DEF 14A of Atlas Energy Solutions Inc.
Filed Mar 29, 2024 · FY20230001140361-24-016541
BOARD NOMINEES
BOARD NOMINEES
BOARD NOMINEES
| Name | Age | Director Since | Principal Occupation | Independent | AC | NCGC | CC | | Ben M. “Bud” Brigham | 64 | 2022 | Executive Chairman | | | | | | John Michael “Mike” Howard | 50 | 2024 | Chairman and Chief Executive Officer of Howard Midstream Energy Partners, LLC | X | | X | |
BOARD NOMINEES
AC: Audit Committee NCGC: Nominating & Corporate Governance Committee CC: Compensation Committee
BOARD NOMINEES
| PROXY SUMMARY | i | | ABOUT ATLAS ENERGY SOLUTIONS INC. | 1 | | ABOUT THE ANNUAL MEETING | 2 | | PROPOSAL ONE: ELECTION OF DIRECTORS | 5 | | DIRECTOR NOMINEES | 6 | | INCUMBENT DIRECTORS AND EXECUTIVE OFFICERS | 8 | | CORPORATE GOVERNANCE | 11 | | CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS | 17 | | DIRECTOR COMPENSATION | 22 | | EXECUTIVE COMPENSATION | 24 | | SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT | 29 | | EQUITY COMPENSATION PLAN INFORMATION | 31 | | PROPOSAL TWO: RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM | 32 | | AUDIT COMMITTEE REPORT | 34 | | DELINQUENT SECTION 16(a) REPORTS | 35 | | SUBMISSION OF STOCKHOLDER PROPOSALS FOR NEXT YEAR | 36 | | HOUSEHOLDING | 36 | | SOLICITATION OF PROXIES | 36 | | STOCKHOLDER PROXY SOLICITATION FOR SHAREHOLDER DIRECTOR NOMINEES | 37 | | STOCKHOLDER LIST | 37 | | OTHER MATTERS | 37 | | DIRECTIONS TO ANNUAL MEETING | 37 | | ADDITIONAL INFORMATION | 37 | | INVOLVEMENT IN CERTAIN LEGAL PROCEEDINGS | 37 |
BOARD NOMINEES
Atlas Energy Solutions Inc.
PROPOSAL ONE: ELECTION OF DIRECTORS
PROPOSAL ONE: ELECTION OF DIRECTORS The Board, upon the recommendation of the Nominating and Corporate Governance Committee, has nominated the following individuals for election as Class I directors of the Company, to serve for three-year terms beginning at the Annual Meeting and expiring at our 2027 Annual Meeting of Stockholders, and until his or her successor shall have been elected and qualified or until his or her earlier death, resignation or removal: Ben M. “Bud” Brigham John Michael “Mike” Howard Both of the nominees are currently directors of the Company and each of the nominees’ terms are expiring at the Annual Meeting. Since fewer nominees are named for director than the number fixed by the Company’s governing documents, the proxies cannot be voted for a greater number of persons than the number of nominees named. The Company’s stockholders are not being asked to vote separately on an amendment to the Company’s governing documents to reduce the size of the Board because the Company’s governing documents delegate the power to reduce the size of the Board solely to the Board and not to the Company’s stockholders. If Mr. Brigham and Mr. Howard are re-elected to the Board, the size of the Board will bet eight members. Biographical information for each director nominee is contained in the “Directors and Executive Officers” section below. The Board has no reason to believe that its director nominees will be unable or unwilling to serve if elected. If a director nominee becomes unable or unwilling to accept nomination or election, either the number of the Company’s directors will be reduced or the persons acting under the proxy will vote for the election of a substitute nominee that the Board recommends.
DIRECTOR NOMINEES
DIRECTOR NOMINEES The Board has determined that its current composition provides a balanced mix of expertise, including with respect to the energy and logistics sectors, public company management, financial acumen and other expertise and diversity of ideas. The Board believes that each director nominee possesses the leadership, experience, qualifications, attributes and skills to make significant contributions to the Board, our stockholders and the Company as a whole. Additionally, the information detailed below specifies each nominee’s experience, qualifications, attributes and skills the Board considered in concluding that the nominee should serve as a director. There are no family relationships between any of our executive officers or directors.
