smaller carbon footprint for a permit to mine at Shirley Basin; WDEQ has progressed with its technical review. Our application for a source material license for Shirley Basin is now proceeding through its review with the State of Wyoming Uranium Recovery Program (“URP”). We anticipate this process to be complete, with necessary permitsLost Creek, and authorizations received, in 2019. As anticipated, the BLM has initiated its review of the Plan of Operations upon completion of its review of the LC East amendment. Work is well underway on initial engineering evaluations, designsconsiderably lower vehicle and studies.labor costs.
EffortsIn 2022, we stand ready to advance value from the Pathfinder exploration database continued, with further claims located at our new Excel gold project, as well as further testingquickly ramp-up and analysis conducted there. As well, the ongoing review and analyses of the database in order to exploration projects for which data may be sold or traded continued. While we retain our
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focus, first and foremost, assupply a low-cost uranium producer, the opportunities presented by the Excel Project were too attractive not to pursue. We are considering all prospects to advance this new exploration project, and to obtain value for our shareholders, whether further exploring the project ourselves, identifying a viable venture partner, or through a sale process. Additionally, we will continue to mine the large database for other exploration and data sale opportunities.
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KPI AND MEASURE | RESULTS | THRES-HOLD | TARGET | MAXIMUM | KPI WEIGHT | KPI PAYOUT | WEIGHTED KPI PAYOUT |
Corporate Services |
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HSE Maintain/reduce LTIFR and TRIFR incidents and regulatory violations. Emphasize safety culture.
Score of 3.8
| 2/Threshold |
3/Target
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4/Outstanding
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4%
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140%
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5.6%
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Risk Management Minimize risk and
Score of 3.4
| 2/Threshold |
3/Target
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4/Outstanding
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4%
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120%
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4.8%
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Financial Management Achieve $5.2 million average cash budget while meeting operating requirements.
Score of 4.0
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80%
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Budget
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120%
| 6%
| 150%
| 9.0%
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HR / IR Expand and improve HR and IR programs.
Score of 3.3
| 2/Threshold | 3/Target |
4/Outstanding
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3%
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115%
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3.5%
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IT Study cloud-based backup solution for critical servers and implement it or another solution depending on findings.
Score of 2.5
| 2/Threshold | 3/Target |
4/Outstanding
| 3%
| 75%
| 2.3%
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| 20% |
| 25.2% | |
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Grand Total: Score of 3.43 |
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| 100% |
| 121.5% |
Corporate Services: As is emphasized for all our operational staff, our corporate services group maintains a vigilant focus on safety for themselves and at the corporate offices, but also in support of the operational sites. The safety record for corporate services was, again, perfect. Risk management remained a priority for our finance, compliance and legal groups, with reporting and other obligations completed in a timely and professional manner. We experienced no significant legal or compliance issue during the year. Our internal and external reporting remains of high quality, and our internal reporting continues to evolve. The finance department was successful in forecasting and managing
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our cash resources. All of these efforts relatedomestically produced, clean energy solution to our ongoing efforts to strategicallycustomers and successfully position the Company in these challenging market times. Our Chief Financial Officer continues his review of our compensation and benefits programs.America’s communities.
Overall, our 2018 performance-to-objectives result was 121.5% of the targeted 100%.
Total Shareholder Return
The total shareholder return (“TSR”) of the Company compared with the returns of our peer comparator group is shown on a one-year through five-year basis in the table below. The one-year TSR for Ur-Energy was well above the top quartile at 87%, with a ranking in the top three of the comparator companies. The longer, three-year TSR was lower, at approximately 52%, primarily driven by continuing depressed uranium pricing, which impacted producing uranium companies more than non-producers and significantly more than non-uranium mining companies such as gold and silver companies.
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Total Shareholder Returns as at December 31, 2018 | |||||
Ur-Energy Inc. Comparator Companies | |||||
Small Cap Mining Companies - emphasis on uranium & US based companies | |||||
YTD TSRs | |||||
Company Name | 1 Year | 2 Years | 3 Years | 4 Years | 5 Years |
Ur-Energy Inc | 3.49% | 11.96% | 0.00% | -2.63% | -9.17% |
Alio Gold Inc. | -75.11% | -47.36% | -15.40% | -43.62% | -36.67% |
Americas Silver Corporation | -51.31% | -20.18% | 22.92% | -5.70% | -3.75% |
Denison Mines Corp. | -8.70% | -5.13% | -3.45% | -13.58% | -13.35% |
Energy Fuels Inc. | 71.24% | 32.33% | -1.90% | -14.19% | -8.66% |
Fission Uranium Corp. | -30.32% | -8.14% | -12.99% | -10.98% | -12.78% |
Gold Resource Corp. | -8.75% | -3.69% | 34.80% | 5.89% | -0.74% |
Great Panther Silver Limited | -40.49% | -33.90% | 11.48% | 8.49% | 4.72% |
NexGen Energy Ltd. | -24.92% | 1.70% | 49.53% | 58.64% | 52.17% |
Seabridge Gold Inc. | 26.28% | 27.76% | 16.30% | 19.58% | 18.59% |
SilverCorp Metals Inc. | -12.15% | -3.71% | 63.93% | 17.64% | 3.96% |
Uranium Energy Corp. | -29.38% | 5.64% | 5.64% | -8.06% | -8.97% |
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Percent Rank | 81.62% | 82.56% | 32.73% | 51.25% | 28.77% |
Median | -23.32% | -3.71% | 11.48% | -4.21% | -3.75% |
Mean | -15.43% | -4.82% | 15.41% | 2.04% | 0.39% |
10th Percentile | -51.31% | -33.90% | -12.99% | -14.19% | -13.35% |
25th Percentile | -35.41% | -14.16% | -2.68% | -12.28% | -10.72% |
75th Percentile | -4.81% | 4.11% | 28.49% | 13.99% | 4.54% |
90th Percentile | 26.28% | 27.76% | 49.53% | 19.58% | 18.59% |
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Minimum | -75.11% | -47.36% | -15.40% | -43.62% | -36.67% |
Maximum | 71.24% | 32.33% | 63.93% | 58.64% | 52.17% |
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Ur-Energy Inc.'s Rank | 3 | 3 | 8 | 6 | 9 |
| > P75 | < P75 | > P25 | > P50 | > P25 |
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Source: S&P Capital IQ | |||||
For Information | |||||
| 1 Year | 2 Years | 3 Years | 4 Years | 5 Years |
S&P/TSX Composite Index | -11.64% | -6.31% | 10.09% | -2.12% | 5.15% |
S&P/TSX Venture Composite Index | -34.50% | -26.91% | 6.00% | -19.89% | -40.21% |
S&P/TSX Global Mining Index | -6.28% | 7.49% | 52.74% | 9.24% | -6.78% |
31
Executive Compensation – Related Fees
The Compensation Committee did not utilize any third-party consulting services during 2018. Management and the Compensation Committee continue to utilize the Company’s subscription to Equilar Services.
20192022 Compensation Program and Company Outlook
WhileWe currently anticipate that the structure of the Company’s compensation program will remain largely the same in 20192022 for all employees and executive officers, recommendations from the compensation studies in recent years, supported by the Compensation Committee and the Board, continue to be reviewed and implemented by the Company (this may include further action on aligning compensation to peer comparators, refining the STIP plan, or other matters).
officers. The average spot price per pound of U3O8, as reported by UxC, LLC (formerly, The Ux Consulting Company, LLC) and TradeTech, LLC, at or about the Record Date was $25.88. Because of the continuing low spot pricemarket environment is such that we once again intend to maintainare maintaining a controlled and reduced production level, and will do so until market conditions improve or there is a successful outcomewhile further optimizing our operational readiness through fieldwork to the Section 232 trade action. For 2019, we have suspended further MU2 development activities, implemented further cost reductions, and secured purchase contractsadvance certain aspects of wellfield readiness for 100% of our 2019 delivery obligations. We expect our gross profit in 2019 to be approximately $11.5 million from the sale of purchased product, which represents a cash-basis gross profit margin of between 45% and 50%. We are not currently forecasting any spot sales in 2019 at this time; we may, however, choose to sell additional produced product depending on market conditions.ramp-up.
We have maintained our Lost Creek assets and retained our core technical, operational and management staff to run the bestsafest, optimal operations, and to be prepared to ramp upramp-up when we are able.market conditions improve. With initial wellfield development costs of approximately $14 million, and no significant capital expenditures, these measures also provide us with the operational leverage for an efficient and low-cost ramp-up at Lost Creek whenCreek. When we obtain sales contracts and/or market and other conditions warrant, we will ramp-up production at Lost Creek. Development and construction of Shirley Basin may also proceed if market conditions improvepermit. Current conditions are encouraging. However, there can be no certainty of the timing for contracts, whether through the new U.S. uranium reserve or there is a successful outcome to the Section 232 trade action.with utilities.
We currently have over 375,000 pounds of finished, ready-to-sell, product inventory in storage at the conversion facility. Production from our operating MU1 and MU2 HHs, expected to be between 75,000 and 100,000 pounds, will be used to further build our inventory position of finished, ready-to-sell, product at the conversion facility. The inventoried pounds, or the in-the-money contracts themselves, can readily be converted to cash on an as-needed basis.
Our “total company” objectives for 2019 continue to concentrate on operating safely in an environmentally-soundenvironmentally sound fashion, focusing on the health and well-being of our employees, including in the continuing circumstances surrounding COVID-19, while returning value to our shareholders.
As a uranium producer, we are advancing the interests of clean energy, thereby contributing in positive ways to address the challenges of global climate change. Uranium fuels carbon-free, emission-free nuclear power which is a clean, cost-effective, and reliable form of electrical power. Nuclear power is estimated to provide more than 50 percent of the carbon-free electricity in the U.S. and approximately one-third of carbon-free electricity worldwide.
We have made great strides in reducing water consumption at our Lost Creek Mine through the implementation of a Class V treatment system that includes water treatment and injection of the clean water into a shallow formation where it can be accessed by future generations. Since implementation of the Class V system, the generation of wastewater during production has been reduced by 18 percent. To further reduce water consumption and enhance IX effectiveness, a pre-IX filtration and wastewater treatment facility is being contemplated and lab tested. The system, as envisioned, will allow for more effective use of current and future deep disposal wells working in conjunction with the Class V water recycling system while preserving precious water resources. Our goal is to reduce wastewater generation by at least 70 percent.
21 |
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Additional Compensation Practices
Share Ownership Guidelines
All of our executive officers and directors are encouraged to have a significant long-term financial interest in our Company. ToIn 2009, to encourage alignment of the interests of the executive officers and directors with those of our shareholders, in 2009, theour Board of Directors mandated that each executive officer of Ur-Energy, whether currentlythen appointed or appointed in the future,thereafter, is required to invest on a pre-determined schedule an amount equal to one times the executive officer’s annual base salary in shares or securities redeemable into sharesshares. In 2012, the Board approved additional guidelines (the “Guidelines”) related to the mandate, such that the requirement of share ownership be met on or before the later of (i) December 31 2013, (ii)of the fifth anniversaryyear after an executive officer becomes subject to the Guidelines, or (ii) December 31 of the third year from the effective date of the change in the executive officer’s appointment, or (iii) the date of the most recent salary increase.annual base salary. The investment amount is calculated using the amount of the annual base salary of the executive officer at the later of (i) January 1, 2009, (ii) the date ofthe executive officer’s appointment,officer became subject to the Guidelines, or (ii) the date of the most recent increase to annual base salary increase.salary. Compliance is evaluated once per year, at December 31. At December 31, 2021, all executive officers meet the Guidelines or are on-track to meet the Guidelines within the prescribed timeframes. The share ownership requirements are also applicable to the non-executive directors who, since 2012, are required to invest an amount equal to three times their annual retainer. See further discussion under the heading “Share Ownership Guidelines for Directors,” below. Reviewed most recently in December 2018, all executive officers meet the Share Ownership Guidelines or are on-track to meet the Share Ownership Guidelines within the prescribed timeframes.
32
Anti-Hedging Policy; Pledging
We have a formal anti-hedging policy which prohibits our executive officers and directors from engaging inany hedging or similar monetization transactions with respect to the Company’s securities, including, but not limited to, through the use of financial instruments such as exchange funds, prepaid variable forwards, equity swaps, puts, calls, collars, forwards and other derivative instruments, or through the establishment of a short position in the Company’s securities.
The Board has not formally adopted a policy restricting the pledging of its Common Shares held by executive officers or directors as, historically, there has been little or no pledging of the Company’s shares by our executive officers or directors. Currently, only one insider has pledged Common Shares; those pledged Common Shares represent approximatelyless than one percent of our issued and outstanding shares. Among the directors and executive officers, there have been no other pledged Common Shares of the Company. SeeNotesnotes to Security Ownership Table,of Management table, above.
Clawback Policy
The Company has adopted a clawback policy pursuant to which the Company would be entitled to recoup incentive compensation amounts paid to executive officer(s) in the event of a future restatement of financial results and other specified events. This policy covers all incentive cash and equity compensation, including any cash bonuses, restricted share unitsRSUs or stock options received by the executives. It provides that the Board may direct the Company to recoup the incentive cash and equity compensation of the executive(s) at fault if all three of the following events occur:
· | the Company makes an accounting restatement of our financial statements if there is a material financial reporting non-compliance under securities laws; and |
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· | the executive(s) engaged in gross negligence, intentional misconduct or fraud which caused or significantly contributed to the restatement; and |
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· | the executive(s) was overcompensated with respect to incentive cash and equity compensation during the year(s) subject to the restatement. |
If all three of the preceding events occur, the Board, of Directors, following review and recommendation by the Compensation Committee, will decide when and how the policy will apply. The Company may recoup the portion of incentive cash and equity compensation received by the executive(s) at fault during the year(s) subject to the restatement that is in excess of the incentive compensation that would have been received based on the restated results.
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Table of Contents |
Tax and Accounting Considerations
The Compensation Committee considers tax and accounting rules and regulations when structuring our executive compensation program. Our plans and programs are designed to comply with or be exempt from the requirements of Section 409A of the Internal Revenue Code of 1986, as amended (the “IRS Code”), which regulates deferred compensation and provides for potentially early taxation and a 20% additional tax on non-compliant arrangements. Equity awards are accounted for under FASB ASC Topic 718, which requires the recognition of expense for the fair value of such awards, and the Compensation Committee considers the accounting expense of such awards when authorizing stock option and RSU grants.grants under both equity compensation plans.
EXECUTIVE COMPENSATIONCompensation Consultant Fees
The Compensation Committee utilized third-party consulting services of Roger Gurr & Associates (“RG&A”) in conjunction with the review of non-executive director compensation, and paid fees related to the review in 2022 the amount of $18,000. Additionally, management and the Compensation Committee continue to utilize online data sources.
Say on Pay Advisory Vote in 2018
In 2018,2021, our shareholders approved our compensation program for our Named Executive Officers by a vote in favor of 99%80%.
For the past five years, our advisory “say on pay” vote has averaged approximately 90% in favor. The Compensation Committee believes the results of our advisory votes on “say on pay” continue to be indicativeconfirm that the clear majority of our shareholders are satisfied with our executive compensation policies and decisions, and that
33
our executive compensation program effectively aligns the interests of our Named Executive Officers with the interests of our shareholders. As a part of the review of our compensation program and, specifically, review of our compensation of our Named Executive Officers, we did not make substantive changes to the compensation of our executives in 2018; the executives were provided cost of living raises, only, during 2018.
The formal review made in 2018 involvedOur prior reviews of survey data from theour peer group established by the Company,groups, utilizing Equilar data. The review revealedpublicly available data and studies, indicated that our executive officers have fallen wellremain behind even the median ranges of our comparator companies, with certain exceptions. As discussed above, in 2021 the comparator company data, with only certain limited exceptions. Further studychallenging uranium market conditions and effects of COVID-19 persisted and, as such, we chose to defer a formal review of executive compensation until 2022, because no changes were anticipated to be made in executive compensation in 2021 except for the cost-of living adjustment to salary. As in years past, this adjustment was calledmade at the same level for but no actionour executive officers as for non-executive staff. This was taken in 2018. Instead, effortsthe first adjustment to better align the executive officers’ base compensation with the Company’s peers were deferred to 2019. Subsequent to year end, an initial correction to adjust the base compensationlevels of our CEO, Mr. Klenda, was made; his salary was increased to $428,796 to become effectiveany sort since a cost-of-living adjustment in 2019. Consideration of other executive compensation will be a part of our 2019 compensation review, and, if appropriate, further changes to better align our executive compensation with that of our peer comparator companies may be made.
WePursuant to our Board’s recommendation, we continue to reviewwith an annual advisory (non-binding) say on pay vote. Although our human resourcescompensation program has changed little in lightrecent years, and we did not and do not currently anticipate that the structure of the Company’s current operations and needs. As a result of persistently low uranium prices, and responsive reductions in production to control at or about the level ofcompensation program will change significantly, we believe that an annual update for our contractual requirements, we have reduced our overall employee count from a combined Ur-Energy USA (Casper/Littleton) and Lost Creek total of 90 employees at year-end 2013 to a combined 42 employees at year-end 2018.
shareholders is appropriate. Based upon the first advisory vote by our shareholders in 2014,2020, concerning “say when on pay,” our Board adopted an annual advisory vote for “say on pay,pay.” until ourOur next say when on pay vote in 2020. As a result, our next say on pay vote will be in 2020.2026.
23 |
Table of Contents |
Summary Compensation Table
The following table sets forth the summary information concerning compensation earned during the financial years ended December 31, 2018, 20172021, 2020 and 20162019 by our Named Executive Officers serving at December 31, 2018.2021.
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Name and principal position (1) | Year | Salary | Bonus (2) ($) | Stock awards (3)(4)(5) ($) | Option awards (3)(4)(5) ($) | Non-equity incentive plan compensation | Change in pension value and nonqualified deferred compensation | All other compensation (6) ($) | Total |
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Jeffrey T. Klenda | 2018 | 321,436 | 149,399 | 38,171 | 65,108 | Nil | Nil | Nil | 574,114 |
President and | 2017 | 312,441 | 136,034 | 46,157 | 71,373 | Nil | Nil | Nil | 566,005 |
Chief Executive Officer | 2016 | 309,941 | 41,954 | 46,621 | 79,725 | Nil | Nil | Nil | 478,241 |
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Roger L. Smith | 2018 | 275,150 | 90,722 | 27,230 | 46,444 | Nil | Nil | 11,006 | 450,552 |
Chief Financial Officer and | 2017 | 267,444 | 88,133 | 32,925 | 50,913 | Nil | Nil | 10,698 | 450,113 |
Chief Administrative Officer | 2016 | 265,301 | 27,421 | 33,255 | 56,869 | Nil | Nil | 10,612 | 393,458 |
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Penne A. Goplerud | 2018 | 247,372 | 83,529 | 24,480 | 41,755 | Nil | Nil | 9,895 | 407,031 |
General Counsel and | 2017 | 240,446 | 78,997 | 29,601 | 45,773 | Nil | Nil | 9,618 | 404,435 |
Corporate Secretary | 2016 | 238,520 | 25,369 | 29,899 | 51,128 | Nil | Nil | 9,541 | 354,457 |
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Steven M. Hatten | 2018 | 216,794 | 70,836 | 21,455 | 36,594 | Nil | Nil | 8,672 | 354,351 |
Vice President, Operations | 2017 | 210,731 | 69,606 | 25,943 | 40,115 | Nil | Nil | 8,429 | 354,824 |
| 2016 | 209,044 | 20,722 | 26,203 | 44,810 | Nil | Nil | 8,362 | 309,141 |
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John W. Cash | 2018 | 206,614 | 70,381 | 20,447 | 34,876 | Nil | Nil | 7,550 | 339,868 |
Vice President | 2017 | 200,826 | 64,800 | 24,724 | 38,231 | Nil | Nil | 7,347 | 335,928 |
Regulatory Affairs | 2016 | 199,217 | 20,588 | 24,971 | 42,703 | Nil | Nil | 7,352 | 294,831 |
Name and principal position (1) |
| Year |
| Salary ($) |
|
| Bonus (2) ($) |
|
| Stock awards (3)(4)(5) ($) |
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| Option awards (3)(4)(5) ($) |
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| Non-equity incentive plan compensation ($) |
| Change in pension value and nonqualified deferred compensation ($) |
| All other compensation (6) ($) |
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| Total ($) |
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Jeffrey T. Klenda |
| 2021 |
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| 448,454 |
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| 213,318 |
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| 54,359 |
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| 112,070 |
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| Nil |
| Nil |
| Nil |
|
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| 828,201 |
| |
President and |
| 2020 |
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| 441,662 |
|
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| 176,665 |
|
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| 54,160 |
|
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| 102,064 |
|
| Nil |
| Nil |
| Nil |
|
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| 774,551 |
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Chief Executive Officer |
| 2019 |
|
| 426,050 |
|
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| 112,183 |
|
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| 62,082 |
|
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| 109,917 |
|
| Nil |
| Nil |
| Nil |
|
|
| 710,232 |
| |
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Roger L. Smith |
| 2021 |
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| 294,364 |
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| 105,020 |
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| 29,735 |
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| 61,301 |
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| Nil |
| Nil |
|
| 11,762 |
|
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| 502,182 |
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Chief Financial Officer and |
| 2020 |
|
| 289,900 |
|
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| 86,970 |
|
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| 29,625 |
|
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| 55,828 |
|
| Nil |
| Nil |
|
| 11,596 |
|
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| 473,919 |
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Chief Administrative Officer |
| 2019 |
|
| 282,425 |
|
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| 54,487 |
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| 33,958 |
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| 60,124 |
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| Nil |
| Nil |
|
| 11,297 |
|
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| 442,291 |
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Penne A. Goplerud |
| 2021 |
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| 264,632 |
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| 94,409 |
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| 26,730 |
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| 55,110 |
|
| Nil |
| Nil |
|
| 10,585 |
|
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| 451,466 |
|
General Counsel and |
| 2020 |
|
| 260,624 |
|
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| 78,187 |
|
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| 26,634 |
|
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| 50,190 |
|
| Nil |
| Nil |
|
| 10,425 |
|
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| 426,060 |
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Corporate Secretary |
| 2019 |
|
| 253,908 |
|
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| 48,945 |
|
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| 30,529 |
|
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| 54,052 |
|
| Nil |
| Nil |
|
| 10,156 |
|
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| 397,590 |
|
____________
(1) | Each of |
34
| |
(2) | Annual incentive plan awards are shown in the year |
(3) |
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(4) | Canadian dollar figures have been converted to U.S. dollar figures at the average exchange rate for |
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(5) | For additional information regarding the fair value of stock options and RSUs, as at December 31, |
(6) | Reflects only the Company’s matching contribution toward the executive’s 401(k) retirement account. Other aspects of compensation or perquisites are of a non-material value, and/or are provided to executive officers in the same fashion as all employees of the Company |
The following table sets forth certain summary information concerning our equity compensation plans as at December 31, 2018.2021. Directors, officers, employees, and consultants are eligible to participate in the Option Plan. Directors and employees, including executive officers, are eligible to participate in the RSU&EI Plan.
