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
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Filed by the Registrant ☒
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Filed by a Party other than the
Registrant ☐
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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))
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☒
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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.
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(Name of Registrant as Specified In
Its Charter)
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(Name of Person(s) Filing Proxy
Statement, if other than the Registrant)
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Payment of Filing Fee (Check the
appropriate box):
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☒
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No fee required.
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Fee computed on table below per
Exchange Act Rules 14a–6(i)(1) and 0–11.
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(1)
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Title of each class of securities to
which transaction applies:
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(2)
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Aggregate number of securities to
which transaction applies:
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(3)
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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)
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Proposed maximum aggregate value of
transaction:
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(5)
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Total fee paid:
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Fee paid previously with preliminary
materials.
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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.
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(1)
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Amount Previously Paid:
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(2)
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Form, Schedule or Registration
Statement No.:
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(3)
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Filing Party:
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(4)
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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 MAY 7,
2020
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, May 7, 2020 at
1:00 p.m. Mountain Time / 3:00 p.m. Eastern Time to receive
the audited consolidated financial statements of the Company for
the year ended December 31, 2019, together with the report from the
auditors thereon, and for the purpose of considering and voting
upon proposals to:
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1.
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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;
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2.
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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;
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3.
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Approve, in an advisory
(non-binding) vote, the compensation of the Company’s named
executive officers (“say-on-pay”);
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4.
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Conduct an advisory (non-binding)
vote regarding the frequency of the say-on-pay
votes;
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5.
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Ratify, confirm and approve the
renewal of the Ur-Energy Inc. Amended and Restated Stock Option
Plan 2005 (the “Option Plan”), and approve and authorize for a
period of three years all unallocated stock options issuable
pursuant to the Option Plan; and
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6.
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Transact such other
business as may lawfully come before the meeting or any
adjournment(s) or postponement(s) thereof.
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The Board of Directors has fixed the
close of business on March 30, 2020 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 9, 2020.
We cordially invite you to attend the
Annual and Special Meeting of Shareholders either in person or to
listen by tollfree 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 for more information on how to vote your shares
at the meeting and return your voting instructions as promptly as
possible.
The attached
Management Proxy Circular, proxy card, and the Company’s Annual
Report to Shareholders (including financial statements) for the
fiscal year ended December 31, 2019 are available at
http://www.ur- energy.com/annual-general-meeting-info/.
Thank you for your
support.
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BY ORDER OF THE BOARD OF
DIRECTORS,
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/s/ Jeffrey T.
Klenda, Chairman
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MANAGEMENT PROXY
CIRCULAR
TABLE OF
CONTENTS
UR-ENERGY
INC.
10758 West Centennial Road, Suite
200
Littleton, Colorado 80127
MANAGEMENT PROXY
CIRCULAR
ANNUAL AND SPECIAL
MEETING OF SHAREHOLDERS
MAY 7,
2020
SOLICITATION OF PROXIES
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, May 7, 2020 commencing at 1:00
p.m. Mountain Time / 3:00 p.m. Eastern 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 being first distributed or
made available to shareholders beginning on or about April 9, 2020.
The information contained herein is given as at March 30, 2020
unless otherwise indicated.
While we
intend to hold our annual meeting in person on May 7, 2020, we are
sensitive to the public health and travel concerns our shareholders
may have and recommendations that public health and governmental
officials may issue in light of the evolving coronavirus (COVID-19)
situation. As a result, we may impose additional procedures or
limitations to assure the safety of meeting attendees or may decide
to hold the meeting in a different location or solely by means of
remote communication (i.e., a virtual-only meeting). Because
there are additional expenses associated with switching to a
virtual-only meeting at this point, and we continue to work
diligently to minimize unnecessary expenses, we currently plan to
address COVID-19 concerns relating to the meeting by having
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 877-407-9124
(international: 201-689-8584) and/or logging on
to https://www.issuerdirect.com/virtual-event/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 risks
relating to COVID-19 and provide many of the benefits of a
virtual-only meeting while minimizing associated costs. 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
meeting, you must do so in person. We will continue to monitor the
COVID-19 situation and if changes to our current plan become
advisable, we will disclose the updated plan on our website.
We encourage you to check this 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 30,
2020, 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$1.4156.
This Circular, the
proxy card, and the Company’s Annual Report to Shareholders
(including financial statements) for the fiscal year ended
December 31, 2019 are available at
http://www.ur-energy.com/annual-general-meeting-info/.
APPOINTMENT OF PROXIES
The persons named in the enclosed
form of proxy are the Chairman of the Board/Chief Executive
Officer, Mr. Klenda, and our Corporate Secretary, Penne 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.
VOTING INSTRUCTIONS
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 voted 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.
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 1:00
p.m. (MDT) on Tuesday, May 5, 2020, or if the Meeting is adjourned, by no later
than 48 hours (excluding Saturdays, Sundays and holidays) before
any adjourned Meeting.
Voting by
Internet. A Registered
Shareholder may vote by Internet by accessing the following
website: www.investorvote.com. 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 1:00 p.m. (MDT) on
Tuesday, May 5, 2020, or if
the Meeting is adjourned, no later than 48 hours (excluding
Saturdays, Sundays and holidays) before any adjourned
Meeting.
Voting by
Telephone. A Registered
Shareholder may vote by telephone by calling the toll 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 1:00 p.m. (MDT) on Tuesday, May 5, 2020, or if the Meeting is adjourned, no later than
48 hours (excluding Saturdays, Sundays and holidays) before
any adjourned 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.
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, or the person they appoint as their
proxy, are permitted 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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(a)
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in the name of an intermediary (an
“Intermediary”) that the Non-Registered Shareholder deals with in
respect of the shares, such as, among others, banks, trust
companies, securities dealers or brokers and trustees or
administrators of self-administered RRSPs, RRIFs, RESPs and similar
plans; or
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(b)
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in the name of a clearing agency such
as CDS & Co. or DTC (the registration names for CDS
Clearing and Depository Services Inc., and Depositary Trust
Company, respectively) of which the Intermediary is a
participant.
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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 copies of the Notice, Circular, the form of proxy and
our annual report for the fiscal year ended December 31, 2019
(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 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.
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, but does not vote 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
nominee that holds your shares may generally vote on “routine”
matters but cannot vote on “non-routine” matters. Each of the
proposals at the Meeting, other than Proposal No. 2, are
“non-routine” matters and therefore an Intermediary holding shares
for a Beneficial Owner will not have the authority to vote on those
matters in the absence of instructions from the Beneficial Owner.
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.
REVOCATION OF PROXIES
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 may
revoke a VIF or a waiver of the right to receive Meeting Materials
and to 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 (7) days prior to the
Meeting.
VOTING AND DISCRETION OF
PROXIES
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, or the preferred frequency of
say-on-pay votes (or abstention thereon), on the matters 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)
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FOR the
election of all of management’s nominees as directors;
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(2)
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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)
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FOR the
advisory resolution to approve, on an advisory (non-binding) basis,
the compensation of our Named Executive Officers;
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(4)
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FOR the
advisory (non-binding) vote to determine ANNUAL should be the
frequency of future advisory votes on the compensation of the
Company’s named executive officers (“say-when-on-pay”);
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(5)
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FOR the
resolution to approve the renewal of our Amended and Restated Stock
Option Plan 2005 (the “Option Plan”) and to approve and authorize
all unallocated stock options issuable pursuant to the Option Plan
until the third anniversary of the adoption of the present
resolution; and
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(6)
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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.
COMMON SHARES
ENTITLED TO VOTE
As at March 30, 2020, the authorized
capital of the Company consisted of an unlimited number of Common
Shares, of which 160,478,059 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 30,
2020 (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, 5
and 6, 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.
QUORUM
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.
RIGHTS OF DISSENT
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.
SECURITY OWNERSHIP OF
CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
Security
Ownership of Management
As of March 30, 2020, our Record
Date, we had 160,478,059 Common Shares issued and outstanding, and
4,670,128 stock
options which may be exercised currently or within the sixty (60)
days following March 30, 2020.
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Number
of
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Percentage of
Issued and
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Common
Shares of
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Outstanding Common
Shares of
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Name
of Holder
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Ur-Energy
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Ur-Energy
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Directors
and Named Executive Officers
(1)(2)
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W. William
Boberg
(3)
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1,110,468
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*
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John W. Cash
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581,981
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*
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Rob Chang
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167,705
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*
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James M.
Franklin(4)
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920,960
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*
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Penne A.
