D. Stephen Slack
About D. Stephen Slack
D. Stephen Slack is an independent Class One director at U.S. Energy Corp. (USEG), serving on the board since December 2019; he previously served as Chairman from December 2019 to January 2022 . Age 75, Slack holds a bachelor’s degree from the University of Southern California and an MBA from Columbia University, with senior operating and finance credentials in energy (former CFO of Pogo Producing; former President/CEO of South Bay Resources) and public board experience (Cornell Companies audit chair) .
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| South Bay Resources, LLC (and South Bay Resources Canada, Inc.) | President & CEO | Founded 2001 | Led E&P operations; private company leadership |
| Pogo Producing Company, Inc. (NYSE: PPP) | SVP & CFO; Director | CFO 1988–1998; Director 1990–1998 | Senior finance leadership at public E&P |
| Cornell Companies, Inc. (NYSE: CRN) | Director; Audit Committee Chair; Compensation Committee member | Mar 2003–Aug 2010 | Audit Committee chair and designated financial expert at prior public company |
External Roles
| Organization | Role | Status | Notes |
|---|---|---|---|
| Cornell Companies, Inc. | Director | Prior | Served as audit chair and comp committee member |
| Current public company boards | — | None disclosed | Proxy notes only Mr. Smith holds another public directorship (180 Life Sciences); no current external boards for Slack |
Board Governance
- Independence: Board affirms Slack is independent under Nasdaq and SEC rules; all three standing committees are comprised solely of independent directors .
- Committee assignments (current year):
- Audit Committee: Member; chairman is Randall D. Keys; committee met 4 times in 2024 and recommended inclusion of 2024 audited financials .
- Compensation Committee: Chair (with Keys as member); met 4 times in 2024; oversees CEO/CFO goals and compensation, and human capital policies .
- Nominating & Governance Committee: Not a member in 2025 (was a member in 2024) .
- Special Committee: In June 2024, served on Special Committee (with Keys, Denny, Batchelor; Keys as chair) reviewing a related-party transaction with Synergy Offshore LLC (entities controlled by directors Weinzierl and King) .
- Attendance/Engagement: In 2024, the board held 4 meetings; each director attended 100% of board and applicable committee meetings; all directors attended the May 17, 2024 annual meeting (in person or via phone) .
- Executive sessions: Independent directors meet in executive session at least annually .
Committee Roles (evolution)
| Committee | 2024 | 2025 |
|---|---|---|
| Audit | Member | Member |
| Compensation | Chair; members Slack, Keys, King | Chair; members Slack, Keys |
| Nominating & Governance | Member | Not listed as member |
Fixed Compensation
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Cash fees (USD) | $85,000 | $91,000 | $115,000 |
| Committee chair/member cash components (policy) | Audit chair $20,000; Comp chair $10,000; Nom chair $10,000 (effective Jan 1, 2022) | Audit chair $25,000; Comp chair $16,000; Nom & Gov chair $16,000 (effective Mar 19, 2024) | Audit chair $25,000; Comp chair $16,000; Nom & Gov chair $16,000 (policy in effect) |
| Total director cash/equity reported (USD) | $233,000 total; $148,000 stock awards | $203,500 total; $112,500 stock awards | $175,600 total; $60,600 stock awards |
- Director policy: Annual board cash retainer $75,000; committee chair fees per above; Chairman retainer $150,000; plus long-term equity grants; policy effective March 19, 2024 .
Performance Compensation
| Grant Type | Grant Date | Amount | Vesting | Fair Value/Notes |
|---|---|---|---|---|
| Restricted common stock (directors, non-chair) | Feb 14, 2025 | 40,000 shares to each of 5 non-executive directors | 50% on Jul 1, 2025; 50% on Jan 1, 2026; service-based under 2022 EIP | Annual grant for board service; aligns equity participation |
| Unvested restricted shares (as of Dec 31, 2024) | — | 30,000 shares | — | Disclosed for Slack in director comp table |
| 2025 reported stock awards (Slack) | 2025 | $60,600 | — | Aggregate grant date fair value (ASC 718) |
- Company avoids option grants currently; equity awards are discretionary and typically annual in Q1; timing policies not tied to MNPI; anti-hedging provisions in place .
Performance metrics tied to director compensation
- Not disclosed for directors; director equity grants are service-based (time vesting), not performance (TSR/EBITDA) based .
Other Directorships & Interlocks
- Compensation Committee interlocks: None; 2024/2025 proxies state no interlocks for comp committee members (Slack, Keys; King in 2024). Noted that CEO Ryan Smith serves on 180 Life Sciences’ board and committees, but this is not a Slack interlock .
- Current public directorships: None for Slack, per “Other Directorships” section (only Mr. Smith listed) .
Expertise & Qualifications
- Finance and governance: Prior CFO of a public E&P (Pogo Producing); prior audit chair and designated financial expert at Cornell Companies; current audit committee member at USEG, though Keys is designated audit committee financial expert at USEG .
- Education: BA, University of Southern California; MBA, Columbia University .