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| Number of Common Shares to be Issued Upon Exercise of Outstanding Options, Warrants and Rights | Weighted Average Exercise Price of Outstanding Options, Warrants and Rights (2) (C$) | Number of Common Shares Remaining for Future Issuance (Excluding Common Shares to be Issued Upon Exercise of Outstanding Options, Warrants and Rights) (3) |
Equity compensation plans approved by securityholders (1) | 10,747,108 | $ 0.64 | 3,055,321 |
Equity compensation plans not approved by security-holders | - | - | - |
| Number of Common Shares to be Issued Upon Exercise of Outstanding Options, Warrants and Rights | Weighted Average Exercise Price of Outstanding Options, Warrants and Rights (2) (US$) | Number of Common Shares Remaining for Future Issuance (Excluding Common Shares to be Issued Upon Exercise of Outstanding Options, Warrants and Rights) |
Equity compensation plans approved by securityholders (1) | 11,075,684 | $ 0.68 | 9,510,541 |
Equity compensation plans not approved by security-holders | - | - | - |
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(1) | Our shareholders have approved both the Option Plan and the RSU | ||
(2) | The exercise price represents the weighted exercise price of the 10,064,424 outstanding stock options at December 31, 2021. |
(2) The exercise price represents the weighted exercise price of the 9,731,612 outstanding stock options at December 31, 2018.
24 |
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Table of Contents |
Stock Options and RSUsthe Amended and Restated Restricted Share Unit and Equity Incentive Plan
We adopted the Ur-Energy Inc. Amended and Restated Stock Option Plan in 2005 in order to advance our interests by providing directors, officers, employees and consultants with a financial incentive tied to the Company’s long-term financial performance and continued service to or employment with us. Subsequently, we adopted the Ur-Energy Inc. Restricted Share Unit Plan, as thereafter amended, as part of our overall stock-based compensation plan. The RSU&EI Plan allowshas allowed participants to earn Common Shares over time, rather than options that give participants the right to purchase shares at a set price.
A total of up to 10% of Ur-Energy’s issued and outstanding Common Shares may be reserved for issuance pursuant to the Option Plan and the RSU Plan,Plans, in the aggregate. As of March 26, 2019,At April 8, 2022, we have listed and reserved 13,772,42920,346,803 Common Shares of the 21,862,283 total Common Shares that may be reserved under the Plans, in the aggregate of which 12,210,613aggregate. We have 17,158,490 Common Shares were reserved under the Option Plan, and 1,561,8163,188,313 Common Shares were reserved under the RSU&EI Plan. We allocateTherefore, up to 1,515,480 Common Shares are available to be reserved under the Plans.
Of the shares currently reserved, 9,999,602 options for Common Shares have been granted and are outstanding, as of April 8, 2022, or approximately 4.6% of our issued and outstanding Common Shares. There are 1,011,660 RSUs that have been granted and are outstanding as of April 8, 2022, or approximately 0.5% of our issued and outstanding Common Shares. Historically, we have allocated approximately 80% of those reserved
35
shares to the Option Plan and 20% to the RSU&EI Plan, and award grants using a ratio of 4:1 Options to RSUs. The RSU Plan does not allocate more than five percent of the reserved Common Shares. Of those currently reserved, 9,731,612 options for Common Shares have been granted and are outstanding, as at March 26, 2019, or approximately 6.1% of our issued and outstanding Common Shares. There are 985,496 RSUs that have been granted and are outstanding as of March 26, 2019, or approximately 0.6% of our issued and outstanding Common Shares. The number of shares reserved is subject to adjustment if the Common Shares are subdivided, consolidated, converted or reclassified or the number of Common Shares varies as a result of a stock dividend or an increase or a reduction in our share capital. We do not permit the payment of dividendsDividends or dividend equivalents on unvested or redeemed equity awards of all types.types are generally subject to the same vesting conditions as the underlying awards to which they relate. The run rate (or “burn rate”) on the equity plans for the past three years is as follows:
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| 2018 | 2017 | 2016 | |||
Equity Compensation Plans | 2021 | 2020 | 2019 | |||
Stock Option Plan | 1.5% | 1.8% | 2.2% | 0.7% | 1.8% | 1.8% |
Restricted Share Unit Plan | 0.3% | 0.4% | 0.5% | |||
RSU&EI Plan (RSU Plan) | 0.1% | 0.4% | 0.4% |
As at March 26, 2019,April 8, 2022, the closing price of our Common Shares on the NYSE American LLC (“NYSE American”) was $0.83$1.78 and on the TSX was C$1.11.2.23.
Option Plan
Under the Option Plan, options may be granted to our directors, executive officers, eligible employees and consultants. As of March 26, 2019,at April 8, 2022, there are approximately 1811 employees and six non-executive directors who would beare eligible to participate in the Option Plan. The Option Plan was most recently approved by shareholders on May 18, 2017.7, 2020.
The maximum number of Common Shares that may be reserved for issuance to any one person under the Option Plan is five percent of the number of Common Shares outstanding at the time of reservation. The options are personal and non-assignable. Option holders do not have any shareholder rights (and, specifically, shall not be entitled to dividends) with respect to options unless and until the options are exercised and stock certificatesCommon Shares are issued in the name of the option holder. The exercise price for Common Shares subject to an option is determined by the Board of Directors at the time of grant and may not be less than the market price of the Common Shares at the time the option is granted. Market price at any date in respect of the Common Shares means the closing price of the Common Shares on the TSX (or, if the Common Shares are not then listed and posted for trading on the TSX, then on the recognized stock exchange on which such Common Shares are listed or posted or, if such Common Shares are not so listed on any recognized stock exchange, then on the over-the-counter market on which they are traded or posted as selected for such purpose by the Compensation Committee or in accordance with Section 5.5 of the Option Plan) on the immediately preceding trading day.
Amendments to the Option Plan, approved by the shareholders in May 2017 (a) amended and extended the vesting period so that, going forward, options in a grantOptions vest over a three-year period: one-third on the first anniversary, one-third on the second anniversary and one-third on the third anniversary of the grant; (b) confirmed that dividends, for all award types,awards, shall not be payable on unvested options; (c) updated the Option Plan for compliance with applicable laws, including conformity with tax rules and requirements; and (d) made certain other housekeeping changes. The amendments did not request any increase in the percentage number of Common Shares available for issuance under the Option Plan, nor did the amendments change the term (five years) of the options.
all options is five years. Option expiration dates are not extended during blackouts. Additionally, in no event shall more than five percent of the shares available for issuance under the Option Plan have a stated vesting/exercisability schedule of less than one year from the date of grant. The aggregate number of Common Shares issued to insiders within any 12-month period, or issuable to insiders at any time, under the Stock Option Plan and any other security-based compensation arrangement of the Company, may not exceed 10% of the total number of issued and outstanding Common Shares during such time.
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Table of Contents |
Options granted under the Option Plan are subject to early termination under certain circumstances, including (i) one year after the death of the option holder, (ii) three months after the option holder’s resignation or dismissal without cause as an employee or consultant, or (iii) immediately upon the option holder’s dismissal for cause as an employee. In each case, only options vested at the time of the event which gave rise to such early termination may be exercised by the option holder during such period. The Option Plan also provides that upon a change of control all options under the Option Plan vest immediately and are immediately exercisable.
36
The Option Plan and the terms of any outstanding option may be amended at any time by the Board subject to any required regulatory or shareholder approvals, provided that where such an amendment would prejudice the rights of an option holder under any outstanding option, the consent of the option holder is required to be obtained. Amendments requiring shareholder approval are those amendments set forth in the TSX Company Manual. Amendments that do not require shareholder approval are “housekeeping” amendments such as amendments to the Option Plan to comply with regulatory requirements, amendments related to the administration of the Option Plan and to change the eligibility requirements under the Option Plan and terms and conditions on which the options may be granted. The Option Plan may be suspended, terminated or discontinued in the sole discretion of theour Board of Directors.
Stock options are generally treated as ordinary compensation income as and when Common Shares are issued to the participant upon exercise of the award, however, in the case of Incentive Stock Options, the options aremay be taxable at long-term capital gains tax rates when the issued Common Shares are sold so long as certain conditions are met. If the participant is an employee, the compensation income may be subject to withholding for income and employment tax purposes. The Company is generally entitled to an income tax deduction equal to the amount of ordinary income recognized by the participant, subject to possible limitations imposed by the IRS Code. Please note that the foregoing description is based upon U.S. federal income tax laws in effect on the date of this Circular and does not purport to be complete, and does not discuss state, local or non-U.S. tax consequences.
RSUAmended and Restated Restricted Share Unit and Equity Incentive Plan (RSU&EI Plan)
The RSU&EI Plan was originally adopted (then, as the RSU Plan) by the Board of Directors on May 7, 2010 and, as previously amended, was approved in its entirety most recently by our shareholders on May 5, 2016 with an approval of 67%. Certain2, 2019. Our shareholders approved amendments to the then-existing RSU Plan, were approvedon June 3, 2021, including the renaming of the plan as the “Amended and ratifiedRestated Restricted Share Unit and Equity Incentive Plan.”
The RSU&EI Plan is also described in Proposal No. 4, above, and the full text of the plan is attached as Schedule A of this Circular. As discussed above under “Particulars of Matters to Be Acted Upon,” the TSX rules provide that all eligible insiders, in order to participate in the RSU&EI Plan, may not vote on the renewal of the RSU&EI Plan resolution as set forth in Proposal No. 4. Accordingly, the resolution must be passed by our shareholders on May 28, 2015, witha majority of votes, excluding 6,201,821 Common Shares held by certain insiders of the Company and their affiliates. Also as set forth above in Proposal No. 4, there is no request of an approvalincrease in the percentage number of 94%.shares available for issuance under the RSU&EI Plan.
Under the RSU&EI Plan, restrictedawards of Restricted Share Units (RSUs), performance share units (PSUs) and direct share issuances of Common Shares (DSIs), may be granted to directors and employees, including executive officers, of Ur‑Energythe Company as possible eligible participants. TheAs of April 8, 2022, there are 11 employees and six non-executive directors who are eligible to participate in the RSU&EI Plan. Our Board of Directors has appointed the Compensation Committee to determine which persons are entitled to participate in the RSU Planplan and the number of RSUsawards to be awarded to each participant. The RSU Planplan does not limit the participation of any specific eligible participant including insiders. insiders except to the total of 10% of our issued and outstanding Common Shares which may be reserved for issuance pursuant to the Plans, in the aggregate.
Restricted Share Units
RSUs awarded to participants are credited to a notional account that is established on their behalf and maintained in accordance with the RSU Plan.plan. Each RSU awarded conditionally entitles the participant to the delivery of one Common Share (or cash in lieu of such share at the Compensation Committee’s discretion) upon attainment of the RSU vesting period. Grants of RSUs vest 100% on the two-year anniversary of the date of the grant.
Upon payment by the corporation of a dividend, each outstanding RSU is credited with a dividend equivalent equal to the dividend paid per share, which dividend equivalent is then converted into additional RSUs that are subject to the same vesting schedule as the RSUs to which they relate. The RSU Planplan permits usthe Company to either redeem RSUs for cash or issue Common Shares from treasury in order to satisfy all or any portion of a vested RSU award. If redeemed for cash, RSUs will be redeemed for an amount equal to fair market value which means the closing price of the Common Shares on the TSX on the business day immediately prior to the redemption date, or if the shares are not listed on the TSX, then on such other stock exchange or quotation system as may be selected by the Compensation Committee, provided that, if the Common Shares are not listed or quoted on any other stock exchange or quotation system, then the fair market value will be the value determined by the Compensation Committee in its sole discretion acting in good faith. The redemption date of any RSU will not be after the end of the calendar year which is three years following the end of the year in which services to which the grant of such RSU relates were performed by the participant.
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Table of Contents |
In the event of a change of control, as defined in the RSU Plan,plan, we are required to redeem 100% of the RSUs granted to participants. In the event of an involuntary termination of an employee, other than for cause, or a director who is not re-elected, we are required to redeem the RSUs for cash. Rights respecting RSUs shall not be transferable or assignable other than by will.
Performance Share Units
PSUs are performance-based awards that may entitle the recipient to receive Common Shares (or cash in lieu of shares at the Compensation Committee’s discretion) upon attainment of one or more performance goals over a designated performance period set forth in the PSU grant agreement. Each award of PSUs will contain a target number of PSUs that may be earned, with the actual number earned to be determined pursuant to a formula set forth in the PSU grant agreement based on the extent to which corresponding performance criteria have been attained during the performance period. Upon payment by the corporation of a dividend, each outstanding target PSU is credited with a dividend equivalent equal to the amount of the dividend paid per share, which dividend equivalent is then converted into additional PSUs that are subject to the same performance conditions and formula and vest at the same time as the PSUs to which they relate.
Unless settled earlier in accordance with the plan, earned PSUs will be settled on or within 30 days after the end of the performance period. The plan permits the Company to either settle PSUs for cash or issue Common Shares from treasury to satisfy all or any portion of a PSU award. If settled for cash, PSUs will be settled for an amount equal to fair market value which means the closing price of the Common Shares on the TSX on the business day immediately prior to the settlement date, or if the shares are not listed on the TSX, then on such other stock exchange or quotation system as may be selected by the Compensation Committee, provided that, if the Common Shares are not listed or quoted on any other stock exchange or quotation system, then the fair market value will be the value determined by the Compensation Committee in its sole discretion acting in good faith.
In the event of a change of control, as defined in the plan, the performance period of each outstanding PSU shall be deemed to have ended and the Compensation Committee shall determine the number of PSUs earned based upon performance (under a specific award) to the time of change of control, subject to certain discretionary determinations of the Committee under the plan. Unless otherwise provided in a PSU grant agreement, upon a participant’s termination of employment or other service or death prior to the end of the performance period for an award of PSUs, such PSUs shall be forfeited.
Direct Share Issuances
Subject to applicable securities law requirements as well as the rules of the exchanges under which our shares trade, DSIs awarded to participants are awards of Common Shares granted in such amounts and subject to such terms and conditions as the Compensation Committee determines in its sole discretion. It is anticipated that the DSIs will complement our other bonus program awards in instances when such an award of DSIs is made in lieu of a routine (STIP) or extraordinary cash bonus, as a milestone award (outside PSU grant terms), or other circumstances in which this use of our equity compensation plans is deemed appropriate in the discretion of the Compensation Committee. DSIs may be fully vested on the grant date or may be subject to vesting, as determined by the Compensation Committee. DSIs that are subject to a vesting schedule may not be transferred prior to vesting. Dividends on unvested DSIs may be paid in cash or may be reinvested in additional Common Shares, in either case subject to the same vesting schedule as the DSI to which they relate.
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Unless otherwise provided in the DSI grant agreement that is subject to vesting, upon a participant’s termination of employment or other service or death, the provisions related to termination and death as set forth under the heading “Restricted Share Units” above shall apply by analogy. Any unvested Common Shares that do not vest as a result of the participant’s termination of employment of other service or death shall be immediately forfeited and returned to the corporation without the payment of any consideration.
Administration of the RSU&EI Plan and Tax Consequences
The Board may from time to time amend or suspend the RSU&EI Plan and may at any time terminate the RSU Plan.plan. No such amendment, suspension or termination shall adversely affect the rights of any eligible person with respect to outstanding and unredeemed RSUsawards under the plan credited to that person without that RSU holder’s consent. Amendments requiring shareholder approval are those amendments set forth in the TSX Company Manual.Manual, such as the percentage of the issued and outstanding Common Shares available to be granted under the RSU&EI Plan, an extension of the term for redemption of RSUs or settlement of PSUs held by a participant and amendments to Section 8.1 of the RSU&EI Plan. Amendments that do not require shareholder approval are “housekeeping” amendments such as amendments to the RSU&EI Plan to comply with regulatory requirements, amendments related to the administration of the RSU Planplan and to change the eligibility requirements under the RSU Planplan and terms and conditions on which the RSUsawards may be granted.
RSUs and PSUs are generally treated as ordinary compensation income as and when Common Shares are issued to the participant upon vesting or settlement of the award.award and DSIs are treated as ordinary compensation income at the time of grant if fully vested under the plan or, if such grant is subject to vesting under the RSU&EI Plan, at the time of vesting of the Common Shares. If the participant is an employee, this income is subject to withholding for
37
income and employment tax purposes. The Company is generally entitled to an income tax deduction equal to the amount of ordinary income recognized by the participant. Please note that the foregoing description is based upon U.S. federal income tax laws in effect on the date of this Circular and does not purport to be complete, and does not discuss state, local or non-U.S. tax consequences.
GRANTS OF PLAN-BASED AWARDS TO NAMED EXECUTIVE OFFICERS
The following table sets forth information concerning option-based and share-based awards granted to each of the Named Executive Officers during the year ended December 31, 2018.
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|
|
|
|
|
|
| Estimated future payouts under non-equity incentive plan awards |
| Estimated future payouts under equity incentive plan awards |
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|
| ||||
Name | Grant date | Threshold | Target | Maximum |
| Threshold | Target | Maximum |
| All other stock awards: Number of shares of stock or units | All other option awards: Number of securities underlying options | Exercise of base price of option awards | Grant date fair value of stock and option awards (US$) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Jeffrey T. Klenda | 8/20/18 | Nil | Nil | Nil |
| Nil | Nil | Nil |
| Nil | 111,036 | 0.93 | 72,119 |
| 8/20/18 | Nil | Nil | Nil |
| Nil | Nil | Nil |
| 84,530 | Nil | Nil | 41,976 |
| 12/14/18 | Nil | Nil | Nil |
| Nil | Nil | Nil |
| Nil | 103,831 | 0.91 |
|
| 12/14/18 | Nil | Nil | Nil |
| Nil | Nil | Nil |
|
| Nil | Nil |
|
Roger L. Smith | 8/20/18 | Nil | Nil | Nil |
| Nil | Nil | Nil |
| Nil | 79,206 | 0.93 | 51,445 |
| 8/20/18 | Nil | Nil | Nil |
| Nil | Nil | Nil |
| 60,296 | Nil | Nil | 29,942 |
| 12/14/18 | Nil | Nil | Nil |
| Nil | Nil | Nil |
| Nil | 74,067 | 0.91 |
|
| 12/14/18 | Nil | Nil | Nil |
| Nil | Nil | Nil |
|
| Nil | Nil |
|
Penne A. Goplerud | 8/20/18 | Nil | Nil | Nil |
| Nil | Nil | Nil |
| Nil | 71,211 | 0.93 | 46,251 |
| 8/20/18 | Nil | Nil | Nil |
| Nil | Nil | Nil |
| 54,210 | Nil | Nil | 26,919 |
| 12/14/18 | Nil | Nil | Nil |
| Nil | Nil | Nil |
| Nil | 66,588 | 0.91 |
|
| 12/14/18 | Nil | Nil | Nil |
| Nil | Nil | Nil |
|
| Nil | Nil |
|
Steven M. Hatten | 8/20/18 | Nil | Nil | Nil |
| Nil | Nil | Nil |
| Nil | 62,409 | 0.93 | 40,534 |
| 8/20/18 | Nil | Nil | Nil |
| Nil | Nil | Nil |
| 47,510 | Nil | Nil | 23,593 |
| 12/14/18 | Nil | Nil | Nil |
| Nil | Nil | Nil |
| Nil | 58,357 | 0.91 |
|
| 12/14/18 | Nil | Nil | Nil |
| Nil | Nil | Nil |
|
| Nil | Nil |
|
John W. Cash | 8/20/18 | Nil | Nil | Nil |
| Nil | Nil | Nil |
| Nil | 59,476 | 0.93 | 38,632 |
| 8/20/18 | Nil | Nil | Nil |
| Nil | Nil | Nil |
| 45,276 | Nil | Nil | 22,485 |
| 12/14/18 | Nil | Nil | Nil |
| Nil | Nil | Nil |
| Nil | 55,620 | 0.91 |
|
| 12/14/18 | Nil | Nil | Nil |
| Nil | Nil | Nil |
|
| Nil | Nil |
|
28 | ||
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|
38
Outstanding Equity Awards at December 31, 20182021
The following table sets forth information concerning the value vested or earned in respect of incentive plan awards during the year ended December 31, 20182021 by each of the Named Executive Officers.