Goplerud
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698,409
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*
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Steven M.
Hatten
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596,301
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*
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Gary C.
Huber
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686,939
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*
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Jeffrey T.
Klenda
(5)
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3,620,168
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2.17%
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Thomas H.
Parker
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505,753
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*
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Roger L.
Smith
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868,371
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*
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Kathy E.
Walker
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300,239
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*
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All Directors and
executive officers, as a group (11 persons)
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10,057,294
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6.03%
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* Less than
one percent
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(1)
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Address for each of
our directors and executive officers: 10758 West Centennial Road,
Suite 200, Littleton, Colorado 80127.
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(2)
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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 March 30, 2020. For our Directors
and Named Executive Officers, this represents the following: Boberg
(782,069 Common Shares, 328,399 options); Cash (165,793 Common
Shares, 416,188 options); Chang (0 Common Shares, 167,705 Options);
Franklin (592,561 Common Shares, 328,399 options); Goplerud
(200,115 Common Shares, 498,294 options); Hatten (159,588 Common
Shares, 436,713 options); Huber (158,540 Common Shares, 528,399
options); Klenda (2,783,023 Common Shares, 837,145 options); Parker
(177,354 Common Shares, 328,399 options); Smith (314,123 Common
Shares, 554,248 options); and Walker (54,000 Common Shares,
246,239 options). As of the Record Date, March 30, 2020, the
number of the Company’s Common Shares beneficially owned by all of
the Directors and executive officers as a group and entitled to be
voted at the meeting is 5,387,166.
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(3)
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Of the shares
identified, Mr. Boberg holds 118,796 Common Shares jointly with his
wife.
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(4)
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Of the shares
identified, Mr. 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. Mr.
Klenda’s Common Shares are held jointly with his
wife.
|
Security
Ownership of Certain Beneficial Owners
As of March 30, 2020, no person owned
of record, or was known to own beneficially, more than 5% of the
outstanding voting shares of Common Shares.
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 fixed at
seven. 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, James M. Franklin, W. William Boberg, Thomas H.
Parker, Gary C. Huber, Kathy E. Walker and Rob Chang. 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 Director 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 Director of the Company.
All the nominees were elected to the Board of Directors at the last
annual meeting of shareholders. 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.
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,
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 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.
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.
Jeffrey T.
Klenda, 63, B.A.
|
Chairman, President
& CEO
|
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. Over the
last 35 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. Mr. Klenda has served as the
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 nearly 40 years of experience in the financial
markets and in service to numerous publicly-traded companies as an
officer and director.
James M.
Franklin, 77, 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 Aura Resources
Inc. (since October 2003), Anconia Resources Corp. (since June
2012), 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.
W. William (Bill)
Boberg, 80, 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 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 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 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.
Thomas H.
Parker, 77, 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 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 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 and, 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.
Gary C.
Huber, 68, 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 recently
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; 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.
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.
Kathy E.
Walker, 61, MBA
|
Director
|
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 the 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 2017, and because of her 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.
Rob
Chang, 42, MBA
|
Director
|
Rob Chang has over 23 years of
experience in the financial services industry. Mr. Chang served as
the Chief Financial Officer of Riot Blockchain (2018-2019).
Previously, 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 has been 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 $3 billion in assets. He was also on
a five-person multi-strategy hedge fund team where he specialized
in equity and derivative investments. Mr. Chang completed his MBA
at the University of Toronto's Rotman School of Management. Mr.
Chang also serves as a director on the boards of Fission Uranium
Corp. (since April 2018) and Shine Minerals Corp. (since November
2018).
The Board of Directors has concluded
that Mr. Chang is well qualified and should serve as a director of
the Company on the basis of his contributions to the Board since
2018, and his extensive knowledge of the financial markets and
financial services industry, as well as his knowledge of the
uranium mining industry.
Proposal No.
2:
Re-Appointment of
PricewaterhouseCoopers LLP, Chartered Professional Accountants, as
our Independent Auditors and
Approval for the Directors to Fix the Remuneration of the
Auditors
Appointment of
Auditor
The Audit Committee selected and has
recommended the independent accounting firm of
PricewaterhouseCoopers LLP with respect to the audit of our
financial statements for the year ended December 31, 2020. At
the Meeting, it is proposed to re-appoint PricewaterhouseCoopers
LLP, Chartered Professional Accountants, as auditors of the
Company, to serve until the next annual meeting of shareholders
with their remuneration to be fixed by the Board of
Directors.
In light of ongoing travel and
gathering conditions related to COVID-10/coronavirus, we currently
expect that our Audit Partner from PricewaterhouseCoopers LLP will
participate in our Meeting by telephone.
Independent
Accountant Fees and Services
PricewaterhouseCoopers LLP and its
affiliates have been the auditors of Ur-Energy since December 2004.
The fees accrued for audit and audit-related services performed by
PricewaterhouseCoopers LLP in relation to our financial years ended
December 31, 2019 and 2018, paid and shown below in C$, were as
follows:
|
|
|
|
|
Years
ending
|
Audit
fees
(1)
|
Audit-related
Fees
(2)
|
Tax
Fees
(3)
|
All
Other Fees
(4)
|
December 31, 2019
|
$ 192,150
|
$ 63,529
|
$ -
|
$ 19,294
|
December 31, 2018
|
$ 244,438
|
$ 68,256
|
$ -
|
$ 38,588
|
|
(1)
|
|
Audit fees consisted
of audit services, reporting on internal control over 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 work in connection with our
securities filings as required by the United States and Canadian
securities regulators.
|
|
(3)
|
|
Fees such as those
billed for tax compliance, tax advice, and tax planning
services, if any.
|
|
(4)
|
|
The amount reflected
as “All Other Fees” for includes fees related to our shelf
registration and at-market sales agreement and, in September 2018,
for the equity financing we completed under the shelf
registration.
|
Audit Committee’s
Pre-Approval Practice
All services reflected in the
preceding table for 2019 and 2018 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,” 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.
We conducted a similar advisory vote
in 2019 and approximately 93% 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.
If the say-when-on-pay advisory vote
concludes that we will continue with an annual say-on-pay advisory
vote, the next advisory vote will occur at our annual meeting in
2021.
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,” and 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 Discussion and Analysis,” and the
compensation tables and related narrative disclosure, pursuant to
the compensation disclosure rules of the U.S. Securities and
Exchange Commission.
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: Vote, on
an Advisory Basis, for the Frequency of “Say-On-Pay”
Votes (“Say-When-on-Pay”)
Advisory Vote on
Frequency of Votes on Named Executive Officer
Compensation
Under the applicable SEC rules
relating to Named Executive Officer compensation, shareholders
shall provide an advisory, non-binding, vote on whether future
advisory votes on Named Executive Officer compensation should occur
every year, every two years or every three years. Alternatively,
shareholders may abstain from voting. The Dodd-Frank Act requires
the Company to hold the advisory vote on the frequency of the
say-on-pay vote at least once every six years. The next vote on the
frequency of the say-on-pay will be held at our 2026 annual meeting
of shareholders.
For the past six years, since our
first “say-when-on-pay” vote, we have conducted a say-on-pay vote
each year. Our Board of Directors believes that continuing
with an annual vote is the optimal frequency for the
say-on-pay vote in order to keep our shareholders apprised of our
compensation program and any changes thereunder.
This advisory vote on the frequency
of the say-on-pay vote is not binding on the Company’s Board of
Directors. However, the Board of Directors will consider the
result of the vote when determining the frequency of future
say-on-pay votes. The choice among the four choices included in the
resolution which receives the highest number of votes will be
deemed the choice of the shareholders.
After careful consideration of the
frequency alternatives, the Board believes that conducting an
advisory vote on Named Executive Officer compensation on an annual
basis is appropriate for the Company and its shareholders at this
time. However, shareholders may vote for their preferred
voting frequency by choosing the option of one year, two years,
three years (or may abstain from voting) in response to the
following resolution:
BE IT RESOLVED
THAT the shareholders
determine that, on an advisory basis, the preferred frequency of an
advisory vote on the compensation of the Company’s Named Executive
Officers as set forth in the Company’s Management Proxy Circular
should be every year, every two years or every three
years.
The Board of
Directors recommends that shareholders vote ANNUALLY for advisory
votes on the frequency of future votes on Named Executive Officer
compensation.
