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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Kosmos Energy Ltd | NYSE:KOS | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.12 | 2.07% | 5.93 | 5.985 | 5.825 | 5.86 | 5,949,147 | 00:29:49 |
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Preliminary Proxy Statement
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Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
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Soliciting Material under §240.14a-12
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Kosmos Energy Ltd.
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(Name of Registrant as Specified in Its Charter)
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Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
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1.
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To elect the Class II directors to a three-year term to serve until the 2024 annual stockholders meeting;
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2.
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To ratify the appointment of Ernst & Young LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2021 and to authorize the Company’s Audit Committee of the Board of Directors to determine their remuneration;
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3.
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To provide a non-binding, advisory vote to approve named executive officer compensation;
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4.
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To approve an amendment and restatement of the Kosmos Energy Ltd. Long Term Incentive Plan; and
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5.
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To consider such other business as may properly come before the annual stockholders meeting.
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Additional
information
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Board
recommendation
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Votes
required
for approval
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PROPOSAL 1
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To elect the Class II directors to a three-year term to serve until the 2024 annual stockholders meeting
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Page 6
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FOR
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Plurality
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PROPOSAL 2
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To ratify the appointment of Ernst & Young LLP, as our independent registered public accounting firm for the fiscal year ending December 31, 2021 and authorization of the Company’s Audit Committee of the Board of Directors to determine their remuneration
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Page 22
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FOR
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Majority of votes cast
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PROPOSAL 3
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To provide a non-binding, advisory vote to approve named executive officer compensation
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Page 25
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FOR
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Majority of votes cast
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PROPOSAL 4
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To approve an amendment and restatement of the Kosmos Energy Ltd. Long Term Incentive Plan
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Page 57
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FOR
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Majority of votes cast
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Via the Internet
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By telephone
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By mailing your
proxy card
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Visit 24/7
http://www.proxyvote.com
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Dial toll-free 24/7
1-800-690-6903
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Mark, sign and date your proxy card, and return it in the postage-paid envelope or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717
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■ Review and download this Proxy
Statement, a proxy card and our
2020 annual report
■ Request a hard copy of this Proxy
Statement, a proxy card and our
2020 annual report
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■
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At present, all of our non-employee directors (five out of six directors) are independent of management under the requirements of the New York Stock Exchange and Rule 10A-3 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).
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All of our executive officers (including each of our named executive officers) and directors are in compliance with our robust share ownership guidelines.
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At our 2020 annual stockholders meeting, approximately 97% of our stockholders approved of our 2019 executive compensation program for our named executive officers.
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During the extraordinary times the industry was facing in part due to the Coronavirus (COVID-19) pandemic, we greatly enhanced our Board oversight by holding eight special Board meetings in addition to the four regular meetings during 2020.
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What We Do
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What We Don’t Do
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✔ Pay-for-Performance—we align pay and performance by awarding a majority of the compensation paid to our executives in the form of “at-risk” performance-based compensation linked to Company and individual performance
✔ Balanced Short-Term and Long-Term Compensation—we grant compensation that discourages short-term risk taking at the expense of long-term results
✔ Independent Compensation Consultant—our Compensation Committee engages an independent compensation consultant
✔ Share Ownership Guidelines—our executive officers are subject to robust share ownership guidelines, further aligning their interests with our stockholders
✔ Compensation Recoupment Policy—we maintain a compensation recoupment/clawback policy applicable to our executive officers
✔ Risk Mitigation—we have strong risk and control policies, we take risk management into account in making executive compensation decisions, and we perform an annual risk assessment of our executive compensation programs
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✘ No Excise Tax Gross-Ups—we do not provide our executives with gross-ups for the excise tax that would be imposed on the executives under Section 4999 of the Internal Revenue Code, if they received “excess” payments and benefits in connection with a change in control
✘ No Special Executive Defined Benefit Retirement Programs—we do not provide special executive defined benefit retirement programs
✘ No Excessive Perquisites—consistent with our pay-for-performance philosophy, we do not provide our executives with excessive perquisites
✘ No Guaranteed Payouts—we do not grant cash or equity incentive compensation with guaranteed payouts
✘ No Hedging Shares—we do not permit our employees, including our named executive officers, to engage in hedging transactions in the Company’s securities, unless our General Counsel provides prior written authorization
✘ No Top-Up Share Grants—no additional issuance of equity awards to compensate for losses in value of outstanding equity awards
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Deanna L. Goodwin
Age: 56
Director since: 2018
Committees:
■ Health, Safety and Environment Committee (Chair)
■ Audit Committee
■ Nominating and Corporate Governance Committee
Other current public directorships:
■ Arcadis NV
■ Oceaneering International Inc.
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Ms. Goodwin currently serves as a Director of Arcadis NV, where she has served on the Audit Committee since May 2020, and as a Director of Oceaneering International Inc. Ms. Goodwin served as President of the North America region of Technip, a global engineering, construction and services company specializing in supporting the energy industry, from 2013 to 2017. She served as Chief Operating Officer, Offshore North America at Technip from 2012 to 2013. Prior thereto, she served as Senior Vice President and Chief Financial Officer of Technip USA, Inc. Previously, Ms. Goodwin led the integration of the $1.3 billion acquisition of Global Industries by Technip. From 1993 to 2007, Ms. Goodwin served in various capacities for Veritas DGC, a leading provider of geophysical information and services to oil and gas companies worldwide, including President of the North and South America Region. Earlier in her career, Ms. Goodwin served as an Audit Manager at Price Waterhouse. Ms. Goodwin received her Bachelor of Commerce degree in Accounting from the University of Calgary in Canada and her Chartered Accountant designation from the Canadian Institute of Chartered Accountants. For these reasons, we believe she is well qualified to serve on our Board.
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FOR
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The Board recommends that stockholders vote “FOR ALL” the nominees for director.
If not otherwise specified, proxies will be voted “FOR ALL” the nominees for director.
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Andrew G. Inglis
Age: 62
Director since: March 2014
Committees:
None
Other current public directorships:
None
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Mr. Inglis has served as our Chairman and Chief Executive Officer since March 1, 2014. Mr. Inglis joined Kosmos from Petrofac Ltd., a leading provider of oilfield services to the international oil and gas industry, principally engaged in the design of oil and gas infrastructure, the operation, maintenance and management of oil and gas assets and the training of personnel on a worldwide basis. At Petrofac, Mr. Inglis held the position of Chief Executive, Integrated Energy Services and was a member of the Petrofac board of directors. Prior to joining Petrofac in January 2011, Mr. Inglis served BP p.l.c for 30 years in a number of positions, including most recently as Executive Director on the BP board of directors from 2007 to 2010 and as Executive Vice President and Deputy Chief Executive of exploration and production from 2004 to 2007. Mr. Inglis received a Master’s degree in Engineering from Pembroke College, Cambridge University. He is a Chartered Mechanical Engineer, a Fellow of the Institution of Mechanical Engineers and a Fellow of the Royal Academy of Engineering. For these reasons, we believe he is well qualified to serve on our Board.
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Steven M. Sterin
Age: 49
Director since: 2019
Committees:
■ Audit Committee (Chair)
■ Compensation Committee
■ Health, Safety and Environment Committee
Other current public directorships:
■ DuPont de Nemours, Inc.
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Mr. Sterin currently serves on the Board of Directors of DuPont de Nemours, Inc. and is the Chair of its Audit Committee and a member of its Sustainability, Public Policy, Environment and Health and Safety Committee. He has served as a Senior External Advisor to McKinsey & Company since June 2019. Mr. Sterin was most recently an Executive Vice President and the Chief Financial Officer of Andeavor and Andeavor Logistics from 2014 until the merger with Marathon Petroleum Company in October 2018. He served as President of Andeavor Logistics from 2017 to October 2018 and was a member of the Board of Directors for Andeavor Logistics GP, LLC from 2014 to 2018. Mr. Sterin was also responsible for Corporate Strategy and Business Development for both companies from 2016 to 2017. From 2007 to 2014, Mr. Sterin was the Senior Vice President and Chief Financial Officer for Celanese Corporation, a global technology and specialty material company. During his eleven years with Celanese, he served as Corporate Controller and Principal Accounting Officer as well as holding other financial and business leadership roles. Prior to his tenure at Celanese, Mr. Sterin spent six years with Reichhold, Inc., a global chemical company, in a variety of financial positions, including Director of Tax and Treasury in the Netherlands, Global Treasurer and Vice President of Finance. Mr. Sterin’s career started with PricewaterhouseCoopers. Mr. Sterin holds a Master’s degree in Professional Accounting and a Bachelor’s degree in Business Administration and Accounting, which he earned concurrently at the University of Texas at Austin. He is a Certified Public Accountant in Texas. For these reasons, we believe he is well qualified to serve on our Board.
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Director
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Audit
Committee
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Compensation
Committee
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Health, Safety and
Environment
Committee
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Nominating and
Corporate
Governance
Committee
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Andrew G. Inglis
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Lisa A. Davis
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Member
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Member
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Sir Richard Dearlove
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Member
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Chair
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Deanna L. Goodwin
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Member
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Chair
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Member
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Adebayo O. Ogunlesi
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Chair
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Member
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Steven M. Sterin
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Chair
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Member
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Member
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Financial Expert
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Audit Committee
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The Audit Committee is a separately designated standing Committee of the Board established in accordance with Section 3(a)(58)(A) of the Exchange Act.
Membership:
■ Our Board has determined that all members are independent directors as
defined by the NYSE rules and Rule 10A-3 of the Exchange Act.
■ Our Board has determined that all of the members are financially literate.
■ Our Board has determined that each of Mr. Sterin and Ms. Goodwin is an “audit committee financial expert” as described in Item 407(d)(5) of
Regulation S-K.