DIRECTOR NOMINEES
| Ben M. “Bud” Brigham | | | Age: 64 Director Since: 2022 Executive Chairman Committee Membership: None | Mr. Brigham is our founder and has served as the Executive Chairman of the Board since our inception in 2017, and served as our Chief Executive Officer from August 2022 until March 2024. Mr. Brigham has founded several upstream energy enterprises, including Brigham Exploration Company (“Brigham Exploration”) in 1990, which completed its initial public offering in 1997. Mr. Brigham served as its President, Chief Executive Officer and Chairman of the board of directors until its sale to Statoil ASA (“Statoil”) in December 2011. In 2012, Mr. Brigham founded Anthem Ventures, LLC, a family office. In that same year he and others founded Brigham Resources Operating, LLC, which was subsequently sold to Diamondback Energy, Inc. (NASDAQ: FANG) in 2017. In 2012 he also co-founded Brigham Minerals, Inc. (“Brigham Minerals”) to pursue mineral acquisitions in top-tier domestic shale resource plays. Brigham Minerals completed its IPO in 2019, and Mr. Brigham served as its Executive Chairman until its merger with Sitio Royalties Corp. (NYSE: STR) (“Sitio Royalties”) in 2022. In 2017, Mr. Brigham founded Brigham Exploration Company, LLC (the second entity founded by Mr. Brigham with such name) (“Brigham Exploration LLC”), a non-operating company focused on the Permian Basin. BEXP I, LP (“BEXP I”) was initially funded with Mr. Brigham’s capital, with subsequent investments by friends and family and a large institution. In the fourth quarter of 2021, new acreage and working interest acquisitions ceased in BEXP I, and BEXP II, LP commenced acreage and working interest acquisitions, with a larger capitalization including most of the BEXP I participants as well as additional institutions. In 2022, he was a co-founder of Langford Energy Partners LLC, which pursues the acquisition, development and optimization of operated oil and gas properties in top-tier shale resource plays. In 2023, he co-founded Brigham Royalties, a private enterprise pursuing mineral interests primarily in the Permian Basin. Prior to founding Brigham Exploration in 1990, Mr. Brigham served for six years as an exploration geophysicist with Rosewood Resources, Inc., an independent oil and natural gas exploration and production company, and as a seismic data processing geophysicist for Western Geophysical, a provider of 3D seismic services. Mr. Brigham earned a Bachelor of Science in Geophysics from the University of Texas at Austin. Mr. Brigham has served as a member of the National Petroleum Council and The Bureau of Economic Geology Visiting Committee. Mr. Brigham was inducted into the All American Wildcatters in April 2012 and into the Hart Energy Hall of Fame in November 2023. Relevant Skills and Expertise: Mr. Brigham has extensive knowledge and experience in the energy industry, business development and innovation, public company governance and leadership, and has been the leader of our Company since its inception. |
DIRECTOR NOMINEES
| John Michael “Mike” Howard | | | Age: 50 Director Since: 2024 Committee Membership: Nominating & Corporate Governance Committee | Since its founding in 2011, Mike Howard has served as Chairman and Chief Executive Officer of Howard Midstream Energy Partners, LLC (“HEP”), a diverse, multibillion-dollar energy company operating critical energy infrastructure in four states and Mexico. With more than 28 years of midstream energy experience, Mr. Howard is passionate about leading a purpose driven organization through some of the most challenging times in the oil and gas industry. Prior to co-founding HEP in 2011, Mr. Howard was President of Midstream at Energy Transfer Partners (NYSE: ETP and ETE), a Fortune 100 energy company, where his responsibilities encompassed all aspects of the midstream, transportation and storage segments including business development, engineering, operations, contract administration, and compliance for both the regulated and non-regulated businesses. In addition to chairing the HEP Board of Directors, Mike serves on the Board of Directors of Jonah Energy LLC and the Boards of Trustees for the Texas A&M University, Kingsville Foundation, the United Way of Bexar County, and the Witte Museum. Mike received his Bachelor of Science in chemical engineering from Texas A&M University, Kingsville. Relevant Skills and Expertise: Mr. Howard has valuable managerial and financial experience and thorough knowledge of the energy industry. |
INCUMBENT DIRECTORS AND EXECUTIVE OFFICERS
INCUMBENT DIRECTORS AND EXECUTIVE OFFICERS The directors and executive officers of the Company are:
INCUMBENT DIRECTORS AND EXECUTIVE OFFICERS
| Name | Age | Title | | Ben M. “Bud” Brigham | 64 | Executive Chairman and Director | | John Turner | 52 | Chief Executive Officer, President and Chief Financial Officer | | Chris Scholla | 40 | Chief Supply Chain Officer | | Dathan C. Voelter | 52 | General Counsel and Secretary | | Jeffrey Allison | 59 | Executive Vice President, Sales & Marketing | | Gayle Burleson | 58 | Director | | Stacy Hock | 46 | Director | | John Michael “Mike” Howard | 50 | Director | | A. Lance Langford | 61 | Director | | Mark P. Mills | 71 | Director | | Douglas Rogers | 65 | Director | | Gregory M. Shepard | 68 | Director | | Robb L. Voyles | 66 | Director |
INCUMBENT DIRECTORS AND EXECUTIVE OFFICERS
Set forth below is biographical information about each of our directors and executive officers. Ben M. “Bud” Brigham—Executive Chairman and Director. Please see Mr. Brigham’s biography and related information set forth under the section titled “Director Nominees.” John Turner—Chief Executive Officer, President and Chief Financial Officer. John Turner has served as our Chief Executive Officer since March 2024, as our President since November 2022 and as our Chief Financial Officer since April 2017. Mr. Turner has over 20 years of oil and natural gas industry experience. Prior to assuming his current role, Mr. Turner worked in various capacities for both public and private entities, with a focus on corporate finance, business development and strategic planning, including as Chief Financial Officer of Brigham Exploration LLC, Chief Financial Officer of Mediterranean Resources, LLC and Vice President of Brigham Exploration. Mr. Turner received a Bachelor of Business Administration and a Master of Business Administration from the McCombs School of Business at the University of Texas at Austin. Chris Scholla—Chief Supply Chain Officer. Chris Scholla currently serves as our Chief Supply Chain Officer and served