Proposal No. 5: Approval
of the Renewal of the Ur-Energy Inc. Amended and Restated Stock
Option Plan 2005
At the Meeting, shareholders will be
asked to consider, and, if thought advisable, to pass, with or
without variation, a resolution substantially in the form set out
below, to ratify, confirm and approve the renewal of the Ur-Energy
Inc. Amended and Restated Stock Option Plan 2005, as amended (the
“Option Plan”) and approve and authorize for a period of three
years all unallocated options issued pursuant to the Option Plan.
The Board of Directors wishes to renew the Option Plan, which was
previously ratified, confirmed and approved at meetings of
shareholders of the Company in May 2017, April 2014, April 2011,
and May 2008. The rules of the Toronto Stock Exchange
(“TSX”)
provide that the stock option plan of
an issuer must be approved by its securityholders every three years
after its institution if such plan does not have a fixed maximum
number of securities issuable thereunder, which is the case of the
Option Plan of the Company, which provides that the maximum number
of Common Shares available for issuance hereunder is equal to 10%
of the number of Common Shares outstanding at the time of
grant.
The Option Plan is described in
greater detail in the “Equity Incentive Plans” section below under
the heading “Stock Options and
RSUs,” and the full text of
the Option Plan is attached to this Circular as Schedule
A. A shareholder may
obtain a copy of the Option Plan from the Secretary of the Company
upon request at 10758 West Centennial Road, Suite 200, Littleton,
Colorado 80127, telephone 720-981-4588.
At the Meeting,
shareholders will also be asked to consider and, if deemed
advisable, to approve, with or without variation, the unallocated
options, rights or other entitlements with respect to treasury
issuances under the Option Plan and the grant of options until May
6, 2023, which is the date that is three years from the date of the
Meeting.
The Board of Directors
is of the view that it is in the best interests of the Company to
approve and renew the Option Plan, which will continue to enable
the Board of Directors to grant options to directors, officers,
employees and consultants of the Company and its subsidiaries as a
means of attracting and retaining highly-qualified directors,
officers, employees and consultants who will be motivated towards
the success of the Company and to encourage share ownership in the
Company by directors, officers, employees and consultants who work
in behalf of the Company.
If, at the Meeting, the shareholders
of the Company do not approve all unallocated options with respect
to treasury issuances available under the Option Plan, all currently
outstanding options will be unaffected, however the Company will
not issue any further options under the Option Plan and any
outstanding options that are thereafter cancelled or expire will
not be available for re-grant until such time as shareholder
approval is obtained.
Accordingly, shareholders will be
asked to approve the following resolution (the “Option Plan
Resolution”) at the Meeting:
BE IT
RESOLVED THAT:
|
1.
|
|
The renewal of
Ur-Energy Inc. Amended and Restated Stock Option Plan, 2005, as
described herein and as set forth fully in Schedule
A to this
Circular (the “Option Plan”), which was adopted in connection with
the initial public offering of the Company in November 2005, and
ratified, confirmed and approved by the shareholders on May 8,
2008, April 27, 2011, April 29, 2014, May 18, 2017, be and is
hereby ratified, confirmed and approved;
|
|
2.
|
|
All unallocated options
issuable pursuant to the Option Plan be and are hereby approved and
authorized, and the Company be authorized to have the ability to
continue granting options under the Option Plan, until the third
anniversary date of the adoption of the present resolution by the
shareholders of the Company, namely, May 6, 2023; 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 do such things 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 Option Plan continues to be in the best interests of the
Company’s shareholders. The Board of Directors approved the Option
Plan and recommends approval of the resolution by the Company’s
shareholders. The Board of Directors
unanimously recommends that the shareholders vote FOR the Option
Plan Resolution.
The approval of
Proposal No. 5 requires the majority of the votes cast by
shareholders present in person or represented by proxy at the
Meeting.
The Option 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 Option Plan is attached to this Circular as
Schedule A.
Alternatively, a shareholder may obtain a copy of the Option 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 Option Plan is a plan which
includes directors and employees, including executive officers, of
Ur-Energy as possible eligible participants. As of March 30, 2020,
there are approximately 14 employees and six non-executive
directors who would be eligible to participate in the Option Plan.
As at March 30, 2020, the closing price of our Common Shares on the
NYSE American was $0.37 and on the TSX was C$0.53.
Recommendation
of Ur-Energy’s Board of Directors
The TSX rules
provide that all eligible insiders in order to participate in the
Option Plan may not vote on the approval of the renewal of the
Option Plan. Accordingly, the Stock Option Plan
Resolution must be passed by a majority of votes cast by
shareholders present in person or represented by proxy at the
meeting.
MANAGEMENT
Identification of
Executive Officers
Jeffrey T.
Klenda, 63, B.A.
|
Chairman, President
& Chief Executive Officer
|
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. Over the last 35 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. Mr. Klenda has served as the 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.
Roger L.
Smith, 61,
CPA,
MBA, CGMA
|
Chief Financial
Officer and Chief Administrative Officer
|
Mr. Smith has 35 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.
Steven M.
Hatten, 56,
B.Sc.
|
Vice President
Operations
|
Mr. Hatten has served
as Ur-Energy’s Vice President Operations since 2011. Prior to that,
Mr. Hatten was Ur-Energy’s Engineering Manager from 2007 to 2010
and 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.
John W.
Cash, 47,
M.Sc.
|
Vice President
Regulatory Affairs
|
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.
Penne A.
Goplerud, 58,
JD
|
General Counsel
& Corporate Secretary
|
Ms. Goplerud has 25 years of diverse
legal experience in complex litigation, business matters and
natural resources transactions. 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 commercial 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,
much of Ms. Goplerud’s practice focused on natural resources work
in the U.S. and abroad. Ms. Goplerud obtained her JD from the
University of Iowa College of Law.
COMPENSATION
DISCUSSION AND ANALYSIS
Our Compensation Committee is
composed of independent directors and is responsible for matters of
compensation as they relate to our employees and, more
specifically, our executive officers including the Chief Executive
Officer. The Compensation Committee discussed the following
Compensation Discussion and Analysis (“CD&A”) with management,
and thereafter recommended it to the Board, which approved, this
CD&A.
Compensation
Program and Philosophy
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.
Our named executive officers (“Named
Executive Officers” or “NEOs”) for 2019 were:
|
·
|
|
Jeffrey T. Klenda, Chairman,
President and CEO,
|
|
·
|
|
Roger L. Smith, Chief Financial
Officer and Chief Administrative Officer,
|
|
·
|
|
Penne A. Goplerud, General Counsel
and Corporate Secretary,
|
|
·
|
|
Steven M. Hatten, Vice President
Operations, and
|
|
·
|
|
John W. Cash, Vice President
Regulatory Affairs.
|
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 bonuses are more
heavily weighted to their personal objectives), and 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 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 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 stock
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) we have adopted a clawback policy, all as set forth in greater
detail below.
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 link between the achievement of these objectives
and compensation payout. Our first six years in operations at our
Lost Creek uranium recovery project have permitted us an
opportunity to thoughtfully review the metrics and priorities most
appropriately used to establish and maintain that connection. In
doing so, the following considerations have been taken into
account:
|
·
|
|
the selection of corporate and
personal objectives that are measurable and tied to shareholder
value creation is fundamental to our success as a
company;
|
|
·
|
|
executive officers should be
evaluated and paid based on performance and achievement of both
corporate and personal objectives; and
|
|
·
|
|
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 the compensation
program are 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.
|
The compensation program process
generally 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
review 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, with employee
performance assessments 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, bonuses are
determined and awarded, in the discretion of the Compensation
Committee and Board. 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.
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
|
|
Variable
Compensation
|
|
|
|
|
|
|
Current
Incentive
|
|
Short-term
Incentives
|
|
Long-term
Incentives
|
|
|
|
|
|
|
Based
on skills,
experience
and market rates
|
|
Tied to
Past
Annual
Performance
|
|
Tied to Future
Long-term Share Price Performance
|
|
|
|
|
|
|
|
Base
Salary
|
|
Cash
Bonus
|
|
Stock
Options
|
|
Restricted Share
Units
|
Employment
Agreements with Named Executive Officers
We have employment agreements with
each of our current 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 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; and one-year non-competition provisions in the agreements
of Messrs. Hatten and 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 while
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 the 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.