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| |||||||||||||||||||||||||||||
| Option-based Awards |
| Share-based Awards |
| Option-based Awards |
| Share-based Awards | ||||||||||||||||||||||||||||||||
Name | Number of | Number of securities underlying unexercised options | Equity incentive plan awards: number of securities underlying unexercised options | Option exercise price | Option expiration date |
| Number of shares or units of stock that have not vested | Market value of shares or units of stock that have not vested | Equity incentive plan awards: number of unearned shares, units or other rights that have not vested | Equity incentive plan awards: Market or payout value of unearned shares, units or other rights that have not vested |
| Number of securities underlying unexercised options (#) exercisable |
|
| Number of securities underlying unexercised options (#) unexercisable |
|
| Equity incentive plan awards: number of securities underlying unexercised options (#) |
| Option exercise price (C$) |
|
| Option expiration date |
| Number of shares or units of stock that have not vested (#) |
|
| Market value of shares or units of stock that have not vested (US$) |
|
| Equity incentive plan awards: number of unearned shares, units or other rights that have not vested (#) |
| Equity incentive plan awards: Market or payout value of unearned shares, units or other rights that have not vested ($) | ||||||
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|
|
|
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|
|
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|
|
|
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|
|
|
|
|
|
|
|
|
|
| |||||||||||
Jeffrey T. Klenda | 80,354 | Nil | Nil | 1.02 | 12/12/19 |
| Nil | Nil | Nil | Nil |
| 239,422 |
| Nil |
| Nil |
| 0.90 |
| 12/15/22 |
|
|
|
|
|
|
|
| |||||||||||
| 70,762 | Nil | Nil | 0.86 | 8/17/20 |
| Nil | Nil | Nil | Nil | |||||||||||||||||||||||||||||
| 199,340 | Nil | Nil | 0.80 | 12/11/20 |
| Nil | Nil | Nil | Nil | |||||||||||||||||||||||||||||
| 338,118 | Nil | Nil | 0.73 | 12/16/21 |
| Nil | Nil | Nil | Nil |
| 111,036 |
| Nil |
| Nil |
| 0.93 |
| 08/20/23 |
|
|
|
|
|
|
|
| |||||||||||
| 79,009 | 160,413 | Nil | 0.80 | 12/15/22 |
| Nil | Nil | Nil | Nil |
| 103,831 |
| Nil |
| Nil |
| 0.91 |
| 12/14/23 |
|
|
|
|
|
|
|
| |||||||||||
| Nil | 111,036 | Nil | 0.93 | 8/20/23 |
| Nil | Nil | Nil | Nil |
| 278,029 |
| 139,015 |
| Nil |
| 0.79 |
| 11/05/24 |
|
|
|
|
|
|
|
| |||||||||||
| Nil | 103,831 | Nil | 0.91 | 12/14/23 |
| Nil | Nil | Nil | Nil |
| 153,621 |
| 307,244 |
| Nil |
| 0.63 |
| 11/13/25 |
|
|
|
|
|
|
|
| |||||||||||
| Nil | Nil | Nil | Nil | Nil |
| 59,856 | 41,132 | Nil | Nil |
| Nil |
| 189,285 |
| Nil |
| 1.44 |
| 08/27/26 |
|
|
|
|
|
|
|
| |||||||||||
| Nil | Nil | Nil | Nil | Nil |
| 27,759 | 19,075 | Nil | Nil |
|
|
|
|
|
|
|
|
| 11/13/22 |
| 115,217 |
| 139,954 |
| Nil |
| Nil | |||||||||||
| Nil | Nil | Nil | Nil | Nil |
| 25,958 | 17,838 | Nil | Nil |
|
|
|
|
|
|
|
|
| 08/27/23 |
| 47,320 |
| 57,480 |
| Nil |
| Nil | |||||||||||
Roger L. Smith | 70,746 | Nil | Nil | 1.02 | 12/12/19 |
| Nil | Nil | Nil | Nil |
| 170,788 |
| Nil |
| Nil |
| 0.90 |
| 12/15/22 |
|
|
|
|
|
|
|
| |||||||||||
| 62,302 | Nil | Nil | 0.86 | 8/17/20 |
| Nil | Nil | Nil | Nil |
| 79,206 |
| Nil |
| Nil |
| 0.93 |
| 08/20/23 |
|
|
|
|
|
|
|
| |||||||||||
| 87,462 | Nil | Nil | 0.80 | 12/11/20 |
| Nil | Nil | Nil | Nil |
| 74,067 |
| Nil |
| Nil |
| 0.91 |
| 12/14/23 |
|
|
|
|
|
|
|
| |||||||||||
| 241,184 | Nil | Nil | 0.73 | 12/16/21 |
| Nil | Nil | Nil | Nil |
| 152,079 |
| 76,040 |
| Nil |
| 0.79 |
| 11/05/24 |
|
|
|
|
|
|
|
| |||||||||||
| 56,360 | 114,428 | Nil | 0.80 | 12/15/22 |
| Nil | Nil | Nil | Nil |
| 84,029 |
| 168,058 |
| Nil |
| 0.63 |
| 11/13/25 |
|
|
|
|
|
|
|
| |||||||||||
| Nil | 79,206 | Nil | 0.93 | 8/20/23 |
| Nil | Nil | Nil | Nil |
| Nil |
| 103,536 |
| Nil |
| 1.44 |
| 08/27/26 |
|
|
|
|
|
|
|
| |||||||||||
| Nil | 74,067 | Nil | 0.91 | 12/14/23 |
| Nil | Nil | Nil | Nil |
|
|
|
|
|
|
|
|
| 11/13/22 |
| 63,022 |
| 76,553 |
| Nil |
| Nil | |||||||||||
| Nil | Nil | Nil | Nil | Nil |
| 42,696 | 29,340 | Nil | Nil |
|
|
|
|
|
|
|
|
| 08/27/23 |
| 25,884 |
| 31,441 |
| Nil |
| Nil | |||||||||||
| Nil | Nil | Nil | Nil | Nil |
| 19,802 | 13,608 | Nil | Nil | |||||||||||||||||||||||||||||
| Nil | Nil | Nil | Nil | Nil |
| 18,517 | 12,725 | Nil | Nil | |||||||||||||||||||||||||||||
Penne A. Goplerud | 63,606 | Nil | Nil | 1.02 | 12/12/19 |
| Nil | Nil | Nil | Nil |
| 153,546 |
| Nil |
| Nil |
| 0.90 |
| 12/15/22 |
|
|
|
|
|
|
|
| |||||||||||
| 56,012 | Nil | Nil | 0.86 | 8/17/20 |
| Nil | Nil | Nil | Nil |
| 71,211 |
| Nil |
| Nil |
| 0.93 |
| 08/20/23 |
|
|
|
|
|
|
|
| |||||||||||
| 78,632 | Nil | Nil | 0.80 | 12/11/20 |
| Nil | Nil | Nil | Nil |
| 66,588 |
| Nil |
| Nil |
| 0.91 |
| 12/14/23 |
|
|
|
|
|
|
|
| |||||||||||
| 216,836 | Nil | Nil | 0.73 | 12/16/21 |
| Nil | Nil | Nil | Nil |
| 136,721 |
| 68,360 |
| Nil |
| 0.79 |
| 11/05/24 |
|
|
|
|
|
|
|
| |||||||||||
| 50,670 | 102,876 | Nil | 0.80 | 12/15/22 |
| Nil | Nil | Nil | Nil |
| 75,543 |
| 151,087 |
| Nil |
| 0.63 |
| 11/13/25 |
|
|
|
|
|
|
|
| |||||||||||
| Nil | 71,211 | Nil | 0.93 | 8/20/23 |
| Nil | Nil | Nil | Nil |
| Nil |
| 93,081 |
| Nil |
| 1.44 |
| 08/27/26 |
|
|
|
|
|
|
|
| |||||||||||
| Nil | 66,588 | Nil | 0.91 | 12/14/23 |
| Nil | Nil | Nil | Nil |
|
|
|
|
|
|
|
|
| 11/13/22 |
| 56,658 |
| 68,883 |
| Nil |
| Nil | |||||||||||
| Nil | Nil | Nil | Nil | Nil |
| 38,386 | 26,378 | Nil | Nil |
|
|
|
|
|
|
|
|
| 08/27/23 |
| 23,269 |
| 28,265 |
| Nil |
| Nil | |||||||||||
| Nil | Nil | Nil | Nil | Nil |
| 17,803 | 12,234 | Nil | Nil | |||||||||||||||||||||||||||||
| Nil | Nil | Nil | Nil | Nil |
| 16,647 | 11,439 | Nil | Nil | |||||||||||||||||||||||||||||
Steven M. Hatten | 50,704 | Nil | Nil | 1.02 | 12/12/19 |
| Nil | Nil | Nil | Nil | |||||||||||||||||||||||||||||
| 49,090 | Nil | Nil | 0.86 | 8/17/20 |
| Nil | Nil | Nil | Nil | |||||||||||||||||||||||||||||
| 68,916 | Nil | Nil | 0.80 | 12/11/20 |
| Nil | Nil | Nil | Nil | |||||||||||||||||||||||||||||
| 190,040 | Nil | Nil | 0.73 | 12/16/21 |
| Nil | Nil | Nil | Nil | |||||||||||||||||||||||||||||
| 44,407 | 90,159 | Nil | 0.80 | 12/15/22 |
| Nil | Nil | Nil | Nil | |||||||||||||||||||||||||||||
| Nil | 62,409 | Nil | 0.93 | 8/20/23 |
| Nil | Nil | Nil | Nil | |||||||||||||||||||||||||||||
| Nil | 58,357 | Nil | 0.91 | 12/14/23 |
| Nil | Nil | Nil | Nil | |||||||||||||||||||||||||||||
| Nil | Nil | Nil | Nil | Nil |
| 33,642 | 23,118 | Nil | Nil | |||||||||||||||||||||||||||||
| Nil | Nil | Nil | Nil | Nil |
| 15,603 | 10,722 | Nil | Nil | |||||||||||||||||||||||||||||
| Nil | Nil | Nil | Nil | Nil |
| 15,490 | 10,644 | Nil | Nil | |||||||||||||||||||||||||||||
John W. Cash | 48,084 | Nil | Nil | 1.02 | 12/12/19 |
| Nil | Nil | Nil | Nil | |||||||||||||||||||||||||||||
| 46,782 | Nil | Nil | 0.86 | 8/17/20 |
| Nil | Nil | Nil | Nil | |||||||||||||||||||||||||||||
| 65,676 | Nil | Nil | 0.80 | 12/11/20 |
| Nil | Nil | Nil | Nil | |||||||||||||||||||||||||||||
| 181,106 | Nil | Nil | 0.73 | 12/16/21 |
| Nil | Nil | Nil | Nil | |||||||||||||||||||||||||||||
| 42,321 | 85,925 | Nil | 0.80 | 12/15/22 |
| Nil | Nil | Nil | Nil | |||||||||||||||||||||||||||||
| Nil | 59,476 | Nil | 0.93 | 8/20/23 |
| Nil | Nil | Nil | Nil | |||||||||||||||||||||||||||||
| Nil | 55,620 | Nil | 0.91 | 12/14/23 |
| Nil | Nil | Nil | Nil | |||||||||||||||||||||||||||||
| Nil | Nil | Nil | Nil | Nil |
| 32,062 | 22,032 | Nil | Nil | |||||||||||||||||||||||||||||
| Nil | Nil | Nil | Nil | Nil |
| 14,869 | 10,218 | Nil | Nil |
39
OPTION EXERCISES AND STOCK VESTED
The following table sets forth the value realized on options exercise and stock awards vested for the Named Executive Officers for the year ended December 31, 2018.
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|
|
|
|
| Option awards |
| Stock awards | ||
Name | Number of shares acquired on exercise ($) | Value realized on exercise ($) |
| Number of shares acquired on vesting (#) | Value realized on vesting ($) |
Jeffrey T. Klenda | Nil | Nil |
| 84,530 | 58,038 |
Roger L. Smith | Nil | Nil |
| 60,296 | 41,399 |
Penne A. Goplerud | Nil | Nil |
| 54,210 | 37,220 |
Steven M. Hatten | Nil | Nil |
| 47,510 | 32,620 |
John W. Cash | Nil | Nil |
| 45,276 | 31,086 |
The following table sets forth information concerning the value vested or earned in respect of incentive plan awards during the financial year ended December 31, 2018 by each of our Named Executive Officers.
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|
Incentive Plan Awards - Value Vested or Earned During the | |||||||
| Option based awards |
| Share based awards |
| Non-equity incentive plan compensation | ||
Name | Number of securities underlying options vested (#) | Value vested during the year ($) |
| Number of shares or units of shares vested (#) | Value vested during the year ($) |
| Value earned during the year ($) |
Jeffrey T. Klenda | 234,543 | 18,868 |
| 84,530 | 58,038 |
| 149,399 |
Roger L. Smith | 167,305 | 13,459 |
| 60,296 | 41,399 |
| 90,722 |
Penne A. Goplerud | 150,415 | 12,101 |
| 54,210 | 37,220 |
| 83,529 |
Steven M. Hatten | 131,825 | 10,605 |
| 47,510 | 32,620 |
| 70,836 |
John W. Cash | 125,630 | 10,106 |
| 45,276 | 31,086 |
| 70,381 |
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE OF CONTROL
Employment Agreements with our Named Executive Officers
As set forthdiscussed above, our Named Executive Officers have employment agreements with the Company, as have been amended from time to time. Relevant to potential payments to be made upon termination without cause or change of control, the agreements provide that thean executive officer is entitled to certain amounts, based upon the executive’s then-current salary of the executive. Thesebase salary. As discussed below, our employment agreements, as well asand the Company’s equity compensation plans, of the Company (Option Plan and RSU Plan), specify the obligations of the Company to the executive officers in the event of termination or change of control. These are set forth below.
Equity Award Provisions
Upon separation of employment of any of our executive officers, including under circumstances of termination without cause or change of control, the Option Plan and RSU&EI Plan govern the treatment of outstanding equity compensation in the form of vested stock options and RSUs, PSUs or DSIs not yet redeemed. All vested options of Designated Officers (all of our current executive officers, as defined by the plan and resolution of our Board) will expire on the expiration date identified at the time of the grant of the option, and all unvested options will expire upon termination.
29 |
Table of Contents |
The RSU&EI Plan provides that the RSUs of an employee who is an eligible person who is involuntarily terminated without cause, shall be redeemed for cash at a fair market value on the redemption/termination date. In the event of a
40
change of control, as defined in the RSU Plan,plan, all of the RSUs granted and outstanding will be redeemed as soon as reasonably practical and not later than 30 days following the redemption date associated with the change of control.
The RSU&EI Plan provides for redemption, instead of cancellation, of outstanding RSUs at the date of redemption for retiring directors and executive officers, which is defined as a threshold of combined service and age of 65 years, and a minimum of five years of service to the Company.Corporation. At this time, the Board has not made other grants under the plan. Treatment of awards of other share units and Common Shares is governed by the RSU&EI Plan.
Change of Control and Termination Benefits Tables
Each of our Named Executive Officersexecutive officers has entered into an employment agreement that provides for certain payments if the executive’s employment is terminated in connection with a change of control. In addition, upon the occurrence of a change of control, all of the executive officer’s unvested options and RSUs will vest. The table below shows the amounts that would be payable or vest assuming that a change of control occurred on December 31, 20182021 and that such executive officer’sNamed Executive Officer’s employment terminated on that date. The Compensation Committee has established a policy that the Company will not enter into an employment agreement with any new executive officer that includes a single-trigger severance arrangement.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Cash |
| Equity |
| Pension |
| Perquisites/ |
| Tax reimbursement |
| Other |
| Total |
Name |
| ($)(1) |
| ($)(2) |
| ($) |
| ($) |
| ($) |
| ($) |
| ($) |
Jeffrey T. Klenda |
| 657,592 |
| 128,459 |
| Nil |
| Nil |
| Nil |
| Nil |
| 786,051 |
Roger L. Smith |
| 562,900 |
| 88,281 |
| Nil |
| Nil |
| Nil |
| Nil |
| 651,181 |
Penne A. Goplerud |
| 379,548 |
| 79,369 |
| Nil |
| Nil |
| Nil |
| Nil |
| 458,917 |
Steven M. Hatten |
| 332,631 |
| 69,561 |
| Nil |
| Nil |
| Nil |
| Nil |
| 402,192 |
John W. Cash |
| 317,031 |
| 66,291 |
| Nil |
| Nil |
| Nil |
| Nil |
| 383,322 |
|
| Cash |
|
| Equity |
|
| Pension /NQDC |
| Perquisites/ benefits |
| Tax reimbursement |
| Other |
| Total |
| |||
Name |
| ($)(1) |
|
| ($)(2) |
|
| ($) |
| ($) |
| ($) |
| ($) |
| ($) |
| |||
Jeffrey T. Klenda |
|
| 1,391,208 |
|
|
| 1,015,760 |
|
| Nil |
| Nil |
| Nil |
| Nil |
|
| 2,406,968 |
|
Roger L. Smith |
|
| 761,020 |
|
|
| 593,185 |
|
| Nil |
| Nil |
| Nil |
| Nil |
|
| 1,354,205 |
|
Penne A. Goplerud |
|
| 547,300 |
|
|
| 533,285 |
|
| Nil |
| Nil |
| Nil |
| Nil |
|
| 1,080,585 |
|
____________
(1) | Pursuant to their respective employment agreements, |
| |
(2) | These amounts represent equity values based upon the closing price of our Common Shares on the TSX on the last trading day of |
30 |
Table of Contents |
41
Additionally,severance is calculated solely based upon then-current salary (i.e., without cash bonus value included) and are reflected in the table below. The following summarizes the compensation or other benefits which would be owed and paid to our executive officers if employment is terminated for the specified reasons.reasons, effective December 31, 2021. We believe that these terms are fair and are competitive with the market and our peer group, based upon industry and geographical practices.
Type of Termination | Severance Payment(1)(2) | STIP Bonus | Stock Options | RSUs(3) |
|
|
|
|
|
Resignation or Retirement | CEO will receive
Other executive officers, no severance payment | Pro rata entitlement to discretionary bonus, per agreement | Unvested options are cancelled; vested options expire at date on option for current executive officers (as a “Designated Officer” per Section 6.7 of Plan) | RSUs are cancelled unless retirement provision is satisfied; RSUs will be carried with the executive until redemption, if the executive has combined service and age of 65 years, and a minimum of five years of service to the Company |
|
|
|
|
|
Termination without cause |
CFO: 2.5-year salary payment, based upon then-current salary. Other executive officers: two-year salary payment, based upon
| Pro rata entitlement to discretionary bonus, per agreement | Unvested options are cancelled; vested options expire at date on option for current executive officers (as a “Designated Officer” per Section 6.7 of Plan) | Outstanding RSUs are redeemed for cash at fair market value, as defined in the Plan |
|
|
|
|
|
Termination for cause | None | Possible pro rata share entitlement | None | None |
|
|
|
|
|
Change of control (and/or termination within 24 months of a change of control) |
Other executive | Pro rata entitlement to discretionary bonus, per agreement | All options become fully vested and exercisable | Outstanding RSUs are redeemed for cash at fair market value, as defined in the Plan |
|
|
|
|
|
Death |
• • Other executive officers, no severance payment | Pro rata entitlement to discretionary bonus, per agreement | Unvested options are cancelled; vested options expire at the earlier of expiry at date on option or one year from the date of death (with discretion of Board as per Section 6.3(b) of Plan to extend) | RSUs are redeemed (Section 3.2 of Plan); date of death is redemption date |
|
|
|
|
|
____________
(1) | At December 31, |
| |
(2) | Accrued paid time off is paid to the executive officer at the time of termination, according to Company policy and applicable law. |
(3) | The RSU&EI Plan sets forth the settlement of PSUs and DSIs for participants in the plan, including executive officers. Any future awards of PSUs and DSIs will be governed by the plan and individual grant agreements. See discussion above under “Stock Options and the Amended and Restated Restricted Share Unit and Equity Incentive Plan.” |
42
During 2018, and for several years prior,We conduct routine reviews of the total compensation of our non-executive directors wereon an internal basis, utilizing data about our peers which we obtain through public sources. Additionally, on a time-to-time basis, we have engaged independent third-party compensation advisors to review the total compensation of our directors. Results of these reviews in recent years indicated that while our non-executive director cash retainer and equity-based compensation remained generally within a range of the median of the comparator group, compensation has been consistently at the lower end of the range. This has been particularly true of the cash retainer for our directors.
The Board approved the last change to the director annual retainer at year-end 2018, after which time our non-executive directors have been paid a cash retainer of $24,000 annually (see discussion below), with$41,000 annually. With that adjustment, the only change being the currency in which the retainer and otherpayment of fees are paid (December 2017, a changefor attendance at Board meetings was made to pay in U.S. dollars). Meetingeliminated, while payment for attendance at committee meetings continued unchanged. Committee meeting fees were paid as follows during 2018: the fee for board meeting attendance was set at $1,000; committee meeting attendance was compensated at2021: $500 per Audit Committee meeting and $250 per meeting for other committees. In addition, working time spentincurred for work related to a director’s assignment to a particular committee, participation, not including preparation for and attendance at regular meetings, has beenis compensated at the rate of $250/half day and $500/full day, to be monitored by the Compensation Committee and reported to the BoardBoard.
Most recently, in addition to the Committee’s internal review and consideration in 2021, the review of Directors. Directors serving as a chair of the standing committees of our Board do not receive additionaltotal compensation for our non-executive directors involved retaining an independent third-party compensation advisor, Roger Gurr & Associates (“RG&A”). The review concluded that service.
In recent years, we have conducted an annual and periodic review thetotal compensation offor the non-executive directors internally, utilizing Equilarremained below median. Because the annual retainer continued to lag behind the peer compactors, it was concluded that, in the best interests of retaining current directors and other available comparable data for consideration bylooking ahead to recruitment of non-executive members of our board, an appropriate adjustment should be made. The annual retainer was increased to $75,000, effective November 1, 2021. RG&A noted the competitive market in the U.S. and Canada particularly warranted the adjustment. In subsequent action, following year-end, the Board, upon the recommendation of the Compensation Committee. Results consistently have indicated thatCommitted, eliminated all meeting attendance fees.
The Compensation Committee intends to continue its review with RG&A in 2022 to examine the Company’s non-executive director base cashcompensation program further and equity-based compensation remained generally within a rangeto undertake an independent review of the median of the comparator group, although consistently at the lower end of the range, particularly because the Company does not provide an additional retainer amount for committee chair positions, or other additionalexecutive compensation.
