DEF 14A of Hallador Energy Co
Filed Apr 17, 2025 · FY20240001558370-25-004951
PROPOSAL NO. 1: ELECTION OF DIRECTORS FOR A ONE-YEAR TERM.6
PROPOSAL NO. 1: ELECTION OF DIRECTORS FOR A ONE-YEAR TERM.6
OUR CURRENT BOARD OF DIRECTORS AND NOMINEES7
OUR CURRENT BOARD OF DIRECTORS AND NOMINEES7
Director Nominees7
Director Nominees7
Director Compensation13
Director Compensation13
2024 Director Compensation14
2024 Director Compensation14
Summary Compensation Table15
Summary Compensation Table15
2024 Bonus Payout20
2024 Bonus Payout20
Outstanding Equity Awards at December 31, 202420
Outstanding Equity Awards at December 31, 202420
Equity Compensation Plan Information21
Equity Compensation Plan Information21
Potential Payments Upon Termination or Change in Control21
Potential Payments Upon Termination or Change in Control21
PAY VS. PERFORMANCE24
PAY VS. PERFORMANCE24
Relationship Between Compensation Actually Paid and Performance Measures26
Relationship Between Compensation Actually Paid and Performance Measures26
PROPOSAL NO.3: TO APPROVE THE HALLADOR ENERGY COMPANY SECOND AMENDED AND RESTATED 2008 RESTRICTED STOCK UNIT PLAN29
PROPOSAL NO.3: TO APPROVE THE HALLADOR ENERGY COMPANY SECOND AMENDED AND RESTATED 2008 RESTRICTED STOCK UNIT PLAN29
SECOND AMENDED AND RESTATED 2008 RESTRICTED STOCK UNIT PLANi
SECOND AMENDED AND RESTATED 2008 RESTRICTED STOCK UNIT PLANi
What vote is required to approve each item?
What vote is required to approve each item? Election of Directors. At the Annual Meeting, six director-nominees are standing for election to the Board. With respect to the election of directors, you may vote "for" or "against" each of the nominees for the Board, or you may "abstain” voting for one or more nominees. To be elected to the Board, a director-nominee must receive the affirmative vote of the holders of a majority of shares present in person or represented by proxy and entitled to vote on the matter (meaning that of the shares represented at the Annual Meeting and entitled to vote, a majority of them must be voted "FOR" the nominee). Abstentions will have the same effect as a vote "against" the election of the nominee to the Board. Your broker may not vote your shares on the nominees unless you give voting instructions. Broker non-votes will have no effect on the election of the nominees. Each director-nominee elected at the Annual Meeting will serve on the Board for a one-year term or until his successor is duly elected and qualified, or until he resigns or is removed. Say-on-Pay. At the Annual Meeting, we are asking shareholders to vote to approve on an advisory basis the compensation paid to the Named Executive Officers. With respect to this proposal, you may vote "for," "against," or "abstain" from voting with respect to this proposal. A majority of the shares represented at the Annual Meeting and entitled to vote on this proposal must vote "FOR" the proposal to approve it. If you "abstain" from voting with respect to this proposal, your vote will have the same effect as a vote "against" the proposal. Your broker may not vote your shares on this proposal unless you give voting instructions. Broker non-votes will have no effect on the vote for this proposal. Your vote will not directly change or otherwise limit or enhance any existing compensation or award arrangement of any of our Named Executive Officers, but the outcome of the say-on-pay vote will be considered by the Compensation Committee when making future compensation decisions. Hallador Energy Company Second Amended and Restated 2008 Restricted Stock Unit Plan. At the Annual Meeting, we are asking shareholders to approve the Second A&R RSU Plan. With respect to this proposal, you may vote "for" "against" or "abstain" from voting with respect to this proposal. A majority of the shares represented at the Annual Meeting and entitled to vote on this proposal must vote "FOR" the proposal to approve it. If you "abstain" from voting with respect to this proposal, your vote will have the same effect as a vote "against" the proposal. Your broker may not vote your shares on this proposal unless you give voting instructions. Broker non-votes will have no effect on the vote for this proposal. Ratification of Auditor. At the Annual Meeting, we are asking shareholders to ratify the appointment of Grant Thornton LLP, as our independent registered public accounting firm for the year ending December 31, 2025. With respect to this proposal, you may vote "for," "against" or "abstain" from voting with respect to this proposal. A majority of the shares represented at the Annual Meeting and entitled to vote on this proposal must vote "FOR" the proposal to approve it. If you "abstain" from voting with respect to this proposal, your vote will have the same effect as a vote "against" the proposal. As this proposal is considered a "routine" matter, your broker may vote your shares on this proposal if you do not provide voting instructions. Other Matters. For most other matters that properly come before the Annual Meeting, the affirmative vote of a majority of shares of Common Stock, present in person or represented by proxy and voted at the Annual Meeting, will be required.