previously as our Vice President of Supply Chain and Logistics from November 2017 until his promotion to his current role in November of 2022. Mr. Scholla is responsible for our end-to-end supply chain operations, as well as customer service and support. Mr. Scholla led our entry into the oilfield logistics market in 2019 and oversees our strategic logistics growth initiatives. Prior to joining us in 2017, Mr. Scholla worked at Hexion Inc. and DuPont de Nemours, Inc. (NYSE: DD) in a number of business strategy, supply chain, procurement and operations roles. Mr. Scholla has over a decade of proppant experience and almost 20 years of global supply chain experience. He holds a bachelor’s degree in Supply Chain & Information Systems from The Pennsylvania State University and a Master of Business Administration with concentrations in operations and finance from the College of William & Mary. He also currently serves on the Board of Directors of the Permian Road Safety Coalition. Dathan C. Voelter—General Counsel and Secretary. Dathan C. Voelter currently serves as our General Counsel and Secretary and served previously as our Deputy General Counsel and Secretary from April 2019 until his promotion to his current role in December 2021. Prior to joining us, Mr. Voelter served as Managing Counsel and Assistant Secretary of Andeavor and its midstream subsidiary, Andeavor Logistics LP, from September 2017 until February 2019, shortly after they were acquired by Marathon Petroleum Corp. (NYSE: MPC). Mr. Voelter also served as Associate General Counsel and Chief Compliance Officer of Itron, Inc. (NASD: ITRI) from 2016 to 2017 and held various executive leadership roles at Freescale Semiconductor Ltd. (NYSE: FSL) including Vice President and Chief Securities, Ethics and Compliance Counsel from 2005 until 2016, shortly after Freescale was acquired by NXP Semiconductors N.V. (NASDAQ: NXPI). Previously, Mr. Voelter was an attorney with Vinson & Elkins L.L.P. and he started his professional career as a public accountant with Coopers & Lybrand, L.L.P. Mr. Voelter received a Bachelor of Business Administration in International Business from the University of Texas at Austin and a Doctor of Jurisprudence summa cum laude from Baylor University School of Law. Jeffrey Allison—Executive Vice President, Sales & Marketing. Jeffrey Allison has served as our Executive Vice President, Sales & Marketing since May 2022. Prior to joining us, Mr. Allison served as President of Allison Energy Consulting, LLC from July 2020 until May 2022. Mr. Allison also served in various roles with Halliburton Company (NYSE: HAL) (“Halliburton”) over a 20-year period, including Mid-Continent Area Vice President from May 2018 until March 2020, where he led Halliburton’s business delivery in the area with accountability over business development (sales), operations, financial performance, HSE, capital execution and personnel development, and Executive Account Vice President from June 2010 until April 2018, where he provided oversight of strategic clients and accountability of all geographies, products and services, technology and commercial growth. Previously, Mr. Allison held various leadership and strategic roles with Baker Hughes INTEQ GmbH, Afognak Native Corporation and ConocoPhillips (NYSE: COP) both domestically and internationally. Mr. Allison currently sits on the Industry Advisory Board of Directors for the University of Oklahoma and has sat on several other industry advisory boards throughout his career, including the Petroleum Alliance of Oklahoma and the Petroleum Equipment & Services Association of Oklahoma. Mr. Allison received a Bachelor of Science in Petroleum Engineering from the Colorado School of Mines. Gayle Burleson—Director. Gayle Burleson has served as a member of our Board since March 2023 and currently serves on our Audit Committee and as chair of our Compensation Committee. Ms. Burleson served as a director of Brigham Minerals from January 2022 until its merger with Sitio Royalties in December 2022, where she currently serves on the board of directors. Ms. Burleson has served as a director for Select Water Solutions, Inc. since 2021, and previously served as a director for privately held Chisholm Energy Holdings, LLC from May 2021 until its acquisition by Earthstone Energy, Inc. (NYSE: ESTE) in February 2022. Ms. Burleson was most recently with Concho Resources Inc. (NYSE: CXO) (“Concho”) as the Senior Vice President of Business Development and Land and held that position from May 2017 until Concho’s acquisition by ConocoPhillips in January 2021. She was employed for 15 years at Concho in various roles and capacities with ever-increasing leadership responsibilities. Prior to joining Concho, Ms. Burleson served in a number of engineering and operations positions with BTA Oil Producers, LLC, Mobil Oil Corporation, Parker & Parsley Petroleum Company and Exxon Corporation. Ms. Burleson received her B.S. in Chemical Engineering from Texas Tech University. Ms. Burleson was appointed to our Board in March 2023 in connection with our initial public offering (our “IPO”) in light of her knowledge of the energy industry. Stacy Hock—Director. Stacy Hock has served as a member of our Board since March 2023 and currently serves on our Nominating & Corporate Governance Committee. Since 2008, Ms. Hock has been a private investor and philanthropist. Ms. Hock served on the board of directors of Brigham Minerals from January 2022 until its merger with Sitio Royalties in December 2022. Since 2015, Ms. Hock has served on the boards of Aminex Therapeutics, a privately held clinical stage drug development company, and the Texas Public Policy Foundation. She has also served for the last ten years on the board of the African Dream Initiative. Since 2016, she has served on multiple boards associated with the University of Texas, including the Blanton Museum of Art National Leadership Board and The University of Texas at Austin McCombs MBA Advisory Board. In 2021, Ms. Hock joined the University of Austin Board of Advisors. In July 2023, Governor Abbott appointed Ms. Hock to serve on the Texas Higher Education Coordinating Board. Ms. Hock previously held senior management positions in the software industry, including IBM’s WebSphere Software Services business. Ms. Hock received her B.S. in Computer Science and Electrical Engineering from the Massachusetts Institute of Technology, and her M.B.A from the University of Texas at Austin. Ms. Hock was appointed to our Board in March 2023 in connection with our IPO due to her finance and investment experience as a private investor.