Total compensation for those and other leadership roles. Committee meeting fees also have been consistently belowour non-executive directors for the market median of the comparator group.year ended December 31, 2021, is set forth here:
|
| Fees earned(1) |
|
| Share-based awards(2) |
|
| Option-based awards(3) |
|
| Non-equity incentive plan compensation |
| Pension value |
| All other compensation |
| Total |
| ||||
Name |
| $ |
|
| $ |
|
| $ |
|
| $ |
| $ |
| $ |
| $ |
| ||||
W. William Boberg |
|
| 47,917 |
|
|
| 25,231 |
|
|
| 52,018 |
|
| Nil |
| Nil |
| Nil |
|
| 125,166 |
|
Rob Chang |
|
| 50,667 |
|
|
| 25,231 |
|
|
| 52,018 |
|
| Nil |
| Nil |
| Nil |
|
| 127,916 |
|
James M. Franklin |
|
| 48,417 |
|
|
| 25,231 |
|
|
| 52,018 |
|
| Nil |
| Nil |
| Nil |
|
| 125,666 |
|
Gary C. Huber |
|
| 51,667 |
|
|
| 25,231 |
|
|
| 52,018 |
|
| Nil |
| Nil |
| Nil |
|
| 128,916 |
|
Thomas H. Parker |
|
| 50,417 |
|
|
| 25,231 |
|
|
| 52,018 |
|
| Nil |
| Nil |
| Nil |
|
| 127,666 |
|
Kathy E. Walker |
|
| 49,917 |
|
|
| 25,231 |
|
|
| 52,018 |
|
| Nil |
| Nil |
| Nil |
|
| 127,666 |
|
In December 2018, we again undertook a review of the compensation of the non-executive directors utilizing Equilar data to compare director compensation with that of the Company’s peer group (see 2018 peer group set forth above under the heading “2018 Review of Compensation Program”). Again, and even more significantly than in past years, overall per-board member compensation fell below the range of median director compensation. Subsequent to year end, the Compensation Committee recommended, and the Board of Directors approved a change in annual retainer to $41,000, while at the same time eliminating Board meeting fees. These changes will only be made effective in 2019. While also remaining below median comparators, the committee fees remain unchanged. As well, no action was taken to provide for additional compensation for committee chairs or for the independent Lead Director. ____________
(1) | As discussed, the annual retainer of the non-executive directors was approved to be changed to $75,000 effective November 1, 2021. |
(2) | Each of our non-executive directors received a grant of 21,964 RSUs on August 27, 2021. |
(3) | Each of our non-executive directors received options for 87,858 Common Shares on August 27, 2021, at an exercise price of C$1.44. These options expire on August 27, 2026. |
In addition to other compensation received by our directors, a 2008 resolutionlong-standing policy of the Company provides that a non-executive directors participatingdirector serving on ad hoc or special committees of the Board, of Directors, which may be constituted from time to time, areis entitled to additional director fees, to be determined in accordance with additional duties and requirements requested of those individuals from time to time. There currently are no such ad hoc or special committees of the Board of Directors.
|
|
|
|
|
|
|
|
Name | Fees earned(1) | Share-based awards | Option-based awards | Non-equity incentive plan compensation | Pension value | All other compensation | Total |
|
|
|
|
|
|
|
|
W. William Boberg (2) | 33,000 | 18,867 | 32,175 | Nil | Nil | Nil | 84,042 |
Rob Chang (3) | 29,750 | 18,867 | 82,573 | Nil | Nil | Nil | 131,190 |
James M. Franklin (4) | 35,500 | 18,867 | 32,175 | Nil | Nil | Nil | 86,542 |
Gary C. Huber (5) | 36,000 | 18,867 | 32,175 | Nil | Nil | Nil | 87,042 |
Thomas H. Parker (6) | 36,500 | 18,867 | 32,175 | Nil | Nil | Nil | 87,542 |
Kathy E. Walker (7) | 32,500 | 18,867 | 32,175 | Nil | Nil | Nil | 83,542 |
32 | ||
|
|
|
|
|
|
43
|
|
|
|
|
|
|
|
|
Share Ownership Guidelines for Non-Executive Directors
Our non-executive directors also are encouraged to have a significant long-term financial interest in the Company. In 2009, the Compensation Committee recommended, and Board of Directors adopted, a resolution requiring mandatory minimum share ownership by the non-executive directors to encourage the alignment of their interests with those of our shareholders. Thereafter,Pursuant to the mandate, and subsequent amendments in 2012 through the Share Ownership Guidelines, our non-executive directors wereare required to invest an amount equal to three times the non-executive director’s annual retainer in shares or securities redeemable into shares on or before the later of (i) December 31 2013, (ii)of the fifth anniversaryyear of the non-executive director’s electiondirector becoming subject to the requirement, or appointment, or (iii) the fifth anniversary(ii) December 31 of the most recent annual retainer increase.third year from the effective date of the change in retainer. The retainer amount wasis to be calculated using the amount of the annual retainer at the later of (i) January 1, 2009, (ii) the date of the non-executive director’s electiondirector becomes subject to the requirement, or appointment, or (iii)(ii) the date of the most recent annual retainer increase.
As discussed above under the heading “Share Ownership Guidelines,” in February 2012 the Compensation Committee recommended, and the Board of Directors approved, Share Ownership Guidelines which provide greater detail concerning these ownership requirements. Additionally, the Board approved a recommendation that the share ownership requirement be adjusted with respect to the non-executive directors, to require each to acquire and own three times their annual retainer. All At December 31, 2021, all non-executive directors meet the Share Ownership Guidelines or are on-track to meet the Share Ownership Guidelines within the prescribed timeframes.
44
|
|
|
|
|
|
|
| Option-based Awards | Share-based Awards | ||||
| Number of securities underlying unexercised options | Option exercise price | Option expiration | Value of unexercised in-the-money options | Number of shares or units of shares that have not vested | Market or payout value of share-based awards that have not vested |
Name | (#) | (C$) | date | ($) | (#) | ($) |
W. William Boberg | 42,000 | 0.80 | 12-Dec-2019 | 2,771 | Nil | Nil |
| 29,690 | 0.73 | 17-Aug-2020 | 3,482 | Nil | Nil |
| 56,470 | 0.90 | 11-Dec-2020 | Nil | Nil | Nil |
| 128,000 | 0.73 | 16-Dec-2021 | 15,012 | Nil | Nil |
| 120,000 | 0.90 | 15-Dec-2022 | Nil | Nil | Nil |
| 55,653 | 0.93 | 20-Aug-2023 | Nil | Nil | Nil |
| 50,527 | 0.91 | 14-Dec-2023 | Nil | Nil | Nil |
| Nil | Nil | Nil | Nil | 30,000 | 19,572 |
| Nil | Nil | Nil | Nil | 13,914 | 9,077 |
| Nil | Nil | Nil | Nil | 12,632 | 8,241 |
Rob Chang | 200,000 | 0.77 | 30-Mar-2023 | 2,290 | Nil | Nil |
| 55,653 | 0.93 | 20-Aug-2023 | Nil | Nil | Nil |
| 50,527 | 0.91 | 14-Dec-2023 | Nil | Nil | Nil |
| Nil | Nil | Nil | Nil | 13,914 | 9,077 |
| Nil | Nil | Nil | Nil | 12,632 | 8,241 |
James M. Franklin | 42,000 | 0.80 | 12-Dec-2019 | 2,771 | Nil | Nil |
| 29,690 | 0.73 | 17-Aug-2020 | 3,482 | Nil | Nil |
| 56,470 | 0.90 | 11-Dec-2020 | Nil | Nil | Nil |
| 128,000 | 0.73 | 16-Dec-2021 | 15,012 | Nil | Nil |
| 120,000 | 0.90 | 15-Dec-2022 | Nil | Nil | Nil |
| 55,653 | 0.93 | 20-Aug-2023 | Nil | Nil | Nil |
| 50,527 | 0.91 | 14-Dec-2023 | Nil | Nil | Nil |
| Nil | Nil | Nil | Nil | 30,000 | 19,572 |
| Nil | Nil | Nil | Nil | 13,914 | 9,077 |
| Nil | Nil | Nil | Nil | 12,632 | 8,241 |
Gary C. Huber | 200,000 | 1.14 | 29-May-2020 | Nil | Nil | Nil |
| 29,690 | 0.86 | 17-Aug-2020 | 653 | Nil | Nil |
| 56,470 | 0.80 | 11-Dec-2020 | 3,725 | Nil | Nil |
| 128,000 | 0.73 | 16-Dec-2021 | 15,012 | Nil | Nil |
| 120,000 | 0.90 | 15-Dec-2022 | Nil | Nil | Nil |
| 55,653 | 0.99 | 20-Aug-2023 | Nil | Nil | Nil |
| 50,527 | 0.91 | 14-Dec-2023 | Nil | Nil | Nil |
| Nil | Nil | Nil | Nil | 30,000 | 19,572 |
| Nil | Nil | Nil | Nil | 13,914 | 9,077 |
| Nil | Nil | Nil | Nil | 12,632 | 8,241 |
Thomas H. Parker | 42,000 | 0.80 | 12-Dec-2019 | 2,771 | Nil | Nil |
| 29,690 | 0.73 | 17-Aug-2020 | 3,482 | Nil | Nil |
| 56,470 | 0.90 | 11-Dec-2020 | Nil | Nil | Nil |
| 128,000 | 0.73 | 16-Dec-2021 | 15,012 | Nil | Nil |
| 120,000 | 0.90 | 15-Dec-2022 | Nil | Nil | Nil |
| 55,653 | 0.93 | 20-Aug-2023 | Nil | Nil | Nil |
| 50,527 | 0.91 | 14-Dec-2023 | Nil | Nil | Nil |
| Nil | Nil | Nil | Nil | 30,000 | 19,572 |
| Nil | Nil | Nil | Nil | 13,914 | 9,077 |
| Nil | Nil | Nil | Nil | 12,632 | 8,241 |
Kathy E. Walker | 200,000 | 0.73 | 07-Sep-2022 | 23,457 | Nil | Nil |
| 120,000 | 0.90 | 15-Dec-2022 | Nil | Nil | Nil |
| 55,653 | 0.93 | 20-Aug-2023 | Nil | Nil | Nil |
| 50,527 | 0.91 | 14-Dec-2023 | Nil | Nil | Nil |
| Nil | Nil | Nil | Nil | 30,000 | 19,572 |
| Nil | Nil | Nil | Nil | 13,914 | 9,077 |
| Nil | Nil | Nil | Nil | 12,632 | 8,241 |
45
Paul Macdonell | 42,000 | 1.02 | 12-Dec-2019 | Nil | Nil | Nil |
| 29,690 | 0.86 | 17-Aug-2020 | 653 | Nil | Nil |
| 56,470 | 0.80 | 11-Dec-2020 | 3,725 | Nil | Nil |
| 120,000 | 0.90 | 15-Dec-2022 | Nil | Nil | Nil |
| Nil | Nil | Nil | Nil | 30,000 | 21,991 |
TheEquity Grants to Non-Executive Directors
Our non-executive directors are eligible to receive grants of options and RSUsgrants under the RSU&EI Plan at the discretion of the Board, and did soreceived such grants in 20182021 as indicated in the following table:
|
|
|
|
|
|
|
| |||||||||||||||||
Incentive Plan Awards - Value Vested or Earned During the | Incentive Plan Awards - Value Vested or Earned During the | Incentive Plan Awards - Value Vested or Earned During the | ||||||||||||||||||||||
Financial Year Ended December 31, 2018 | ||||||||||||||||||||||||
Financial Year Ended December 31, 2021 | Financial Year Ended December 31, 2021 | |||||||||||||||||||||||
| Option-based Awards |
| Share-based Awards |
| Non-equity incentive plan compensation |
| Option-based Awards |
| Share-based Awards |
| Non-equity incentive plan compensation | |||||||||||||
Name | Number of Securities Underlying Options Vested | Value vested during the year |
| Number of Shares or Units of Shares Vested | Value vested during the year |
| Value earned during the year |
| Number of Securities Underlying Options Vested (#) |
|
| Value vested during the year ($) |
| Number of Shares or Units of Shares Vested (#) |
|
| Value vested during the year ($) |
|
| Value earned during the year ($) | ||||
|
|
|
|
|
|
|
| |||||||||||||||||
W. William Boberg | 98,480 | 7,293 |
| 32,000 | 21,971 |
| Nil |
| 171,929 |
| Nil |
| 48,394 |
| 91,111 |
| Nil | |||||||
Rob Chang | Nil | Nil |
| Nil | Nil |
| Nil |
| 238,596 |
| Nil |
| 48,394 |
| 91,111 |
| Nil | |||||||
James M. Franklin | 98,480 | 7,293 |
| 32,000 | 21,971 |
| Nil |
| 171,929 |
| Nil |
| 48,394 |
| 91,111 |
| Nil | |||||||
Gary C. Huber | 98,480 | 7,293 |
| 32,000 | 21,971 |
| Nil |
| 171,929 |
| Nil |
| 48,394 |
| 91,111 |
| Nil | |||||||
Thomas H. Parker | 98,480 | 7,293 |
| 32,000 | 21,971 |
| Nil |
| 171,929 |
| Nil |
| 48,394 |
| 91,111 |
| Nil | |||||||
Kathy E. Walker | 106,600 | 16,919 |
| Nil | Nil |
| Nil |
| 171,929 |
| Nil |
| 48,394 |
| 91,111 |
| Nil | |||||||
Paul Macdonell | 178,880 | 3,123 |
| 62,000 | 37,200 |
| Nil |
33 |
|
Table of Contents |
The Reportfollowing table sets forth information concerning the value vested or earned in respect of the Compensation Committee does not constitute soliciting material and should not be deemed filed or incorporated by reference into any other Company filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent the Company specifically incorporates this Report.
Report of the Compensation Committee
To the Board of Directors of Ur-Energy Inc.:
The Compensation Committee hereby reports to the Board of Directors that, in connection with the Company’s Annual Report on Form 10-K forincentive plan awards during the year ended December 31, 2018, we have:2021, by each of our non-executive directors.
Outstanding Equity Awards at December 31, 2021
|
| Option-based Awards |
|
| Share-based Awards |
| ||||||||||||||||
|
| Number of securities underlying unexercised options |
|
| Option exercise price |
|
| Option expiration |
| Value of unexercised in-the-money options |
|
| Number of shares or units of shares that have not vested |
|
| Market or payout value of share-based awards that have not vested |
| |||||
Name |
| (#) |
|
| (C$) |
|
| date |
| ($) |
|
| (#) |
|
| ($) |
| |||||
W. William Boberg |
|
| 120,000 |
|
|
| 0.90 |
|
| 12/15/22 |
|
| 60,577 |
|
|
|
|
|
|
| ||
|
|
| 55,653 |
|
|
| 0.93 |
|
| 08/20/23 |
|
| 26,777 |
|
|
|
|
|
|
| ||
|
|
| 50,527 |
|
|
| 0.91 |
|
| 12/14/23 |
|
| 25,108 |
|
|
|
|
|
|
| ||
|
|
| 193,574 |
|
|
| 0.79 |
|
| 11/05/24 |
|
| 114,514 |
|
|
|
|
|
|
| ||
|
|
| 213,914 |
|
|
| 0.63 |
|
| 11/13/25 |
|
| 153,543 |
|
|
|
|
|
|
| ||
|
|
| 87,858 |
|
|
| 1.44 |
|
| 08/27/26 |
|
| 6,930 |
|
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
| 11/13/22 |
|
|
|
|
|
| 53,479 |
|
|
| 64,961 |
|
|
|
|
|
|
|
|
|
|
| 08/27/23 |
|
|
|
|
|
| 21,964 |
|
|
| 26,680 |
|
Rob Chang |
|
| 200,000 |
|
|
| 0.77 |
|
| 03/30/23 |
|
| 121,470 |
|
|
|
|
|
|
|
|
|
|
|
| 55,653 |
|
|
| 0.93 |
|
| 08/20/23 |
|
| 26,777 |
|
|
|
|
|
|
|
|
|
|
|
| 50,527 |
|
|
| 0.91 |
|
| 12/14/23 |
|
| 25,108 |
|
|
|
|
|
|
|
|
|
|
|
| 193,574 |
|
|
| 0.79 |
|
| 11/05/24 |
|
| 114,514 |
|
|
|
|
|
|
|
|
|
|
|
| 213,914 |
|
|
| 0.63 |
|
| 11/13/25 |
|
| 153,543 |
|
|
|
|
|
|
|
|
|
|
|
| 87,858 |
|
|
| 1.44 |
|
| 08/27/26 |
|
| 6,930 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 11/13/22 |
|
|
|
|
|
| 53,479 |
|
|
| 64,961 |
|
|
|
|
|
|
|
|
|
|
| 08/27/23 |
|
|
|
|
|
| 21,964 |
|
|
| 26,680 |
|
James M. Franklin |
|
| 120,000 |
|
|
| 0.90 |
|
| 12/15/22 |
|
| 60,577 |
|
|
|
|
|
|
|
|
|
|
|
| 55,653 |
|
|
| 0.93 |
|
| 08/20/23 |
|
| 26,777 |
|
|
|
|
|
|
|
|
|
|
|
| 50,527 |
|
|
| 0.91 |
|
| 12/14/23 |
|
| 25,108 |
|
|
|
|
|
|
|
|
|
|
|
| 193,574 |
|
|
| 0.79 |
|
| 11/05/24 |
|
| 114,514 |
|
|
|
|
|
|
|
|
|
|
|
| 213,914 |
|
|
| 0.63 |
|
| 11/13/25 |
|
| 153,543 |
|
|
|
|
|
|
|
|
|
|
|
| 87,858 |
|
|
| 1.44 |
|
| 08/27/26 |
|
| 6,930 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 11/13/22 |
|
|
|
|
|
| 53,479 |
|
|
| 64,961 |
|
|
|
|
|
|
|
|
|
|
| 08/27/23 |
|
|
|
|
|
| 21,964 |
|
|
| 26,680 |
|
Gary C. Huber |
|
| 120,000 |
|
|
| 0.90 |
|
| 12/15/22 |
|
| 60,577 |
|
|
|
|
|
|
|
|
|
|
|
| 55,653 |
|
|
| 0.93 |
|
| 08/20/23 |
|
| 26,777 |
|
|
|
|
|
|
|
|
|
|
|
| 50,527 |
|
|
| 0.91 |
|
| 12/14/23 |
|
| 25,108 |
|
|
|
|
|
|
|
|
|
|
|
| 193,574 |
|
|
| 0.79 |
|
| 11/05/24 |
|
| 114,514 |
|
|
|
|
|
|
|
|
|
|
|
| 213,914 |
|
|
| 0.63 |
|
| 11/13/25 |
|
| 153,543 |
|
|
|
|
|
|
|
|
|
|
|
| 87,858 |
|
|
| 1.44 |
|
| 08/27/26 |
|
| 6,930 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 11/13/22 |
|
|
|
|
|
| 53,479 |
|
|
| 64,961 |
|
|
|
|
|
|
|
|
|
|
| 08/27/23 |
|
|
|
|
|
| 21,964 |
|
|
| 26,680 |
|
Thomas H. Parker |
|
| 120,000 |
|
|
| 0.90 |
|
| 12/15/22 |
|
| 60,577 |
|
|
|
|
|
|
|
|
|
|
|
| 55,653 |
|
|
| 0.93 |
|
| 08/20/23 |
|
| 26,777 |
|
|
|
|
|
|
|
|
|
|
|
| 50,527 |
|
|
| 0.91 |
|
| 12/14/23 |
|
| 25,108 |
|
|
|
|
|
|
|
|
|
|
|
| 193,574 |
|
|
| 0.79 |
|
| 11/05/24 |
|
| 114,514 |
|
|
|
|
|
|
|
|
|
|
|
| 213,914 |
|
|
| 0.63 |
|
| 11/13/25 |
|
| 153,543 |
|
|
|
|
|
|
|
|
|
|
|
| 87,858 |
|
|
| 1.44 |
|
| 08/27/26 |
|
| 6,930 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 11/13/22 |
|
|
|
|
|
| 53,479 |
|
|
| 64,961 |
|
|
|
|
|
|
|
|
|
|
| 08/27/23 |
|
|
|
|
|
| 21,964 |
|
|
| 26,680 |
|
Kathy E. Walker |
|
| 200,000 |
|
|
| 0.73 |
|
| 09/07/22 |
|
| 127,780 |
|
|
|
|
|
|
|
|
|
|
|
| 120,000 |
|
|
| 0.90 |
|
| 12/15/22 |
|
| 60,577 |
|
|
|
|
|
|
|
|
|
|
|
| 55,653 |
|
|
| 0.93 |
|
| 08/20/23 |
|
| 26,777 |
|
|
|
|
|
|
|
|
|
|
|
| 50,527 |
|
|
| 0.91 |
|
| 12/14/23 |
|
| 25,108 |
|
|
|
|
|
|
|
|
|
|
|
| 193,574 |
|
|
| 0.79 |
|
| 11/05/24 |
|
| 114,514 |
|
|
|
|
|
|
|
|
|
|
|
| 213,914 |
|
|
| 0.63 |
|
| 11/13/25 |
|
| 153,543 |
|
|
|
|
|
|
|
|
|
|
|
| 87,858 |
|
|
| 1.44 |
|
| 08/27/26 |
|
| 6,930 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 11/13/22 |
|
|
|
|
|
| 53,479 |
|
|
| 64,961 |
|
|
|
|
|
|
|
|
|
|
| 08/27/23 |
|
|
|
|
|
| 21,964 |
|
|
| 26,680 |
|
34 | ||
|
|
|
|
Respectfully submitted,
The Compensation Committee of Ur-Energy Inc.
Gary C. Huber, Chair
James M. Franklin
Rob Chang
PAY RATIO OF CHIEF EXECUTIVE OFFICER COMPENSATION TO
MEDIAN EMPLOYEE COMPENSATION
The pay ratio of our CEO, Mr. Klenda, to our median employee’s compensation for 2018 was 6:1. In 2018, for the first time, we disclosed the pay ratio of our CEO, Mr. Klenda, to our median employee’s compensation from 2017. Mr. Klenda’s annual total compensation compared with that of the estimated median compensated Ur-Energy employee was 7:1 in that initial disclosure. For that process, we identified our median compensated employee, using a consistently applied compensation measure (“CACM”); in our case this was defined as base salary (including overtime) and other cash incentives, including the short-term bonus, which provides a reasonable estimate of compensation received. We did not include the value of our health and welfare benefits, as those are benefits programs for which all our employees, including the CEO, are eligible. We undertook to annualize the data of new 2017 hires, including certain reasonable assumptions as to short-term incentive bonus calculations. We did not make adjustments for part-time status. We have no employees outside the U.S. and, therefore, there are no currency exchange rate issues contemplated in our calculations. Our calculations included all employees of Ur-Energy USA Inc. and Lost Creek ISR, LLC, our two subsidiaries with employees, which at the point of measurement, October 7, 2017, numbered 51 collectively (excluding Mr. Klenda). We do not typically employ temporary or seasonal employees and did not at that date.
Although we implemented a reduction in force in 2018 which affected nine employees, the calculation of the pay ratio, based upon the median employee’s total compensation is still representative of our earlier pay structure and median wage/salary. As set forth elsewhere in this Circular, our compensation plan remained largely unchanged in 2018. Using that position for the determination of the 2018 pay ratio, we determined that, in 2018, annual total compensation of the estimated median compensated employee was $89,999. Mr. Klenda’s annual total compensation for 2018 was $574,114. The pay ratio for 2018, therefore, was 6:1. This pay ratio is a reasonable estimate calculated in accordance with SEC rules based on our payroll and employment records and the methodology described here.
Our practices seek to ensure a compensation program which is fair, equitable, compliant and which aligns with our overall business objectives. The SEC rules for identifying the median compensated employee and calculating the pay ratio based on that employee’s annual total compensation allow companies to adopt a variety of methodologies,
47
exclusions, and assumptions that reflect their compensation practices. As such, the figures and ultimately the pay ratio reported above may not be comparable to the calculations and pay ratio reported by other companies, even those in a related industry or of a similar size and scope. Other companies may have different employment practices, regional demographics or may utilize different methodologies and assumptions in calculating their pay ratios.