Director Nominees
Director Nominees BRENT K. BILSLAND, the Chairman of the Board, President, and CEO, has served on the Board since 2009. Mr. Bilsland was elected Chairman of the Board in 2018, appointed CEO in 2014, and has been a director and our President since 2009. He was President of Sunrise Coal, LLC, our primary operating subsidiary, from July 2006 through November 2017, and Vice President of Knapper Corporation, a private corporation, from 1998 to 2004. Mr. Bilsland is a graduate of Butler University located in Indianapolis, Indiana. Mr. Bilsland brings broad industry experience and significant operational capabilities to our Company. He has an intimate understanding of our business and its operations that benefit us. In 2015 and 2016, Mr. Bilsland served as the Chairman of the Indiana Coal Council. Mr. Bilsland's investment in our Common Stock, combined with his wife and children, is 3.62%. ZARRELL GRAY, a director, serves as Chair of our Nominating Committee. Mr. Gray is Executive Advisor to Teays Rivers, a U.S. holding company with a strategic focus on production based and vertically integrated agricultural businesses with assets and operations across 23 states and 10 countries. From 2007 to 2021 he was Executive Vice President and Chief Operating Officer at Teays River. Prior to joining Teays River, Mr. Gray was professionally involved in the hybrid seed industry for over 17 years (1990 to 2007) and remains a principal owner of Gray's Seed, Inc. Mr. Gray graduated from Purdue University and has a Bachelor of Science in Agricultural Economics. Mr. Gray brings more than 17 years as a senior executive (COO/EVP) in the formation and growth of a large-scale holding company. Mr. Gray has served on multiple private corporate boards, each with sales in the hundreds of millions or greater. He also has extensive experience in investment committees, diligence processes, and various acquisition execution responsibilities and has been engaged in raising capital and debt facilities, each in excess of a billion dollars. Over his career he developed a unique and broad global network of investors, bankers and operators. We believe that Mr. Gray's vast experience will enable us to advance our long-term strategic growth plan. DAVID C. HARDIE, a director, is the Executive Chairman of the board of directors of Hallador Investment Advisors Inc., which manages Hallador Cash Fund LP, Hallador Alternative Assets Fund, Moka Fund, and Hallador Balanced Fund. Mr. Hardie is also the Managing Member of Allora, a fine dining restaurant in Sacramento, California. Mr. Hardie joined the board of directors of Earlens Corporation, a venture-backed hearing aid company, in November 2020. He serves as a director and partner of other private entities that are owned by members of his family and serves as director of The Parasol Tahoe Community Foundation and University of California Davis Environmental Research Center. Mr. Hardie is a Graduate of California Polytechnic University, San Luis Obispo with a Bachelor of Science in Accounting. He also completed the Owner/President Management program at the Harvard Business School. Mr. David C. Hardie, who controls 5.06% of our Common Stock, has been a Board member for the last 36 years. His significant broad experience, as well as an intimate knowledge of our Company, is a tremendous benefit to us in planning and executing our corporate strategy. BRYAN H. LAWRENCE, a director, is a founder and senior manager of Yorktown Partners LLC, the manager of the Yorktown group of investment partnerships, which make investments in companies engaged in the energy industry. The Yorktown partnerships were formerly affiliated with the investment firm of Dillon, Read & Co. Inc., where Mr. Lawrence had been employed since 1966, serving as a Managing Director until the merger of Dillon Read with SBC Warburg in September 1997. Mr. Lawrence also serves as a director of Riley Exploration Permian, Inc., Ramaco Resources, Inc., and Star Group, LP (each a United States publicly traded company) and certain non-public companies in the energy industry in which Yorktown partnerships hold equity interests. Mr. Lawrence is a graduate of Hamilton College and has an MBA from Columbia University. . Mr. Lawrence, who controls 1.16% of our Common Stock, has been a Board member for the last 30 years. We believe that Mr. Lawrence's wealth of industry-specific transactional skills and experience qualifies him to serve on our Board. As with most of our other Board members, he too has a significant indirect monetary investment in our Company and accordingly has a vested interest in our success. DAVID J. LUBAR, a director, is President and CEO of Lubar & Co. He began his career in 1977 at Wells Fargo Bank (f/k/a Norwest Bank N.A.) in Minneapolis, where he spent six years in commercial and correspondent banking. Mr. Lubar joined Lubar & Co. in 1983 and has served as lead investor to over 20 companies in a wide range of industries and various stages of development. He currently serves as a director of each of the Lubar Companies as well as Nicholas Company, Baird Funds, Ixonia Bank (chairman), Milwaukee Brewers Baseball Club, and several other private companies. He previously served on the boards of BMO Financial Corp and Northwestern Mutual Life Insurance