US Energy Corp

This advisory proposal asks holders to approve, on a non-binding basis, the Company’s disclosed 2025 executive compensation (the named executive officers’ pay). Management is seeking stockholder endorsement to validate its compensation framework — which combines base salary, annual cash bonuses tied to individual and company performance, and long‑term equity incentives — and to demonstrate alignment between management interests and stockholder value. The Compensation Committee argues that the program is designed to attract, retain, and motivate experienced executives while balancing short‑term operational goals with long‑term equity‑based incentives. The proxy includes pay-versus-performance disclosures and narrative detail intended to show how compensation paid correlates with company performance and TSR over the relevant period; the Board will consider the advisory vote results in future compensation decisions. Because this is an advisory vote it will not alter contractual obligations but serves as important shareholder feedback; the filing notes the Board values stockholder input and will continue to consider outcomes when setting future pay. The proposal also provides context on prior voting results (the 2025 say‑on‑pay vote was disclosed) demonstrating investor sentiment is tracked over time. While the Company frames the program as aligned with long‑term value creation, investors should weigh disclosure on realized pay, equity vesting schedules, and recent pay actions (including option grants and restricted stock awards) when assessing whether the incentives are appropriately calibrated. In sum, management seeks ratification to support its compensation practices and to use the advisory outcome as guidance for subsequent compensation decisions.

This proposal requests approval under Nasdaq Listing Rule 5635(d) to eliminate the Exchange Cap (the 19.99% limit) so the Company may issue shares in excess of that threshold to Roth Principal Investments pursuant to the Purchase Agreement dated October 9, 2025. The Purchase Agreement provides the Company the right, at its option, to sell up to $25 million of newly issued common stock to Roth Principal Investments through market‑open and intraday purchases, with per‑share pricing tied to VWAP during defined valuation periods (subject to a 2.5% discount). Nasdaq’s 20% rule would otherwise limit issuances to 19.99% of outstanding stock without prior stockholder approval; management seeks approval to preserve optionality to fully utilize the facility regardless of market pricing dynamics. The Board’s rationale emphasizes enhanced capital‑raising flexibility and the ability to time issuances responsively to market conditions to fund operations or strategic needs, while noting that use of the facility will be at the Company’s discretion. The filing discloses material tradeoffs: potential significant dilution to existing holders, possible adverse effects on market price and voting power, and the anti‑takeover implications of incremental share issuance. The proxy also discloses transaction economics and fees (commitment shares, cash commitment fee, legal reimbursements, and use of a qualified independent underwriter) and that the Company has already sold and issued shares under the agreement, including amounts sold above the Exchange Cap Price. Investors evaluating the proposal should weigh the immediate liquidity benefits and optional access to a committed capital source against dilution risk, governance implications of large issuances to a single counterparty, and the absence of firm issuance obligations by the Company. The Board recommends approval as a means to preserve financing flexibility and efficient access to capital while retaining discretion over if, when, and how many shares to sell under the Purchase Agreement.