The compensation structure and “pay
mix” in place for 2019 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;
|
|
·
|
|
executive officers have a higher
percentage of at-risk compensation relative to other employees,
because they have the greatest ability to influence corporate
performance;
|
|
·
|
|
of an executive’s short-term
incentive is based on corporate performance; and
|
|
·
|
|
80% of an executive’s long-term
incentive is composed of stock options, which are highly leveraged
to our share price performance.
|
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 with
base salaries to compensate them for services rendered. We seek to
identify levels of base salary or wage which will aid us in
attracting and retaining quality employees. Base salaries for all
employees are reviewed annually by management, and 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.
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 term
incentive plan (“STIP”) are 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 the CEO and Board. The STIP program is designed to recognize and
reward both corporate and individual performance results. Weighting
of corporate and personal objectives as related to the STIP program
provides 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, was developed through consideration of peer
group practices and other standards.
The following table shows the current
target levels and weightings used to establish STIP awards for our
NEOs:
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%
|
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%
|
We calculate the STIP awards as
follows:

Actual STIP awards are based on
performance for the year and paid in the following year after our
year-end results are released. 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.

Long-Term
Equity Incentives
The long-term incentive plan (“LTIP”)
includes our Option Plan and the Ur-Energy Amended Restricted Share
Unit Plan (the “RSU Plan”). The Option Plan and the RSU Plan form a
long-term incentive plan for employees including executive officers
and, in the case of the Option Plan, our consultants. Participation
in the Option Plan and the RSU
Plan is determined by the
Compensation Committee, considering the recommendations of the
Chief Executive Officer (and, for the Chief Executive Officer, the
recommendations of the Compensation Committee). The purpose of the
Option Plan and the RSU Plan is 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 the participant’s interests with those of the Company’s
shareholders. Awards made under the Option Plan and RSU Plan 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). The LTIP
target for our CEO is 60% of his base salary; the LTIP target for
our other Named Executive Officers is 50% of his or her base
salary. A more detailed discussion of the Option Plan and RSU Plan
can be found below under the heading “Stock Options and
RSUs.”
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 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 other benefit
programs including a 401(k) Plan, medical, prescription drug,
dental, vision, short- 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 2019. 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.
2019 Review of
Compensation Program
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-term and long-term incentives. Most
recently, this review of the program and of the compensation of
executive officers was completed in 2019. As we typically have
done, the compensation program review included the development of
our peer group, to be utilized for multiple purposes. As with other
peer comparator groups before it, the peer group was used within
our corporate objectives as a base from which we can compare our
performance to peer companies for such things as total shareholder
return. It is also used as a comparison when we evaluate our
directors and officers compensation, with additional review of
companies outside the peer group which have similar executive
positions where the peer group does not have sufficient depth of
data. Generally, we review and/or update our peer group annually.
Once updated, the Compensation Committee reviews the peer group and
recommends it, with any changes or additions, to the Board for
approval. In 2019, we subscribed to Equilar’s compensation
services, which 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
includes six uranium producers and explorers and ten 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 continues to reflect a lack
of similarly-situated uranium explorers and producers 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 15 of the 16 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 2019 peer group, as approved by the Board of Directors,
is as follows:
|
|
|
ALEXCO Resource Corp.
|
Alio Gold
Inc.
|
Americas Gold and
Silver Corporation
|
Denison Mines
Corp.
|
Endeavour Silver Corp.
|
Energy Fuels
Inc.
|
Fission Uranium
Corp.
|
Gold Resource
Corporation
|
Golden Star Resources Ltd.
|
Great Panther Mining
Limited
|
Largo Resources Ltd.
|
NexGen Energy
Ltd.
|
Seabridge Gold
Inc.
|
Silvercorp Metals
Inc.
|
Uranium Energy
Corp.
|
Westwater Resources,
Inc.
|
|
|
As a result of our compensation
program review and establishment of the peer group, no changes to
our compensation program were determined to be appropriate at that
time. The weighting of personal and corporate objectives
remains unchanged, with executives’ personal objectives aligned
with the objectives of the department for which the executive
officer is responsible; the executives’ personal objectives are
also designed to help the Company achieve its overall corporate
objectives.
We continue to use corporate
objectives to broadly measure our total corporate performance. Our
corporate objectives are grouped into Key Performance Areas
(KPA(s)), which in turn include a number of compensable Key
Performance Indicators (KPI(s)). For 2019, our corporate objectives
were divided into four KPAs that reflect our core reporting
segments (Total Company, Lost Creek, Pathfinder and Corporate
Services) on a weighted basis. Since commencement of
operations at Lost Creek, we have maintained a more significant
weighting for Lost Creek objectives (40%), for a greater emphasis
on operational priorities. Each of the other categories
carries a 20% weight.
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. As well, in 2019 we asked every employee to adopt a
personal safety objective when they prepared their personal
objectives for the year. 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 developed by executive
management and our Board of Directors to establish objectives that
align with our corporate strategy as established by the Board.
Annually, 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:
|
|
1
|
Unsatisfactory Performance (Fails to
meet minimum expectations)
|
2
|
Partially Successful Performance
(Needs some improvement in specific areas)
|
3
|
Fully Successful Performance
(Effective)
|
4
|
Superior Performance (Highly
Effective)
|
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.
The Threshold level of performance is
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 if the Threshold is not met.
Achieving the Threshold would result in a 50% payout of the
Weighted KPI. The Maximum level of performance for each KPI 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 of the Weighted KPI.
A straight-line interpolation is used
to calculate payouts when the result is between the Threshold
payment (50%) and Maximum payout (150%). The KPI
Weighted Payout is the result of multiplying (a) the KPI times (b)
the KPI Payout.
2019
Performance on Objectives
With the Compensation Committee,
management regularly monitors the corporate results as they relate
to the KPIs to determine if the Company is on-track to meet its
objectives, and adjusts the KPIs if there are substantive shifts in
the objectives and priorities of the Company as the year
progresses. After year end, a final review of the corporate results
is overseen by the Compensation Committee and reported to our
Board. In February 2020, the Board reviewed corporate performance
based upon the selected 2019 KPI objectives. Our corporate
performance was evaluated as having generally met the performance
objective targets, and exceeded the targets in several categories
and specific objectives. Results of performance based upon our
2019 KPIs, as approved by the Compensation Committee and Board of
Directors, are set forth below.
|
|
|
|
|
|
|
|
|
TOTAL
COMPANY
|
KPI
WEIGHT
|
KPI
PAYOUT
|
KPI
WEIGHTED PAYOUT
|
KPI
Measures and Results
|
|
|
|
HSE
– Have no lost time
accidents and no medical aids. Emphasize safety
culture.
Score
of 4.0
|
3%
|
150%
|
4.5%
|
Financing
– Anticipate and
meet financial needs without hampering operating
requirements.
Score
of 4.0
|
5%
|
150%
|
7.5%
|
TSR
– Achieve median
one- and three-year return compared to peers.
Score
of 3.2
|
4%
|
110%
|
4.4%
|
Regulatory
– Continue with
trade action and defend against harmful, negative issues (market,
legislation, etc.).
Score
of 3.8
|
4%
|
140%
|
5.6%
|
Strategic
Plans – Implement 2019
plan to positively position Company.
Score
of 3.2
|
4%
|
110%
|
4.4%
|
|
20%
|
|
26.4%
|
Total
Company: Our “Total Company” corporate objectives
continued to focus on safe, controlled-level production operations
at Lost Creek. The Company ended the year with a cash and cash
equivalents balance of $7.8 million. Excluding NRV adjustments, we
recognized a gross profit of $12.2 million on sales of $32.3
million during 2019, which represents a gross profit margin of
approximately 38%. The Company realized an average price per pound
sold of $48.50. These accomplishments were achieved alongside
another perfect safety year with no lost-time
accidents (“LTAs”) and no medical aids.
During 2019, we continued our
dedicated pursuit of a healthy uranium mining industry which is
vital to U.S. national security. While our Section 232 action
did not result in immediate action by the White House, the
President mandated the establishment of the U.S. Nuclear Fuel
Working Group (the “Working Group”). We continued our efforts to
influence that work and the ultimate relief package, including
through the formation of a fuel cycle-wide industry working group
which provided its recommendations to the Working Group.
Due to the continuing depressed
market conditions, we conducted no further development work in MU2
at Lost Creek in 2019. Continued production from MU1 and the
first three header houses of MU2 allowed us to capture
approximately 48,000 pounds U3O8 at Lost
Creek. We further de-risked our business utilizing purchased
pounds to be delivered into our contractual obligations, and
monetizing future obligations for approximately $7.5
additional revenue in 2019. We reached agreement with the
State of Wyoming and Sweetwater County to defer 18 months of
principal payments on our State Bond Loan, resulting in a $7.8
million dollar savings in that period. Finally, the Company secured
purchase agreements for inventory to sell into 2020 contractual
obligations in order to continue to preserve our inventory which,
at year-end 2019, was approximately 270,000 pounds of ready-to-sell
product at the converter.