Company. He also serves in many community leadership positions throughout the Milwaukee area. Mr. Lubar has a Bachelor of Arts degree from Bowdoin College and Master of Business Administration from the University of Minnesota. Mr. David J. Lubar controls 12.69% of our Common Stock. Mr. Lubar has 41 years of investment experience with private companies, public stocks, and fixed income. His experience provides him insight from the view of an investor and Board member. CHARLES R WESLEY, IV, a director, has served as President of Thoroughbred Resources LP (a Yorktown Partners affiliate) since 2014 and CEO since 2016. Mr. Wesley served as Chief Planning and Commercial Officer of Ramaco Resources and, before joining Thoroughbred, Senior Director of Finance and Senior Counsel at Lumen Technologies (formerly Level 3 Communications), where he was also responsible for the operation and ultimate disposition of the Company's coal mining operations. Prior to Lumen Technologies, he worked at the law firms of Akin, Gump, Strauss, Hauer & Feld, and Strasburger & Price, focusing on international energy transactions. He began his career with a coal company as a mining engineer and is an active investor in natural resources and financial technology. Mr. Wesley is a board member across multiple industries and philanthropic organizations. Mr. Wesley holds a Juris Doctorate from the University of Kentucky College of Law and a Bachelor of Science in Mining Engineering from Virginia Polytechnic Institute. Mr. Wesley brings a wealth of invaluable coal mining industry knowledge and experience to the Board. His vast knowledge of the industry assists the Board in driving future and potential growth and expansion opportunities. Below is an overview of our current directors and each of the director nominees you are being asked to elect at the Annual Meeting.
Director Nominees
| Name and Principal Occupation | Age | Board Member Since | Independent | Audit Committee | Compensation Committee | Nominating Committee | | Brent K. Bilsland | 51 | 2009 | | | | | | Chairman of the Board, President and CEO Hallador Energy Company | | | | | | | | Zarrell Gray | 58 | 2024 | ✔ | ✔ | | Chair | | Executive Advisor to Teays Rivers | | | | | | | | David C. Hardie | 74 | 1989 | ✔ | | ✔ | ✔ | | Executive Chairman of the Board of Hallador Investment Advisors Inc. | | | | | | | | Bryan H. Lawrence | 82 | 1995 | ✔ | ✔ | | | | Managing Member of Yorktown Partners LLC | | | | | | | | David J. Lubar | 70 | 2018 | ✔ | Chair | ✔ | | | Director, CEO and President of Lubar & Co. | | | | | | | | Charles R. Wesley, IV | 46 | 2018 | ✔ | | Chair | ✔ | | President of Thoroughbred Resources LP | | | | | | |
OUR EXECUTIVE OFFICERS WHO ARE NOT DIRECTORS
OUR EXECUTIVE OFFICERS WHO ARE NOT DIRECTORS HEATH A. LOVELL, age 50, has served as President of Hallador Power Company since 2022 and President of Sunrise Coal since June 2024. Prior to joining Hallador, Mr. Lovell was the Vice President – Public Affairs for Alliance Coal, LLC since June of 2017. Before that, he was Vice President of Operations for Alliance Coal covering Illinois, Indiana, and parts of Western Kentucky. He had been with Alliance Coal since 2006 and held several other positions including General Manager of River View Coal, LLC and General Manager of Webster County Coal, LLC. Mr. Lovell was responsible for the development of River View in 2009 with its nine units of operations and initial capital investment of $270 million. Before joining Alliance, Mr. Lovell was Vice President and Partner of Dodge Hill Mining, LLC. He has over 25 years of experience in the mining industry and has a Master of Business Administration and a Bachelor of Science degree in Electrical Engineering from the University of Kentucky. Mr. Lovell has served as the Chairman of the Kentucky Coal Association Board of Directors, West Virginia Coal Association Board of Directors, Indiana Coal Association Board of Directors, Reliable Energy, Inc. Board of Directors, as well as a Board Member of the American Coal Council and an appointed member of the National Coal Council. MARJORIE HARGRAVE, age 61, joined Hallador on April 10, 2024, as our Chief Financial Officer. Ms. Hargrave has served as a director for Evolution Petroleum, a publicly traded company on the NYSE, since March 1, 2021, and currently serves as its Chair of the Audit Committee, and as a member of the Compensation and Nominating & Corporate Governance Committees. Ms. Hargrave most recently was the President and CFO of Enservco Corporation, a publicly traded Oilfield Services Company. Ms. Hargrave is the former CFO of CTAP (currently owned by Marubeni-Itochu Tubulars America), a provider of pipe and tubing to the energy industry and the former CFO of High Sierra Energy, a midstream energy company that was sold to NGL Energy Partners. Previous assignments include VP Finance/Managing Director, Black Hills Corp., Finance Consultant, Xcel Energy, and VP Investment Banking, Merrill Lynch. Ms. Hargrave holds a bachelor's degree in economics from Boston University, a master's degree in economics from New York University, certification in Cybersecurity Oversight from Carnegie Mellon University, a Senior Professional Human Resource Certification (2011-2026) and an Artificial Intelligence Certification from MIT.