Primary Responsibilities:
■ Recommend, through the Board, to the stockholders on the appointment
and termination of our independent auditors;
■ Review the proposed scope and results of the independent auditors’
audit;
■ Review and approve the independent auditors’ audit and non-audit
services rendered;
■ Approve the audit fees to be paid (subject to authorization by our
stockholders to do so);
■ Review accounting and financial controls with the independent auditors
and our financial and accounting staff;
■ Recognize and prevent prohibited non-audit services;
■ Establish procedures for complaints received by us regarding accounting
matters;
■ Oversee internal audit functions;
■ Oversee the resource and reserve process, including the external
reporting of resource and reserve information; and
■ Review and approve the report of the Audit Committee that SEC rules
require to be included in this Proxy Statement.
The Audit Committee Charter:
■ Was approved by the Board on May 9, 2011 (as amended on April 3, 2012 further updated on May 2, 2019 and further updated on June 10, 2020)
and is reviewed annually; and
■ Is available under the Corporate Governance link on the Investors’ page of our website at www.kosmosenergy.com. The information on our
website is not incorporated by reference into this Proxy Statement.
The Report of the Audit Committee is set forth on page 24 of this Proxy Statement. |
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Members:
Steven M. Sterin,
Chair
Lisa A. Davis
Deanna L. Goodwin
Meetings in 2020: 4
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Compensation Committee
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The Compensation Committee is a separately designated standing Committee of the Board established in accordance with Section 3(a)(58)(A) of the Exchange Act.
Membership:
■ Our Board has determined that all members are independent directors as defined by the NYSE rules and Rule 10A-3 of the Exchange Act and qualify as “non-employee directors” for purposes of Rule 16b-3 under the
Exchange Act.
Compensation Committee Interlocks:
■ No member of the Compensation Committee has been at any time an employee or an officer of ours. None of our executive officers serves as a member of the board of directors or compensation committee of any entity that has one or more executive officers serving as a member of
our Board or Compensation Committee.
Primary Responsibilities:
■ Review and approve the compensation arrangements for our executive
officers, including the compensation for our Chief Executive Officer;
■ Review and approve compensation for our directors;
■ Periodically review, in consultation with our Chief Executive Officer, our
management succession planning;
■ Review and evaluate our executive compensation and benefits policies generally, including review and recommendation of any incentive
compensation and equity-based plans;
■ Prepare the report of the Compensation Committee that SEC rules require to be included in the Proxy Statement or Annual Report on Form 10-K, review and discuss the Company’s Compensation Discussion and Analysis with management and provide a recommendation to the Company’s Board regarding the inclusion of the Compensation
Discussion and Analysis in the Proxy Statement or Form 10-K;
■ Retain and terminate any advisors, including any compensation consultants, and approve any such advisors’ fees and other retention
terms; and
■ Delegate its authority to subcommittees or the Chair of the Committee
when it deems it appropriate and in the best interests of the Company.
The Compensation Committee Charter:
■ Was approved by the Board on May 9, 2011 and is reviewed periodically;
and
■ Is available under the Corporate Governance link on the Investors’ page of our website at www.kosmosenergy.com. The information on our
website is not incorporated by reference into this Proxy Statement.
The report of the Compensation Committee is set forth on page 44 of this Proxy Statement. |
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Members:
Adebayo O. Ogunlesi,
Chair
Sir Richard Dearlove
Steven M. Sterin
Meetings in 2020: 3
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Nominating and Corporate Governance Committee
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The Nominating and Corporate Governance Committee is a separately designated standing Committee of the Board established in accordance with Section 3(a)(58)(A) of the Exchange Act.
Membership:
■ Our Board has determined that all members are independent directors as
defined by the NYSE rules and Rule 10A-3 of the Exchange Act.
Primary Responsibilities:
■ Identify and nominate members for election to the Board;
■ Review and approve transactions between us and our directors, officers
and affiliates;
■ Develop and recommend to the Board a set of corporate governance
principles applicable to the Company; and
■ Oversee the evaluation of the Board.
The Nominating and Corporate Governance Committee Charter:
■ Was approved by the Board on May 9, 2011 and is reviewed periodically;
and
■ Is available under the Corporate Governance link on the Investors’ page of our website at www.kosmosenergy.com. The information on our
website is not incorporated by reference into this Proxy Statement.
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Members:
Sir Richard Dearlove,
Chair
Deanna L. Goodwin
Adebayo O. Ogunlesi
No Meetings in 2020:
Duties delegated to
the Nominating and
Corporate Governance
Committee were
attended to by the full
Board.
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Health, Safety and Environment Committee
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Membership:
■ Our Board has determined that all members are independent directors as
defined by the NYSE rules and Rule 10A-3 of the Exchange Act.
Primary Responsibilities:
■ Monitor the establishment of goals and targets for health, safety and
environmental performance;
■ Monitor medium- and long-term performance versus targets and objectives and work with management to review health, safety and environmental standards, policies and procedures and make
improvements accordingly;
■ Review emergency and incident response plans; and
■ Monitor the identification, management and mitigation of major health,
safety and environmental risks.
The Health, Safety and Environment Committee Charter:
■ Was approved by the Board on May 6, 2011 and is reviewed periodically;
and
■ Is available under the Corporate Governance link on the Investors’ page of our website at www.kosmosenergy.com. The information on our website is not incorporated by reference into this Proxy Statement.
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Members:
Deanna L. Goodwin, Chair
Lisa A. Davis
Steven M. Sterin
Meetings in 2020: 4
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Name
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Fees Earned or Paid
in Cash ($)(1)
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Stock Awards
($)(2)
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All Other
Compensation ($)
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Total ($)
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Lisa Davis
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60,000
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170,000
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—
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230,000
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Sir Richard Dearlove
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110,000
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170,000
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—
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280,000
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Deanna Goodwin
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85,000
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170,000
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—
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255,000
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Adebayo Ogunlesi
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85,000
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170,000
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—
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255,000
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Steven Sterin
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110,000
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170,000
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—
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280,000
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(1)
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Each of our non-employee directors is entitled to (i) an annual cash retainer for service on the Board and (ii) an additional cash retainer if the director chairs a Board committee, in each case, paid quarterly and, if applicable, prorated for the portion of the year that the director serves on the Board or committee. The table below sets forth the annualized cash retainers for the period from January 1, 2020 to December 31, 2020.
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Type of Retainer
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Retainer
(Annualized) ($)
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Board Member
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60,000
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Audit Committee Chair
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50,000
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Compensation Committee Chair
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25,000
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Nominating and Corporate Governance Committee Chair
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50,000
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Health, Safety and Environment Committee Chair
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25,000
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(2)
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Effective January 1, 2020, each non-employee director is entitled to receive an annual equity award retainer in the form of service-vesting restricted share units (“RSUs”) granted under our Long Term Incentive Plan with an annual grant date value of $170,000. These grants are made annually on the date of our annual stockholders meeting (or, for new directors who begin serving on the Board on a different date, on such date).
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Name
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Total RSUs
(#)
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Lisa Davis
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70,834
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Sir Richard Dearlove
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70,834
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Deanna Goodwin
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70,834
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Adebayo Ogunlesi
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70,834
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Steven Sterin
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70,834
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■
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each of our named executive officers;
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■
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each of our directors;
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■
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each of our director nominees;
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all of our executive officers and directors as a group; and
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■
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each stockholder known by us to be the beneficial owner of more than 5% of our issued and outstanding common shares.
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Name of Beneficial Owner
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Number of Shares
Beneficially
Owned(1)
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Percentage of
Shares
Beneficially
Owned
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Named Executive Officers
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Andrew G. Inglis
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2,019,918
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*
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Thomas P. Chambers(2)
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678,178
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*
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Neal D. Shah(3)
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559,743
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*
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Christopher J. Ball
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859,062
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*
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Richard R. Clark
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471,415
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*
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Jason E. Doughty
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854,361
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*
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Directors
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Sir Richard Dearlove
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132,389
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*
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Adebayo O. Ogunlesi
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1,502,990
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*
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Deanna L. Goodwin
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42,993
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*
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Steven M. Sterin
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74,605
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*
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Lisa Davis
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20,498
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*
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All directors, nominees and executive officers as a group (11 individuals)
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7,216,152
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1.77%
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Five Percent Stockholders
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FMR LLC(4)
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60,818,191
|
| |
14.91%
|
|
|
BlackRock, Inc.(5)
|
| |
47,641,736
|
| |
11.68%
|
|
|
Vaughan Nelson Investment Management, L.P. (6)
|
| |
33,878,564
|
| |
8.31%
|
|
*
|
Less than one percent.
|
(1)
|
Excludes restricted share units held by each of our executive officers (including our named executive officers) and directors.
|
(2)
|
Mr. Chambers ceased serving as the Company’s Senior Vice President and Chief Financial Officer, effective May 11, 2020 and at the time, he owned 678,178 shares.
|
(3)
|
Mr. Shah was promoted to the position of Senior Vice President and Chief Financial Officer, effective May 11, 2020.
|
(4)
|
Based on a Schedule 13G/A filed on February 8, 2021, FMR LLC (“FMR”) exercises sole voting power over 5,610,809 shares and sole dispositive power over 60,818,191 shares. FMR’s beneficial ownership reflects the securities beneficially owned, or that may be deemed to be beneficially owned, by FMR, certain of its subsidiaries and affiliates, and other companies, including FIAM LLC, Fidelity Institutional Asset Management Trust Company, Fidelity Management & Research Company LLC, FMR Investment Management (UK) Limited and Strategic Advisers LLC. The address for FMR is 245 Summer Street, Boston, Massachusetts 02210.