Even with persistently depressed
uranium pricing, the percent rank of our total shareholder returns
(TSR) were largely on target for both one-year (46.6%) and
three-year (57.3%) results compared with our peer group, although
the one-year performance slipped due to strong precious metals
results for the year. See also discussion under heading “Total Shareholder
Return,” below.
|
|
|
|
|
|
|
|
|
LOST
CREEK
|
KPI
WEIGHT
|
KPI
PAYOUT
|
KPI
WEIGHTED PAYOUT
|
KPI
Measures and Results
|
|
|
|
HSE
– No LTAs or
medical aids. Emphasize safety culture.
Score
of 4.0
|
9%
|
150%
|
13.5%
|
Development
– Water treatment
alternatives.
Score
of 3.8
|
11%
|
140%
|
15.4%
|
Operations
– Prepare plant for
1M lbs/year production rate.
Score
of 3.0
|
11%
|
100%
|
11.0%
|
Production
– Complete
production from initial MU1 patterns.
Score
of 3.5
|
4%
|
125%
|
5.0%
|
Permitting
– Complete permitting
of LC East to allow timely development per current mine
plan.
Score
of 3.0
|
5%
|
100%
|
5.0%
|
|
40%
|
|
49.9%
|
Lost
Creek: Our corporate
objectives continued to focus on Lost Creek operations. As
mentioned, Lost Creek KPIs total 40% of our corporate objectives.
In 2019, this meant advancing operations on a limited production
plan, readying the staff and facilities to a ramp-up scenario and
continuing to improve our safety culture and results. Our overall
safety record demonstrated that commitment with the milestone of
another 12 months with no LTAs or medical aids. The operational
refinements we have implemented continue to serve us
well. Additionally, we advanced engineering reviews
of wastewater alternatives in order to further optimize future
operations.
Permitting
advanced in the effort to obtain all approvals for amendments
to existing permits and authorizations for recovery from mine units
at LC East. The BLM authorizations were issued early in 2019, while
work continued on other final permits throughout 2019.
We expect remaining authorizations to be obtained this year.
Although we conducted another
reduction in force in Q3 2019, we have maintained a skilled
and dedicated workforce, with experience and expertise which will
allow us to be best prepared for ramp-up of Lost Creek
operations.
|
|
|
|
|
|
|
|
|
PATHFINDER
|
KPI
WEIGHT
|
KPI
PAYOUT
|
KPI
WEIGHTED PAYOUT
|
KPI
Measures and Results
|
|
|
|
HSE
– No LTAs and no
regulatory violations. Emphasize safety culture.
Score
of 4.0
|
2%
|
150%
|
3.0%
|
Development
– Advance
engineering design of plant/satellite and initial
wellfield.
Score
of 3.0
|
9%
|
100%
|
9.0%
|
Permitting
– Advance
permitting of Shirley Basin (air, EPA, URP, LQD and
BLM).
Score
of 3.5
|
7%
|
125%
|
8.8%
|
Data
Development – Continue to
develop means to monetize PMC data and/or Excel Project.
Score
of 3.4
|
2%
|
120%
|
2.4%
|
|
20%
|
|
23.2%
|
Pathfinder:
Performance relative to our
objectives for our Pathfinder Mines assets continued to be strong
in 2019. Our safety record for Pathfinder, including Shirley Basin
Project, remained perfect: no incidents. Significant progress was
made during the year, advancing our application for a permit
and license to mine at Shirley Basin with the Wyoming State
regulators. The BLM substantially progressed its review of
the Plan of Operations for Shirley Basin. Work is well underway on
initial engineering evaluations, designs and studies, with
road design and completion of mine unit infrastructure
completed.
Efforts to advance value from the
Pathfinder exploration database continued, with further review and
analyses of the database to identify exploration projects from
which data may be sold or traded. We continue to consider all
prospects to advance Excel Project, and to obtain value for our
shareholders, whether further exploring the project ourselves,
identifying a viable venture partner, or through a sale
process.
|
|
|
|
|
|
|
|
|
CORPORATE
SERVICES
|
KPI
WEIGHT
|
KPI
PAYOUT
|
KPI
WEIGHTED PAYOUT
|
KPI
Measures and Results
|
|
|
|
HSE
– No LTAs.
Emphasize safety culture.
Score
of 4.0
|
4%
|
150%
|
6%
|
HR
– Anticipate and
address risk management of HR issues.
Score
of 3.7
|
4%
|
135%
|
5.4%
|
Risk
Management – Minimize risk and
maintain compliance.
Score
of 3.3
|
3%
|
115%
|
3.5%
|
Finance
– Implement
business unit recordkeeping and reporting.
Score
of 3.0
|
3%
|
100%
|
3.0%
|
IR-
Update all
materials (website, presentations and database) and maintain
shareholder contact and marketing outreach.
Score
of 3.3
|
3%
|
115%
|
3.5%
|
IT
– Assess IT
requirements, develop needs-based plan, and implement.
Score
of 3.5
|
3%
|
125%
|
3.8%
|
|
20%
|
|
25.2%
|
Corporate
Services: Our corporate
services group maintains a vigilant focus on safety at the
corporate offices, and also in support of our operations at Lost
Creek. The safety record for corporate services was, again, without
incident. Risk management remained a priority for our finance,
compliance and legal groups, with 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. Business unit cash flow models and accounting
reports were readied in anticipation of the ability to not only
ramp-up at Lost Creek, but construct and operate at Shirley Basin.
The finance department was successful in forecasting and managing
our cash resources, including to guide cost-cutting measures and
the financing opportunities described above. HR advanced all
aspects of preparation for ramp-up hiring as well as maintaining
staffing for current needs, all while managing risks. All of these
efforts relate to our ongoing efforts to successfully position the
Company in these challenging market times.
Overall, our 2019
performance-to-objectives result was 124.7% 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 46.6%. The longer,
three-year TSR was approximately 57.3%. These results continue to
be primarily driven by 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
in our comparator group.
|
|
|
|
|
|
Total
Shareholder Returns as at December 31, 2019
|
Ur-Energy Inc.
Comparator Companies
|
Small
Cap Mining Companies - emphasis on uranium
companies
|
YTD
TSRs
|
Company
Name
|
1
Year
|
2
Years
|
3
Years
|
4
Years
|
5
Years
|
Ur-Energy
Inc
|
-14.61%
|
-11.63%
|
7.04% |
-14.61%
|
-23.23%
|
Alexco Resource
Corp.
|
136.22% |
50.75% |
65.75% |
538.30% |
400.00% |
Alio Gold
Inc.
|
-12.17%
|
-78.14%
|
-75.66%
|
-46.84%
|
-91.14%
|
Americas Gold and
Silver Corporation
|
82.51% |
-11.14%
|
16.29% |
239.17% |
44.33% |
Denison Mines
Corp.
|
-14.29%
|
-21.74%
|
-22.86%
|
-22.86%
|
-52.21%
|
Endeavour Silver
Corp.
|
6.46% |
3.64% |
-34.11%
|
58.08% |
23.23% |
Energy Fuels
Inc.
|
-35.92%
|
9.73% |
12.22% |
-39.51%
|
-65.27%
|
Fission Uranium
Corp.
|
-47.22%
|
-63.23%
|
-55.47%
|
-65.24%
|
-66.86%
|
Gold Resource
Corporation
|
39.48% |
26.80% |
28.26% |
236.11% |
65.07% |
Golden Star Resources
Ltd.
|
13.36% |
-11.35%
|
-0.61%
|
318.72% |
293.60% |
Great Panther Mining
Limited
|
-30.93%
|
-58.90%
|
-69.82%
|
-4.29%
|
-4.29%
|
Largo Resources
Ltd.
|
-65.02%
|
-25.56%
|
102.04% |
235.59% |
-42.77%
|
NexGen Energy
Ltd.
|
-30.71%
|
-47.98%
|
-28.33%
|
131.94% |
339.47% |
Seabridge Gold
Inc.
|
-0.33%
|
25.86% |
62.68% |
56.86% |
103.86% |
Silvercorp Metals
Inc.
|
159.25% |
125.26% |
136.06% |
1019.49% |
382.92% |
Uranium Energy
Corp.