Equity Award Grant Practices
Equity Award Grant Practices The Compensation Committee typically approves and grants equity awards to our Named Executive Officers biennially, with each such award having a target grant date value as set forth in a two-year executive officer plan that is adopted by the Compensation Committee in advance of such grants. Awards granted to any newly hired or promoted executive officers are typically made on or close in time to the effective date of hire or promotion. We generally aim to avoid granting equity awards, including stock options (or similar awards), in anticipation of the release of material non-public information that is likely to result in changes to the price of our Common Stock, and the release of material non-public information is not timed based on stock option or other equity award grant dates. We do not currently grant stock options or similar stock appreciation awards as part of our equity compensation program. Accordingly, during the last completed fiscal year, we did not grant any stock options (or similar awards) to our Named Executive Officers during any period beginning four business days before the filing of any Company periodic report on Form 10-Q or Form 10-K, or the filing or furnishing of any Company current report on Form 8-K that disclosed material nonpublic information (other than a Company current report on Form 8-K disclosing a material new option award grant under Item 5.02(e) of that form), and ending one business day after the filing or furnishing of such reports. If stock options were to be granted in the future, the Company would generally aim to avoid granting such options in anticipation of the release of material nonpublic information that is likely to result in changes to the price of our Common Stock.
Director Compensation
Director Compensation Each of our non-employee members of our Board, except for Mr. Lawrence, who declined being compensated for his Board role, receives an annual retainer of $50,000 and each committee chair receives an additional retainer of $25,000 for each fiscal year.
2024 Director Compensation
2024 Director Compensation The following table sets forth information concerning the compensation paid to the non-employee members of our Board during the fiscal year ended December 31, 2024:
2024 Director Compensation
| Director Name | Annual Board Retainer | Annual Committee Fee | Total Compensation | | Brent K. Bilsland | -- | -- | -- | | Zarrell Gray (1) | $29,396 | $9,918 | $39,314 | | David C. Hardie (2) | $50,000 | $15,082 | $65,082 | | Steven R. Hardie (3) | $20,604 | -- | $20,604 | | Bryan H. Lawrence | -- | -- | -- | | David J. Lubar | $50,000 | $25,000 | $75,000 | | Charles R. Wesley, IV (4) | $50,000 | $25,000 | $75,000(4) |
2024 Director Compensation
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2024 Director Compensation
| (1) Mr. Gray joined the Board on May 30, 2024, and received a pro-rated annual retainer. He also received an additional pro-rated retainer for his service as Chair of the Nominating Committee, a position he has held since August 8, 2024. | | (2) Mr. Hardie received a pro-rated retainer for his service as Chair of the Audit Committee for the period of January 1, 2024, through August 7, 2024. | | (3) Mr. Steven Hardie's Board service terminated on May 29, 2024. | | (4) Mr. Wesley elected to receive both his annual retainer and his annual committee chair fee in shares of our Common Stock. All of Mr. Wesley’s compensation reported in the 2023 director compensation table, which was intended to be paid in 2023, was, due to an inadvertent administrative error, paid in 2024. |
2024 Director Compensation
In March 2025, with input from its compensation consultant, F.W. Cook & Co., our Board reviewed our non-employee director compensation policy and determined to increase, effective as of January 1, 2025, the annual retainer paid to non-employee members of our Board from $50,000 to $75,000 and to increase the additional retainer paid to the audit committee chair from $25,000 to $35,000, with each retainer paid on a quarterly basis. Our Board also determined that 50% of both the annual retainer and the annual committee chair fee will be paid in fully vested shares of Common Stock based upon the closing price of our Common Stock on the payment date. PROPOSAL NO. 2: APPROVE, ON AN ADVISORY BASIS, THE NAMED EXECUTIVE OFFICERS' COMPENSATION. The Board recommends that you vote "FOR" Hallador's named executive officer compensation. In accordance with Section 14A of the Securities Exchange Act of 1934, we are asking our shareholders for an advisory vote to approve the compensation of our Named Executive Officers as disclosed in this Proxy Statement as set forth