John Michael “Mike” Howard—Director. Please see Mr. Howard’s biography and related information set forth under the section titled “Director Nominees.”
John Michael “Mike” Howard—Director. Please see Mr. Howard’s biography and related information set forth under the section titled “Director Nominees.” A. Lance Langford—Director. A. Lance Langford has served as a member of our Board since March 2023 and currently serves on our Compensation Committee and as chair of our Nominating & Corporate Governance Committee. Mr. Langford served as a director of Atlas LLC since 2018, and previously served as a director of Brigham Minerals from August 2020 until its merger with Sitio Royalties in December 2022. Mr. Langford has over 30 years of oil and gas industry experience. He has served as the Chief Executive Officer of Langford Energy Partners I, LLC since 2020. He is also a co-founder and has served as a member of the general partner of Brigham Royalties Fund I, LP since 2023. Previously, he was the Chief Executive Officer, Co-Founder, and director of Luxe Energy LLC and Luxe Minerals LLC from 2015 to 2020. Prior to that, Mr. Langford served as Senior Vice President for Equinor ASA (formerly named Statoil ASA) from 2011 to 2015. From 1995 to 2011, Mr. Langford built and led Brigham Exploration’s engineering, operations, marketing and midstream departments, ultimately serving as Executive Vice President—Operations at the time the company was purchased by Statoil. He started his engineering career with Burlington Resources Inc. from 1987 to 1995. Mr. Langford earned a Bachelor of Science in Petroleum Engineering from Texas Tech University. Mr. Langford was appointed to our Board in March 2023 in connection with our IPO in light of his knowledge of the energy industry and familiarity and experience with Atlas LLC. Mark P. Mills—Director. Mark P. Mills has served as a member of our Board since March 2023 and currently serves on our Compensation Committee. Mr. Mills has been a senior fellow at the Manhattan Institute, an economics and policy research institute, since 2013, and a faculty fellow at Northwestern University’s McCormick School of Engineering and Applied Science since 2014. He has also served as a strategic non-operating partner with Montrose Lane (an energy-tech venture fund) since 2017, and Chief Executive Officer of Digital Power Capital LLC, a boutique venture fund he co-founded in 2001 (which ceased operation in 2009). Previously, Mr. Mills was chairman and Chief Technology Officer of ICx Technologies, Inc., from 2005 to 2008, aiding in its public offering in 2007. Mr. Mills served in the White House Science Office under President Reagan and subsequently provided science and technology policy counsel to a variety of private-sector firms, the Department of Energy and U.S. research laboratories. Mr. Mills was a technology advisor for Bank of America Securities, Inc. and coauthor of the Huber-Mills Digital Power Report, a tech investment newsletter. Early in his career, Mr. Mills was an experimental physicist and development engineer at Bell Northern Research (Canada’s Bell Labs) and at the RCA David Sarnoff Research Center on microprocessors, fiber optics and missile guidance, earning several patents for his work. In 2016, Mr. Mills was named “Energy Writer of the Year” by the American Energy Society. Mr. Mills holds a degree in physics from Queen’s University, Ontario, Canada. Mr. Mills was appointed to our Board in March 2023 in connection with our IPO in light of his management skills and knowledge of the energy and the technology industries. Douglas G. Rogers—Director. Douglas G. Rogers has served as a member of our Board since March 2023. Since 2015, Mr. Rogers has served as the Executive Director and Secretary/Treasurer of The Sealy & Smith Foundation, a charitable organization that has provided John Sealy Hospital and the University of Texas Medical Branch with over $1 billion in funding in furtherance of its mission to provide healthcare on Galveston Island, Texas. Mr. Rogers is also a member of the board of directors of The Sealy & Smith Foundation. Mr. Rogers holds a Bachelor of Business Administration degree from Texas A&M University. Mr. Rogers was appointed to our Board in March 2023 in connection with our IPO as a representative of The Sealy & Smith Foundation and because of his background in banking, real estate and investments. Gregory M. Shepard—Director. Gregory M. Shepard has served as a member of our Board since September 2023 currently serves on our Nominating and Governance Committee. Mr. Shepard was on the board of directors of 20th Century Industries, later renamed 21st Century Insurance Group, from 1995 to 2004. In 2017, Mr. Shepard signed the initial private placement memorandum to invest in Atlas Sand Management Company, LLC. From 2014 to 2019, Mr. Shepard was the sole owner and founder of Wisconsin Northern White Sands Holdings LLC, which explored building proppant mines in Illinois, Wisconsin, Oklahoma and Texas. From 1996 to 2019, Mr. Shepard was an activist investor in publicly traded subsidiaries of mutual property-casualty insurance companies including Meridian Insurance Group, Inc., State Auto Financial Corp., Donegal Group Inc. and EMC Insurance