|
(5)
|
Based on Schedule 13G/A filed on January 27, 2021, BlackRock, Inc. (“BlackRock”) exercises sole voting power over 46,881,778 shares and sole dispositive power over 47,641,736 shares. The address for BlackRock is 55 East 52nd Street, New York, New York 10055.
|
(6)
|
Based on Schedule 13G/A filed on February 11, 2021, Vaughan Nelson Investment Management, L.P. (“Vaughan Nelson”) exercises sole voting power over 16,288,466 shares, sole dispositive power over 28,209,861 shares and shared dispositive power over 5,668,703 shares. Vaughan Nelson’s beneficial ownership reflects securities beneficially owned, or that may be deemed to be beneficially owned, by Vaughan Nelson Investment Management, Inc., as general partner of Vaughan Nelson. The address for Vaughan Nelson is 600 Travis Street, Suite 3800, Houston, Texas 77002.
|
|
|
| |
2019
|
| |
2020
|
|
|
Audit fees
|
| |
$2,146,148
|
| |
$2,020,533
|
|
|
Audit-related fees
|
| |
$20,000
|
| |
$13,000
|
|
|
Tax fees
|
| |
$73,214
|
| |
$181,364
|
|
|
All other fees
|
| |
$8,038
|
| |
$9,819
|
|
|
Total fees
|
| |
$2,247,400
|
| |
$2,224,716
|
|
|
FOR
|
| |
The Board recommends a vote “FOR” the ratification of the appointment of Ernst & Young LLP to serve as our independent registered public accounting firm for the fiscal year ending December 31, 2021 and to authorize the Audit Committee to determine their remuneration. If not otherwise specified, proxies will be voted “FOR” Proposal 2.
|
|
|
FOR
|
| |
The Board recommends a vote “FOR” the approval of the compensation of our named executive officers as disclosed in this Proxy Statement. If not otherwise specified, proxies will be voted “FOR” Proposal 3.
|
|
Andrew G. Inglis
|
||||||
Chairman and Chief Executive Officer
|
||||||
|
| |
Age: 62
|
| |
Mr. Inglis has served as our Chairman and Chief Executive Officer since March 1, 2014. Mr. Inglis joined Kosmos from Petrofac Ltd., a leading provider of oilfield services to the international oil and gas industry, principally engaged in the design of oil and gas infrastructure, the operation, maintenance and management of oil and gas assets and the training of personnel on a worldwide basis. At Petrofac, Mr. Inglis held the position of Chief Executive, Integrated Energy Services and was a member of the Petrofac board of directors. Prior to joining Petrofac in January 2011, Mr. Inglis served BP p.l.c for 30 years in a number of positions, including most recently as Executive Director on the BP board of directors from 2007 to 2010 and as Executive Vice President and Deputy Chief Executive of exploration and production from 2004 to 2007. Mr. Inglis received a Master’s degree in Engineering from Pembroke College, Cambridge University. He is a Chartered Mechanical Engineer, a Fellow of the Institution of Mechanical Engineers and a Fellow of the Royal Academy of Engineering.
|
Neal D. Shah
|
||||||
Senior Vice President and Chief Financial Officer
|
||||||
|
| |
Age: 36
|
| |
Mr. Shah became Chief Financial Officer in May 2020. As Deputy Chief Financial Officer from November 2019 to May 2020, Mr. Shah led finance, treasury, investor relations, information technology and internal audit for the Company. He joined Kosmos in 2010, serving in a series of roles of increasing responsibility in finance, treasury, investor relations and international operations as head of the Equatorial Guinea business unit. Before Kosmos, Mr. Shah was an investment banker at Morgan Stanley assisting oil and gas companies. Mr. Shah earned his bachelor’s degree with honors in finance from the University of Texas at Austin.
|
Richard R. Clark
|
||||||
Senior Vice President and Head of Gulf of Mexico Business Unit
|
||||||
|
| |
Age: 65
|
| |
Mr. Clark became our Senior Vice President and Head of Gulf of Mexico Business Unit on September 14, 2018, upon the closing of the Deep Gulf Energy (“DGE”) Transaction. Mr. Clark was a founder of DGE and served as its President until its acquisition. More than 20 of his 36 years in the energy business have been focused in the deepwater Gulf of Mexico. In 1996, he was one of the founders of Mariner Energy, Inc., serving as Executive Vice President and a board member until 2004. Mr. Clark has a Mechanical Engineering degree from the University of Tennessee at Chattanooga. He launched his career at Shell Offshore in 1979.
|
Christopher J. Ball
|
||||||
Senior Vice President and Chief Commercial Officer
|
||||||
|
| |
Age: 53
|
| |
Mr. Ball became our Chief Commercial Officer effective October 1, 2018 and has served as our Senior Vice President, Planning and Business Development since August 2013. Mr. Ball joined Kosmos in July 2013 after serving as Vice President, Business Development for the upstream unit of Mubadala Development Company PJSC, a company based in Abu Dhabi, United Arab Emirates. Previously, he was Senior Vice President of Occidental Development Company and President and General Manager of Occidental Middle East Development Company, where he was responsible for business development activities in the Caspian, the Middle East, and North Africa. During his tenure at Occidental, Mr. Ball led and facilitated numerous successful new business activities including the company’s acquisition of concessions in Angola, Nigeria, and Suriname. He also worked in the commercial and mergers and acquisitions arena at Texaco in Houston, London, and New York and in upstream asset development and management at Amoco Corporation in London. Mr. Ball earned a Bachelor of Science degree in Mechanical Engineering from Brunel University in London.
|
Jason E. Doughty
|
||||||
Senior Vice President and General Counsel
|
||||||
|
| |
Age: 56
|
| |
Mr. Doughty has served as our General Counsel since September 2011. Mr. Doughty spent more than 11 years with ConocoPhillips in various leadership roles, including serving as Deputy General Counsel, Americas Exploration and Production. During his tenure with ConocoPhillips, he was responsible for the company’s commercial litigation and international arbitration efforts, the Lower 48 and Latin America E&P legal group and the Indonesia legal group. Previously, Mr. Doughty was an attorney with ExxonMobil in Houston and a commercial litigation attorney in private practice in Santa Fe, New Mexico. He earned a Juris Doctor from the University of Houston Law Center, a Master’s degree in Business Administration from the University of Texas at Austin and a Bachelor of Science in Finance from Louisiana Tech University. He is a member of the State Bar of Texas.
|
Ronald W. Glass
|
||||||
Vice President and Chief Accounting Officer
|
||||||
|
| |
Age: 43
|
| |
Mr. Glass has served as our Vice President and Chief Accounting Officer since November 2019. Mr. Glass served as our Controller from July 2015 to November 2019. Prior to that, he served as the Company’s SEC Director since 2011. Mr. Glass worked in the Audit practice at KPMG LLP for over nine years prior to joining the Company. He has extensive experience in the oil and gas industry, including initial public offerings, mergers and acquisitions and various other capital market transactions. He earned a Bachelor of Arts degree from Ouachita Baptist University and is a Certified Public Accountant.
|
|
Name
|
| |
Title
|
|
|
Andrew G. Inglis
|
| |
Chairman and Chief Executive Officer
|
|
|
Neal D. Shah(1)
|
| |
Senior Vice President and Chief Financial Officer
|
|
|
Richard R. Clark
|
| |
Senior Vice President and Head of Gulf of Mexico Business Unit
|
|
|
Christopher J. Ball
|
| |
Senior Vice President and Chief Commercial Officer
|
|
|
Jason E. Doughty
|
| |
Senior Vice President and General Counsel
|
|
|
Thomas P. Chambers(1)
|
| |
Former Senior Vice President and Chief Financial Officer
|
|
(1)
|
Mr. Shah was promoted to the position of Senior Vice President and Chief Financial Officer, effective May 11, 2020, when Mr. Chambers ceased serving in that role. From May 11, 2020 through December 31, 2020, Mr. Chambers served as Senior Advisor to the Company’s Chairman and Chief Executive Officer, working on strategic projects and helping to ensure an orderly transition of his duties to Mr. Shah. Mr. Chambers retired from the Company on December 31, 2020.
|
■
|
Kosmos recorded a strong safety performance in 2020 with one lost time incident over a total of 1.3 million man hours.
|
■
|
In response to the COVID-19 pandemic, the Company decisively cut costs across operating expenses, capital expenditure and G&A to protect the business.
|
■
|
Maintained a solid balance sheet and sufficient liquidity through a very challenging market backdrop.
|
■
|
Accessed an additional source of capital through the $200 million Gulf of Mexico term loan.
|
■
|
Robust production performance over the year from the Company’s three production hubs in Ghana, Gulf of Mexico and Equatorial Guinea.
|
■
|
Progressed Phase 1 of the Greater Tortue Ahmeyim project to approximately 50% completion at year-end 2020 and established a financing path through to first gas.
|
■
|
Kosmos and partners also optimized Phase 2 of the Greater Tortue Ahmeyim project, significantly reducing costs and increasing expected returns.
|
■
|
Monetized a portfolio of frontier exploration assets to Shell for approximately $100 million with a further $100 million of potential upside through contingent payments to focus on proven-basin infrastructure-led exploration opportunities.
|
■
|
Continued to drive the Company’s ESG initiatives, publishing Kosmos’ first ever Climate Risk and Resilience and Sustainability reports.
|
■
|
Base Salaries: In early 2020, the Compensation Committee reviewed the base salaries paid to each of our named executive officers and determined to increase each of their base salaries by 2% based on a review of recent market data and each executive’s continued performance over the prior year and their future anticipated contributions to the Company’s success.