in the "Summary Compensation Table" in accordance with the compensation disclosure rules of the SEC. The Board recommends that shareholders support the following resolution. RESOLVED, that the shareholders approve, on an advisory basis, Hallador's compensation of its Named Executive Officers, as disclosed in Hallador's Proxy Statement for the Annual Meeting, pursuant to the compensation disclosure rules of the SEC, including the Summary Compensation Table and all other tables and narrative disclosures regarding Named Executive Officer compensation. This advisory proposal is not binding. A majority of the shares of Common Stock represented at the Annual Meeting in person or by proxy must vote FOR the proposal to approve it. If you "abstain" from voting with respect to this proposal, your vote will have the same effect as a vote "against" the proposal. Your broker may not vote on this proposal unless you give voting instructions. Broker non-votes will have no effect on the vote for this proposal. Your vote will not directly change or otherwise limit or enhance any existing compensation or award arrangement of any of our Named Executive Officers, but the outcome of the say-on- pay vote will be considered by the Compensation Committee when making future compensation decisions.
Summary Compensation Table
Summary Compensation Table The following table sets forth information regarding the compensation awarded to, earned by, or paid to our NEOs in fiscal years ended December 31, 2024 and 2023:
Summary Compensation Table
| Name and Principal Position | Fiscal Year | Salary | Bonus (1) | | Non- Equity Incentive Plan (2) | | Stock Awards (3) | All Other Compensation (4) | | Total | | | Brent K. Bilsland | 2024 | $658,846 | | 169,400 | | $184,800 | $1,800,000 | | 10,725 | | $2,823,771 | | Chairman, President and CEO | 2023 | $615,000 | | 184,800 | | $184,800 | $- | | 13,200 | | $997,800 | | Marjorie A. Hargrave (5) | 2024 | $281,539 | | 73,333 | | $80,000 | $500,000(7) | | 6,769 | | $941,641 | | Chief Financial Officer | | | | | | | | | | | | | Lawrence D. Martin (6) | 2024 | $259,166 | | - | | | $- | | 981,492 | | $1,240,658 | | Chief Financial Officer, and President, Sunrise Coal | 2023 | $400,000 | | 120,000 | | $120,000 | $- | | 13,200 | | $653,200 | | Heath A. Lovell | 2024 | $436,539 | | 110,000 | | $120,000 | $700,000 | | 13,800 | | $1,380,339 | | President, Hallador Power | 2023 | $400,000 | | 120,000 | | $120,000 | $- | | 13,200 | | $653,200 |
Summary Compensation Table
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Summary Compensation Table
| (1) The amounts disclosed in the Bonus column reflect discretionary bonuses under the executive officer plan. | | (2) The amounts disclosed in the Non-Equity Incentive Plan column reflect amounts paid in respect of our 2024 executive officer bonus performance plan, as determined by the Compensation Committee. | | (3) The amounts disclosed in the Stock Awards column represent the aggregate grant date fair value of time-based restricted stock units, or RSUs, computed in accordance with Financial Accounting Standard Board's Accounting Standards Codification Topic 718, disregarding for this purpose the estimate of forfeitures and do not necessarily correspond to the actual value that might be realized by the NEOs, which depends on the market value of our Common Stock on a date in the future when the award vests or is settled, as applicable. Amounts disclosed in this column reflect the closing market price per share on the respective grant dates of the time-based RSUs. For additional information, including a discussion of the assumptions used to calculate these values, please see Note 8 to our consolidated financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024. | | (4) The amounts disclosed in the All-Other Compensation column reflect matching contributions by the Company to our 401(k) plan. For Mr. Martin, the amount disclosed also reflects certain amounts received by him in connection with his transition period and termination of employment on August 6, 2024, pursuant to the separation agreement entered into between the Company and Mr. Martin, effective as of April 17, 2024. Please see "Potential Payments Upon Termination or Change In Control" below for additional information regarding Mr. Martin's separation agreement. |
Summary Compensation Table
| (5) Ms. Hargrave joined the Company as its Chief Financial Officer effective as of April 10, 2024. Ms. Hargrave was not an NEO during the fiscal year ended December 31, 2023 and, therefore, in accordance with SEC regulations, only compensation information for the fiscal year ended December 31, 2024 is included in the Summary Compensation Table. | | (6) Mr. Martin ceased to be our Chief Financial Officer effective as of April 9, 2024. | | (7) The amount disclosed for Ms. Hargraves includes a biennial RSU grant with a value of $400,000 and an additional sign-on RSU grant with a value of $100,000. |