Group Inc. Mr. Shepard led the Union Insurance Group as Chairman and President from 1985 to 2004, and Vice President from 1981 to 1985. Mr. Shepard was subjected to a cease-and-desist order from the SEC in June 2014 for violations of Section 16(a) of the Securities Exchange Act of 1934, as amended, stemming from failures to file timely reports of holdings and transactions from 2010 to 2011 in Donegal Group, Inc. Mr. Shepard ultimately signed a consent decree with the SEC, pursuant to which he paid an $80,000 civil penalty. Mr. Shepard received a Bachelor of Science in Insurance and Risk Management from the University of Illinois and a Juris Doctor from Northern Illinois University. He has been a member of the Illinois Bar Association since 1981. Mr. Shepard was selected to serve on our board of directors in light of his financial knowledge and familiarity with our predecessor, Atlas Sand Company LLC. Robb L. Voyles—Director. Robb L. Voyles has served as a member of our Board since March 2023 and currently serves as chair of our Audit Committee. Mr. Voyles has served as a Mediator, Arbitrator and Referee/Special Master with JAMS, the largest private provider of alternative dispute resolution services worldwide since 2021. Mr. Voyles previously served as Executive Vice President, Secretary and Chief Legal Officer at Halliburton from 2014 through 2021, where he led the company’s litigation, commercial law, mergers and acquisitions, intellectual property, labor and employment and ethics and compliance departments. He was also responsible for Halliburton’s corporate governance, directed its enterprise risk management program and guided the company’s sustainability and ESG design, practices and reporting. Mr. Voyles also served as Halliburton’s interim Chief Financial Officer in 2017. Prior to his tenure at Halliburton, Mr. Voyles spent 26 years with Baker Botts L.L.P., where he was a senior partner and the global chair of the litigation department. Mr. Voyles earned a Juris Doctor degree from the University of Michigan Law School and a Bachelor of Business Administration in accounting from the University of Dayton. Mr. Voyles was appointed to our Board in March 2023 in connection with our IPO in light of his experiences in the oil field services industry, and with corporate governance and legal matters.
Guidelines for Selecting Director Nominees
Guidelines for Selecting Director Nominees Although the Nominating & Corporate Governance Committee does not maintain a formal list of qualifications, the guidelines for selecting nominees generally provide that persons to be nominated:
Guidelines for Selecting Director Nominees
| • | should have demonstrated notable or significant achievements in business, education or public service; |
Guidelines for Selecting Director Nominees
| • | should possess the requisite intelligence, education and experience to make a significant contribution to the Board and bring a range of skills, diverse perspectives and backgrounds to its deliberations; and |
Guidelines for Selecting Director Nominees
| • | should have the highest ethical standards, a strong sense of professionalism and intense dedication to serving the interests of the stockholders. |
Guidelines for Selecting Director Nominees
The Nominating & Corporate Governance Committee considers a number of qualifications relating to management and leadership experience, background, integrity and professionalism in evaluating a person’s candidacy for membership on the Board. The Nominating & Corporate Governance Committee may require certain skills or attributes, such as financial or accounting experience, to meet specific needs of the Board that arise from time to time and also considers the overall experience and makeup of its members to obtain a broad and diverse mix of Board members. The Nominating & Corporate Governance Committee does not consider diversity of the Board when identifying and evaluating director nominees. The Nominating & Corporate Governance Committee does not distinguish among nominees recommended by stockholders and other persons.
DIRECTOR COMPENSATION
DIRECTOR COMPENSATION Our directors play a critical role in guiding the Company’s strategic direction and in overseeing the Company’s management. The many responsibilities and risks and the substantial time commitment of being a director require the Company to provide adequate compensation commensurate with the directors’ workload and opportunity costs. During 2023, directors who were not employees of the Company received annual cash retainers and a restricted stock unit award as set forth below in respect of their service on the Board during 2023. Directors who are employees of the Company do not receive any additional compensation for their service on the Board. Cash Compensation. The following table is a summary of the annual cash retainers that were approved in March 2023 for the non-employee directors to be paid in arrears in quarterly installments. In 2023, non-employee directors received a pro-rated retainer fee based on their roles on the Board and the time period from when they were appointed. Those amounts are disclosed below. We also reimburse directors for fees or expenses incurred in connection with attending meetings.