To the Board of Directors of Ur-Energy Inc.:
Management is responsible for our internal controls and the financial reporting process. The independent accountants are responsible for performing an independent audit of our financial statements in accordance with U.S. generally accepted accounting principles (“US GAAP”) and the standards of the Public Company Accounting Oversight Board (“PCAOB”) and to issue an opinion on our financial statements. Our responsibility is to monitor and oversee those processes. We hereby report to the Board of Directors that, in connection with the financial statements for the year ended December 31, 2018,2021, we have:
· | reviewed and discussed the audited consolidated financial statements with management and the independent accountants; |
| ||
· | discussed with the independent accountants the matters required to be discussed by SAS 61 (Codification of Statements on Auditing Standards, AU section 380), as modified by SAS 89 and SAS 90; and |
| ||
· | received the written disclosures and the letter from the independent accountants required by PCAOB Rule 3526, as may be modified or supplemented, and discussed with the independent accountants the accountants’ independence. |
Based on the discussions and our review described above, we recommended to the Board of Directors that the audited financial statements for the year ended December 31, 20182021, be included in the Company’s Annual Report on Form 10‑K for the year ended December 31, 2018.2021.
Respectfully submitted,
The Audit Committee of Ur-Energy Inc.
Thomas Parker, Chair
Gary C. Huber
Kathy E. Walker
Rob Chang
48
35 |
Table of Contents |
STATEMENT OF CORPORATE GOVERNANCE PRACTICES
Introduction
TheOur Board of Directors believes that effective corporate governance contributes to improved corporate performance and enhanced shareholder value. The Board has reviewed the corporate governance best practices identified in National Policy 58‑201 Corporate Governance Guidelines and National Instrument 58-101 Disclosure of Corporate Governance Practices (collectively, the “CSA Guidelines”). The Board of Directors is committed to ensuring that the Company follows best practices and continues to develop and enhance such practices.
Board Mandate
The responsibility of the Board of Directors is to supervise the management of the business and affairs of the Company in accordance with the best interests of the Company and its shareholders. Our Board establishes overall policies and standards for the Company and is engaged in company-wide risk management oversight. When premised upon a reasonable basis, the directors are entitled to rely upon management and the advice of the Company’s outside advisors and auditors. The Board also delegates certain responsibilities to its standing committees, based upon the approved charters of each, which are reviewed on a regular basis.
The Board of Directors does not currently have a written mandate or a written description for the Chairman of the Board or the Chief Executive Officer. In discharging its responsibility, the Board routinely reviews the performance and responsibilities of the Chief Executive Office. Further, the Board oversees and reviews the development and implementation of the following significant corporate plans and initiatives:
· | the identification of the principal risks to the Company’s business and the implementation of systems to manage these risks, whether financial, operational, environmental, safety-related, cyber-security or otherwise; |
| ||
· | the Company’s strategic planning and budgeting process; |
| ||
· | succession planning and determination of relative strengths of existing management including the needs to ensure sufficient depth of management, including appointing, developing and monitoring senior management of the Company; |
| ||
· | shareholder communications, as well as public communications policies and continuous disclosure record of the Company; |
| ||
· | analysis and approval of significant acquisitions and dispositions of mineral properties or other Company assets; and |
| ||
· | monitoring the integrity of the Company’s internal controls and management information systems. |
When needed, the Board of Directors recruits possible directors from contacts within the mining industry orand other strategic areas that will complement the knowledge and depth of the Board. Currently, the Board of Directors has determined that seven directors is an appropriate number of directors to oversee and provide guidance to management on the business and affairs of the Company, which is accomplished with the existing members of the Board. However, the Board continues to evaluate its size in conjunction with theanticipated further development of our operations and possible growth or other strategic decisions of the Company.
Orientation and Continuing Education of our Board Members
New directors who join the Board of Directors are provided with the opportunity to meet with the other directors prior to joining the Board of Directors.Board. Upon joining the Board, a basic orientation of the Company, the Board of Directors, and the committees of the Board is provided to a new director, as was completed with Mr. Chang in 2018.director. All material relationships and agreements, technical reports, and recent continuous disclosure filings are provided and reviewed. In addition, new Directorsdirectors have the opportunity to attend Committee meetings by invitation and to meet with management of the Company to have a better understanding of the business of the Company and its operations. Site visits to our Lost Creek operating uranium ISR facility are strongly encouraged before or shortly after a new director has joined the Board. Most recently, although he is thoroughly familiar with the Company, Mr. Cash has been participating in a board-practices orientation process.
49
Directors are encouraged to participate in continuing education courses in corporate governance, executive and director compensation and other education coursesfields that will assist them in their role as directors of the Company or on various committees. To further its Board educationcommittees and enhance stakeholder confidence. Additionally, our management makes use of a variety of other online governance programs,and board-related resources for the Board is a memberbenefit of the Board. Most recently, we have rejoined National Association of Corporate Directors (“NACD”). NACD is a recognized authority focused on advancing exemplary board leadership and establishing leading boardroom practices. NACD provides directorlook forward to Board members and management enjoying the benefits of NACD’s education programs national peer exchange forums, and proprietary research to promote director professionalism, all to benefit its member companies and to enhanceonline resources. Costs of continuing education are borne by the stakeholder confidence. Additionally, our Corporate Secretary maintains her membership in the NYSE Governance Services Board Leadership Program, making use of its resources for the benefit of the Board.Company.
Throughout the year, directors were provided with regulatory and legal updates on several topics germane to the responsibilities of the Board and standing committees, includingcommittees. In 2021, these continued to include regulatory guidance and public health updates related to COVID-19. Additionally, as in years past, updates included cyber and data security (including additional threats during the pandemic); key accounting considerations,considerations; risk assessment,assessment; corporate governance and disclosure of corporate governance practices, executive and directorsdirector compensation, and Canadian and U.S. securities law and other legal developments. As
Reports were routinely received from management regarding current operations, plans and challenges within our business, as well updates were providedas broader industry issues (e.g., federal and state rulemakings and proposed legislation related to the Boardmining, taxation and other matters). In 2021, briefing continued with respect to issues affecting our operations and the further development of our business (e.g., Wyoming’s status as an “agreement state” under the Atomic Energy Act; EPA rulemakings and withdrawals of same; petitions related to endangered species designation; and the rulemaking to replace U.S. Industry Guide 7, finalized in 2018) and the development of the Section 232 trade action. Additionally, ourDOE national uranium reserve; climate change initiatives and ongoing development of environmental, social, sustainability and governance practices and guidance. Our Board members – who are all knowledgeable about the nuclear industry as well as uranium mining and– are provided with routinecomprehensive market and industry updates.updates at each regular Board meeting. In 2021, this included positive developments regarding growing support for nuclear energy and their effects on spot pricing and the uranium equities. Additionally, subscriptions to trade publications are made available to our directors; again, with costs borne by the Company. These updates and routine access to our management permit all directors to remain aware of important developments and issues in the context of our business.business and the uranium market.
Board Composition – Including Diversity, Tenure and Outlook on Set Retirement Age
The Board of Directors is composed of seven directors.eight directors at the date of this Circular. Upon the recommendation of the Corporate Governance and Nominating Committee, theour Board of Directors has nominated allthe following seven current directors: Jeffrey T. Klenda,directors for election at the Meeting: W. William Boberg, John W. Cash, Rob Chang, James M. Franklin, W. William Boberg,Gary C. Huber, Thomas H. Parker, Gary C. Huber,and Kathy E. Walker and Rob Chang.Walker. Earlier this year, Mr. Klenda announced his retirement, which will become effective following the Meeting. All directors are elected annually. The Corporate Governance and Nominating Committee regularly reviews the profile of the Board members, including the average age and tenure. The Committee has not established a retirement age for the members of the Board, nor a limitation of term of service. These restrictions are considered from time to time by the Committee, including most recently in December 2018.2021.
The Committee prefers that our directors, without regard to their age or tenure, are rigorously evaluated on their attendance and contributions to the business of the Board and Company. This scrutiny arises in annual reviews and assessments of the Board constitution as well as the composition of each standing committee of the Board. Our industry and, specifically, our operations are highly technical, and the Board considers it critical to retain the knowledge base on our Board while we continue to advance operations and plan for renewed full production at Lost Creek, and plan for the furtherconstruction and development and permitting of Shirley Basin. With theFollowing board refreshment of our board membershipin 2017-2018, with the addition of Ms. Walker and following Mr. Macdonell’s retirement, Mr. Chang, we have reconstituted our Board committees to best utilize the expertise of our directors (e.g., additional finance and energy sector experience to assist us with strategic planning). Additionally, each is involved with executive management in other industries, and brings enhanced leadership and perspective to many of the universal business, legislative, governance and community issues the Board must navigate.
The presence of Ms. Walker now reflects approximately 14% female representation among the seven directors nominated for election at the Meeting. We have a 14% representation of visible minorities among the seven directors nominated for election at the Meeting, as defined by the Employment Equity Act (Canada). Our Board’s diversity members, therefore, represent approximately 29% of the directors nominated for election at the Meeting. Our Board does not have members who are Indigenous peoples or are disabled. See further discussion at Gender Diversity Policy and Diversity Reporting, below.
37 |
Table of Contents |
All of our directors have C-suite experience or, in the case of Dr. Franklin’s service to the Canadian government, the equivalent thereof. FourFive of our seven directors, Drs. Franklin and Huber, and Messrs. ParkerBoberg, Cash and BobergParker have professional and technical expertise in geology, engineering and mining operations. For more than a decade, Dr. Franklin has been integral to our Board, as its lead technical expert, including chairing the HSE & Technical Committee since its inception in 2008.inception. Mr. Boberg, as a director since 2006 and for four and a half years as our President and CEO, of the Company, has contributed his technical expertise specifically with respect to roll-front uranium deposits like Lost Creek, beginning with the acquisition of Lost Creek in 2005 through to its steady state operations today.2005. Mr. Parker has decades of experience in executive management positions atwith operating mining companies and has lent that expertise to his role as a member of the HSE & Technical Committee,several committees, and more recently as our Lead Director. Dr. Huber contributes his dual expertise in financial matters and geology gained in management roles of both private and public natural resource companies at various stages of development. Meanwhile,While the Board has benefitted greatly from Mr. Klenda hasCash’s regular reports and participation at Board meetings for more than a decade, invested as aCEO and our newest Board member, ashe will bring nearly 30 years of technical, operational, regulatory, and management expertise to the Company explored, permitted, developed, constructed and now is operating the Lost Creek facility. Mr. Klenda has been responsible for the equity and debt financingBoard’s consideration of the Company from inception to date, as well as leading the Company’s management as our CEO (and, previously, as our Executive Director). all matters.
Collectively, the vast knowledge specific to the Lost Creek project,and Shirley Basin Projects, as well as the uranium
50
industry and market, has been gainedinstilled by all our Board members through the years of dedication and service to the BoardCompany and the Company.continues to offer great value. This continuity and growth of expertise has been importantcritical to our development from a uranium explorer into a uranium producer.producer, and in some ways is even more valuable as the Company navigates the current challenges of our industry. We believe that implementing a restriction on tenure or a strictly-enforced retirement agestrictly enforced retirements would unnecessarily deprive the Company of these contributions and knowledge.contributions.
As noted, we refreshed our Board, adding to the diversity and diversified skill sets of our Board as Ms. Walker and Mr. Chang joined ourthe Board in 2017 bringingand 2018, respectively. This refreshment of expertise and perspective continues with her decades of experience inMr. Cash being named to the energy-marketing field, including a background as a business owner and a board member to banking institutions and in various industry associations. Mr. Chang joined our Board in 2018, upon2022. His wide-ranging uranium industry experiences throughout the retirement of Mr. Macdonell. Mr. Chang brings more than two decades of broad-ranging experiencepast 30 years, including operational and regulatory, place him in the financial services industry, as well as a vast current knowledge of the uranium mining industry, having covered the industry for many years as a financial analyst. These additions to our Board have served us well through refreshment and further diversification of the skill sets ofunique seat on our Board.
At March 26, 2019,April 8, 2022, the average age of our currentseven directors to be voted upon at the Meeting is approximately 66;67 years of age; the average tenure of our currentthose directors is approximately 8.78.9 years.
As described in Proposal No. 1, above, the Corporate Governance and Nominating Committee and our Board of Directors have determined that our directors should possess minimum qualifications including high personal and professional ethics; a commitment to the long-term interests of our shareholders demonstrated through service, risk management and share ownership; sufficient time to commit to fulfill duties as a director, including membership on standing committees as requested; active engagement and participation in the meetings of the Board, Board committees on which the member serves and on special projects as may be requested; financial literacy as would be required for service on our Audit Committee; and broad experience in business and/or experience in government, as well as education and technical expertise.
Our sevenAt April 8, 2021, our directors at March 26, 2019, include Jeffrey T. Klenda, Chairman of the Board of Directors; W. William Boberg; John W. Cash; Rob Chang; James M. Franklin; W. William Boberg; Thomas Parker, our Lead Director; Gary C. Huber; Thomas H. Parker, Lead Director; and Kathy E. Walker; and Rob Chang, about whomWalker. Mr. Klenda is not seeking re-election at the Meeting.
The residency, age, principal occupation and years of service as a member of our Board follows here:for each director is set forth below.
Name (Age) and Residency | Position with Company and Principal Occupation Within the Past Five Years | Service as a Director |
Jeffrey T. Klenda Colorado, USA |
| August 2004 – present |
W. William Boberg (82) Colorado, USA | Director Presently Retired (2011) Mining Company Executive | January 2006 – present |
John W. Cash (49) Wyoming, USA | Chief Executive Officer, Director Ur-Energy Vice President Regulatory Affairs | March 2022 - present |
Rob Chang (44) Ontario, Canada | Director Chief Executive Officer Chief Financial Officer / Financial Research Analyst | March 2018 – present |
James M. Franklin Ontario, Canada | Director Consulting Geologist/Adjunct Professor of Geology Queen’s University, Laurentian University and University of Ottawa | March 2004 – present |
Colorado, USA | Director Presently Retired Mining Company Executive |
|
Thomas Parker Montana, USA | Lead Director Presently Retired (2012) Mining Company Executive | July 2007 – present |
|
|
|
Kathy E. Walker Kentucky, USA | Director
Director, eKentucky Advanced Manufacturing Institute Coal trader/Business owner | September 2017 – present |
38 | ||
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|
51
Service on Additional Boards
Mr. Klenda is a director of Organto Foods Inc. (since November 2013). Dr. Franklin is a director of Aura Silver Resources Inc.Gold79 Mines Ltd. (since October 2003), and of AnconiaNuinsco Resources Corp.Ltd. (since June 2012)2018). Mr. Boberg is a director of Aura Silver Resources Inc.Gold79 Mines Ltd. (since June 2008). Dr. Huber is a director of Gold Resource Corporation (since January 2013). Mr. Chang is a director of Fission Uranium Corp. (since April 2018) and Shine Mineral Corp. (since November 2018).
Board Independence
Messrs. Parker, Boberg, Chang and Chang,Parker, Drs. Franklin and Huber, and Ms. Walker are independent directors as determined in accordance with Canadian and U.S. securities laws and the rules of the NYSE American. In determining whether a director is independent, the Board of Directors considers the specific circumstances of a director and the nature, as well as materiality, of any relationship between the director and Ur-Energy.
Committee Membership
During 2018,2021, our directors provided expertise and leadership to our Board committees as follows:
Independent Board Members | Committees/Memberships (2018 or dates as shown) | ||||
Audit | Compensation | Corporate Governance / Nominating | Treasury and Investment(1) | Health, Safety and Environment (HSE) & Technical | |
Thomas Parker (Lead Director) | Chair 2018 | 1.1 – 7.26 | 1.1 – 7.26 | Chair 2018 | 2018 |
James M. Franklin | 1.1-7.26 | 2018 | 2018 |
| Chair 2018 |
W. William Boberg |
|
| 3.15-12.31 |
| 2018 |
Gary C. Huber | 2018 | Chair (3.15 – 12.31) | Chair (3.15-12.31) |
| 2018 |
Kathy E. Walker | 3.15-12.31 |
|
| 3.15 – 12.31 |
|
Rob Chang | 7.26 – 12.31 | 7.26 – 12.31 | 7.26 – 12.31 |
|
|
Paul G. Macdonell | 1.1 – 3.30 | 1.1 – 3.30(2) | 1.1 – 3.30(2) | 1.1 – 3.30 |
|
Independent Board Members |
| ||||
Audit | Compensation | Corporate Governance / Nominating | Treasury and Investment(1) | Health, Safety and Environment (HSE) & Technical | |
Thomas H. Parker (Lead Director) | Chair | Chair | ♦ | ||
W. William Boberg | ♦ | ♦ | |||
Rob Chang | ♦ | ♦ | ♦ | ||
James M. Franklin | ♦ | ♦ | Chair | ||
Gary C. Huber | ♦ | Chair | Chair | ♦ | |
Kathy E. Walker | ♦ | ♦ |
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(1) | Roger Smith, CFO of the Company, serves as a non-director member of the Treasury and Investment Committee. |
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Family Relationships
None of our directors is related to any of our executive officers.
Involvement in Certain Legal Proceedings
Corporate Cease Trade Orders or Bankruptcies
None of the directors or officers of the Company is, or has been within the ten years before the date of this Circular, a director or officer of any other issuer that, while that person was acting in that capacity, was the subject of a cease trade or similar order or an order that denied the issuer access to any statutory exemptions under Canadian or U.S. securities legislation for a period of more than 30 consecutive days or was declared bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency or was subject to or instituted any proceedings, arrangement or compromise with creditors or had a receiver, receiver-manager or trustee appointed to hold the assets of that company.
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Penalties or Sanctions
None of the directors or officers of the Company has been subject to any penalties or sanctions imposed by a court relating to Canadian or U.S. securities legislation or by a Canadian or U.S. securities regulatory authority or has entered into a settlement agreement with a Canadian or U.S. securities regulatory authority or been subject to any other penalties or sanctions imposed by a court or regulatory body that would likely be considered important to a reasonable investor in making an investment decision.
Personal Bankruptcies
None of the directors, or officers, of the Company has, during the ten years prior to the date hereof, become bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency or has been subject to or instituted any proceedings, arrangement or compromise with creditors, or had a receiver, receiver-manager or trustee appointed to hold the assets of the director or officer.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) requires any person who is a director or executive officer of the Company or who beneficially holds more than 10% of any class of our securities which have been registered with the SEC to file reports of initial ownership and changes in ownership with the SEC.
Based upon our review of the copies of the Section 16(a) reports furnished to us, all Section 16(a) filing reports applicable to our directors, executive officers and holders of more than 10% of any class of our registered securities were timely complied with during 2018.
Leadership Structure and Board’s Role in Risk Oversight
Mr. Klenda became our Chairman and Executive Director in 2006. He assumed the role of Acting Chief Executive Officer in May 2015, and thereafter was subsequently named President and Chief Executive Officer in December 2016. He remains the2016, while remaining Chairman of ourthe Board. Because of Mr. Klenda’s role from the inception of the Company, our Corporate Governance and Nominating Committee considered, from time to time, the functions customarily assigned to a director serving in the role of an independent lead director.
In December 2014, at the conclusion of our first full year of operations at our Lost Creek Mine, the Corporate Governance and Nominating Committee determined that establishment of the role of lead director of our Board of Directors would enhance the communications within the Board, among its committees, and with management. The Committee recommended and the Board approved a policy statement for such an independent lead director’s position at any time that the chairman of the Board is not an independent director. In that event, under the adopted policy, the Corporate Governance and Nominating Committee may suggest an independent director to serve as lead independent director (“Lead Director”), who shall be approved by a majority of the independent directors. In December 2014, Mr. Parker was approved by a majority of the independent directors to serve as the Lead Director of our Board and continues to serve in that role to date.
Pursuant to the policy statement approved by the full Board, the responsibilities of the Lead Director include:
· | When necessary, act as the principal liaison between the independent directors and the Chairman of the Board and Chief Executive Officer; |
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· | Call and chair, at least annually, a meeting of the independent directors; |
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· | Preside at meetings of the Board of Directors where the Chairman of the Board is not available or where the Chairman has stated a real or perceived conflict of interest concerning a matter before the Board; and |
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· | During merger or acquisition discussions or activities, be advised by management at early-stage discussions, and chair any Board appointed special committee composed of independent directors to review and make recommendations regarding the proposed transaction, subject to any conflict of interest which would require the appointment of a different lead independent director being approved by a majority of the independent directors for such specified purpose. |
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Further, the policy statement provides that the Lead Director shall serve until such time as he or she ceases to be a director, resigns as Lead Director, is replaced as Lead Director by a majority of the independent directors, or is replaced by an independent Chairman of the Board elected by a majority of the independent directors of the Board. The performance of a Lead Director shallis to be reviewed annually as a part of the normal Board evaluation process. Mr. Parker’s performance as Lead Director has been reviewed annually, most recently in December 2018.2021.
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The Board oversees the risks involved in our operations as part of its general oversight function, integrating risk management into the Company’s compliance policies and procedures. While the Board has the ultimate oversight responsibility for the risk management process, the Audit Committee, the Compensation Committee and the Technical Committee have certain specific responsibilities relating to risk management. Among other things, the Audit Committee addresses risk assessment and risk management, and reviews major risk exposures (whether financial, operating, cyber-security or otherwise) and the guidelines and policies that management has put in place to govern the process of assessing, controlling, mitigating, managing and reporting such exposures. In addition, whenWhen recommending to the Board appropriate compensation for executive officers, the Compensation Committee considers the nature, extent and acceptability of risks that the executive officers may be encouraged to take by any incentive compensation. The Compensation Committee also oversees human resources and talent management risks, succession risk and planning. The HSE & Technical Committee continues with its role of overseeing our mineral resources and related operational risks, and now with ongoing operations at Lost Creek, oversees health, safety and environmental risks. The Board also satisfies its risk oversight responsibility through full reports by each committee chair regarding the committee’s considerations and actions, as well as through regular reports directly from executive officers responsible for oversight of particular risks within the Company.
Majority Voting Policy
The Company has adopted a majority voting policy for the election of directors at uncontested meetings which can be viewed on our website at https://www.ur-energy/investors/corporate-governance/.governance-documents. The policy provides that, in an uncontested election, each director must be elected by a majority of the votes cast with respect to that director’s election. Votes will not be deemed cast if no authority or discretion is given (for example, a broker non-vote). If a director does not receive a majority (50% + 1) of the votes cast as to his or her election, the candidate will forthwith submit to the Board a notice of resignation and shall not participate in any meeting of the Board or any of its committees while the resignation is considered. The Corporate Governance and Nominating Committee will expeditiously consider the candidate’s resignation and make recommendation to the Board whether to accept it. In considering the candidate’s resignation, the Committee and the Board shall only refuse to accept such resignation if there are exceptional circumstances.