Outstanding Equity Awards at December 31, 2024
Outstanding Equity Awards at December 31, 2024
Outstanding Equity Awards at December 31, 2024
| Name | Grant Date | Number of Shares or Units of Stock That Have Not Vested | Market Value of Shares or Units of Stock That Have Not Vested (4) | | Brent K. Bilsland | 9/6/2024(3) | 315,236 | $3,609,452 | | | 11/11/2022(1) | 89,179 | $1,021,100 | | Heath A. Lovell | 9/6/2024(3) | 122,592 | $1,403,678 | | | 11/11/2022(1) | 57,971 | $663,768 | | Marjorie Hargrave | 9/6/2024(3) | 70,053 | $802,107 | | | 4/10/2024(2) | 20,747 | $237,553 |
Outstanding Equity Awards at December 31, 2024
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Outstanding Equity Awards at December 31, 2024
| (1) The RSUs granted to Messrs. Bilsland and Lovell on November 11, 2022, vest on March 31, 2025. | | (2) The RSUs granted to Ms. Hargrave on April 10, 2024, vest ratably annually over three years beginning March 31, 2025. | | (3) The RSUs granted to Messrs. Bilsland, and Lovell and Ms. Hargrave on September 6, 2024, vest ratably annually over three years beginning March 31, 2025. | | (4) Market value was calculated based on the closing market price per share of our Common Stock on the last trading day of 2024 ($11.45 per share). |
Potential Payments Upon Termination or Change in Control
Potential Payments Upon Termination or Change in Control As of December 31, 2024, our NEOs were eligible to receive payments upon (i) a change in control, including with respect to termination of employment related to a change in control in certain cases, in accordance with the 2024 executive officer plan dated March 27, 2024, or (ii) a qualifying termination of employment, in accordance with individual severance agreements ("Severance Agreements") with Messrs. Bilsland and Lovell dated April 1, 2024 and with Ms. Hargrave dated April 10, 2024, in each case, as follows:
Potential Payments Upon Termination or Change in Control
| ● | Mr. Bilsland – in the event of a change in control, Mr. Bilsland would be entitled to the following amounts, subject to his execution, delivery and non-revocation of a general release of claims in favor of the Company: |
Potential Payments Upon Termination or Change in Control
| o | a lump sum retention payment equal to $1,181,250, provided he remains employed with the Company through the closing of such change in control transaction (or $1,350,000 in the event he is not engaged to work for the acquiring company following the transaction) or, if following the announcement or signing of, but prior to the closing of, a change in control transaction, Mr. Bilsland's employment is terminated by the Company without cause, or if he resigns for good reason, the retention payment described above that would have been paid had he remained employed through the change in control (reduced on a dollar-for-dollar basis (but not below zero) by the amount of any severance paid to him by the Company pursuant to the terms of his Severance Agreement); and |
Potential Payments Upon Termination or Change in Control
| o | an amount equal to the performance bonus paid for the most recently completed fiscal year prior to the change in control, pro-rated for the period served in the fiscal year in which the closing of such change in control transaction occurs. |
Potential Payments Upon Termination or Change in Control
In the event of Mr. Bilsland's termination of employment by the Company without cause or resignation for good reason (in either case without regard to whether such termination or resignation is in connection with a change in control), Mr. Bilsland would be entitled to a severance payment equal to eighteen (18) months of his current base salary, plus the amount of annual bonus received by him for the fiscal year prior to the year of termination (or nine (9) months of such total compensation in the event of his resignation without good reason), in any case, subject to his execution, delivery and non-revocation of a general release of claims in favor of the Company. If Mr. Bilsland's employment had been terminated by the Company without cause, or if he resigned for good reason, on December 31, 2024, then he would have been entitled to approximately $1,289,700 of cash severance payments (or $644,850 in the event of his resignation without good reason). These estimates are based on Mr. Bilsland's base salary level as in effect on December 31, 2024, as well as the annual performance bonus payout he received for the prior fiscal year.