|
■
|
Annual Cash Bonuses: As noted above, in order to more closely align our named executive officers’ compensation for 2020 with stockholders’ value and in an effort to reduce G&A costs, the Compensation Committee determined that no annual cash
|
■
|
Annual Equity Awards: In January 2020, consistent with the Compensation Committee’s pay for performance
|
■
|
attract, retain and motivate talented and experienced executives in the highly competitive oil and gas industry;
|
■
|
reward individual and corporate performance;
|
■
|
align the interests of our executives and stockholders by providing a substantial
|
■
|
motivate and reward our executives to manage our business to meet our long-term objectives and create and increase stockholder value.
|
|
Element
|
| |
Objective and Basis
|
| ||||||
|
Variable
Compensation
|
| |
Equity incentive awards
|
| |
■
|
| |
Link interests of executive officers and stockholders, as the ultimate value realized depends on share price performance over the long term.
|
|
|
|
| |
■
|
| |
Require comparable or superior share performance relative to industry peers.
|
| |||
|
|
| |
■
|
| |
Encourage retention due to the multi-year service condition.
|
| |||
|
Annual cash bonus
|
| |
■
|
| |
Motivate and reward Company and individual performance for the year.
|
| |||
|
■
|
| |
Tie bonus amounts payable to our named executive officers to the Compensation Committee’s quantitative and qualitative assessment of the achievement of “key performance indicators”, general Company performance and individual performance goals.
|
|
|
Element
|
| |
Objective and Basis
|
| ||||||
|
Fixed
Compensation
|
| |
Base salary
|
| |
■
|
| |
Competitive for each role, taking into account experience and level of responsibility in companies of similar size, complexity and stage of development.
|
|
|
|
| |
■
|
| |
A basic fixed component, which comprises a relatively modest portion of overall compensation.
|
| |||
|
Employee Benefits
|
| |
Retirement Plans
|
| |
■
|
| |
We do not provide any supplemental executive defined benefit retirement plans.
|
|
|
■
|
| |
Our executive officers are eligible to participate in our 401(k) plan on the same basis as our employees generally. In addition, members of our Senior Leadership Team (including all of our named executive officers) are eligible to participate in a voluntary nonqualified deferred compensation program pursuant to which the Company matches the first 8% of compensation deferred by the executive.
|
| ||||||
|
Health and Welfare Benefits
|
| |
■
|
| |
Our named executive officers (along with other employees at the level of Vice President and above) are entitled to the same health and welfare benefits during employment that are offered to U.S.-based employees generally, except that they are also entitled to executive long-term care, executive supplemental disability income insurance, up to $5,000 reimbursement for financial planning services and payment of premiums for executive life insurance. Our Senior Vice Presidents and above (which includes our named executive officers) are also entitled to annual executive physicals.
|
|
|
Relative TSR (Ranking)
|
| |
Performance Goal Attainment
|
|
|
1st (highest)
|
| |
200%
|
|
|
2nd highest
|
| |
175%
|
|
|
3rd highest – 3rd lowest (“Middle Zone”)
|
| |
*
|
|
|
2nd lowest
|
| |
25%
|
|
|
Lowest
|
| |
0%
|
|
*
|
If Kosmos’ TSR ranking is in the “Middle Zone”, the percentage at which the performance goal will be deemed attained will be interpolated for performance between 25% and 175% based on the proportional position of Kosmos’ TSR between the TSR of the performance peer company with the 2nd highest ranking and the TSR of the performance peer company with the 2nd lowest ranking. If there are less than four performance peer companies on the last day of the performance period, the Compensation Committee will make such adjustments to the composition of the Middle Zone as it deems necessary or appropriate.
|
|
2020 PSUs: Performance Peer Companies
|
| |||
|
Africa Oil Corp.
|
| |
Noble Energy, Inc.
|
|
|
Cairn Energy plc
|
| |
Premier Oil plc
|
|
|
Genel Energy plc
|
| |
Tullow Oil plc
|
|
|
Lundin Petroleum AB
|
| |
|
|
|
Name
|
| |
2019
|
| |
2020
|
| |
2021
|
|
|
Mr. Inglis
|
| |
$2,117,408
|
| |
$2,299,500
|
| |
$2,208,900
|
|
|
Mr. Shah(1)
|
| |
—
|
| |
$766,500
|
| |
$1,100,000
|
|
|
Mr. Clark
|
| |
$1,128,600
|
| |
$1,124,200
|
| |
$1,265,400
|
|
|
Mr. Ball
|
| |
$1,128,600
|
| |
$1,124,200
|
| |
$1,265,400
|
|
|
Mr. Doughty
|
| |
$811,320
|
| |
$808,157
|
| |
$888,000
|
|
|
Mr. Chambers
|
| |
$1,128,600
|
| |
—
|
| |
—
|
|
(1)
|
Mr. Shah was promoted to the position of Senior Vice President and Chief Financial Officer, effective May 11, 2020, when Mr. Chambers ceased serving in that role. From May 11, 2020 through December 31, 2020, Mr. Chambers served as Senior Advisor to the Company’s Chairman and Chief Executive Officer, working on strategic projects and helping to ensure an orderly transition of his duties to Mr. Shah. Mr. Chambers retired from the Company on December 31, 2020.
|
|
KPI
|
| |
Commentary
|
|
|
Enhance License to Operate
|
| |||
|
■ Zero anti-corruption violations
|
| |
Continued to satisfy anticorruption compliance requirements via proactive diligence and training, and constant compliance vigilance
|
|
|
■ Deliver HSES plan targets
|
| |
One Lost Time Incident in operated activity of over 1.3 million man hours; no environmental incidents, spills or fines.
|
|
|
■ Establish Kosmos as a company recognized for its leading ESG credentials
|
| |
|
|
|
☐ Roll out Climate Change policy in 1Q and complete TCFD reporting in 3Q
|
| |
Rolled out Kosmos’ Climate Change Policy in February 2020 and published TCFD-aligned Climate Risk and Resilience Report and Sustainability Report in September 2020
|
|
|
☐ Secure opportunities to deliver Scope 1 and Scope 2 carbon neutrality
|
| |
Entered into an agreement with Shell Energy North America accessing carbon credits from two leading reforestation projects in Ghana and the United States; set goal to be carbon neutral for Scope 1 and Scope 2 emissions by 2030 or sooner
|
|
|
☐ Effectively manage above ground country risk through leveraging Kosmos brand
|
| |
Continued to advance our country strategies by leveraging the Kosmos brand to strengthen relationships and manage above and below ground risks through:
■ effective influence of our non- operated activity in Equatorial Guinea, Ghana, Mauritania and Senegal
■ consistent and transparent engagement with our host government bodies supporting our operated activity set which enhanced our relationship as a trusted partner
|
|
|
Grow Organizational Capability
|
| |||
|
■ Ensure organizational capability consistent with the Long Range Plan inclusive of active leadership planning
|
| |
Restructured the organization to better align the business with the long-term future opportunity set, resulting in a significant and sustainable reduction in G&A expenses
Moved to a remote work environment in March 2020 in response to COVID-19, while maintaining the capability of the organization
|
|
|
■ Improve the efficiency and connection of the Company (as measured through the Work Force survey)
|
| |
Despite transitioning to a remote working environment, the Work Force survey results demonstrated no year-over-year decline in either efficiency or connection of the Company
|
|
|
KPI
|
| |
Commentary
|
|
|
Deliver Operational Milestones
|
| |||
|
Ghana Business Unit:
|
| |
|
|
|
■ Maximize Jubilee production through increased gas handling, enhanced gas export capacity and more reliable seawater injection
|
| |
Gas processing upgrade completed early in the year increasing gas handling capacity; Gas export capacity ramped up; 95% Jubilee FPSO uptime in 2020
|
|
|
■ Optimize TEN production through efficient drilling/completion and reservoir management
|
| |
Optimized TEN production through improved facility reliability: 99% TEN FPSO uptime in 2020
|
|
|
■ Finalize installation of Jubilee CALM buoy offloading system
|
| |
All work scopes were completed and ready for commissioning by year-end 2020; the first offloading via CALM buoy was completed in February 2021
|
|
|
Gulf of Mexico Business Unit:
|
| |
|
|
|
■ Test three infrastructure-led exploration (ILX) prospects and deliver discoveries with cumulative net reserves of 20 MMboe (NRI)
|
| |
ILX drilling program deferred until Winterfell prospect spud in late 2020, which produced a discovery in January 2021
|
|
|
Equatorial Guinea Business Unit:
|
| |
|
|
|
■ Execute production optimization program, including ESP and Stimulation programs, that cumulatively deliver 0.9 Mbopd (gross) annualized production uplift
|
| |
Jack-up drilling program, next phase of ESPs and certain production optimization work scopes deferred to 2021 Successful stimulation program at Okume in 4Q
|
|
|
Mauritania/Senegal Business Unit:
|
| |
|
|
|
■ GTA: Ensure Phase 1 remains on schedule to deliver first gas in 1H 2022; complete pre-FEED and commence market engagement for FEED for Phases 2/3
|
| |
Disruptions caused by COVID-19 and resulting mitigation measures deferred Phase 1 expected first gas to 1H 2023 although strong progress made in 2020
■ Phase 1: ~50% complete at year-end 2020
■ Tortue Phase 1 financing path established
|
|
|
■ Maximize BirAllah resource capture and commence Yakaar/Teranga pre-FEED of domestic gas project
|
| |
Evaluation of BirAllah and Yakaar/Teranga continued
|
|
|
Basin-opening Exploration:
|
| |
|
|
|
■ Drill Sao Tome Block 6 Jaca well
|
| |
Block 6 was included in the exploration portfolio farm-down to Shell
|
|
|
Manage Costs
|
| |||
|
■ Net Cash G&A of $83 million
|
| |
Rigorously managed Net Cash G&A(1) expense to $39 million
|
|
|
■ Firm Project CapEx of $600 MM
|
| |
CapEx significantly reduced to $274 million in response to COVID-19/low oil price environment
|
|
|
KPI
|
| |
Commentary
|
|
|
Deliver 2020 Corporate Targets and Maintain Long Term Financial Liquidity
|
| |||
|
■ Deliver production target of 64 – 70 Mboepd(2) and corresponding EBITDAX(3) of $800-900 million(2) at $60/Bbl Brent
|
| |
Production and EBITDAX for 2020 were below initial expectations, largely as a result of the challenges of the COVID-19 pandemic, that led to record low oil prices and shut-ins in the Gulf of Mexico in 2Q, as well as elevated hurricane activity in 3Q and 4Q that further decreased production in the Gulf of Mexico. In Ghana, the Gulf of Mexico and Equatorial Guinea, the planned work program was deferred to reduce operating risks and reduce capital costs. These lower activity levels resulted in lower production in the second half of the year.