Equity Ownership
| Holder | Shares Beneficially Owned | % Outstanding | Vested vs. Unvested Detail |
|---|---|---|---|
| D. Stephen Slack | 208,913 shares | <1% (“*” per table) | 168,913 fully vested; 40,000 subject to vesting 50% on Jul 1, 2025 and 50% on Jan 1, 2026 (service-based) |
- Ownership guidelines: Company discloses no formal equity ownership policy at this time; all directors hold stock .
- Anti-hedging/pledging: Directors prohibited from short sales and derivative hedging; pledging generally prohibited unless financially able to repay without pledged securities .
Governance Assessment
-
Strengths
- Independence and attendance: Slack is affirmed independent and recorded 100% attendance in 2024; strong engagement metrics .
- Committee leadership: As Compensation Committee Chair, Slack oversees executive pay and human capital; consistent service on Audit suggests comfort with oversight rigor .
- Conflict management: Participation on an independent Special Committee reviewing a related-party acquisition (Synergy Offshore) indicates proper conflict-handling structures .
-
Risks and potential RED FLAGS
- Related-party exposure: 2025 Synergy Offshore acquisition involved entities controlled by sitting directors (Weinzierl and King), with complex consideration including 1,400,000 shares, carried interest to $20M, and carbon credit/proceeds sharing—ongoing monitoring warranted for transaction economics and governance optics .
- Board nomination rights: Amended and Restated Nominating and Voting Agreement grants sellers and affiliates nomination and voting rights conditioned on ownership thresholds, potentially concentrating influence; directors must ensure continued compliance with independence and fiduciary duties .
- Pay structure shift: Year-over-year director stock award values declined (Slack: $148k in 2023 → $112.5k in 2024 → $60.6k in 2025) while cash fees rose; lesser at-risk equity may modestly reduce alignment if persistent .
Say‑on‑Pay & Shareholder Feedback
- 2025 Annual Meeting results (May 16, 2025): Say‑on‑pay approved (For: 8,197,095; Against: 305,486; Abstain: 70,012; Broker non-votes: 12,834,054) .
- 2024 proxy disclosure (prior year): Say‑on‑pay approved (For: 11,704,076; Against: 476,835; Abstain: 49,143; Broker non-votes: 7,297,058) .
Director Compensation (Detail)
| Component | 2023 | 2024 | 2025 |
|---|---|---|---|
| Annual board retainer (policy) | $75,000 | $75,000 | $75,000 |
| Compensation Committee Chair fee (policy) | $10,000 | $16,000 | $16,000 |
| Audit Committee Chair fee (policy) | $20,000 | $25,000 | $25,000 |
| Nominating & Governance Chair fee (policy) | $10,000 | $16,000 | $16,000 |
| Reported cash fees (Slack) | $85,000 | $91,000 | $115,000 |
| Reported stock awards (Slack) | $148,000 | $112,500 | $60,600 |
| Total (Slack) | $233,000 | $203,500 | $175,600 |
Related Party Transactions (context)
- Synergy Offshore acquisition (Jan 7, 2025): Consideration included $2.0M cash, 1,400,000 shares, carried interest up to 78 months or $20M, 18% share of carbon-related benefits and first gas plant sale gains within AMI; Synergy is controlled by director King and approx. 60% beneficially owned by Chairman Weinzierl .
- Share Repurchase Agreement (Jan 27, 2025): Private repurchase from entities associated with director Batchelor (Banner, Woodford, Sage Road Energy) at $2.47775/share; approved by disinterested board members and Audit Committee of independent directors .
- Nominating & Voting Agreement: Amended Sept 16, 2022; confers nomination/voting rights for Sellers and designated affiliates subject to ownership thresholds; includes disqualified person safeguards and Nasdaq independence allocations .
Governance Quality Signals
- Audit Committee report signed by Keys (chair), Denny, and Slack; formal 2024 oversight and recommendation for 10‑K inclusion indicates functioning financial oversight .
- Policies: Clawback policy adopted to comply with SEC/Nasdaq rules (effective Oct 2, 2023); insider trading/anti‑hedging and pledging restrictions are established .
Notes on Insider Trades
- Section 16(a) compliance: 2024 filings were timely except one late Form 4 by CFO Mark Zajac; no late filings noted for Slack in 2024 .
- No Slack‑specific Form 4 transactions were disclosed in the proxy; additional Form 4 details not provided in the cited filings.
Summary Assessment
- Slack’s profile combines deep energy operations and financial governance experience, with current leadership of the Compensation Committee and consistent Audit Committee service—supportive of board effectiveness .
- Independence and attendance are strong; however, the board’s transactional ties via peers (Synergy, seller affiliates) create perceived conflicts that have been addressed via independent committee processes—continued vigilance and transparency are warranted –.
- Director pay shows increasing cash/committee emphasis and reduced equity grant values in 2025; monitoring of alignment and pay‑for‑performance balance is advisable .
RED FLAGS: Related‑party transactions with entities controlled by sitting directors (Synergy; seller affiliates) ; concentrated nomination/voting rights via the Nominating and Voting Agreement –.