Code of Ethics and Other Policies
We have adopted a Code of Ethics (“Code”) which applies to our principal executive officer, principal financial officer, principal accounting officer or controller and others performing similar functions. The Code has been filed on Form 8‑K and is available on our website at www.ur-energy/corporate governance/https://www.ur‑energy.com/investors/corporate-governance/governance-documents/. The Code is designed to reasonably deter wrongdoing and to promote honest and ethical conduct; full, fair, accurate, timely and understandable disclosure in reports; compliance with applicable governmental laws, rules and regulations; prompt internal reporting of the violations of the Code; and adherence to the Code. We intend to disclose any amendment or waiver (including any implicit waiver) of the Code on our website at https://www.ur‑energy.com/investors/corporate-governance/governance-documents/ within four business days following such amendment or waiver. Since its adoption, there have been no waivers of the Code.
We also have adopted a Code of Business Conduct and Ethics which applies to all employees, officers and directors, and which also may be accessed on our website. Both the Code and the Code of Business Conduct and Ethics are reviewed routinely, most recently in December 2018.2021. We maintain a separate Whistleblower Policy statement in conjunction withas a part of our Whistleblower Program, which was last reviewed in December 2018.Program. The policy statement, as well asprovides a link to our third-party programthe provider’s confidential reporting website and is also found on our website at http:https://www.ur-energy.com/www.ur‑energy.com/investors/corporate-governance/governance-documents/. The link and other program information is also available to our employees on an internal Company intranet site.
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Policies Concerning Confidentiality, Public Disclosure and Restrictions on Trading Securities
We have also adopted various policies related to trading restrictions, disclosure requirements and confidentiality obligations which have been amended and restated from time to time, most recently amended effective December 16, 2016. The Corporate Governance and Nominating Committee oversees the implementation and compliance of these policies, which are set out in the “Ur-Energy Inc. Policies Concerning Confidentiality, Public Disclosure and Restrictions on Trading Securities,Securities.” andThese policies are available on our website at http:https://www.ur- www.ur‑energy.com/investors/corporate-governance/governance-documents/. All directors, officers and employees of the Company are expected to be familiar with and adhere to the policies.
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Gender Diversity Policy and Diversity Reporting
In 2014, theThe Board of Directors adopted a Gender Diversity policy in 2014 by which the Company seeks to encourage the identification, recruitment, development and, ultimately, retention of talented women at all levels including on its Board. The Board believes that a board made up of highly-qualifiedhighly qualified directors, from diverse backgrounds, promotes better corporate governance and improves business outcomes. We were fortunate in 2017 to have Kathy Walker join our Board. Her presence now reflects approximately 14% female representation of our directors nominated for election at the Meeting. As set forth above, we also have a 14% representation of visible minorities of our directors nominated for election at the Meeting.
The inclusion of women and members of diversity extends to our Board composition, and consideration of the level of representation by women on the Board by women and other designated groups will continue to be an important consideration during searches for qualified new Board members as those needs may arise. The Company embraces the proposition that more women on boards is advantageous. We remain duty bound to recruit and invest in the best available talent based upon education, experience and personal skills and qualities. Although the Board is not at this time endorsing a quota or target, it does commit to seeking and having increasing representation of women on the Board, in executive management and throughout the Company. We were fortunate in 2017 to have Kathy Walker join our Board. Her presence now reflects approximately 14% female representation on our Board.
There has not been systemic consideration of the effectiveness or measures taken under the policy. However, as additional refreshment of the non-executive directors of our Board may occuroccurs and/or additional expansion is contemplated, the Governance Committee will continue to review additional qualified female candidates who have beenare placed before it, andThe Committee will also continue to reviewconsider thoroughly the qualifications of those, and all candidates brought forward for consideration.
The Company has one female executive officer, Penne Goplerud, who has been our General Counsel and Corporate Secretary since 2011. Among our six-personcurrent five-person management team, this approximates 17%is a 20% representation by women. Prior to her appointment as a member of our executive officers, Ms. Goplerud served the Company as Associate General Counsel from 2007, and as outside counsel betweenfrom 2005 and the timeuntil she joined us in 2007 as an employee. At this time, there is no consideration for expanding our executive group. We restructured certain of ourthe respective responsibilities of our executives in 2015 and again in 2019 when our executive group was reduced in number and have foundnumber. With our current operations, we continue to find that the currenta smaller structure and size offor our executive team works well, further enhances communication and best facilitates othernumerous management matters. responsibilities. Consideration is ongoing of the requirements and appropriate size of our executive group following Mr. Klenda’s retirement in June 2022.
Total Number of Directors Nominated for Election to the Board of Directors and Senior Management Members | |
Board of Directors | Seven (7) |
Diversity of the Directors Nominated for Election to the Board of Directors | |
Gender | One (1) |
Visible Minority | One (1) |
Diversity of Members of Senior Management(1) | |
Female | One in Five (20%) |
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(1) | At the date of this Circular, our executive management team numbers five. Absent additions to our executive group following Mr. Klenda’s retirement in June 2022, Ms. Goplerud will be one of four executive officers (or, 25% of the executive group). |
At this time, we have not established a policy or targets for additional representation of womenin identified diversity groups (women, visible minorities, Aboriginal, and disabled individuals) in our executive group. We have no executives who are visible minorities, Aboriginal or disabled. If andor as the executive group is expanded or current members may depart and be replaced, whether following Mr. Klenda’s retirement, as we anticipate returning to full production operations or as our business otherwise grows and develops demonstrating additional needs, we believe that experience, merit and skill sets must be considered foremost when candidates are evaluated.
While certain aspectsevaluated, together with a thoughtful consideration of and areasall types of expertise within, our industry remain predominantly male, wediversity. We remain committed to equality of opportunity and look forward to facilitating any appropriate increase in representation of women and other diverse groups in our management structure based upon merit and overall qualifications. We currently have women filling managerial roles and/or critical support roles in our engineering staff, accounting and finance group, and land-legal department. Here, again, rather than instituting a target or quota, we look forward to the development of our internal talent at both staffing and management levels.
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Meetings of the Board and Committees
The Board of Directors meets at least four times a year and more frequently if required. In 2018,2021, the Board of Directors met sixeight times. Additionally, the Board of Directors took six10 actions by written resolutions. The Board of Directors from time to time holds a portion of its meetings when management departs, and the independent directors meet in camera. Management may be asked to depart a meeting for in camera sessions at such other meetings as the
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independent directors deem appropriate from time to time. During 20182021 the Board held three meetingsone meeting during which non-director executives were excused for a portion of the meeting. Additionally, the independent directors met in camera without executive management on at least one occasion. A separate meeting of the independent directors was held in December 2018.2021.
Board Committees
There are five permanent committees of the Board of Directors: the Audit Committee, the Compensation Committee, the Corporate Governance and Nominating Committee, the Treasury & Investment Committee and the HSE & Technical Committee. The Board of Directors may also appoint other temporary or permanent committees from time to time for particular purposes, as it did in conjunction with the equity financing completed by the Company in September 2018.purposes.
The following sets out a summary of the responsibilities and activities of the Board Committees and the Report of the Audit Committee. The charters of each of the permanent standing committees may be found on our website http:https://www.ur-energy/investors/corporate-governance/.
Audit Committee
The Audit Committee assists the Board of Directors in carrying out its responsibilities relating to corporate accounting and financial reporting practices, as well as oversight of internal controls, and the Whistleblower Program. The duties and responsibilities of the Audit Committee include the following:
· | reviewing for recommendation to the Board of Directors for its approval the principal documents comprising our continuous disclosure record, including interim and annual financial statements and management’s discussion and analysis; |
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· | recommending to the Board of Directors a firm of independent auditors for appointment by the shareholders and reporting to the Board of Directors on the fees and expenses of such auditors. The Audit Committee has the authority and responsibility to select, evaluate and, if necessary, replace the independent auditor. The Audit Committee has the authority to approve all audit engagement fees and terms and the Audit Committee, or a member of the Audit Committee, must review and pre-approve any non-audit services provided to the Company by our independent auditor and consider the impact on the independence of the auditor; |
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· | reviewing periodic reports from the Chief Financial Officer; |
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· | discussing with management and the independent auditor, as appropriate, any audit problems or difficulties and management’s response; and |
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· | establishing procedures for the receipt, retention and treatment of complaints regarding accounting, internal accounting controls or auditing matters, including through the Whistleblower Program. |
The Audit Committee maintains direct communication during the year with our independent auditor and with our executive officers and other personnel responsible for accounting and financial matters.
During 2018,2021, the members of the Audit Committee were Thomas Parker (Chair), Paul Macdonell (1.1-3.30), James Franklin (1.1-7.26)Rob Chang, Gary Huber, and Gary Huber. Additionally, in 2018, Ms. Walker (3.18) and Mr. Chang (7.26) joined the Audit Committee.Kathy Walker. The members of the Audit Committee were in 2018,2021, and are currently, independent directors pursuant to National Instrument 52-110 Audit Committees (“NI 52-110”) and the listing standards of the NYSE American. Each of the members is financially literate as defined in NI 52-110 and financially sophisticated under the NYSE American rules. The Audit Committee has confirmed its earlier designation of each of Thomas Parker and Gary Hubermember as an “audit committee financial expert” as that term is currently defined by the rules of the SEC, as well as also designating each of Ms. Walker and Mr. Chang as an “audit committee financial expert.”SEC.
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During 2018,2021, the Audit Committee met five times, and took one action by written resolution. The activities of the Audit Committee over the past year included the following:
· | review of our annual financial statements and management’s discussion and analysis prior to filing with the regulatory authorities; |
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· | review of our quarterly interim financial statements and management’s discussion and analysis prior to filing with regulatory authorities; |
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· | review of periodic reports from the Chief Financial Officer; |
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· | review of applicable corporate disclosure reporting and control processes, including Chief Executive Officer and Chief Financial Officer certifications; |
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· | review of reports from our external firm for testing of internal controls; |
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· | review Audit Committee governance practices to ensure its terms of reference incorporate all regulatory requirements; |
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· | oversee the Company’s Whistleblower Program, including training regarding the program; |
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· | assess and manage risk, including those risks presented by cyber-security and related threats, including receiving presentations |
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· | received presentations on new regulatory matters and accounting pronouncements; |
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· | review of the Audit Committee Charter; and |
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· | review of the engagement letter with the independent auditors and annual audit fees prior to approval by the Board of Directors, |
The Audit Committee has recommended to the Board of Directors that Ur-Energy shareholders be requested to re-appoint PricewaterhouseCoopers LLP, Chartered Professional Accountants, as the independent auditor for 2019.2022.
The Audit Committee reviews its charter on a yearly basis and did so most recently on December 13, 2018.2021. The Committee’s charter was last substantively amended on December 16,in 2016. The qualifications of each of the members of the Audit Committee are set forth above as a part of Proposal No. 1.
Compensation Committee
The Compensation Committee assists the Board of Directors in carrying out its responsibilities relating to personnel matters, including performance, compensation practices and succession.rates. The Compensation Committee has prepared terms of reference which includeestablishes annual objectives against which to assess members of management including the Chief Executive Officer, reviewingOfficer. The Committee reviews and makingmakes recommendations to the Board of Directors with respect to employee and consultant compensation arrangements including stock options, restricted share units and management succession planning.equity compensation. The Compensation Committee reviews its charter on a yearly basis and did so most recently on December 13, 2018.15, 2021. The Committee’s charter was last substantively amended on December 12, 2014.in 2018.
The Compensation Committee met formally three times in 2018.2021. Additionally, the Committee took threesix actions by written resolution during 2018.2021. Portions of meetings are conducted without management present, including specifically for the purpose of discussing the compensation of the Chief Executive Officer. Additionally, the Compensation Committee consideredconsiders various matters related to the Company’s existing compensation program, executive and director compensation, share ownership guidelines for directors and executive officers (including compliance), the equity compensation plans, and presentations on trends in governance and compensation including “say on pay.” The Compensation Committee annually reviews the results of the “say on pay” vote of our shareholders. The Compensation Committee is authorized to engage, at the Company’s expense, compensation consulting firms or other professional advisors as necessary to assist in discharging its responsibilities. responsibilities as it did in connection with the retention of RG&A as described above.
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During 2018,2021, the members of the Committee were Paul Macdonell (1.1-3.30)Gary Huber (Chair), Thomas Parker (1.1-7.26), James Franklin and Rob Chang (7.26-12.31). Following Mr. Macdonell’s announcement of his retirement in 2018, Dr. Huber joined the Committee as its Chair on March 15, 2018 and continues to serve in that capacity.James Franklin. The members of the Compensation Committee were in 2018,2021, and are currently, independent under applicable law and the rules of the NYSE American. As well, at least two members of the Committee (all three, currently) qualify as “outside” directors within the meaning of U.S. Internal Revenue Code Section 162(m) and as “non-employee” directors within the meaning of Rule 16b-3 under the Exchange Act, as amended. The qualifications of each of the members of the Compensation Committee are set forth above as a part of Proposal No. 1.
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Corporate Governance and Nominating Committee
The Corporate Governance and Nominating Committee assists the Board of Directors with determining the director nominees for election to the Board, recommending candidates to fill vacancies, other succession planning, the composition of the committees of the Board and monitoring compliance with corporate governance regulatory requirements. In performing its duties, the Committee will review and consider director nominees recommended by shareholders. The Committee also conducts Board member evaluations and evaluation of the Lead Director on an annual basis, while considering the overall composition and appropriate size of the Board.
The Corporate Governance and Nominating Committee reviews its charter on a yearly basis and did so most recently on December 13, 2018.15, 2021. The Committee’s charter was last substantively amended on December 15,in 2017.
During 2018,2021, the members of the Committee were Paul Macdonell (1.1-3.30)Gary Huber (Chair), Thomas Parker (1.1-7.26), James Franklin, William Boberg, (7.26-12.31) and Rob Chang (7.26 and 12.31). Following Mr. Macdonell’s announcement of his retirement in 2018, Dr. Huber joined the Committee as its Chair on March 15, 2018 and continues to serve in that capacity.James Franklin. The Corporate Governance and Nominating Committee met three timestwice during 20182021 and took three actionsone action by written resolution. The members of the Corporate Governance and Nominating Committee were in 2018,2021, and are currently, independent under the rules of the NYSE American. The qualifications of each of the members of the Corporate Governance and Nominating Committee are set forth above as a part of Proposal No. 1.
During 2018,2021, the Corporate Governance and Nominating Committee received a presentationpresentations about the Company’s directors’ and officers’ liability program and insurance coverage; and updates regarding environmental, social and governance (ESG) guidance and practices. The Committee reviewed othergenerally our corporate policies including the Code of Ethics, Whistleblower Policy, and Ur‑Energy Inc. Policies Concerning Confidentiality, Public Disclosure and Restrictions on Trading Securities. The Committee also considers the Company’s risks and risk management.
Treasury & Investment Committee
The Treasury & Investment Committee assists the Board of Directors by centralizing for oversight of all treasury activities of the Company, insofar as practical, and coordinating our banking, cash management, investment and funding arrangements. The Committee also formulates and implements the Treasury and Investment Policy, reviewing it from time to time. The Committee’s charter, as last substantively amended February 5,in 2014, provides that the Committee consist of the Chief Financial Officer and at least two independent members of the Board of Directors. The Committee reviews its charter on an annual basis and did so most recently on December 13, 2018.2021.
During 2018,2021, the members of the Treasury & Investment Committee were Thomas Parker (Chair), Paul Macdonell (1.1-3.30), and Kathy Walker, (3.15-12.31), along withand our Chief Financial Officer, Roger Smith. The Treasury & Investment Committee met twice during 2018.2021.
HSE & Technical Committee
The Health, Safety and Environment & Technical Committee (the “HSE & Technical Committee”) assists the Board of Directors with reserve and resource matters relating to our mineral properties; technical matters relating to our exploration, development, permitting, construction, operations, reclamation and restoration activities; health, safety and environmental matters relating to our operations and activities; and compliance with legal requirements relating to reserve and resource matters, technical matters, and health, safety and environmental matters. The Committee’s
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charter is reviewed annually; it was amended in 2016 and 2017 to reflect additional responsibilities of the Committee. Mostannually, including most recently the charter was reviewed, without substantive revision, on December 13, 2018. 2021.
The members of the HSE & Technical Committee are James Franklin (Chair)(Professional (Professional Geologist), William Boberg (Professional Geologist), Thomas Parker (Professional Engineer), and Gary Huber (Professional Geologist). The members of the Committee are not required to be independent. Currently, however, all members are independent. There are several membersMembers of executive management who routinely participate in the Committee meetings. Because of the significance of the physical and environmental safety and operational matters overseen by the Committee, a standing invitation has been extended by the Committee for all directors and executive officers to attend the Committee’s meetings. In 2018, weWe continued this practice. Ms. Walker was unablepractice in 2021. However, as a part of more frequently held video conference meetings of the Board, and other efficiencies, we adapted our processes to attendreceive operational and technical matters which have more routinely been received by the October meetingCommittee to be a part of the management report to the full Board. Additionally, the Committee held two formal meetings during 2021. We anticipate the Committee may return to holding quarterly meetings as we return to full production operations.
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In recent years, the HSE & Technical Committee; with that exception, all non-Committee directors attended all Committee meetings.
The HSE & Technical Committee continues to conducthas conducted certain of its reviews by means of informal meetings. In 2018, the Committee again conducted anmeetings, including in-house technical sessionsessions at the Lost Creek site which focusedsite. In 2021, with operations continuing on operational updatesa controlled, lower production rate and in recognition of our Lost Creek Project, including operations in the first three header houses in Mine Unit 2 which began after the last such Committee meeting was held in July 2017. The 2018 technical session was conducted with executive staffprecautions and operational management and staff participating.
The Committee held five formal meetings during 2018. Pursuanttravel restrictions imposed due to the Committee’s charter, it is the responsibility of Committee members to make periodic site visits to our operational locations. All Committee members traveled to Lost Creek during 2018 to observe operations and meet with personnel at the facility. Another of our independent directors, Ms. Walker, who does not serve onCOVID-19, the HSE & Technical Committee also traveleddid not travel to the site in 2018 to observe operations, as did our Chairman, Mr. Klenda. Mr. Chang was unable to attend the onsite Committee meeting in 2018, although he visited the site prior to the time he became a director. The Committee also received routine presentations throughout the year on technical, operational, safety and environmental matters at Lost Creek.
Summary of Memberships on Permanent Committees and Record of Attendance for 20182021
During the year ended December 31, 2018,2021, the Board of Directors and its permanent committees met as follows:
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Board of Directors | 6 | (1) |
Audit Committee (“AC”) | 5 |
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Compensation Committee (“CC”) | 3 |
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Corporate Governance and Nominating Committee (“CGN”) | 3 |
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HSE & Technical Committee (“HSE&TC”) | 5 |
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Treasury & Investment Committee (“TIC”) | 2 |
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Total number of meetings held | 24 |
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Board of Directors |
| 8 | (1) | |
Audit Committee (“AC”) | 5 | |||
Compensation Committee (“CC”) | 3 | |||
Corporate Governance and Nominating Committee (“CGN”) | 2 | |||
HSE & Technical Committee (“HSE&TC”) | 2 | |||
Treasury & Investment Committee (“TIC”) | 2 | |||
Total number of meetings held | 22 |
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(1) | In addition to the |
During 2018,For 2021, attendance by our directors attendedat scheduled Board and assigned Committee meetings(1) is set forth below. All directors had better than 85% attendance at all meetings, with only two directors having missed any meeting. Additionally, Roger Smith, CFO of the Company, who serves as follows:a member of the Treasury and Investment Committee, attended 100% of the meetings of that committee.
| Board Meetings | |||||||||
| Committee Meeting Memberships and Meetings Attended | |||||||||
Director | Attended | AC | CC | CGN | TIC | HSE&TC | ||||
Jeffrey T. Klenda |
| - | - | - | - | - | ||||
James M. Franklin |
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| - |
| 2/2 | - | 2/2 | |
W. William Boberg |
| - | - | 2/2 | - |
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Thomas H. Parker |
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| ||||
|
| 5/5 | - | - |
| 2/2 | ||||
Gary C. Huber | 8/8 | 5/5 | 3/3 | 2/2 | - | 2/2 | ||||
Kathy E. Walker | 7/8 | 5/5 | - | - | 2/2 | - | ||||
Rob Chang |
| 5/5 | 3/3 | 2/2 |
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| - | |||
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|
| - |
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Board Attendance at Shareholder Meeting
It has been the Company’s practice and expectation that its directors attend the annual shareholders’ meetings. Last year, all sevenIn 2021, due to the continuing impacts and traveling restrictions caused by COVID-19, we held an in-person meeting, with participation by our directors being facilitated through a teleconference / webcast platform. All of our directors attended the annual and special meeting of shareholders.
Shareholder Feedback
The Board of Directors believes that management should speak for the Company in its communications with shareholders and others in the investment community and that the Board of Directors should be satisfied that appropriate investor relations programs and procedures are in place. The Board of Directors has approved these policies, including the designation of spokespersons in behalf of the Company, from time to time. The Board of Directors regularly reviews the Company’s major communications with shareholders and the public, including continuous disclosure documents and periodic press releases in accordance with the Company’s policies.
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Shareholder Communication with the Board
We believe that it is important to maintain good shareholder relations. The Board of Directors will give appropriate attention to all written communications that are submitted by shareholders. Any shareholder wishing to send communications to the Board, or a specific committee of the Board, should send such communication to the Corporate Secretary of the Company by email to legaldept@ur‑energy.comlegaldept@Ur‑Energy.com or by mail to Ur-Energy Inc. Board of Directors, c/o Corporate Secretary, 10758 West Centennial Road, Suite 200, Littleton, Colorado, USA 80127. All communications shall state the type and amount of the Company’s securities held by the shareholder and shall clearly state that the communication is intended to be shared with the Board, or if applicable, with a specific committee of the Board. The Corporate Secretary shall forward all such communications to the Board or the specific committee, as appropriate.
Expectations of Management
The Board of Directors believes that it is appropriate for management to be responsible for the development of long-term strategies for our Company. Meetings of the Board of Directors are held, as required, to specifically review and deal with long-term strategies of the Company as presented by senior members of management.
The Board of Directors appreciates the value of having selectedits executive officers attend board meetings to provide information and opinions to assist the Directors in their deliberations. The Chair, in consultation with the Chief Financial Officer and Corporate Secretary, arranges for the attendance of executive officers as well as managers for consultation including technical presentations at Board of Directors meetings.
INDEBTEDNESS OF DIRECTORS AND OFFICERS
At no time since the beginning of the Company’s last financial year was any director, executive officer, proposed nominee for election as a director, or any of their respective associates, indebted to the Company or any of its subsidiaries, nor was the indebtedness of any such person to another entity the subject of any guarantee, support agreement, letter of credit or similar arrangement provided by the Company or any of its subsidiaries.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
None of our directors or officers has had any material interest, direct or indirect, in any material transaction since the incorporation of Ur-Energy or in any proposed transaction which has or may materially affect Ur-Energy.