|
|
|
■ Evaluate options to achieve free cash flow neutrality post dividends
|
| |
Free cash flow was negative for the year due to the impacts of reduced oil production and oil prices, although the company reached a free cash flow inflection point in the second half of 2020 as oil prices improved and costs were reduced.
|
|
|
|
| |
Monetized portfolio of frontier exploration assets for ~$100 million upfront
■ Potential upside of up to $100 million through
contingent payments
Liquidity
■ Year-end liquidity of ~$570 million
■ Paid down $250 million on the RBL in 4Q
■ Suspended dividend in an effort to maintain balance sheet strength and preserve flexibility
■ Diversified sources of available capital with Gulf of Mexico term loan
|
|
|
■ Maintain long-term financial strength through continuing a disciplined hedging program
|
| |
Continued disciplined hedging program
|
|
|
Build Portfolio
|
| |||
|
■ Strengthen the ILX portfolio to create greater quality through choice
|
| |
Optimized portfolio focusing on proven basins where the Company has deep technical expertise
■ High-graded ILX opportunities complemented by material play extensions in both the Gulf of Mexico and Equatorial Guinea
■ Added the Winterfell prospect in the Gulf of Mexico to our ILX portfolio and commenced drilling in late 2020, which marked the re-start of our ILX drilling campaign
|
|
|
■ Maximize the value of existing portfolio by high-grading the best prospects with minimal capital exposure
|
| |
Continued to mature and high-grade portfolio within proven basins with access to infrastructure providing low cost, lower carbon, high return potential Monetized portfolio of frontier exploration assets for ~$100 million upfront, with potential upside of up to $100 million through contingent payments
|
|
(1)
|
“Net Cash G&A” represents G&A excluding non-cash equity-based compensation expense.
|
(2)
|
Excluding impact of acquisitions
|
(3)
|
“EBITDAX” is defined in the Company’s 2020 Annual Report on Form 10-K.
|
|
Name
|
| |
2019 Base Salary
|
| |
2020 Base Salary
|
|
|
($)
|
| |
($)
|
| |||
|
Mr. Inglis
|
| |
1,007,855
|
| |
1,028,012
|
|
|
Mr. Shah
|
| |
—
|
| |
460,000
|
|
|
Mr. Clark
|
| |
655,636
|
| |
668,749
|
|
|
Mr. Ball
|
| |
603,580
|
| |
615,652
|
|
|
Mr. Doughty
|
| |
457,470
|
| |
466,620
|
|
|
Mr. Chambers
|
| |
603,652
|
| |
615,725
|
|
|
Components of CEO Compensation
|
| |
January 2020
Compensation Decisions
|
| |
January 2021
Compensation Decisions
|
| |
Change
($)
|
|
|
Base Salary
|
| |
$1,028,012
|
| |
$1,028,012
|
| |
$0
|
|
|
Annual Cash Bonus (for Prior Year’s Performance)
|
| |
$1,763,746
|
| |
$0
|
| |
$(1,763,746)
|
|
|
Long-Term Equity Incentive Awards
|
| |
$2,299,500
|
| |
$2,208,900
|
| |
$(90,600)
|
|
■
|
Base Salary: The 2020 base salary represented a 2% increase from 2019, consistent with the adjustments applied to all named executive officers at the time. The Committee did not increase CEO base salary for 2021.
|
■
|
Annual Cash Bonus: The Committee determined that no annual cash bonuses would be awarded to our CEO and our other named executive officers for the 2020 performance year.
|
■
|
Long-Term Equity Incentive Awards: In early 2020, the Committee increased our CEO’s target incentive opportunity relative to 2019, as the target value of the 2019 equity awards granted to our CEO trailed the middle range of incentive opportunities measured across other US-based exploration and production companies of comparable size. In 2021, the grant date value of our CEO’s annual long-term equity incentive awards decreased as a result of the allocation of a fixed share pool across all of our officers. The values in the table
|
■
|
Equity Awards: The vesting of the equity awards held by our named executive officers accelerates in connection with specified terminations of employment or a change in control. See “2020 Compensation—Potential Payments Upon Termination or Change in Control” below.
|
■
|
Offer Letters: The offer letter agreements we have entered into with each of our named executive officers (other than Messrs. Clark and Shah) provide for specified termination payments and benefits. See “2020 Compensation—Potential Payments Upon Termination or Change in Control—Offer Letters” below.
|
■
|
Transition Agreement with Mr. Chambers: In connection with Mr. Chambers’ retirement on December 31, 2020, and in accordance with the Company’s existing executive retirement guidelines previously approved by the Compensation Committee, the Company entered into a transition agreement with Mr. Chambers on January 4, 2021, pursuant to which any RSU
|
■
|
Severance Policy: We maintain a change in control severance policy that is designed to encourage continuity of management and other employees after a “change in control” (as defined in the LTIP). The policy provides severance benefits to regular full-time U.S. employees whose employment is terminated in connection with a change in
|
|
Position
|
| |
Multiple of Annual
Base Salary
|
|
|
Chief Executive Officer
|
| |
6x
|
|
|
Other Executive Officers
|
| |
3x
|
|
|
|
| |
Respectfully submitted by the Compensation
Committee of the Board,
|
|
|
|
| |
|
|
|
|
| |
Adebayo (“Bayo”) O. Ogunlesi, Chair
Sir Richard Dearlove
Steven M. Sterin
|
|
|
Name and Principal Position
|
| |
Year
|
| |
Salary
($)(1)
|
| |
Bonus
($)
|
| |
Non-Equity
Incentive
Compensation
($)(2)
|
| |
Stock
Awards
($)(3)
|
| |
All Other
Compensation
($)(4)
|
| |
Total
($)
|
|
|
Andrew G. Inglis
Chairman and Chief Executive Officer
|
| |
2020
|
| |
1,028,012
|
| |
—
|
| |
—
|
| |
3,636,630
|
| |
58,059
|
| |
4,722,701
|
|
|
2019
|
| |
1,007,855
|
| |
—
|
| |
1,763,746
|
| |
2,334,927
|
| |
47,932
|
| |
5,154,460
|
| |||
|
2018
|
| |
978,500
|
| |
—
|
| |
1,712,375
|
| |
3,614,395
|
| |
56,452
|
| |
6,361,722
|
| |||
|
Neal D. Shah(5)
Senior Vice President and Chief Financial Office
|
| |
2020
|
| |
460,000
|
| |
—
|
| |
—
|
| |
1,212,210
|
| |
34,581
|
| |
1,706,791
|
|
|
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |||
|
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |||
|
Richard Clark
Senior Vice President and Head of Gulf of Mexico Business Unit
|
| |
2020
|
| |
668,749
|
| |
—
|
| |
—
|
| |
1,776,638
|
| |
49,927
|
| |
2,495,314
|
|
|
2019
|
| |
655,636
|
| |
—
|
| |
1,147,363
|
| |
1,235,919
|
| |
47,956
|
| |
3,086,874
|
| |||
|
2018
|
| |
185,658
|
| |
—
|
| |
477,405
|
| |
1,815,243
|
| |
26,826
|
| |
2,505,132
|
| |||
|
Christopher J. Ball
Senior Vice President and Chief Commercial Office
|
| |
2020
|
| |
615,652
|
| |
—
|
| |
—
|
| |
1,776,638
|
| |
63,451
|
| |
2,455,741
|
|
|
2019
|
| |
603,580
|
| |
—
|
| |
905,370
|
| |
1,235,919
|
| |
46,062
|
| |
2,790,931
|
| |||
|
2018
|
| |
544,130
|
| |
—
|
| |
1,025,500
|
| |
1,491,148
|
| |
42,722
|
| |
3,103,500
|
| |||
|
Jason E. Doughty
Senior Vice President and General Counsel
|
| |
2020
|
| |
466,620
|
| |
—
|
| |
—
|
| |
1,278,182
|
| |
39,276
|
| |
1,784,078
|
|
|
2019
|
| |
457,470
|
| |
—
|
| |
514,654
|
| |
888,971
|
| |
39,584
|
| |
1,900,679
|
| |||
|
2018
|
| |
443,068
|
| |
—
|
| |
582,942
|
| |
1,362,470
|
| |
33,402
|
| |
2,421,882
|
| |||
|
Thomas P Chambers(6)
Former Senior Vice President and Chief
Financial Officer
|
| |
2020
|
| |
615,725
|
| |
—
|
| |
—
|
| |
—
|
| |
528,203
|
| |
1,143,928
|
|
|
2019
|
| |
603,652
|
| |
—
|
| |
603,652
|
| |
1,235,919
|
| |
81,049
|
| |
2,524,272
|
| |||
|
2018
|
| |
586,070
|
| |
—
|
| |
879,105
|
| |
1,909,394
|
| |
183,428
|
| |
3,557,997
|
|
(1)
|
The amounts in this column reflect the actual amounts of salary paid to our named executive officers in the relevant fiscal year.