DIRECTOR COMPENSATION
| Compensation Component | Annual Amount ($) | | Non-Employee Board Member | 75,000 | | Committee Chair | | | Audit Committee | 30,000 | | Compensation Committee | 20,000 | | Nominating & Corporate Governance Committee | 20,000 |
DIRECTOR COMPENSATION
Equity Compensation. Our non-employee director compensation program is intended to include a meaningful element of equity-based compensation awards from the LTIP to align the interests of our directors and our stockholders. Non-employee directors receive an annual award from our LTIP in the form of restricted stock units with a target value equal to $145,000.
2023 Director Compensation Table
2023 Director Compensation Table The following table sets forth information for the year ended December 31, 2023, regarding the compensation awarded to, earned by or paid to the non-employee directors who served on the Board during 2023. Mr. Brigham, the Executive Chairman of the Company, does not receive additional compensation for his service as a director, and therefore, is not included in the Director Compensation table below. All compensation paid to Mr. Brigham is reported in the “Summary Compensation Table” under the section titled “Executive Compensation.”
Director Compensation in 2023
Director Compensation in 2023
Director Compensation in 2023
| Director Name | Fees Earned or Paid in Cash ($) | Stock Awards ($)(1)(2) | Total ($) | | Gayle Burleson | 77,583.33 | 128,815 | 206,398.33 | | Steven C. Cole | 42,500 | 128,815 | 171,315 | | Stacy Hock | 61,250 | 128,815 | 190,065 | | A. Lance Langford | 77,583.33 | 128,815 | 206,398.33 | | Mark P. Mills | 61,250 | 128,815 | 190,065 | | Douglas Rogers | 61,250 | 140,899 | 202,149 | | Gregory M. Shepard | 22,083.33 | 72,508 | 94,591.33 | | Robb L. Voyles | 85,750 | 128,815 | 214,565 |
Director Compensation in 2023
| (1) The amounts in this column reflect the aggregate grant date fair value of stock awards in accordance with Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 718 and as reported in Note 11 to the audited financial statements contained in our Annual Report on Form 10-K for the year ended December 31, 2023, but assuming no forfeitures. For each Director the amount reflected in the Stock Awards column represents restricted stock units (“RSUs”). RSU recipients accrue dividend rights on un-vested RSU awards, which will be remitted to the recipient to the extent that the RSUs vest. Each director, other than Gregory M. Shepard, received a number of RSUs calculated by dividing the target equity value by the initial public offering price of $18.00 per share. Mr. Shepard received an award that was prorated for a partial year of service. |
Director Compensation in 2023
| (2) For each of the directors other than Steven C. Cole and Gregory M. Shepard, there were 8,056 RSUs outstanding as of December 31, 2023. Mr. Cole’s RSUs vested immediately upon his resignation from the Board. Mr. Shepard had 3,197 RSUs outstanding as of December 31, 2023. |
2024 Director Compensation Program
2024 Director Compensation Program For 2024, the non-employee director compensation program includes the same cash retainers described above for 2023, which amounts will be paid in arrears in quarterly installments. Non-employee directors will also receive an annual restricted stock unit award, with a target value of $145,000 that vests on the one-year anniversary of the grant date, subject the director’s continued service through such date. Each director may elect to receive their cash retainer in the form of equity by combining their respective annual cash retainer with the grant date fair value of the restricted stock unit award.
2023 Summary Compensation Table
2023 Summary Compensation Table The following table sets forth the aggregate compensation earned by our Named Executive Officers for the fiscal years ended December 31, 2023 and 2022, to the extent that they were NEOs for the applicable year.