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As discussed in their biographies set forth herein, certain of our directors and/or officers are also directors and/or officers of one or more other mining or natural resources companies. Our directors and officers are also in many cases shareholders of one or more mining or natural resources companies. Consequently, there exists the possibility for such directors and/or officers to be in a position of conflict. While there is a potential for conflicts of interest to arise in such situations, that potential is minimized because of the nature of these other companies including those in other areas of mineral resources and precious metals. Any decision made by any of these directors and/or officers will be made in accordance with their duties and obligations to deal fairly and in good faith with Ur‑Energy and such other companies. In addition, at meetings of the Board, any director with an interest in a matter being considered will declare such interest and refrain from voting on such matter.
The Audit Committee is charged with reviewing and approving in advance any transaction with any “related person,” as that term is defined under applicable U.S. securities laws. Except as previously disclosed, there have been no transactions between the Company and any “related person” since the beginning of the Company’s last fiscal year that would be required to be disclosed under applicable U.S. securities laws.
HOUSEHOLDINGHOUSEHOLDING
The bank, broker or other nominee for any shareholder who is a beneficial owner, but not the record holder, of the Company’s Common Shares may deliver only one copy of the Circular to multiple shareholders who share the same address, unless that broker, bank or other nominee has received contrary instructions from one or more of the shareholders. The Company will deliver promptly, upon written or oral request, a separate copy of the Circular to a shareholder at a shared address to which a single copy of the document was delivered. Shareholders who wish to receive a separate copy of the Circular now, or a separate copy of the Notice of Internet Availability or Circular in the future, should write to us at: Ur-Energy Inc., 10758 West Centennial Road, Suite 200, Littleton, Colorado 80127, Attention: Corporate Secretary. Beneficial owners sharing an address who are receiving multiple copies of the Circular and wish to receive a single copy of the Notice of Internet Availability or Circular in the future will need to contact their broker, bank or other nominee to request that only a single copy be mailed to all shareholders at the shared address in the future.
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The performance graph and disclosure related thereto is set forth in Item 5 of our Annual Report on Form 10-K for the year ended December 31, 2018 under the heading “Performance Graph” and is incorporated by reference here. The information in Item 5 of the Annual Report on Form 10-K is not deemed to be “soliciting material” or to be “filed” with the SEC or subject to the liabilities of Section 8 of the Exchange Act. A copy of our Annual Report on Form 10-K for the year ended December 31, 2018 is available at www.sedar.com, www.sec.gov and upon request by a shareholder to the Company as set forth below under “Availability of Documents.”
ACCOMPANYING FINANCIAL INFORMATION AND INCORPORATION BY REFERENCE
Additional financial information for the Company is available in the Company’s audited consolidated financial statements for the year ended December 31, 20182021, and related management’s discussion and analysis of financial condition and results of operations for the year ended December 31, 2018,2021, included in the Annual Report on Form 10-K10‑K which has been filed with the SEC at http:https://www.sec.gov/edgar.shtml, and with Canadian securities regulators at www.sedar.com.https://sedar.com.
Included with this Circular is theThe Company’s 2018 Annual Report on Form 10-K for the year ended December 31, 2018 (without exhibits which2021, may be accessed on our Annual Report on Form 10-K at http:https://www.sec.gov/edgar.shtml). edgar.shtml.
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All proposals of the Company’s shareholders intended to be presented at the Company’s annual meeting of shareholders in 20192022 must meet the requirements set forth in Section 137 of the Canada Business Corporations Act (CBCA) and Rule 14a-8 of the Exchange Act. Pursuant to the CBCA, proposals must be received by the Company’s Corporate Secretary no later January 5, 2020December 22, 2022, in order to be included in the Management Proxy Circular for the Company’s 20202023 annual meeting. The Company’s next annual meeting of shareholders is planned for May 2020. 2023.
As to any proposal that a shareholder intends to present to shareholders other than by inclusion in our Management Proxy Circular for our 20202022 annual meeting of shareholders, the proxies named in our proxy for that meeting will be entitled to exercise their discretionary voting authority on that proposal unless we receive notice of the matter to be proposed not later than February 19, 2020.March 1, 2023. Even if proper notice is received on or prior to that date, the proxies named in our proxy for that meeting may nevertheless exercise their discretionary authority with respect to such matter by advising shareholders of that proposal and how they intend to exercise their discretion to vote on such matter, unless the shareholder making the proposal solicits proxies with respect to the proposal to the extent required by Rule 14a-4(c)(2) under the Exchange Act.
Upon request made to the Corporate Secretary of Ur-Energy at 10758 West Centennial Road, Suite 200, Littleton, Colorado 80127 or by email at legaldept@Ur-Energy.com (Telephone: +1 720-981-4588 ext. 250), the Corporate Secretary will provide to any shareholder of the Company entitled to vote at the Annual Meeting, free of charge, by first class mail within one business day of receipt of written request, a copy of our Annual Report on Form 10-K for the fiscal year ended December 31, 20182021 (including exhibits) as filed with the SEC and with the Canadian securities authorities. Due to continuing remote-work arrangements, we may be able to respond to your request more quickly by email request and response.
Our management and the Board of Directors know of no other matters to be brought before the Meeting. If other matters are presented properly to the shareholders for action at the Meeting and any postponements and adjournments thereof, it is the intention of the proxy holders named in the proxy to vote in their discretion on all matters on which the Common Shares represented by such proxy are entitled to vote.
There have been no other proposals made by shareholders for consideration at this Meeting, nor are there any other proposals to be addressed at the Meeting but not included in this Circular.
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APPROVALAPPROVAL
The contents and mailing of this Circular have been approved by the Board of Directors of the Company.
You are urged to promptly complete, sign, date and return your proxy, promptly.or to vote online or by telephone as set forth above. You may revoke your proxy at any time before it is voted. If you attend the Meeting as we hope you will,in person, and you are a Registered Shareholder, you may vote your shares in person.at the time of the Meeting.
| BY ORDER OF THE BOARD OF DIRECTORS, | ||
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| /s/ Jeffrey T. Klenda | |
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| Jeffrey T. Klenda, Chairman |
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SCHEDULE AUr-Energy Inc.
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Ur-Energy Inc.
Amended and Restated Restricted Share Unit and Equity Incentive Plan
Originally Effective May 7, 2010
As amended and restated on March 23, 2015April 13, 2021
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Article 1 GENERAL PROVISIONS | 3 | |
1.1 | Purpose | 3 |
1.2 | Definitions | 3 |
1.3 | Effective Date | 5 |
1.4 | Governing Law; Subject to Applicable Regulatory Rules | 5 |
Article 2 ELIGIBILITY AND PARTICIPATION | 5 | |
2.1 | Eligibility | 5 |
2.2 | Rights Under the Plan | 5 |
2.3 | Copy of Plan | 5 |
2.4 | Limitation on Rights | 5 |
2.5 | Grant Agreements | 5 |
2.6 | Maximum Number of Common Shares | 5 |
Article 3 RESTRICTED SHARE UNITS | 6 | |
3.1 | Grant of Restricted Share Units | 6 |
3.2 | Redemption of Restricted Share Units | 6 |
3.3 | Compliance With Tax Requirements | 6 |
3.4 | Payment of Dividend Equivalents | 6 |
3.5 | Adjustments | 6 |
3.6 | Offer for Common Shares – Change of Control | 7 |
Article 4 EVENTS AFFECTING ENTITLEMENT | 7 | |
4.1 | Termination of Employment or Election as a Director | 7 |
4.2 | Death | 8 |
4.3 | No Grants Following Last Day of Active Employment | 8 |
Article 5 ADMINISTRATION | 8 | |
5.1 | Transferability | 8 |
5.2 | Administration | 8 |
5.3 | Records | 8 |
5.4 | Statements | 8 |
5.5 | Legal Compliance | 9 |
Article 6 AMENDMENT AND TERMINATION | 9 | |
6.1 | 9 | 9 |
6.2 | 9 | 9 |
Article 7 GENERAL | 10 | |
7.1 | Rights to Common Shares | 10 |
7.2 | No Right to Employment | 10 |
7.3 | Right to Funds | 10 |
7.4 | Successors and Assigns | 10 |
7.5 | Severability | 10 |
7.6 | Code Section 409A | 10 |
ARTICLE 1 GENERAL PROVISIONS |
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| 1 |
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1.1 |
| Purpose |
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| 1 |
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1.2 |
| Definitions |
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| 1 |
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1.3 |
| Effective Date |
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| 3 |
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1.4 |
| Governing Law; Subject to Applicable Regulatory Rules |
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| 3 |
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ARTICLE 2 ELIGIBILITY AND PARTICIPATION |
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| 3 |
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2.1 |
| Eligibility |
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| 3 |
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2.2 |
| Rights Under the Plan |
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| 4 |
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2.3 |
| Copy of Plan |
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| 4 |
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2.4 |
| Limitation on Rights |
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| 4 |
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2.5 |
| Grant Agreements |
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| 4 |
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2.6 |
| Maximum Number of Common Shares |
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| 4 |
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ARTICLE 3 RESTRICTED SHARE UNITS |
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3.1 |
| Grant of Restricted Share Units |
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| 4 |
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3.2 |
| Redemption of Restricted Share Units |
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| 5 |
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3.3 |
| Payment of Dividend Equivalents |
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| 5 |
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3.4 |
| Offer for Common Shares – Change of Control |
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| 5 |
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ARTICLE 4 PERFORMANCE SHARE UNITS |
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| 5 |
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4.1 |
| Grant of Performance Share Units |
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| 5 |
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4.2 |
| Settlement of Earned Performance Share Units |
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| 5 |
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4.3 |
| Payment of Dividend Equivalents |
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| 6 |
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4.4 |
| Termination of Employment |
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| 6 |
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4.5 |
| Change of Control |
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| 6 |
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ARTICLE 5 DIRECT SHARE ISSUANCES |
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| 6 |
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5.1 |
| Direct Share Issuances |
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| 6 |
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5.2 |
| Vesting |
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| 7 |
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5.3 |
| Termination of Employment |
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| 7 |
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5.4 |
| Change in Control |
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| 7 |
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ARTICLE 6 EVENTS AFFECTING ENTITLEMENT |
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6.1 |
| Termination of Employment or Election as a Director |
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| 7 |
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6.2 |
| Death |
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| 8 |
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6.3 |
| No Grants Following Last Day of Active Employment |
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| 8 |
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ARTICLE 7 ADMINISTRATION |
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| 9 |
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7.1 |
| Adjustments |
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| 9 |
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7.2 |
| Compliance with Tax Requirements |
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| 9 |
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7.3 |
| Transferability |
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| 9 |
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7.4 |
| Administration |
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| 9 |
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7.5 |
| Records |
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| 10 |
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7.6 |
| Statements |
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| 10 |
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7.7 |
| Legal Compliance |
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| 10 |
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ARTICLE 8 AMENDMENT AND TERMINATION |
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| 10 |
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8.1 |
| Amendment |
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| 10 |
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8.2 |
| Termination of Plan |
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| 11 |
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ARTICLE 9 GENERAL |
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| 11 |
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9.1 |
| Rights to Common Shares |
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| 11 |
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9.2 |
| No Right to Employment |
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| 11 |
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9.3 |
| Right to Funds |
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| 11 |
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9.4 |
| Successors and Assigns |
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| 11 |
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9.5 |
| Severability |
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| 12 |
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9.6 |
| Code Section 409A |
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| 12 |
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This Amended and Restated Restricted Share Unit and Equity Incentive Plan is established as a vehicle by which equity-based incentives may be awarded to retain employees, to recognize and reward their significant contributions to the long-term success of the Corporation including to align the employees and directors interests more closely with the shareholders of the Corporation.
As used in the Plan, the following terms have the following meanings:
(a) | “Award” means the grant of a Restricted Share Unit award, a Performance Share Unit award, or a Direct Share Issuance under the Plan. | |
(b) | “Board” means the Board of Directors of the Corporation; |
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(c) | “Change of Control” includes: | |
(i) | the acquisition by any persons acting jointly or in concert (as determined by the Securities Act (Ontario)), whether directly or indirectly, of voting securities of the Corporation that, together with all other voting securities of the Corporation held by such persons, constitute in the aggregate more than 50% of all outstanding voting securities of the Corporation; |
(ii) | an amalgamation, arrangement or other form of business combination of the Corporation with another corporation that results in the holders of voting securities of that other corporation holding, in the aggregate, more than 50% of all outstanding voting securities of the corporation resulting from the business combination; |
(iii) | the sale, lease or exchange of all or substantially all of the property of the Corporation to another person, other than in the ordinary course of business of the Corporation or to a Related Entity; or |
(iv) | any other transaction that is deemed to be a “Change of Control” for the purposes of this Plan by the Board in its sole discretion; | ||
provided, however, with respect to Section 409A Covered Awards, a transaction will not be deemed to be a Change in Control unless such transaction constitutes a “change in control event” within the meaning of Section 409A of the Code.
| (d) | “Code” means the US Internal Revenue Code of 1986, as amended; |
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(e) | “Committee” means the Compensation Committee of the Board or such other persons designated by the Board; |
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(f) | “Common Share” means a common share in the capital of the Corporation; |
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(g) | “Corporation” means Ur-Energy Inc. and its successors and assigns; |
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(h) | “Direct Share Issuance” means the direct issuance of Common Shares to an Eligible Person. | |
(i) | “Director” means a non-Employee director of the Board of the Corporation; |
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| (j) | “Dividend” means a dividend declared and payable on a Common Share in accordance with the Corporation’s dividend policy as the same may be amended from time to time (an “Ordinary Dividend”), and may, in the discretion of the Committee, include a special or stock dividend (a “Special Dividend”) declared and payable on a Common Share; |
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(k) | “Eligible Person” means an Employee or a Director who is designated as an Eligible Person pursuant to Section |
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(l) | “Employee” means an employee of the Corporation or a Subsidiary; |
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(m) | “Fair Market Value” means the closing price of the Common Shares on the Toronto Stock Exchange on the Business Day immediately prior to the |
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(n) | “Grant Date” means any date determined from time to time by the Committee as a date on which |
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(o) | “Officer” means a person who is an officer of the Corporation within the meaning of Section 1 of the Securities Act (Ontario). |
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(p) | “Performance Period” shall mean the period over which the performance goals with respect to a grant of Performance Share Units is measured. | |
(q) | “Performance Share Unit” means a performance-based Award that entitles the Eligible Person to receive Common Shares based on the attainment of one or more performance goals over a designated Performance Period. | |
(r) | “Plan” means the Ur-Energy Inc. Amended and Restated Restricted Share Unit and Equity Incentive Plan, as amended from time to time; |
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(s) | “Redemption Date” in respect of any Restricted Share Unit means (A) for Restricted Share Units issued prior to March 23, 2015 (the “First Amended Effective |
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(t) | “Reorganization” means any declaration of any stock dividend (other than a Special Dividend in respect of which the Committee, in its discretion, determines that Eligible Persons are to be paid a cash amount pursuant to Section |
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| (u) | “Restricted Share Unit” means one notional Common Share (without any of the attendant rights of a shareholder of such Common Share, including the right to vote such Common Share and the right to receive dividends thereon, except to the extent otherwise specifically provided herein) credited by bookkeeping entry to a notional account maintained by the Corporation in respect of an Eligible Person in accordance with this Plan; and |
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(v) | “Section 409A Covered Award” means any Award granted under the Plan after the Amended Effective Date that constitutes “non-qualified deferred compensation” subject to Section 409A of the Code. |
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(w) | “Separation from Service” has the meaning set forth in Treasury Regulation 1.409A-1(h) applying the default rules thereunder. |
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(x) | “Specified Employee” means a “specified employee” within the meaning of Section 409A(a)(2)(B) of the Code using the identification methodology selected by the Corporation from time to time, or if none, the default methodology set forth in Section 409A of the Code. |
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(y) | “Subsidiary” has the meaning set out in the Securities Act (Ontario). |
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The Plan was originally effective May 7, 2010 with respect to the Eligible Person payable commencing in and with respect to the 2010 fiscal year. The Plan aswas first amended isand restated effective March 23, 2015. The Plan is now amended and restated again effective April 13, 2021. No Common Shares may be issued under the Plan until and unless all required regulatory and shareholder approvals have been obtained with respect to the issuance of Common Shares hereunder.
The Plan shall be governed by and construed in accordance with the laws of the Province of Ontario and the federal laws of Canada applicable therein. The provisions of the Plan shall be subject to the applicable by-laws, rules and policies of the Toronto Stock Exchange and applicable securities legislation.
This Plan applies to those Employees and Directors whom the Committee designates as eligible for a grant of Restricted Share Units pursuant to Section 3.1.receive an Award under the Plan. The Committee shall make such a designation prior to each Grant Date.
Subject to Article 4Article 6 and Article 5,Article 7, an Eligible Person who has been granted Restricted Share Unitsan Award shall continue to have rights in respect of such Restricted Share UnitsAward until such Restricted Share Units haveAward has been redeemed for cash or shares in accordance with this Plan.
The Corporation shall provide each Eligible Person with a copy of this Plan following the initial grant of Restricted Share UnitsAward to such Eligible Person and shall provide each Eligible Person with a copy of all amendments to this Plan.
Nothing in this Plan shall confer on any Employee or Director any right to be designated as an Eligible Person or to be granted any Restricted Share Units.an Award under the Plan. There is no obligation for uniformity of treatment of Eligible Persons or any group of Employees, Directors or Eligible Persons, whether based on salary or compensation, grade or level or organizational position or level or otherwise. A grant of Restricted Share UnitsAn Award to an Eligible Person on one or more Grant Dates shall not be construed to create a right to a grant of Restricted Share Unitsan additional Award on a subsequent Grant Date.
Each grant of Restricted Share UnitsAward shall be evidenced by a written agreement executed by the Eligible Person in substantially the form appended hereto.hereto or in such other form as may be approved by the Committee from time to time. An Eligible Person will not be entitled to any grant of Restricted Share UnitsAward hereunder or any benefit of this Plan unless the Eligible Person agrees with the Corporation to be bound by the provisions of this Plan. By entering into an agreement described in this Section 2.5,2.5, each Eligible Person shall be deemed conclusively to have accepted and consented to all terms of this Plan and all bona fide actions or decisions made by the Committee. Such terms and consent shall also apply to and be binding on the legal representative, beneficiaries, heirs and successors of each Eligible Person.
Notwithstanding any provision herein, the aggregate number of Common Shares which may be issuable upon the redemptionin respect of all Restricted Share UnitsAwards under the Plan, in combination with the aggregate number of Common Shares which may be issuable under any and all of the Corporation’s equity incentive plans in existence from time to time, including the Corporation’s Stock Option Plan 2005, as amended from time to time, shall not exceed ten percent (10%) of the issued and outstanding shares of the Corporation as at the Grant Date of each Restricted Share UnitAward under the Plan or such greater number of Common Shares as shall have been duly approved by the Board and, if required by the rules or policies of the Toronto Stock Exchange or any other stock exchange on which the Common
A-5
Shares of the Corporation may then be listed, by the shareholders of the Corporation. No fractional Common Shares may be issued under the Plan.
On each Grant Date, the Committee shall designate Eligible Persons and determine the number of Restricted Share Units, if any, to be granted to each Eligible Person in the Committee’s sole discretion.
(a) | Unless redeemed earlier in accordance with this Plan, the Restricted Share Units of each Eligible Person will be redeemed on or within thirty (30) days after the Redemption Date for cash or Common Shares, as determined by the Committee, for an amount equal to the Fair Market Value of a Restricted Share Unit. |
(b) | If the Committee determines that any Restricted Share Units are to be redeemed for Common Shares, the Eligible Person will be entitled to receive and the Corporation will issue to the Eligible Person a number of Common Shares equal to the Fair Market Value of the Restricted Share Units (net of any applicable statutory withholdings) that have vested on the Redemption Date. |
3.3 | Payment of Dividend Equivalents |
When Dividends are paid on Common Shares, an Eligible Person shall be credited with Dividend equivalents in respect of the Restricted Share Units credited to the Eligible Person’s account as of the record date for payment of Dividends. Such Dividend equivalents shall be converted into additional Restricted Share Units (including fractional Restricted Share Units) based on the Fair Market Value per Common Share on the date credited, and such new Restricted Share Units shall be paid at the same time as the Restricted Share Units to which the Dividend equivalents related.
3.4 | Offer for Common Shares – Change of Control |
Notwithstanding anything else herein to the contrary, in the event of a Change of Control, then the Corporation shall redeem 100% of the Restricted Share Units granted to the Eligible Persons and outstanding under the Plan as soon as reasonably practical, but no later than thirty (30) days following the Redemption Date for cash. For the purposes of this Section 3.4: (i) the Redemption Date shall be the date on which the Change of Control occurs, and (ii) the Fair Market Value of a Restricted Share Unit shall be the greater of (i) the closing price per Common Share on the Toronto Stock Exchange on the Business Day immediately preceding the Redemption Date, and (ii) the price at which Common Shares are taken up under the Change of Control, as applicable.
ARTICLE 4
PERFORMANCE SHARE UNITS
4.1 | Grant of Performance Share Units |
On each Grant Date, the Committee shall designate Eligible Persons and determine the Performance Share Units, if any, to be granted to each Eligible Person in the Committee’s sole discretion. Each Award of Performance Share Units shall designate a target number of Performance Share Units covered by the Award, with the actual number of Performance Share Units earned (if any) to be based on a formula set forth in the grant agreement related to the attainment of one or more performance goals set forth in the grant agreement over the Performance Period set forth in the grant agreement.
4.2 | Settlement of Earned Performance Share Units |
(a) | Unless settled earlier in accordance with this Plan, earned Performance Share Units of each Eligible Person will be settled on or within thirty (30) days after the end of the Performance Period applicable to such Performance Share Units for cash or Common Shares, as determined by the Committee. | |
(b) | If the Committee determines that any earned Performance Share Units are to be settled in Common Shares, the Eligible Person will be entitled to receive and the Corporation will issue to the Eligible Person a number of Common Shares equal to the number of earned Performance Share Units (net of any applicable statutory withholdings). If the Committee determines that any earned Performance Share Units are to be settled in cash, the Eligible Person will be entitled to receive and the Corporation will issue to the Eligible Person a cash payment equal to the Fair Market Value (measured as of the settlement date) of a number of Common Shares equal to the number of earned Performance Share Units. |
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Payment of Dividend Equivalents |
When Dividends are paid on Common Shares, an Eligible Person shall be credited with Dividend equivalents in respect of the target number of Performance Share Units credited to the Eligible Person’s account as of the record date for payment of Dividends. Such Dividend equivalents shall be converted into additional Performance Share Units (including fractional Performance Share Units) based on the Fair Market Value per Common Share on the date credited, and such new Performance Share Units shall be earned based on the same performance goals measured over the same Performance Period and shall be paid at the same time as the Performance Share Units to which the Dividend equivalents related.