|
(2)
|
The Compensation Committee determined not to award annual cash bonuses to any of our named executive officers for 2020. For additional information, see “Compensation Discussion and Analysis—Analysis of 2020 Executive Compensation Decisions—Annual Cash Bonus” above.
|
(3)
|
The amounts in this column reflect the aggregate grant date fair values of the RSUs and PSUs granted under the LTIP in 2020 to the named executive officers, in each case, calculated in accordance with FASB ASC Topic 718, excluding the effect of estimated forfeitures. The actual value, if any, that the executives will realize for these awards is a function of the value of the underlying shares if and when these awards vest and, for PSU awards, the level of attainment of the applicable performance goal.
|
(4)
|
The amounts reported for 2020 in this column for our named executive officers reflect the following:
|
(a)
|
For Mr. Inglis, includes: (i) matching contributions under the Company’s 401(k) plan ($22,800); (ii) payment of premiums for (a) executive life insurance ($11,487), (b) executive supplemental disability income insurance ($6,542) and (c) executive long-term care insurance ($4,721); (iii) the cost of an annual executive physical ($8,138); and (iv) reimbursement for financial planning services ($4,370).
|
(b)
|
For Mr. Shah, includes: (i) matching contributions under the Company’s 401(k) plan ($19,500); (ii) payment of premiums for (a) executive life insurance ($245), (b) executive supplemental disability income insurance ($3,130) and (c) executive long-term care insurance ($4,229); (iii) the cost of an annual executive physical ($3,127); and (iv) reimbursement for financial planning services $5,000.
|
(c)
|
For Mr. Clark, includes: (i) matching contributions under the Company’s 401(k) plan ($22,800); and (ii) payment of premiums for (a) executive life insurance ($14,858), (b) executive supplemental disability income insurance ($5,233) and (c) executive long-term care insurance ($7,036).
|
(d)
|
For Mr. Ball, includes: (i) matching contributions under the Company’s 401(k) plan ($22,800); (ii) payment of premiums for (a) executive life insurance ($4,235), (b) executive supplemental disability income insurance ($5,129) and (c) executive long-term care insurance ($3,284); (iii) reimbursement for financial planning services ($5,000); and (iv) reimbursement for moving expenses in connection with his move back to the United Kingdom ($23,002).
|
(e)
|
For Mr. Doughty, includes: (i) matching contributions under the Company’s 401(k) plan ($22,800); (ii) payment of premiums for (a) executive life insurance ($1,906), (b) executive supplemental disability income insurance ($5,962) and (c) executive long-term care insurance ($4,229); and (iii) the cost of an annual executive physical ($4,378).
|
(f)
|
For Mr. Chambers, includes: (i) matching contributions under the Company’s 401(k) plan ($22,800); (ii) payment of premiums for (a) executive life insurance ($29,371), (b) executive supplemental disability income insurance ($6,261) and (c) executive long-term care insurance ($5,974); (iii) the cost of an annual executive physical ($4,136); (iv) Company matching contributions to our non-qualified deferred compensation plan ($49,178); and (v) a one-time cash payment to Mr. Chambers in consideration for his services during his extended transition period through the end of 2020 and his additional responsibilities and contributions in supporting the Company through the impact of the COVID-19 pandemic during such period ($410,483). See “Potential Payments on Termination or Change in Control—Transition Agreement with Mr. Chambers” below for additional details.
|
(5)
|
Mr. Shah was promoted to the position of Senior Vice President and Chief Financial Officer, effective May 11, 2020.
|
(6)
|
Mr. Chambers ceased serving as the Company’s Senior Vice President and Chief Financial Officer, effective May 11, 2020. Mr. Chambers retired from the Company effective December 31, 2020.
|
|
Name
|
| |
Grant Date
|
| |
Approval
Effective
Date
|
| |
Estimated Future
Payouts Under Non-
Equity Incentive Plan
Awards(1)
|
| |
Estimated Future Payouts Under
Equity Incentive Plan
Awards(2)
|
| |
All Other
Stock
Awards:
Number of
Shares of
Stock or
Units (#)(3)
|
| |
Grant Date
Fair Value
of Stock and
Option Awards
($)(4)
|
| |||||||||
|
Target ($)
|
| |
Maximum ($)
|
| |
Threshold (#)
|
| |
Target (#)
|
| |
Maximum (#)
|
| |||||||||||||||
|
Andrew G. Inglis
|
| |
—
|
| |
—
|
| |
1,028,012
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
|
| |
01/31/2020
|
| |
01/24/2020
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
148,500
|
| |
959,310
|
|
|
|
| |
01/31/2020
|
| |
01/24/2020
|
| |
—
|
| |
—
|
| |
75,375
|
| |
301,500
|
| |
603,000
|
| |
—
|
| |
2,677,320
|
|
|
Neal D. Shah
|
| |
—
|
| |
—
|
| |
460,000
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
|
| |
01/31/2020
|
| |
01/24/2020
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
49,500
|
| |
319,770
|
|
|
|
| |
01/31/2020
|
| |
01/24/2020
|
| |
—
|
| |
—
|
| |
25,125
|
| |
100,500
|
| |
201,000
|
| |
—
|
| |
892,440
|
|
|
Richard R. Clark
|
| |
—
|
| |
—
|
| |
668,749
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
|
| |
01/31/2020
|
| |
01/24/2020
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
73,125
|
| |
472,388
|
|
|
|
| |
01/31/2020
|
| |
01/24/2020
|
| |
—
|
| |
—
|
| |
36,719
|
| |
146,875
|
| |
293,750
|
| |
—
|
| |
1,304,250
|
|
|
Christopher J. Ball
|
| |
—
|
| |
—
|
| |
615,652
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
|
| |
01/31/2020
|
| |
01/24/2020
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
73,125
|
| |
472,388
|
|
|
|
| |
01/31/2020
|
| |
01/24/2020
|
| |
—
|
| |
—
|
| |
36,718
|
| |
146,875
|
| |
293,750
|
| |
—
|
| |
1,304,250
|
|
|
Jason E. Doughty
|
| |
—
|
| |
—
|
| |
349,965
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
|
| |
01/31/2020
|
| |
01/24/2020
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
52,152
|
| |
336,902
|
|
|
|
| |
01/31/2020
|
| |
01/24/2020
|
| |
—
|
| |
—
|
| |
26,500
|
| |
106,000
|
| |
212,000
|
| |
—
|
| |
941,280
|
|
|
Thomas P. Chambers
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
(1)
|
The amounts reported are the target annual bonuses that our named executive officers were eligible to receive for performance in respect of 2020 pursuant to our annual cash bonus plan. However, the Compensation Committee determined not to award any annual cash bonuses to our named executive officers in respect of 2020. For additional information, see “Compensation Discussion and Analysis—Analysis of 2020 Executive Compensation Decisions—Annual Cash Bonus” above.
|
(2)
|
These amounts reflect PSUs, which are scheduled to vest between 0% and 200% of the number of shares shown in the “Target” sub-column based on attainment of both a service condition that will lapse one-third
|
(3)
|
These amounts reflect RSUs that are scheduled to vest one-third each year over three years, based solely on service.
|
(4)
|
The amounts in this column for the RSUs reflect their aggregate grant date fair values, calculated in accordance with FASB ASC Topic 718, excluding the effect of estimated forfeitures.
|
|
Name
|
| |
Number of Shares
or Units of Stock
That Have Not
Vested
(#)
|
| |
Market Value of
Shares or Units of
Stock That Have
Not Vested
($)(1)
|
| |
Equity Incentive
Plan Awards:
Number of
Unearned Shares,
Units or Other
Rights That Have
Not Vested
(#)(2)
|
| |
Equity Incentive
Plan Awards:
Market or Payout
Value of Unearned
Shares, Units or
Other Rights That
Have Not Vested
($)(1)(2)
|
|
|
Andrew G. Inglis
|
| |
272,548(3)
|
| |
640,488
|
| |
878,675(3)
|
| |
2,064,886
|
|
|
Neal D. Shah
|
| |
91,166(4)
|
| |
214,240
|
| |
278,000(4)
|
| |
653,300
|
|
|
Richard R. Clark
|
| |
121,874(5)
|
| |
286,404
|
| |
434,140(5)
|
| |
1,020,229
|
|
|
Christopher J. Ball
|
| |
143,330(6)
|
| |
336,826
|
| |
403,120(6)
|
| |
947,332
|
|
|
Jason E. Doughty
|
| |
105,777 (7)
|
| |
248,576
|
| |
313,576 (7)
|
| |
736,904
|
|
|
Thomas P. Chambers(8)
|
| |
73,123 (8)
|
| |
171,839
|
| |
293,750(8)
|
| |
690,313
|
|
(1)
|
The market values of the awards were calculated by multiplying the number of shares underlying the awards by $2.35, which was the closing price of a common share on December 31, 2020.
|
(2)
|
The number of shares underlying PSU awards reflected in this table assumes attainment of the applicable specified relative TSR goal at the target performance level for PSU awards granted in 2018, 2019 and 2020. The actual number of shares, if any, that will vest will be based on (i) the level of achievement of the relative TSR goal as of the actual end of the performance period and (ii) satisfaction of the applicable service condition, in each case, as indicated in the footnotes below, plus the amount of any dividends or distributions that are declared on the shares during the applicable performance period. Following the end of 2020, the PSUs granted in 2018 achieved the specified relative TSR goal with a payout at 49.9% of the target number of shares. For more on the terms of outstanding equity awards granted in 2020, see “Compensation Discussion and Analysis—Analysis of 2020 Executive Compensation Decisions—Equity Awards” above.