Potential Payments Upon Termination or Change in Control
| ● | Mr. Lovell – in the event of a change in control, Mr. Lovell would be entitled to the following amounts, subject to his execution, delivery and non-revocation of a general release of claims in favor of the Company: |
Potential Payments Upon Termination or Change in Control
| o | a lump sum retention payment equal to $787,500, provided he remains employed with the Company through the closing of such change in control transaction (or $900,000 in the event he is not engaged to work for the acquiring company following the transaction) or, if following the announcement or signing of, but prior to the closing of, a change in control transaction, Mr. Lovell's employment is terminated by the Company without cause, or if he resigns for good reason, the retention payment described above that would have been paid had he remained employed through the change in control (reduced on a dollar-for-dollar basis (but not below zero) by the amount of any severance paid to him by the Company pursuant to the terms of his Severance Agreement). |
Potential Payments Upon Termination or Change in Control
| o | an amount equal to the performance bonus paid for the most recently completed fiscal year prior to the change in control, pro-rated for the period served in the fiscal year in which the closing of such change in control transaction occurs. |
Potential Payments Upon Termination or Change in Control
In the event of Mr. Lovell's termination of employment by the Company without cause or resignation for good reason (in either case without regard to whether such termination or resignation is in connection with a change in control), Mr. Lovell would be entitled to a severance payment equal to eighteen (18) months of his current base salary, plus the amount of annual bonus received by him for the fiscal year prior to the year of termination (or nine (9) months of such total compensation in the event of his resignation without good reason), in any case, subject to his execution, delivery and non-revocation of a general release of claims in favor of the Company. If Mr. Lovell's employment had been terminated by the Company without cause, or if he resigned for good reason, on December 31, 2024, then he would have been entitled to approximately $855,000 of cash severance payments (or $427,500 in the event of his resignation without good reason). These estimates are based on Mr. Lovell's base salary level as in effect on December 31, 2024, as well as the annual performance bonus payout he received for the prior fiscal year.
Potential Payments Upon Termination or Change in Control
| ● | Ms. Hargrave – in the event of a change in control, Ms. Hargrave would be entitled to the following amounts, subject to her execution, delivery and non-revocation of a general release of claims in favor of the Company: |
Potential Payments Upon Termination or Change in Control
| o | a lump sum retention payment equal to $700,000, provided she remains employed with the Company through the closing of such change in control transaction (or $800,000 in the event she is not engaged to work for the acquiring company following the transaction) or, if following the announcement or signing of, but prior to the closing of, a change in control transaction, Ms. Hargrave's employment is terminated by the Company without cause, or if she resigns for good reason, the retention payment described above that would have been paid had she remained employed through the change in control (reduced on a dollar-for-dollar basis (but not below zero) by the amount of any severance paid to her by the Company pursuant to the terms of her Severance Agreement). |
Potential Payments Upon Termination or Change in Control
| o | an amount equal to the performance bonus paid for the most recently completed fiscal year prior to the change in control, pro-rated for the period served in the fiscal year in which the closing of such change in control transaction occurs. |
Potential Payments Upon Termination or Change in Control
In the event of Ms. Hargrave's termination of employment by the Company without cause or resignation for good reason (in either case without regard to whether such termination or resignation is in connection with a change in control), Ms. Hargrave would be entitled to a severance payment equal to eighteen (18) months of her current base salary, plus the amount of annual bonus received by her for the fiscal year prior to the year of termination (or nine (9) months of such total compensation in the event of her resignation without good reason), in any case, subject to her execution, delivery and non-revocation of a general release of claims in favor of the Company. If Ms. Hargrave's employment had been terminated by the Company without cause, or if she resigned for good reason, on December 31, 2024, then she would have been entitled to approximately $900,000 of cash severance payments (or $450,000 in the event of her resignation without good reason). These estimates are based on Ms. Hargrave's base salary level as in effect on December 31, 2024, as well as her annual performance bonus target for the fiscal year ended December 31, 2024. Because Ms. Hargrave was not covered under the predecessor executive officer plan during the prior fiscal year, her target bonus for the fiscal year ended December 31, 2024, provides a better estimate of the probable severance benefits to which she would be entitled. The retention payments described above for each of Messrs. Bilsland and Lovell and Ms. Hargrave may, if they are employed at the time of the change in control, be conditioned on them agreeing with the acquirer, if so requested, to continue to work for the acquirer following the change-in-control for a period of three months, provided the acquirer agrees to pay (i) a monthly base salary no less than the monthly base salary rate in effect before the transaction, and (ii) an additional retention payment equal to 25% of the performance bonus for the most recently completed fiscal year prior to the change in control. In addition, vesting would be accelerated for any unvested RSUs held by our NEOs upon either (i) a change in control, or (ii) termination of employment by the Company without cause, or resignation for good reason. If either of these events had occurred on December 31, 2024, Messrs. Bilsland and Lovell and Ms. Hargrave would have realized $4,630,552, $2,067,446, and $1,039,660, respectively, on account of their then-unvested RSUs. These amounts reflect each such NEOs unvested RSUs as of December 31, 2024, that would accelerate upon such event, multiplied by the closing market price per share of our Common Stock on December 31, 2024 ($11.45 per share).