|
-26.46%
|
-48.07%
|
-17.93%
|
-13.28%
|
-47.47%
|
Westwater Resources,
Inc.
|
-69.86%
|
-96.06%
|
-96.92%
|
-99.32%
|
-99.81%
|
|
|
|
|
|
|
Percent
Rank
|
46.53% |
53.16% |
57.31% |
35.27% |
43.24% |
Median
|
-13.23%
|
-16.55%
|
-10.62%
|
57.47% |
9.47% |
Mean
|
5.78% |
-13.38%
|
0.91% |
157.23% |
75.57% |
10th
Percentile
|
-56.12%
|
-70.68%
|
-72.74%
|
-56.04%
|
-79.00%
|
25th
Percentile
|
-32.18%
|
-50.71%
|
-39.45%
|
-27.02%
|
-55.48%
|
75th
Percentile
|
18.20% |
13.77% |
33.69% |
236.49% |
151.29%
|
90th
Percentile
|
109.37% |
40.86% |
83.89% |
428.51% |
361.20% |
|
|
|
|
|
|
Minimum
|
-69.86%
|
-96.06%
|
-96.92%
|
-99.32%
|
-99.81%
|
Maximum
|
159.25% |
125.26% |
136.06% |
1019.49% |
400.00% |
|
|
|
|
|
|
Ur-Energy Inc.'s
Rank
|
10
|
9
|
8
|
12
|
10
|
|
>P25
|
>P50
|
>P50
|
>P25
|
>P25
|
|
|
|
|
|
|
Source: S&P
Capital IQ
|
For
Information
|
|
1
Year
|
2
Years
|
3
Years
|
4
Years
|
5
Years
|
S&P/TSX Composite
Index
|
19.13%
|
5.27%
|
11.62%
|
31.16%
|
16.61%
|
S&P/TSX Venture
Composite Index
|
3.65%
|
-32.11%
|
-24.24%
|
9.87%
|
-16.96%
|
S&P/TSX Global
Mining Index
|
21.59%
|
13.95%
|
30.69%
|
85.71%
|
32.82%
|
Executive
Compensation – Related Fees
The Compensation Committee did not
utilize any third-party consulting services during 2019. Management
and the Compensation Committee continue to utilize the Company’s
subscription to Equilar Services, as well as other online data
sources.
2020
Compensation Program and Outlook
We currently anticipate that the
compensation program will remain largely the same in 2020 for all
employees and executive officers. The average spot price per
pound of U3O8, as reported by UxC, LLC and TradeTech, LLC, at
or about the Record Date was $27.45. Although spot prices
have risen in the past week or so, with the announcement by Cameco
of its immediate closure of Cigar Lake, the continuing market
environment, is such that we will continue to maintain a reduced
production level with no further development. If
additional supply destruction causes market conditions to further
improve or there is relief provided through the Working Group, we
stand ready to enter additional contracts and ramp-up Lost Creek.
In recent months, we have implemented
still further cost reductions, and secured purchase contracts for
100% of our 2020 delivery obligations. In 2020, we expect to
deliver 200,000 pounds into term contracts at an average price of
$42 per pound. We have contracts in place to purchase 200,000
pounds at an average cost of $26 per pound, which we intend to
deliver into the term contracts. We currently have approximately
270,000 pounds of finished, ready-to-sell, product inventory at the
conversion facility, although at this time we are not forecasting
sales from inventories at existing spot prices. We may,
however, choose to sell additional produced product or inventory
depending on market conditions.
Most recently, the President’s
proposed FY2021 budget included a line item of $150 million per
year from 2021 to 2030 to support the creation and fulfillment of a
new national uranium reserve to be supplied by domestically mined
uranium; we understand that this is a part of the Working Group’s
recommendations which have been submitted to the White
House. While this news is encouraging, there can be no
certainty of the approval and implementation of the President’s
proposed budget, nor of the outcome of the Working Group’s findings
and recommendations, and therefore, the outcome of this continuing
process and its effects on the U.S. uranium market is
uncertain.
We have maintained our Lost Creek
assets and retained our core technical and management staff to run
the best operations, and to be prepared to ramp-up when market
conditions warrant. With initial 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 when market conditions improve or
there is relief obtained from the Working Group.
We will continue to concentrate on
operating safely in an environmentally-sound fashion, focusing on
the health and well-being of our employees, including in the
current circumstances surrounding COVID-19/coronavirus, while
returning value to our shareholders.
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. To encourage alignment of the interests of
the executive officers and directors with those of our
shareholders, in 2009, the Board of Directors mandated that each
executive officer of Ur-Energy, whether then appointed or appointed
thereafter, is required to invest an amount equal to one times the
executive officer’s annual base salary in shares or securities
redeemable into shares on or before the later of (i) December 31,
2013, (ii) the fifth anniversary of the executive officer’s
appointment, or (iii) the date of the most recent salary increase.
The investment amount is calculated using the amount of the base
salary of the executive officer at the later of (i) January 1,
2009, (ii) the date of executive officer’s appointment, or the date
of the most recent base salary increase. The share ownership
requirements are also applicable to the non-executive directors who
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 2019,
all executive officers meet the Share Ownership Guidelines or are
on-track to meet the Share Ownership Guidelines within the
prescribed timeframes.
Anti-Hedging
Policy; Pledging
We have a formal anti-hedging policy
which prohibits our executive officers and directors from engaging
in any 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 only
approximately 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. See Notes to Security Ownership
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 units 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
|
|
·
|
|
the executive(s)
engaged in gross negligence, intentional misconduct or fraud which
caused or significantly contributed to the restatement;
and
|
|
·
|
|
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.
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.
EXECUTIVE COMPENSATION
Say on Pay
Advisory Vote in 2019
In 2019, our shareholders approved
our compensation program for our Named Executive Officers by a vote
in favor of 93%.
In each of the last four years, our
advisory “say on pay” votes have been above 90%. The Compensation
Committee believes the results of our advisory votes on “say on
pay” continue to be indicative that the clear majority of our
shareholders are satisfied with our executive compensation policies
and decisions, and that our executive
compensation program effectively
aligns the interests of our Named Executive Officers with the
interests of our shareholders.
Following the recommendations of the
2018 compensation review as only partially implemented in early
2019, and with uranium market conditions as they remained in Q4
2019, only an informal review of executive compensation was made in
2019. We included survey data from the peer group established by
the Company, utilizing Equilar and other, publicly-available data.
The review confirms that our executive officers remain well behind
even the median ranges of the comparator company data, with only
certain limited exceptions. In 2018, effective in 2019, an initial
correction was made to adjust the base compensation of our CEO, Mr.
Klenda. Due to continuing market conditions, however, no further
corrective action was taken in 2019. Executives were then provided
cost of living raises, only, in November 2019. Additionally, to
conserve our cash resources, when our Vice President Geology
retired in 2019, he was not replaced; rather, others on staff and
in the executive team assumed his responsibilities for the
Company.
We continue to review our human
resources in light of the Company’s current operations and needs.
Responsive to both persistently low uranium prices, and resulting
reductions in production, 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 30
employees at year-end 2019. This reduction has included controlled
attrition as well as the reductions in force which have been
implemented. Twelve employees were laid off in
2019.
On our say when on pay vote, the
Board is recommending that we continue with an annual advisory
(non-binding) say on pay vote. Although our compensation program
has changed little in recent years, and we do not currently
anticipate that the program will change significantly in the
near-term, we believe that an annual update for our shareholders is
appropriate. Based upon the first advisory vote by our
shareholders, in 2014, concerning “say when on pay,” our Board
adopted an annual advisory vote for “say on pay,” until our next
say when on pay vote this year. Our next say when on pay vote will
be in 2026.