4.4 | Termination of Employment |
Unless otherwise provided in a grant agreement for an Award of Performance Share Units, upon an Eligible Person’s termination of employment or other service or death prior to the end of the Performance Period for an Award of Performance Share Units, such Performance Share Units shall be forfeited. For avoidance of doubt, the provisions of Section 6.1 and 6.2 below shall not apply to Performance Share Units granted hereunder.
4.5 | Change of Control |
Upon the occurrence of a Change of Control, the Performance Period of each outstanding Performance Share Unit Award shall be deemed to have ended and the Committee shall determine the number of Performance Share Units earned under each outstanding Performance Share Unit Award based on performance through the date of the Change in Control. The Committee may make adjustments to the performance goals in its sole discretion to account for the truncation of the Performance Period on the date of the Change of Control and the Committee may adopt reasonable procedures for determining the level of achievement of any financial metrics, such as using audited financial statements from the most recently completed fiscal quarter. Earned Performance Share Units shall be settled in cash as soon as reasonably practical, but no later than thirty (30) days following, the Change of Control. For the purposes of this Section 4.5: (i) the Fair Market Value of an earned Performance Share Unit shall be the greater of (i) the closing price per Common Share on the Toronto Stock Exchange on the Business Day immediately preceding the Change of Control, and (ii) the price at which Common Shares are taken up under the Change of Control, as applicable.
ARTICLE 5
DIRECT SHARE ISSUANCES
5.1 | Direct Share Issuances |
On each Grant Date, the Committee shall designate Eligible Persons and determine the number of Common Shares, if any, to be granted as a Direct Share Issuance to each Eligible Person in the Committee’s sole discretion. Except to the extent restricted under the terms of this Plan or under the applicable grant agreement, an Eligible Person receiving a Direct Share Issuance shall have all of the rights of a shareholder of the Corporation with respect to the Common Shares issued, including the right to vote the Common Shares and the right to receive dividends thereon.
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5.2 | Vesting |
Direct Shares Issuances may be fully vested on the Grant Date or may be subject to vesting, as determined by the Committee. Direct Share Issuances that are subject to a vesting schedule may not be transferred prior to vesting.
5.3 | Termination of Employment |
Unless otherwise provided in the grant agreement for a Direct Share Issuance that is subject to vesting, upon an Eligible Person’s termination of employment or other service or death, the provisions of Section 6.1 and Section 6.2 shall apply to such Direct Share Issuance by analogy. Any unvested Common Shares that do not vest as a result of the Eligible Person’s termination of employment of other service or death shall be immediately forfeited and returned to the Corporation without the payment of any consideration. Common Shares subject to any Direct Share Issuance may be evidenced in such manner as the Committee shall determine, and if certificated, may be held in escrow with appropriate legends to help enforce any forfeiture described in the Section.
5.4 | Change in Control |
Notwithstanding anything else herein to the contrary, unvested Common Shares subject to a Direct Share Issuance shall vest in full immediately prior to the occurrence of a Change of Control.
ARTICLE 6
EVENTS AFFECTING ENTITLEMENT
6.1 | Termination of Employment or Election as a Director |
(a) | Voluntary Termination or Termination for Cause. If an Eligible Person is terminated by the Corporation for cause (as determined by the Corporation), or if an Eligible Person, voluntarily terminates employment for any reason or resigns as a Director, as applicable, all of the Eligible Person’s Restricted Share Units shall be cancelled and no amount shall be paid by the Corporation to the Eligible Person in respect of the Restricted Share Units so cancelled. | |
(b) | Involuntary Termination. The Restricted Share Units of an Eligible Person, other than a Director, who is involuntarily terminated by the Corporation, for reasons other than cause, shall be redeemed for cash at the Fair Market Value of a Restricted Share Unit on the Redemption Date. For the purposes of this Section 6.1(b) the Redemption Date shall be: |
(i) | for Restricted Share Units other than Section 409A Covered Awards, the date on which the employment of the Eligible Person, other than a Director, is terminated irrespective of any entitlement of the Eligible Person to notice, pay in lieu of notice or benefits beyond the termination date, and | |
(ii) | for Section 409A Covered Awards, the date of the Eligible Person’s Separation from Service; provided, however, that if on such date the Eligible Person is a Specified Employee, then to the extent required by Section 409A(a)(2)(B) of the Code, the Redemption Date shall be the earlier of (i) the expiration of the six (6)-month period measured from the date of the Eligible Person’s Separation from Service, and (ii) the date of the Eligible Person’s death (the “Delay Period”). |
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(c) | Termination related to Directors. The Restricted Share Units of a Director, who is not re-elected at an annual or special meeting of shareholders shall be redeemed for cash at the Fair Market Value of a Restricted Share Unit on the Redemption Date. For purposes of this Section 6.1(c), the Redemption Date shall be: |
(i) | for Restricted Share Units other than Section 409A Covered Awards, the date on which the annual or special meeting is held, and | |
(ii) | for Section 409A Covered Awards, the date of the Eligible Person’s Separation from Service. |
(d) | Retirement of Officers and Directors. Any unvested Restricted Share Units held by the Officer or Director will become fully vested upon such Officer’s or Director’s “Retirement,” which shall mean such Officer’s or Director’s voluntary termination of employment or cessation of services to the Corporation when the Officer’s or Director’s age plus years of service with the Corporation (in each case measured in complete, whole years) equals or exceeds 65, provided that at the date of termination such Officer or Director has completed at least five years of service with the Corporation. Such Restricted Share Units shall be redeemed in accordance with Section 3.2 on their originally scheduled Redemption Dates. |
6.2 | Death |
All of the Restricted Share Units of an Eligible Person who dies shall be redeemed in accordance with Section 3.2. For the purposes of the foregoing, the Redemption Date shall be the date of the Eligible Person’s death.
6.3 | No Grants Following Last Day of Active Employment |
In the event of termination of any Eligible Person’s employment with the Corporation, such Eligible Person shall not be granted any Awards under the Plan after the last day of active employment of such Eligible Person. Without limiting the generality of the foregoing and of Section 2.4, notwithstanding any other provision hereof, and notwithstanding any provision of any employment agreement between any Eligible Person and the Corporation, no Eligible Person will have any right to an Award under the Plan, and shall not be granted any Award under the Plan after the last day of active employment of such Eligible Person on which such Eligible Person actually performs the duties of the Eligible Person’s position, whether or not such Eligible Person receives a lump sum payment of salary or other compensation in lieu of notice of termination, or continues to receive payment of salary, benefits or other remuneration for any period following such last day of active employment. Notwithstanding any other provision hereof, or any provision of any employment agreement between the Corporation and an Eligible Person, in no event will any Eligible Person have any right to damages in respect of any loss of any right to receive an Award under the Plan after the last day of active employment of such Eligible Person and no severance allowance, or termination settlement of any kind in respect of any Eligible Person will include or reflect any claim for such loss of right and no Eligible Person will have any right to assert, claim, seek or obtain, and shall not assert, claim, seek or obtain, any judgment or award in respect of or which includes or reflects any such right or claim for such loss of right.
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ARTICLE 7
ADMINISTRATION
7.1 | Adjustments |
If any change occurs in the outstanding Common Shares by reason of a reorganization, the Committee, in its sole discretion, and without liability to any person, shall make such equitable changes or adjustments, if any, as it considers appropriate, in such manner as the Committee may consider equitable, to reflect such change or event including, without limitation, adjusting the number of Common Shares subject to Awards outstanding under the Plan, provided that any such adjustment will not otherwise extend the Redemption Date otherwise applicable to Restricted Share Units or the Performance Period applicable to Performance Share Units. The Corporation shall give notice to each Eligible Person of any adjustment made pursuant to this Section and, upon such notice, such adjustment shall be conclusive and binding for all purposes. The existence of outstanding Awards shall not affect in any way the right or power and authority of the Corporation or its shareholders to make or authorize any alteration, recapitalization, reorganization or any other change in the Corporation’s capital structure or its business or any merger or consolidation of the Corporation, any issue of bonds, debentures or preferred or preference shares (ranking ahead of the Common Shares or otherwise) or any right thereto, or the dissolution or liquidation of the Corporation, any sale or transfer of all or any part of its assets or business or any corporate act or proceeding whether of a similar character or otherwise.
7.2 | Compliance |
In taking any action hereunder, or in relation to any rights hereunder, the Corporation and each Eligible Person shall comply with all provisions and requirements of any income tax, pension plan, or employment or unemployment insurance legislation or regulations of any jurisdiction which may be applicable to the Corporation or Eligible Person, as the case may be. The Corporation shall have the right to deduct from all payments made to the Employeeemployee in respect of the Restricted Share Units,Awards, whether in cash or Common Shares, any federal, provincial, local, foreign or other taxes, Canadian Pension Planpension plan or Employment Insurance Commissionemployment insurance commission or other deductions required by law to be withheld with respect to such payments. The Corporation may take such other action as the Board or the Committee may consider advisable to enable the Corporation and any Eligible Person to satisfy obligations for the payment of withholding or other tax obligations relating to any payment to be made under this Plan. Each Eligible Person (or the heirs and legal representatives of the Eligible Person) shall bear any and all income or other tax imposed on amounts paid to the Eligible Person (or the heirs and legal representatives of the Eligible Person) under this Plan, including any taxes, interest or penalties resulting from the application of Section 409A of the Code. If the Board or the Committee so determines, the Corporation shall have the right to require, prior to making any payment under this Plan, payment by the recipient of the excess of any applicable Canadian or foreign federal, provincial, state, local or other taxes over any amounts withheld by the Corporation, in order to satisfy the tax obligations in respect of any payment under this Plan. If the Corporation does not withhold from any payment, or require payment of an amount by a recipient, sufficient to satisfy all income tax obligations, the Eligible Person shall make reimbursement, on demand, in cash, of any amount paid by the Corporation in satisfaction of any tax obligation. Notwithstanding any other provision hereof, in taking such action hereunder, the Board and the Committee shall endeavour to ensure that the payments to be made hereunder will not be subject to the “salary deferral arrangement” rules under the Income Tax Actincome tax act (Canada), as amended, or income tax legislation of any other jurisdiction.
When Dividends are paid on Common Shares, an Eligible Person shall be credited with Dividend equivalents in respect of the Restricted Share Units credited to the Eligible Person’s account as of the record date for payment of Dividends. Such Dividend equivalents shall be converted into additional Restricted Share Units (including fractional Restricted Share Units) based on the Fair Market Value per Common Share on the date credited, and such new Restricted Share Units shall be paid at the same time as the Restricted Share Units to which the Dividend equivalents related.
If any change occurs in the outstanding Common Shares by reason of a Reorganization, the Committee, in its sole discretion, and without liability to any person, shall make such equitable changes or adjustments, if any, as it considers appropriate, in such manner as the Committee may consider equitable, to reflect such change or event including, without limitation, adjusting the number of Restricted Share Units credited to Eligible Persons and outstanding under the Plan, provided that any such adjustment will not otherwise
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extend the Redemption Date otherwise applicable. The Corporation shall give notice to each Eligible Person of any adjustment made pursuant to this section and, upon such notice, such adjustment shall be conclusive and binding for all purposes. The existence of outstanding Restricted Share Units shall not affect in any way the right or power and authority of the Corporation or its shareholders to make or authorize any alteration, recapitalization, reorganization or any other change in the Corporation’s capital structure or its business or any merger or consolidation of the Corporation, any issue of bonds, debentures or preferred or preference shares (ranking ahead of the Common Shares or otherwise) or any right thereto, or the dissolution or liquidation of the Corporation, any sale or transfer of all or any part of its assets or business or any corporate act or proceeding whether of a similar character or otherwise.
Notwithstanding anything else herein to the contrary, in the event of a Change of Control, then the Corporation shall redeem 100% of the Restricted Share Units granted to the Eligible Persons and outstanding under the Plan as soon as reasonably practical, but no later than thirty (30) days following the Redemption Date for cash. For the purposes of this Section 3.6: (i) the Redemption Date shall be the date on which the Change of Control occurs, and (ii) the Fair Market Value of a Restricted Share Unit shall be the greater of (i) the closing price per Common Share on the Toronto Stock Exchange on the Business Day immediately preceding the Redemption Date, and (ii) the price at which Common Shares are taken up under the Change of Control, as applicable.
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All of the Restricted Share Units of an Eligible Person who dies shall be redeemed in accordance with Section 3.2. For the purposes of the foregoing, the Redemption Date shall be the date of the Eligible Person’s death.
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In the event of termination of any Eligible Person’s employment with the Corporation, such Eligible Person shall not be granted any Restricted Share Units pursuant to Section after the last day of active employment of such Eligible Person. Without limiting the generality of the foregoing and of Section 2.4, notwithstanding any other provision hereof, and notwithstanding any provision of any employment agreement between any Eligible Person and the Corporation, no Eligible Person will have any right to be awarded additional Restricted Share Units, and shall not be awarded any Restricted Share Units, pursuant to Section 3.1 after the last day of active employment of such Eligible Person on which such Eligible Person actually performs the duties of the Eligible Person’s position, whether or not such Eligible Person receives a lump sum payment of salary or other compensation in lieu of notice of termination, or continues to receive payment of salary, benefits or other remuneration for any period following such last day of active employment. Notwithstanding any other provision hereof, or any provision of any employment agreement between the Corporation and an Eligible Person, in no event will any Eligible Person have any right to damages in respect of any loss of any right to be awarded Restricted Share Units pursuant to Section 3.1 after the last day of active employment of such Eligible Person and no severance allowance, or termination settlement of any kind in respect of any Eligible Person will include or reflect any claim for such loss of right and no Eligible Person will have any right to assert, claim, seek or obtain, and shall not assert, claim, seek or obtain, any judgment or award in respect of or which includes or reflects any such right or claim for such loss of right.
Rights respecting Restricted Share UnitsAwards shall not be transferable or assignable other than by will or the laws of decent and distribution.
The Committee shall, in its sole and absolute discretion, but subject to applicable corporate, securities and tax law requirements: (i) interpret and administer the Plan; (ii) establish, amend and rescind any rules and regulations relating to the Plan; and (iii) make any other determinations that the Committee deems necessary or desirable for the administration and operation of the Plan. The Committee may delegate to any person any administrative duties and powers under this Plan. The Committee may correct any defect or supply any omission or reconcile any inconsistency in the Plan in the manner and to the extent the Committee deems, in its sole and absolute discretion, necessary or desirable. Any decision of the Committee with respect to the administration and interpretation of the Plan shall be conclusive and binding on the Eligible Person and his or her legal representative. The Board may establish policies respecting minimum ownership of Common Shares of the Corporation by Eligible Persons and the ability to elect Restricted Share Units to have Awards satisfy any such policy.
The Corporation will maintain records indicating the number of Restricted Share UnitsAwards credited to an Eligible Person under the Plan from time to time and the Grant Dates of such Restricted Share Units.Awards. Such records shall be conclusive as to all matters involved in the administration of this Plan.
The Corporation shall furnish annual statements to each Eligible Person indicating the number of Restricted Share UnitsAwards credited to the Eligible Person and the Grant Dates of the Restricted Share UnitsAwards and such other information that the Corporation considers relevant to the Eligible Person.
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Without limiting the generality of the foregoing, the Committee may take such steps and require such documentation from Eligible Persons as the Committee may determine are desirable to ensure compliance with all applicable laws and legal requirements, including all applicable corporate and securities laws and regulations of any country, and any political subdivisions thereof, and the by-laws, rules and regulations of any stock exchanges or other organized market on which Common Shares may from time to time be listed or posted and any applicable provisions of the Income Tax Act (Canada), as amended or income tax legislation or any other jurisdiction.
(a) | The Board reserves the right, in its sole discretion, to amend, suspend or terminate the Plan or any portion thereof at any time, in accordance with applicable legislation, without obtaining the approval of shareholders. Notwithstanding the foregoing, the Corporation will be required to obtain, in accordance with the provisions of the rules and policies of the Toronto Stock Exchange, the approval of holders of a majority of shares present and voting in person or by proxy at a meeting of the shareholders of the Corporation for any amendment related to: |
(i) | the percentage of the issued and outstanding Common Shares available to be granted under the Plan; |
(ii) | a change in the method of calculation of redemption of Restricted Share Units or settlement of Performance Share Units held by Eligible Persons; |
(iii) | an extension to the term for redemption of Restricted Share Units or settlement of Performance Share Units held by Eligible Persons; and |
(iv) | amendments to this Section |
(b) | Unless an Eligible Person otherwise agrees, any amendment to the Plan or |
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| (c) | Without limiting the generality of the foregoing, the Board may make the following amendments to the Plan, without obtaining shareholder approval: |
(i) | amendments to the terms and conditions of the Plan necessary to ensure that the Plan complies with the applicable regulatory requirements, including the rules of the TSX, in place from time to time; |
(ii) | amendments to the provisions of the Plan respecting administration of the Plan and eligibility for participation under the Plan; |
(iii) | amendments to the provisions of the Plan respecting the terms and conditions on which |
(iv) | amendments to the Plan that are of a “housekeeping” nature. |
The Board may from time to time amend or suspend this Plan in whole or in part and may at any time terminate this Plan. No such amendment, suspension or termination shall adversely affect the rights of any Eligible Person at the time of such amendment, suspension or termination with respect to outstanding and unredeemed Restricted Share UnitsAwards credited to such Eligible Person without the consent of the affected Eligible Person. If the Board terminates the Plan, no new Restricted Share UnitsAwards will be awardedgranted to any Eligible Person, but outstanding and unredeemed previously credited Restricted Share UnitsAwards shall remain outstanding, be entitled to payments as provided under Section 3.4, and be paid in accordance with the terms and conditions of this Plan existing at the time of termination. This Plan will finally cease to operate for all purposes when the last remaining Eligible Person receives a payment in satisfaction of all outstanding and unredeemed Restricted Share UnitsAwards credited to such Eligible Person, or all outstanding and unredeemed Restricted Share UnitsAwards credited to such Eligible Person are cancelled pursuant to the provisions thereof.
ARTICLE 9
A-9GENERAL
This Plan shall not be interpreted to create any entitlement of any Eligible Person to any Common Shares, or to the dividends payable pursuant thereto, except as expressly provided herein. A holder of Restricted Share Units or Performance Share Units shall not have rights as a shareholder of the Corporation with respect to any Common Shares which may be issuable pursuant to the Restricted Share Units or Performance Share Units so held, whether voting, right on liquidation or otherwise.
This Plan shall not be interpreted as either an employment or trust agreement. Nothing in this Plan nor any Committee guidelines or any agreement referred to in Section 2.52.5 nor any action taken hereunder shall be construed as giving any Eligible Person the right to be retained in the continued employ or service of the Corporation or any of its subsidiaries, or giving any Eligible Person or any other person the right to receive any benefits not specifically expressly provided in this Plan nor shall it interfere in any way with any other right of the Corporation to terminate the employment or service of any Eligible Person at any time.
Neither the establishment of this Plan nor the granting of Restricted Share UnitsAwards under this Plan shall be deemed to create a trust. Amounts payable to any Eligible Person under the Plan shall be a general, unsecured obligation of the Corporation. The right of the Employee to receive payment pursuant to this Plan shall be no greater than the right of other unsecured creditors of the Corporation.
The Plan shall be binding on all successors and assigns of the Corporation and an Eligible Person, including without limitation, the estate of such Eligible Person and the legal representative of such estate, or any receiver or trustee in bankruptcy or representative of the Corporation’s or Eligible Person’s creditors.
If any provision of the Plan or part hereof is determined to be void or unenforceable in whole or in part, such determination shall not affect the validity or enforcement of any other provision or part thereof.
(a) | Although the Corporation does not guarantee to a Eligible Person any particular tax treatment of an Award, the |
(b) | All payments in respect of Restricted Share Units and Performance Share Units other than Section 409A Covered Awards are intended to be “short-term deferrals” exempt from the application of Code Section 409A and are intended to be made no later than the 15th day of the third month after the later of the end of (i) the first calendar year in which the Eligible Person’s right to the payment is no longer subject to a substantial risk of forfeiture or (ii) the first taxable year of the Corporation in which the Eligible Person’s right to payment is no longer subject to a substantial risk of forfeiture. |
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RESTRICTED SHARE UNIT GRANT AGREEMENT
This Restricted Share Unit Grant Agreement is made as of the ___ day of __________, 20__ between _______________________, the undersigned “Eligible Person” (the “Eligible Person”), being an employee or director of Ur-Energy Inc. (the “Corporation”), named or designated pursuant to the terms of the Restricted Share Unit Plan of Ur-Energy Inc. (which Plan, as the same may from time to time be modified, supplemented or amended and in effect is herein referred to as the “Plan”), and the Corporation.
In consideration of the grant of Restricted Share Units made to the Eligible Person pursuant to the Plan (the receipt and sufficiency of which are hereby acknowledged), the Eligible Person hereby agrees and confirms that:
1. | The Eligible Person has received a copy of the Plan and has read, understands and agrees to be bound by the provisions of the Plan. |
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2. | The Eligible Person accepts and consents to and shall be deemed conclusively to have accepted and consented to, and agreed to be bound by, the provisions and all terms of the Plan and all bona fide actions or decisions made by the Board, the Committee, or any person to whom the Committee may delegate administrative duties and powers in relation to the Plan, which terms and consent shall also apply to and be binding on the legal representatives, beneficiaries and successors of the undersigned. |
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3. | On ________________, 20__, the Eligible Person was granted __________ Restricted Share Units, which grant is evidenced by this Agreement. |
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4. | This Restricted Share Unit Grant Agreement shall be considered as part of and an amendment to the employment agreement between the Eligible Person and the Corporation and the Eligible Person hereby agrees that the Eligible Person will not make any claim under that employment agreement for any rights or entitlement under the Plan or damages in lieu thereof except as expressly provided in the Plan. |
This Agreement shall be determined in accordance with the laws of Ontario and the laws of Canada applicable therein.
Words used herein which are defined in the Plan shall have the respective meanings ascribed to them in the Plan.
IN WITNESS WHEREOF, Ur-Energy Inc. has executed and delivered this Agreement, and the Eligible Person has signed, sealed and delivered this Agreement, as of the date first above written.
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