PAY VS. PERFORMANCE
PAY VS. PERFORMANCE The following table sets forth additional compensation information of our Principal Executive Officer ("PEO") and our non- PEO named executive officers ("Non-PEOs") along with the relationship of such compensation to total shareholder return and net income performance results for our fiscal years ended December 31, 2024, 2023, and 2022, in accordance with Item 402(v) of Regulation S-K. "Compensation Actually Paid" values shown in the required table below are calculated in accordance with SEC rules and do not represent amounts actually earned or realized by our PEO and Non-PEOs in such fiscal years. The calculations and analysis below do not necessarily reflect the Company's approach to aligning executive compensation with performance.
Table Footnotes
| (2) SEC rules require certain adjustments to be made to the “Summary Compensation Table” totals to determine “compensation actually paid” as reported in the “Pay versus Performance Table” above. The following tables detail the applicable adjustments from the compensation reported in the “Total” column of the Summary Compensation Table. |
Table Footnotes
| PEO | | | | | Adjustments to Determine Compensation Actually Paid | 2024 | 2023 | 2022 | | Reported Summary Compensation Table Total for PEO | $2,823,771 | $997,800 | $3,431,832 | | Deduction for Amounts Reported under the Stock Awards Column in our Summary Compensation Table (or SCT) | (1,800,000) | | (1,864,733) | | Increase for Fair Value as of Year-end of Awards Granted during the Year that Remain Unvested as of Year- end | 3,609,452 | | 2,672,695 | | Increase for Fair Value as of the Vesting Date of Awards Granted during the Year that Vest during the Year | | | | | Increase/deduction for Change in Fair Value from prior Year-end to current Year-end of Awards Granted Prior to the Year that were Outstanding and Unvested as of Year-end | 232,757 | (205,112) | | | Increase/deduction for Change in Fair Value from prior Year-end to Vesting Date of Awards Granted Prior to the Year that Vested during the Year | (313,018) | (71,343) | | | Deduction of Fair Value of Awards Granted Prior to the Year that were Forfeited during the Year | | | | | Compensation Actually Paid to PEO | $4,552,962 | $721,345 | $4,239,794 |
Table Footnotes
| Non-PEO NEOs | | | | | Adjustments to Determine Compensation Actually Paid | 2024 | 2023 | 2022 | | Reported Average Summary Compensation Table Total for Non-PEO NEOs | $1,187,546 | $653,200 | $2,256,419 | | Deduction for Amounts Reported under the Stock Awards Column in our Summary Compensation Table (or SCT) | (400,000) | | (1,212,174) | | Increase for Fair Value as of Year-end of Awards Granted during the Year that Remain Unvested as of Year- end | 814,446 | | 1,737,391 | | Increase for Fair Value as of the Vesting Date of Awards Granted during the Year that Vest during the Year | | | | | Increase/deduction for Change in Fair Value from prior Year-end to current Year-end of Awards Granted Prior to the Year that were Outstanding and Unvested as of Year-end | 50,435 | (133,333) | | | Increase/deduction for Change in Fair Value from prior Year-end to Vesting Date of Awards Granted Prior to the Year that Vested during the Year | (207,729) | (46,377) | | | Deduction of Fair Value of Awards Granted Prior to the Year that were Forfeited during the Year | | | | | Average Compensation Actually Paid to Non-PEO NEOs | $1,444,697 | $473,490 | $2,781,636 |
Relationship Between Compensation Actually Paid and Performance Measures
Relationship Between Compensation Actually Paid and Performance Measures From 2023 to 2024, the compensation actually paid to our PEO increased by 531%, and the average of the compensation actually paid to the Non-PEOs increased by 205%, compared to a 30% increase in our TSR over the same time period, and net income/(loss) changed from $44.8 million in 2023 to a net loss of $226.1 million in 2024.