|
(3)
|
For Mr. Inglis, consists of: (a) 41,499 shares underlying RSU awards that are scheduled to vest on January 2, 2021; (b) 82,549 shares underlying RSU awards that are scheduled to vest ratably on January 31 of each of 2021 and 2022; (c) 148,500 shares underlying RSU awards that are scheduled to vest ratably on January 31 of each of 2021, 2022 and 2023; (d) 288,250 shares underlying PSU awards (with a performance period scheduled to end on January 4, 2021 and a service condition that is scheduled to be met on January 2, 2021); (e) 288,925 shares underlying PSU awards (with a performance period scheduled to end on January 2, 2022 and a service
|
(4)
|
For Mr. Shah, consists of: (a) 13,333 shares underlying RSU awards that are scheduled to vest on January 2, 2021; (b) 28,333 shares underlying RSU awards that are scheduled to vest ratably on January 31 of each of 2021 and 2022; (c) 49,500 shares underlying RSU awards that are scheduled to vest ratably on January 31 of each of 2021, 2022 and 2023; (d) 90,000 shares underlying PSU awards (with a performance period scheduled to end on January 4, 2021 and a service condition that is scheduled to be met on January 2, 2021); (e) 87,500 shares underlying PSU awards (with a performance period scheduled to end on January 2, 2022 and a service condition that is scheduled to be met ratably on January 31 of each of 2021 and 2022); and (f) 100,500 shares underlying PSU awards (with a performance period scheduled to end on January 2, 2023 and a service condition that is scheduled to be met ratably on January 31 of each of 2021, 2022 and 2023).
|
(5)
|
For Mr. Clark, consists of: (a) 48,749 shares underlying RSU awards that are scheduled to vest ratably on January 31 of each of 2021 and 2022; (b) 73,125 shares underlying RSU awards that are scheduled to vest ratably on January 31 of each of 2021, 2022 and 2023; (c) 140,390 shares underlying PSU awards (with a performance period that is scheduled to end on January 4, 2021 and a service condition that is scheduled to be met on September 14, 2021); (d)146,875 shares underlying PSU awards (with a performance period that is scheduled to end on January 2, 2022 and a service condition that is scheduled to be met ratably on January 31 of each of 2021 and 2022); and (e) 146,875 shares underlying PSU awards (with a performance period that is scheduled to end on January 2, 2023 and a service condition that is scheduled to be met ratably on January 31 of each of 2021, 2022 and 2023).
|
(6)
|
For Mr. Ball, consists of: (a) 21,456 shares underlying RSU awards that are scheduled to vest on January 2, 2021; (b) 48,749 shares underlying RSU awards that are scheduled to vest ratably on January 31 of each of 2021 and 2022; (c) 73,125 shares underlying RSU awards that are scheduled to vest ratably on January 31 of each of 2021, 2022 and 2023; (d) 109,370 shares underlying PSU awards (with a performance period scheduled to end on January 4, 2021 and a service condition that is scheduled to be met on January 2, 2021); (e) 146,875 shares underlying PSU awards (with a performance period scheduled to end on January 2, 2022 and a service condition that is scheduled to be met ratably on January 31 of each of 2021 and 2022); and (f) 146,875 shares underlying PSU awards (with a performance period scheduled to end on January 2, 2023 and a service condition that is scheduled to be met ratably on January 31 of each of 2021, 2022 and 2023).
|
(7)
|
For Mr. Doughty, consists of: (a) 18,858 shares underlying RSU awards that are scheduled to vest on January 2, 2021; (b) 34,767 shares underlying RSU awards that are scheduled to vest ratably on January 31 of each of 2021 and 2022; (c) 52,152 shares underlying RSU awards that are scheduled to vest ratably on January 31 of each of 2021, 2022 and 2023; (d) 101,576 shares underlying PSU awards (with a performance period scheduled to end on January 4, 2021 and a service condition that is scheduled to be met on January 2, 2021); (e) 106,000 shares underlying PSU awards (with a performance period scheduled to end on January 2, 2022 and a service condition that is scheduled to be met ratably on January 31 of each of 2021 and 2022); and (f) 106,000 shares underlying PSU awards (with a performance period scheduled to end on January 2, 2023 and a service condition that is scheduled to be met ratably on January 31 of each of 2021, 2022 and 2023).
|
(8)
|
For Mr. Chambers, consists of: (a) 24,374 shares underlying RSU awards that are scheduled to vest on January 2, 2021; (b) 48,749 shares underlying RSU awards that are scheduled to vest ratably on January 31 of each of 2021 and 2022; (c) 146,875 shares underlying PSU awards with a performance period scheduled to end on January 4, 2021 and a service condition that is scheduled to be met on January 2, 2021); and (d) 146,875 shares underlying PSU awards (with a performance period scheduled to end on January 2, 2022 and a service condition that is scheduled to be met ratably on January 31 of each of 2021 and 2022). As described in more detail below under “— Potential Payments Upon Termination or Change in Control — Transition Agreement with Mr. Chambers”, in connection with his retirement on December 31, 2020, the RSU and PSU awards held by Mr. Chambers that were outstanding as of such date for at least one year since their grant date continued to vest in accordance with their existing schedule following his retirement, with any such PSU awards vesting only to the extent the applicable TSR performance goal is achieved in accordance with its terms.
|
|
Name
|
| |
Number of Shares
Acquired on
Vesting
(#)
|
| |
Value Realized on
Vesting
($)(1)
|
|
|
Andrew G. Inglis
|
| |
365,989
|
| |
2,125,314
|
|
|
Neal D. Shah
|
| |
114,540
|
| |
664,924
|
|
|
Richard R. Clark
|
| |
24,376
|
| |
124,561
|
|
|
Christopher J. Ball
|
| |
207,721
|
| |
1,206,803
|
|
|
Jason E. Doughty
|
| |
185,527
|
| |
1,081,880
|
|
|
Thomas P. Chambers
|
| |
229,613
|
| |
1,335,797
|
|
(1)
|
The value realized on vesting of the awards was calculated by multiplying the number of shares underlying the awards that vested in 2020 by the closing price of a share on the vesting date (or if the vesting date was not a trading day, on the trading day immediately preceding the vesting date). These closing prices ranged from $5.11 to $5.98.
|
|
Name
|
| |
Executive
Contributions
in 2020
($)(2)
|
| |
Registrant
Contributions
in 2020
($)(3)
|
| |
Aggregate
Earnings in 2020
($)
|
| |
Aggregate
Withdrawals/
Distributions
($)
|
| |
Aggregate Balance
at End of 2020
($)
|
|
|
Andrew G. Inglis
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
Neal D. Shah
|
| |
—
|
| |
|
| |
|
| |
|
| |
|
|
|
Richard R. Clark
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
Christopher J. Ball
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
Jason E. Doughty
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
Thomas P. Chambers
|
| |
73,263
|
| |
49,178
|
| |
247,759
|
| |
—
|
| |
892,455
|
|
(1)
|
The Company maintains a non-qualified deferred compensation plan pursuant to which each member of our Senior Leadership Team (including our named executive officers) and executives at the level of senior vice president or above may defer up to 50% of his or her base compensation and 100% of his or her annual cash bonus compensation on a pre-tax basis, with the Company providing a matching contribution on the first 8% deferred by each executive. Matching contributions vest after three years of service. The vesting of unvested matching contributions under the deferred compensation plan accelerates upon the participant’s death or disability or upon a change in control of Kosmos. Participants under the plan may elect to have their benefit distributed on a specified date or a separation from service with Kosmos (either in a lump sum or in annual installments over a ten-year period).
|
(2)
|
These amounts are reported as compensation in the “2020 Summary Compensation Table” above under the column “Salary”.
|
(3)
|
These amounts are reported as compensation in the “2020 Summary Compensation Table” above under the column “All Other Compensation”.