Summary
Compensation Table
The following table sets forth the
summary information concerning compensation earned during the
financial years ended December 31, 2019, 2018 and 2017 by our Named
Executive Officers serving at December 31, 2019.
|
|
|
|
|
|
|
|
|
|
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
($)
|
|
|
|
|
|
|
|
|
|
|
Jeffrey
T. Klenda
|
2019
|
426,050
|
Nil
|
62,082
|
109,917
|
Nil
|
Nil
|
Nil
|
598,049
|
President
and
|
2018
|
321,436
|
216,284
|
38,171
|
65,108
|
Nil
|
Nil
|
Nil
|
640,999 |
Chief
Executive Officer
|
2017
|
312,441
|
149,399
|
46,157
|
71,373
|
Nil
|
Nil
|
Nil
|
579,370
|
|
|
|
|
|
|
|
|
|
|
Roger
L. Smith
|
2019
|
282,425
|
Nil
|
33,958
|
60,124
|
Nil
|
Nil
|
11,297
|
387,804
|
Chief
Financial Officer and
|
2018
|
275,150
|
102,251
|
27,230
|
46,444
|
Nil
|
Nil
|
11,006
|
462,081
|
Chief
Administrative Officer
|
2017
|
267,444
|
90,722
|
32,925
|
50,913
|
Nil
|
Nil
|
10,698
|
452,702
|
|
|
|
|
|
|
|
|
|
|
Penne
A. Goplerud
|
2019
|
253,908
|
Nil
|
30,529
|
54,052
|
Nil
|
Nil
|
10,156
|
348,645
|
General
Counsel and
|
2018
|
247,372
|
92,079
|
24,480
|
41,755
|
Nil
|
Nil
|
9,895
|
415,581
|
Corporate
Secretary
|
2017
|
240,446
|
83,529
|
29,601
|
45,773
|
Nil
|
Nil
|
9,618
|
408,967
|
|
|
|
|
|
|
|
|
|
|
Steven
M. Hatten
|
2019
|
222,522
|
Nil
|
26,756
|
47,371
|
Nil
|
Nil
|
8,550
|
305,199
|
Vice
President Operations
|
2018
|
216,794
|
80,430
|
21,455
|
36,594
|
Nil
|
Nil
|
8,672
|
363,945
|
|
2017
|
210,731
|
70,836
|
25,943
|
40,115
|
Nil
|
Nil
|
8,429
|
356,054
|
|
|
|
|
|
|
|
|
|
|
John
W. Cash
|
2019
|
212,086
|
Nil
|
25,501
|
45,149
|
Nil
|
Nil
|
7,756
|
290,492
|
Vice
President
|
2018
|
206,614
|
79,448
|
20,447
|
34,876
|
Nil
|
Nil
|
7,550
|
348,935
|
Regulatory
Affairs
|
2017
|
200,826
|
70,381
|
24,724
|
38,231
|
Nil
|
Nil
|
7,347
|
341,509
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Each of
the NEOs (Messrs. Klenda, Smith, Hatten and Cash and Ms. Goplerud)
has an employment agreement with the Company, as has been amended
from time to time. See discussion under heading “Employment
Agreements with Named Executive Officers” above and
“Potential
Payments Upon Termination or Change of Control – Employment
Agreements with our Named Executive Officers” below.
|
|
(2)
|
|
Annual
incentive plan awards are shown in the year earned and the
presentation of past annual incentive plan awards has been
conformed for consistency. As described above, STIP awards are
typically determined in the first calendar quarter based upon
performance to corporate and personal objectives for the preceding
year. The STIP awards for the Named Executive Officers for 2019,
which would be paid in 2020 were deferred due to market and
worldwide economic conditions. The Board may, in the future,
consider the feasibility of making some payout of the STIPs as may
be suggested by the Compensation Committee.
|
|
(3)
|
|
The
issuance of share-based and option-based awards in conjunction with
the LTIP are shown in the year they were issued.
|
|
(4)
|
|
Canadian dollar
figures have been converted to U.S. dollar figures at the average
exchange rate for 2019 of C$1.00 = US$0.7537308; for 2018 of C$1.00
= US$0.772113; and for 2017 of C$1.00 = US$0.771137 as quoted by
Bank of Canada on its website www.bankofcanada.com.
|
|
(5)
|
|
For
additional information regarding the fair value of stock options
and RSUs, as at December 31, 2019 (using the Company’s TSX closing
stock price of C$0.76 on the last trading day of 2019), see Annual
Report on Form 10-K, note 14 to Financial Statements, which has
been filed with the SEC at https://www.sec.gov/edgar.shtml and with
Canadian securities regulators, and is available at https://sedar.com.
|
|
(6)
|
|
Reflects only the
Company’s matching contribution toward the executive’s 401(k)
retirement account. Other aspects of compensation or perquisites
are of a non-material value, and/or are provided to executive
officers in the same fashion as all employees of the Company
(e.g.,
healthcare, disability, and other insurances).
|
EQUITY
INCENTIVE PLANS
The following table
sets forth certain summary information concerning our equity
compensation plans as at December 31, 2019. Directors, officers,
employees, and consultants are eligible to participate in the
Option Plan. Directors and employees, including executive officers,
are eligible to participate in the RSU Plan.
|
|
|
|
|
Number
of Common Shares to be Issued Upon Exercise of Outstanding Options,
Warrants and Rights
|
Weighted
Average Exercise Price of Outstanding Options, Warrants and
Rights
(2)
(C$)
|
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)
|
12,232,511
|
$
0.64
|
3,291,262
|
Equity
compensation plans not approved by security-holders
|
-
|
-
|
-
|
|
(1)
|
|
Our
shareholders have approved both the Option Plan and the RSU Plan,
and are asked to do so on a routine, every three-year
basis.
|
|
(2)
|
|
The exercise price
represents the weighted exercise price of the 11,076,583
outstanding stock options at December 31, 2019.
|
|
(3)
|
|
The figure represents
the Common Shares remaining available for issuance under the Option
Plan and the RSU Plan as reserved with the TSX at December 31,
2019.
|
Stock Options and
RSUs
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 Plan allows
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, in the aggregate. As
of March 30, 2020, we have listed and reserved 15,523,773 Common
Shares in the aggregate of which 13,886,995 Common Shares were
reserved under the Option Plan, and 1,636,778 Common Shares were
reserved under the RSU Plan. We allocate approximately 80% of those
reserved shares to the Option Plan and 20% to the RSU 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, 11,052,694 options for Common
Shares have been granted and are outstanding, as at March 30, 2020,
or approximately 6.9% of our issued and outstanding Common Shares.
There are 1,149,955 RSUs that have been granted and are
outstanding as of March 30, 2020, or approximately 0.7% 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
dividends on unvested or redeemed equity awards of all types. The
run rate (or, “burn rate”) on the equity plans for the past three
years is as follows:
|
|
|
|
|
2019
|
2018
|
2017
|
Stock
Option Plan
|
1.8% |
1.5% |
1.8% |
Restricted Share
Unit Plan
|
0.4% |
0.3% |
0.4% |
As at March 30, 2020, the closing
price of our Common Shares on the NYSE American was $0.37 and
on the TSX was C$0.53.
Option
Plan
Under the Option Plan, options may be
granted to our directors, executive officers, eligible employees
and consultants. As of March 30, 2020, there are approximately 14
employees and six non-executive directors who would be eligible to
participate in the Option Plan. The Option Plan was most recently
approved by shareholders on May 18, 2017.
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 certificates 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.
Options in a grant 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; dividends, for all award types, shall not be payable on
unvested options; the term of all options is five
years. 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
period of time.
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.
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 the 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 are 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 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.
RSU
Plan
The RSU Plan was adopted by the Board
of Directors on May 7, 2010 and was approved in its entirety most
recently by our shareholders on May 2, 2019. Under the RSU
Plan restricted share units may be granted to directors and
employees, including executive officers, of Ur‑Energy as possible
eligible participants. The Board of Directors has appointed the
Compensation Committee to determine which persons are entitled to
participate in the RSU Plan and the number of RSUs to be awarded to
each participant. The RSU Plan does not limit the participation of
any specific eligible participant including insiders. RSUs awarded
to participants are credited to a notional account that is
established on their behalf and maintained in accordance with the
RSU 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.
The RSU Plan permits us to either
redeem RSUs for cash or issue Common Shares from treasury 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. In the event
of a change of control, as defined in the RSU 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.
The Board may from time to time amend
or suspend the RSU Plan and may at any time terminate the RSU Plan.
No such amendment, suspension or termination shall adversely affect
the rights of any eligible person with respect to outstanding and
unredeemed RSUs credited to that person without that RSU holder’s
consent. 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 RSU Plan to comply with regulatory
requirements, amendments related to the administration of the RSU
Plan and to change the eligibility requirements under the RSU Plan
and terms and conditions on which the RSUs may be
granted.