2023 Summary Compensation Table
| Name | Year | Salary ($) | Bonus ($)(1) | Stock Awards ($)(2) | Non-Equity Incentive Compensation ($) | All Other Compensation ($) | Total ($) | | Ben M. “Bud” Brigham Executive Chairman | 2023 | 497,692 | 0 | 5,608,333 | 0 | 0 | 6,106,025 | | | 2022 | 0 | 0 | 0 | 0 | 0 | 0 | | John Turner Chief Executive Officer, President and Chief Financial Officer | 2023 | 515,385 | 611,350 | 1,658,250 | 0 | 0 | 2,784,985 | | | 2022 | 393,847 | 490,000 | 0 | 0 | 0 | 883,847 | | Dathan C. Voelter(3) General Counsel and Secretary | 2023 | 390,385 | 317,100 | 5,560,628 | 0 | 9,900 | 6,278,013 |
2023 Summary Compensation Table
| (1) The bonuses disclosed in this column reflect discretionary amounts that were earned by the applicable Named Executive Officers during the 2023 or 2022 calendar year, as applicable, whether or not paid in such calendar year. |
2023 Summary Compensation Table
| (2) The amounts in this column reflect the aggregate grant date fair value of stock awards in accordance with Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 718 and as reported in Note 11 to the audited financial statements contained in our Annual Report on Form 10-K for the year ended December 31, 2023, but assuming no forfeitures. For each NEO the amount reflected in the Stock Awards column represents a combination of restricted stock units (“RSUs”) and performance share units (“PSUs”). RSU and PSU recipients accrue dividend rights on un-vested RSU and PSU awards, which will be remitted to the recipient to the extent that the RSUs or PSUs vest. Please refer to the table below for the value of the RSUs and PSUs granted to each of our NEOs in 2023. Values for the PSUs within the table above reflect the probable outcome as of the date of grant, which is not the maximum value achievable. The table below also includes the maximum PSU values achievable as of the date of grant. |
2023 Summary Compensation Table
| Name | RSUs ($) | PSUs (Probable Value) ($) | PSUs (Maximum Value) ($) | | B. Brigham | 0 | 5,608,333 | 11,216,666 | | J. Turner | 732,875 | 925,375 | 1,850,750 | | D. Voelter | 4,999,795 | 560,833 | 1,121,666 |
2023 Summary Compensation Table
| (3) The amount reflected in the All Other Compensation column consists of the Company’s matching contribution of $9,900 to his 401(k) plan account. |
Outstanding Equity Awards at 2023 Fiscal Year-End
Outstanding Equity Awards at 2023 Fiscal Year-End The following table reflects information regarding outstanding equity-based awards held by our Named Executive Officers as of December 31, 2023. All awards reflected below are governed by the LTIP.
Outstanding Equity Awards at 2023 Fiscal Year-End
| | | Stock Awards | | | | | Name | Grant Date | Number of Units That Have Not Vested (#) | Market Value of Units That Have Not Vested ($)(3) | 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, Unit or Other Rights That Have Not Vested ($)(3) | | Ben M. “Bud” Brigham | 03/13/2023(4) | — | — | 555,556 | 9,566,667 | | John Turner | 03/13/2023(1) | 45,833 | 789,244 | — | — | | | 03/13/2023(4) | — | — | 91,667 | 1,578,500 | | Dathan C. Voelter | 10/04/2023(2) | 207,074 | 3,565,814 | — | — | | | 03/13/2023(1) | 27,778 | 478,337 | — | — | | | 03/13/2023(4) | — | — | 55,556 | 956,667 |
Outstanding Equity Awards at 2023 Fiscal Year-End
| (1) The 2023 annual RSU awards vest ratably on the first, second, and third anniversaries of the date of grant. |
Outstanding Equity Awards at 2023 Fiscal Year-End
| (2) Represents a special, one-time retention award which vests ratably vest ratably on the first, second, and third anniversaries of the date of grant. |
Outstanding Equity Awards at 2023 Fiscal Year-End
| (3) Market value is determined by multiplying the number of shares reported by $17.22, the closing price of our Common Stock on December 29, 2023. |
Outstanding Equity Awards at 2023 Fiscal Year-End
| (4) In accordance with the SEC rules, the number of shares presented in this table reflects a payout percentage of 200%; provided, however, that depending on performance, the actual number of PSUs earned may be less than this amount. |
Potential Payments upon a Change of Control or Termination
Potential Payments upon a Change of Control or Termination We do not maintain employment agreements with our NEOs. We adopted our Management Change in Control Severance Plan (the “Severance Plan”) during the first half of 2023 to provide for severance pay and benefits to our NEOs and participating members of management (each, a “Manager”) upon a termination due to our termination of the participant without cause or by the employee for good reason (collectively, a “Qualifying Termination”) or a termination due to death or disability, and to attract and retain talent in the event of any change in control. The Severance Plan generally defines a change in control as (i) an acquisition of 50% or more of our then-outstanding shares or the combined voting power of our then-outstanding voting securities, (ii) individuals who constitute the Board cease for any reason to constitute at least a majority of the Board, excluding any director whose election or nomination was approved by a vote of at least a two-thirds of the then current directors unless such approval occurs as a result of an actual or threatened election contest, (iii) consummation of a reorganization, merger or consolidation or sale or other disposition of all or substantially all of our assets or an acquisition of assets of another entity, unless certain securities ownership percentages remain unchanged following the event, or (iv) approval by our stockholders of our complete liquidation or dissolution. Non-Change in Control Termination. Upon a Qualifying Termination of a Manager, outside of the period of time beginning six months prior to the occurrence of a change in control and lasting through the 18-month anniversary of the occurrence of the change in control (the “Covered Period”) or a termination due to death or disability (collectively, a “Non-CIC Termination”), so long as the Manager satisfies the conditions to payment of severance benefits described below, the Manager will be entitled to receive the following severance benefits: (i) a lump sum cash severance payment calculated by multiplying the Manager’s individual severance multiplier (described below) by the aggregate amount of the Manager’s base salary and target cash bonus