RSUs are generally treated as
ordinary compensation income as and when Common Shares are issued
to the participant upon vesting or settlement of the award. If the
participant is an employee, this income is 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. 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, 2019.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Estimated
future payouts under non-equity incentive plan awards
|
|
Estimated
future payouts under equity incentive plan awards
|
|
|
|
|
|
Name
|
Grant
date
|
Threshold
($)
|
Target
($)
|
Maximum
($)
|
|
Threshold
($)
|
Target
($)
|
Maximum
($)
|
|
All
other stock awards: Number of shares of stock or units
(1)
(#)
|
All
other option awards: Number of securities underlying options
(2)
(#)
|
Exercise
of base price of option awards
(C$/Sh)
|
Grant
date fair value of stock and option awards (US$)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Jeffrey
T. Klenda
|
11/5/19
|
Nil
|
Nil
|
Nil
|
|
Nil
|
Nil
|
Nil
|
|
Nil
|
417,044
|
0.79
|
109,917
|
|
11/5/19
|
Nil
|
Nil
|
Nil
|
|
Nil
|
Nil
|
Nil
|
|
104,261
|
Nil
|
Nil
|
62,082
|
Roger L.
Smith
|
11/5/19
|
Nil
|
Nil
|
Nil
|
|
Nil
|
Nil
|
Nil
|
|
Nil
|
228,119
|
0.79
|
60,124
|
|
11/5/19
|
Nil
|
Nil
|
Nil
|
|
Nil
|
Nil
|
Nil
|
|
57,030
|
Nil
|
Nil
|
33,958
|
Penne A.
Goplerud
|
11/5/19
|
Nil
|
Nil
|
Nil
|
|
Nil
|
Nil
|
Nil
|
|
Nil
|
205,081
|
0.79
|
54,052
|
|
11/5/19
|
Nil
|
Nil
|
Nil
|
|
Nil
|
Nil
|
Nil
|
|
51,271
|
Nil
|
Nil
|
30,529
|
Steven M.
Hatten
|
11/5/19
|
Nil
|
Nil
|
Nil
|
|
Nil
|
Nil
|
Nil
|
|
Nil
|
179,733
|
0.79
|
47,371
|
|
11/5/19
|
Nil
|
Nil
|
Nil
|
|
Nil
|
Nil
|
Nil
|
|
44,934
|
Nil
|
Nil
|
26,756
|
John W.
Cash
|
11/5/19
|
Nil
|
Nil
|
Nil
|
|
Nil
|
Nil
|
Nil
|
|
Nil
|
171,304
|
0.79
|
45,149
|
|
11/5/19
|
Nil
|
Nil
|
Nil
|
|
Nil
|
Nil
|
Nil
|
|
42,826
|
Nil
|
Nil
|
25,501
|
|
(1)
|
|
These amounts
represent grants made pursuant to the RSU Plan. RSUs awarded to
participants will be redeemed 100% on the second anniversary of the
date of grant.
|
|
(2)
|
|
These amounts
represent grants made pursuant to the Option Plan. Options granted
to eligible participants vest and become exercisable 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 the date of grant. The term of the option is five
years.
|
Outstanding Equity
Awards at December 31, 2019
The following table sets forth
information concerning the value vested or earned in respect of
incentive plan awards during the year ended December 31, 2019 by
each of the Named Executive Officers.
|
|
|
|
|
|
|
|
|
|
|
|
Option-based
Awards
|
|
Share-based
Awards
|
Name
|
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$)
|
Equity
incentive plan awards: number of unearned shares, units or other
rights that have not vested
(#)
|
Equity
incentive plan awards: Market or payout value of unearned shares,
units or other rights that have not vested
($)
|
|
|
|
|
|
|
|
|
|
|
|
Jeffrey
T. Klenda
|
70,762
|
0
|
Nil
|
0.86
|
8/17/20
|
|
Nil
|
Nil
|
Nil
|
Nil
|
|
199,340
|
0
|
Nil
|
0.80
|
12/11/20
|
|
Nil
|
Nil
|
Nil
|
Nil
|
|
338,118
|
0
|
Nil
|
0.73
|
12/16/21
|
|
Nil
|
Nil
|
Nil
|
Nil
|
|
158,019
|
81,403
|
Nil
|
0.90
|
12/15/22
|
|
Nil
|
Nil
|
Nil
|
Nil
|
|
36,642
|
74,394
|
Nil
|
0.93
|
8/20/23
|
|
Nil
|
Nil
|
Nil
|
Nil
|
|
34,264
|
69,567
|
Nil
|
0.91
|
12/14/23
|
|
Nil
|
Nil
|
Nil
|
Nil
|
|
0
|
417,044
|
Nil
|
0.79
|
11/5/24
|
|
Nil
|
Nil
|
Nil
|
Nil
|
|
Nil
|
Nil
|
Nil
|
Nil
|
Nil
|
|
27,759
|
16,336
|
Nil
|
Nil
|
|
Nil
|
Nil
|
Nil
|
Nil
|
Nil
|
|
25,958
|
15,276
|
Nil
|
Nil
|
|
Nil
|
Nil
|
Nil
|
Nil
|
Nil
|
|
104,261
|
61,358
|
Nil
|
Nil
|
Roger L.
Smith
|
62,302
|
0
|
Nil
|
0.86
|
8/17/20
|
|
Nil
|
Nil
|
Nil
|
Nil
|
|
87,462
|
0
|
Nil
|
0.80
|
12/11/20
|
|
Nil
|
Nil
|
Nil
|
Nil
|
|
241,184
|
0
|
Nil
|
0.73
|
12/16/21
|
|
Nil
|
Nil
|
Nil
|
Nil
|
|
112,720
|
58,068
|
Nil
|
0.90
|
12/15/22
|
|
Nil
|
Nil
|
Nil
|
Nil
|
|
26,138
|
53,068
|
Nil
|
0.93
|
8/20/23
|
|
Nil
|
Nil
|
Nil
|
Nil
|
|
24,442
|
49,625
|
Nil
|
0.91
|
12/14/23
|
|
Nil
|
Nil
|
Nil
|
Nil
|
|
0
|
228,119
|
Nil
|
0.79
|
11/5/24
|
|
Nil
|
Nil
|
Nil
|
Nil
|
|
Nil
|
Nil
|
Nil
|
Nil
|
Nil
|
|
19,802
|
11,653
|
Nil
|
Nil
|
|
Nil
|
Nil
|
Nil
|
Nil
|
Nil
|
|
18,517
|
10,897
|
Nil
|
Nil
|
|
Nil
|
Nil
|
Nil
|
Nil
|
Nil
|
|
57,030
|
33,562
|
Nil
|
Nil
|
Penne A.
Goplerud
|
56,012
|
0
|
Nil
|
0.86
|
8/17/20
|
|
Nil
|
Nil
|
Nil
|
Nil
|
|
78,632
|
0
|
Nil
|
0.80
|
12/11/20
|
|
Nil
|
Nil
|
Nil
|
Nil
|
|
216,836
|
0
|
Nil
|
0.73
|
12/16/21
|
|
Nil
|
Nil
|
Nil
|
Nil
|
|
101,340
|
52,206
|
Nil
|
0.90
|
12/15/22
|
|
Nil
|
Nil
|
Nil
|
Nil
|
|
23,500
|
47,711
|
Nil
|
0.93
|
8/20/23
|
|
Nil
|
Nil
|
Nil
|
Nil
|
|
21,974
|
44,614
|
Nil
|
0.91
|
12/14/23
|
|
Nil
|
Nil
|
Nil
|
Nil
|
|
0
|
205,081
|
Nil
|
0.79
|
11/5/24
|
|
Nil
|
Nil
|
Nil
|
Nil
|
|
Nil
|
Nil
|
Nil
|
Nil
|
Nil
|
|
17,803
|
10,477
|
Nil
|
Nil
|
|
Nil
|
Nil
|
Nil
|
Nil
|
Nil
|
|
16,647
|
9,797
|
Nil
|
Nil
|
|
Nil
|
Nil
|
Nil
|
Nil
|
Nil
|
|
51,271
|
30,173
|
Nil
|
Nil
|
Steven M.
Hatten
|
49,090
|
0
|
Nil
|
0.86
|
8/17/20
|
|
Nil
|
Nil
|
Nil
|
Nil
|
|
68,916
|
0
|
Nil
|
0.80
|
12/11/20
|
|
Nil
|
Nil
|
Nil
|
Nil
|
|
190,040
|
0
|
Nil
|
0.73
|
12/16/21
|
|
Nil
|
Nil
|
Nil
|
Nil
|
|
88,814
|
45,752
|
Nil
|
0.90
|
12/15/22
|
|
Nil
|
Nil
|
Nil
|
Nil
|
|
20,595
|
41,814
|
|