amount for the year in which the applicable termination occurs; (ii) a lump-sum cash payment equal to the pro-rated amount of the Manager’s target cash bonus award set for the year in which the applicable termination occurs, pro-rated on a daily basis for the applicable calendar year; (iii) subject to the Manager’s timely election of continuation coverage pursuant to Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”), a lump sum equal to the employer portion of continued coverage for 18 months following the separation date for the Manager and the Manager’s spouse and eligible dependents under our health plans; and (iv) payment or reimbursement, as applicable, of (x) earned but unpaid base salary as of the date of the applicable termination; (y) all incurred but unreimbursed expenses for which the Manager is entitled to reimbursement; and (z) benefits to which the Manager is entitled under the terms of any of our applicable benefit plans or programs (collectively, the “Accrued Benefits”). Change in Control Termination. Upon a Qualifying Termination of a Manager during the Covered Period (a “CIC Termination”), so long as the Manager satisfies the conditions to payment of severance benefits described below, the Manager will be entitled to receive the following severance benefits: (i) a lump sum cash severance payment calculated by multiplying the Manager’s individual severance multiplier by the aggregate amount of the Manager’s base salary and target cash bonus amount for the year in which the applicable Qualifying Termination occurs; (ii) a lump-sum cash payment equal to the amount of the Manager’s target cash bonus award set for the year in which the applicable Qualifying Termination occurs; (iii) subject to the Manager’s timely election of continuation coverage pursuant to COBRA, a lump sum equal to the employer portion of continued coverage for 24 months following the separation date for the Manager and the Manager’s spouse and eligible dependents under our health plans; and (iv) the Accrued Benefits. Severance Conditions. Each Manager will receive an individual participation agreement that contains that Manager’s terms of eligibility and any provisions that may be applicable to the Manager in addition to or as modification of the terms of the Severance Plan, including an individualized severance multiplier that will be applicable for calculating the lump sum cash payments described above. As of December 31, 2023, the individual severance multipliers for Bud Brigham, John Turner, and Dathan Voelter were, with respect to any Non-CIC Termination, 2X for Bud Brigham, 2X for John Turner, and 1.5X for Dathan Voelter and, with respect to any CIC Termination, 3X for Bud Brigham, 3X for John Turner, and 2X for Dathan Voelter. Payment of the severance benefits under the Severance Plan is subject to a Manager’s execution and non-revocation of a general release of claims and the Manager’s continued compliance with the terms of the Severance Plan, including, but not limited to, the restrictive covenant obligations set forth therein. Equity Awards. Our equity award agreements provide for certain protections upon different change in control and termination scenarios. RSUs. RSUs accelerate and become fully vested upon a change in control, upon a termination of employment due to death or disability or and upon a Qualifying Termination. PSUs. If the participant’s employment is terminated other than because of a Qualifying Termination or due to death or disability, then the participant’s PSUs are automatically forfeited without payment upon such termination. If, prior to the end of the performance period, the participant is terminated by reason of a Qualifying Termination, then the participant is deemed to have satisfied all service-based employment requirements on a pro-rata basis; if the participant’s termination is due to a death or disability prior to the end of the performance period, then the participant is deemed to have satisfied all service-based employment requirements in full. With respect to a termination due to a Qualifying Termination, a death or a disability within the first two years of the performance period, all performance-based vesting conditions will be deemed to be met at 100% and the resulting vested PSUs will be settled within a 30-day period following the termination. If the participant’s employment is terminated due to a Qualifying Termination or death or disability during the third calendar year of the performance period, then the PSUs will continue to be subject to the performance goals for the remainder of the performance period and performance will be deemed to be met at the actual performance level satisfied at the end of the performance period. In the event of a change in control during the performance period, any PSUs determined to become vested PSUs are payable to the participant in connection with that event. The Compensation Committee will determine the actual performance levels achieved as of the date of such change in control, if determinable, and all service-based requirements will be deemed to be satisfied.
STOCKHOLDER PROXY SOLICITATION FOR SHAREHOLDER DIRECTOR NOMINEES
STOCKHOLDER PROXY SOLICITATION FOR SHAREHOLDER DIRECTOR NOMINEES Any stockholder who intends to solicit proxies in support of any director nominees must comply with the content requirements of SEC Rule 14a-19 (the SEC’s universal proxy rule) at the time it complies with the earlier deadlines in the Company’s advance notice provisions of its bylaws. Thus, if a stockholder intends to solicit proxies in support of any director nominees submitted under the advance notice provisions of the Company’s bylaws for our 2025 Annual Meeting, then such stockholder must also provide proper written notice that sets forth all the information required by SEC Rule 14a-19 to the address shown previously in this section so that it is received no earlier than December 26, 2024, and no later than January 25, 2025; provided, however, that if our 2025 Annual Meeting is called for a date that is more than 30 days before or more than 60 days after the first anniversary date of this year’s Annual Meeting, to be properly brought, timely notice by the stockholder must be so delivered not earlier than the close of business on the 10th day following the day on which public announcement of the date of our 2025 Annual Meeting is first made by the Company.