|
|
Name
|
| |
Change in
Control
(No Termination)
($)
|
| |
Involuntary
Termination in
Connection with
Change in Control
($)
|
| |
Termination without
Cause or Resignation
for Good Reason
(No Change in
Control)
($)
|
| |
Voluntary
Resignation
without
Good Reason
or
Termination
for Cause
($)
|
| |
Death/
Disability
($)
|
|
|
Andrew G. Inglis
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
Equity acceleration(1)
|
| |
4,770,260
|
| |
4,770,260
|
| |
—
|
| |
—
|
| |
4,770,260
|
|
|
Salary payments
|
| |
—
|
| |
2,056,024(2)
|
| |
2,056,024(2)
|
| |
—
|
| |
—
|
|
|
Bonus
|
| |
—
|
| |
2,056,024(2)
|
| |
2,056,024(2)
|
| |
—
|
| |
—
|
|
|
Benefits continuation
|
| |
—
|
| |
61,157(3)
|
| |
61,157(3)
|
| |
—
|
| |
—
|
|
|
Outplacement services
|
| |
—
|
| |
20,700(4)
|
| |
—
|
| |
—
|
| |
—
|
|
|
Relocation
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
Total
|
| |
4,770,260
|
| |
8,964,165
|
| |
4,173,205
|
| |
—
|
| |
4,770,260
|
|
|
Neal D. Shah
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
Equity acceleration(1)
|
| |
—
|
| |
1,520,840
|
| |
—
|
| |
—
|
| |
1,520,840
|
|
|
Salary payments
|
| |
—
|
| |
1,292,653(5)
|
| |
—
|
| |
—
|
| |
—
|
|
|
Bonus
|
| |
—
|
| |
460,000(6)
|
| |
—
|
| |
—
|
| |
—
|
|
|
Benefits continuation
|
| |
—
|
| |
20,157(3)
|
| |
—
|
| |
—
|
| |
—
|
|
|
Outplacement services
|
| |
—
|
| |
20,700(4)
|
| |
—
|
| |
—
|
| |
—
|
|
|
Relocation
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
Total
|
| |
—
|
| |
3,314,350
|
| |
—
|
| |
—
|
| |
1,520,840
|
|
|
Richard R. Clark
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
Equity acceleration(1)
|
| |
—
|
| |
2,326,862
|
| |
—
|
| |
—
|
| |
2,326,862
|
|
|
Salary payments
|
| |
—
|
| |
2,146,198(5)
|
| |
—
|
| |
—
|
| |
—
|
|
|
Bonus
|
| |
—
|
| |
668,749(6)
|
| |
—
|
| |
—
|
| |
—
|
|
|
Benefits continuation
|
| |
—
|
| |
43,848(3)
|
| |
—
|
| |
—
|
| |
—
|
|
|
Outplacement services
|
| |
—
|
| |
20,700(4)
|
| |
—
|
| |
—
|
| |
—
|
|
|
Relocation
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
Total
|
| |
—
|
| |
5,206,357
|
| |
—
|
| |
—
|
| |
2,326,862
|
|
|
Christopher J. Ball
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
Equity acceleration(1)
|
| |
—
|
| |
2,231,490
|
| |
—
|
| |
—
|
| |
2,231,490
|
|
|
Salary payments
|
| |
—
|
| |
1,586,682(5)
|
| |
923,478 (7)
|
| |
—
|
| |
—
|
|
|
Bonus
|
| |
—
|
| |
615,652(6)
|
| |
—
|
| |
—
|
| |
—
|
|
|
Benefits continuation
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
Outplacement services
|
| |
—
|
| |
20,700(4)
|
| |
—
|
| |
—
|
| |
—
|
|
|
Relocation
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
Total
|
| |
—
|
| |
4,454,524
|
| |
923,478
|
| |
—
|
| |
2,231,490
|
|
|
Jason E. Doughty
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
Equity acceleration(1)
|
| |
—
|
| |
1,722,383
|
| |
—
|
| |
—
|
| |
1,722,383
|
|
|
Salary payments
|
| |
—
|
| |
1,266,315(5)
|
| |
466,620(7)
|
| |
—
|
| |
—
|
|
|
Bonus
|
| |
—
|
| |
349,965(6)
|
| |
349,965(7)
|
| |
—
|
| |
—
|
|
|
Benefits continuation
|
| |
—
|
| |
61,157(3)
|
| |
30,578(7)
|
| |
—
|
| |
—
|
|
|
Outplacement services
|
| |
—
|
| |
20,700(4)
|
| |
—
|
| |
—
|
| |
—
|
|
|
Relocation
|
| |
—
|
| |
29,370(8)
|
| |
—
|
| |
—
|
| |
—
|
|
|
Total
|
| |
—
|
| |
3,449,890
|
| |
847,163
|
| |
—
|
| |
1,722,383
|
|
(1)
|
Each named executive officer holds RSU and PSU awards that were unvested as of December 31, 2020. Under the terms of the applicable award agreements, these awards are subject to accelerated vesting under specified circumstances. The amounts in the table are based on the closing price of a share on December 31, 2020. For PSUs, if (i) the awards remain subject to the satisfaction of the specified relative TSR goal following such termination of employment or (ii) the specified relative TSR goal is calculated based on actual achievement as
|
(2)
|
Represents the payment of two times Mr. Inglis’ annual base salary and annual target bonus as of December 31, 2020, payable in equal monthly installments over 24 months under Mr. Inglis’ offer letter. For additional details, see “—Offer Letters” below.
|
(3)
|
Represents a cash payment in an amount equal to the premium cost of continued healthcare coverage for 24 months under our severance policy (or, for Mr. Inglis, under his offer letter).
|
(4)
|
Represents the cost of outplacement services for 18 months under our severance policy.
|
(5)
|
Represents a lump-sum cash severance payment under our severance policy equal to 24 months of base salary plus four additional weeks of base salary for each year of recognized service (for Mr. Shah, 40 additional weeks; for Mr. Clark, 60 additional weeks; for Mr. Ball, 28 additional weeks; and for Mr. Doughty, 36 additional weeks) and any additional amounts payable for any partial year of service.
|
(6)
|
Under our severance policy, each of our named executive officers is entitled to a prorated portion of his annual target bonus for the year of termination, if not paid prior to the date of termination.
|
(7)
|
Represents payments of annual base salary for Mr. Ball (for 18 months) and Mr. Doughty (for 12 months). In addition, for Mr. Doughty, represents (i) 12 months of estimated bonus payments (based on the target amount of his bonus).and (ii) reimbursement of the cost of medical and dental insurance and each of his dependents for 12 months pursuant to his offer letter (Mr. Ball is currently on a UK Health Plan, which is not eligible for COBRA reimbursement). For additional details, see “—Offer Letters” below.
|
(8)
|
Represents reasonable and customary costs that we estimate would be incurred in moving Mr. Doughty and his family back to his former residence location, if solely as a result of a “change in control” (as defined in the LTIP and summarized below under “—Equity Awards—Definitions”), Mr. Doughty is required to relocate to a location outside of the Dallas/Fort Worth area, pursuant to the terms of his offer letter. This estimate is based on the costs incurred in moving Mr. Doughty and his family to the Dallas/Fort Worth area. For additional details, see “—Offer Letters” below.
|
■
|
On a termination of Mr. Inglis’ employment by us without “cause” or by him for “good reason” (as such terms are defined in his offer letter and summarized below under “—Equity Awards—Definitions”), Mr. Inglis is entitled to cash severance in an amount equal to two times the sum of his base salary and target bonus (payable in equal monthly installments over 24 months) and (ii) continued medical and dental coverage for him and his dependents for 24 months, subject to his execution of a general release of claims.
|
■
|
If the employment of each of Messrs. Ball and Doughty is terminated through no fault
|
■
|
Mr. Doughty is also entitled to payment of reasonable and customary expenses associated with him and his family moving back to Houston, Texas under the circumstances described in footnote 8 to the “Potential Payments Upon Termination or Change in Control” table above.
|
■
|
work force reduction;
|
■
|
departmental reorganization that results in job elimination;
|
■
|
departmental reorganization that results in a material diminution of the skills, requirements, aptitudes or other criteria of
|
■
|
relocation of the job functions outside of a 50-mile radius, if the employee is not offered employment at the new location or declines an offer of employment at the new location.
|
■
|
a lump-sum cash severance payment in an amount determined based on the employee’s title, years of service and base salary (for our named executive officers, this amount equals 24 months of base salary plus four additional weeks of base salary for each year of service);
|
■
|
a prorated portion of the employee’s target bonus for the current year, if not paid prior to the date of termination;
|
■
|
a cash payment in an amount equal to the premium cost of continued healthcare coverage for a specified period (24 months for our named executive officers);
|
■
|
outplacement services for a specified period (18 months for our named executive officers); and
|
■
|
payout of unused vacation time.
|
■
|
the regularly scheduled vesting date, if the executive remained employed through the vesting date;
|
■
|
termination of the executive’s employment due to his death or disability;
|
■
|
for our named executive officers other than for Mr. Inglis, termination of the executive’s employment by us or the acquiror without cause or by him for “good reason” (as defined in the LTIP or an applicable offer letter and summarized below) within one year following a change in control; and
|
■
|
for awards granted to Mr. Inglis, (i) the first anniversary of a change in control, if Mr. Inglis remains employed through the anniversary date, or (ii) the later of the date of termination or the change in control, if Mr. Inglis’ employment is terminated by us without cause or by him for good reason during the period beginning three months before, and ending one year after, such
|
■
|
for PSUs granted to our named executive officers (other than Mr. Inglis), the performance condition would have been determined based on actual performance as of the date of such change in control; and
|
■
|
for PSUs granted to Mr. Inglis, the performance condition would have been deemed attained at the maximum performance level.
|
■
|
“Cause” generally means the named executive officer’s:
|
(i)
|
failure (or, in the case of Mr. Inglis, material failure) to perform his duties (other than any such failure resulting from his physical or mental incapacity);
|
(ii)
|
having engaged in misconduct, negligence or a breach of fiduciary duty (or, in the case of Mr. Inglis, having engaged in serious misconduct, gross negligence or a material breach of a fiduciary duty);
|
(iii)
|
having been convicted of, or having entered a plea bargain or settlement admitting guilt or the imposition of unadjudicated probation for, any crime of moral turpitude or felony under any applicable law;
|
(iv)
|
breach (or, in the case of Mr. Inglis, material breach) of any restrictive covenant (and, in
|
(v)
|
breach (or, in the case of Mr. Inglis, material breach) of any of our policies, including any policy that relates to expense management, human resources or the Foreign Corrupt Practices Act;
|
(vi)
|
unlawful use or possession of illegal drugs on our premises or while performing his duties to us; or
|
(vii)
|
commission of an act of fraud, embezzlement or misappropriation, in each case, against us.
|
■
|
“Change in Control” generally means the occurrence of one or more of the following events:
|
(i)
|
the acquisition of 50% or more of the combined voting power of our outstanding securities;
|
(ii)
|
the replacement of the majority of our directors during any 12-month period (other than by directors approved by a majority of our remaining directors);
|
(iii)
|
the consummation of our merger, amalgamation or consolidation with another entity (unless our voting securities outstanding immediately before such transaction continue to represent more than 50% of the combined voting power of the surviving or resulting entity outstanding immediately after such transaction); or
|
(iv)
|
the transfer of our assets having a gross fair market value of 50% or more of the total gross market value of our assets immediately before such transfer (other
|
■
|
“Disability” generally means “disability” as defined in our long-term disability plan for the purpose of determining eligibility for benefits. If such plan contains multiple definitions of disability, then “disability” refers to that definition of disability which, if the named executive officer qualified for such benefits, would provide coverage for the longest period.
|
■
|
“Good Reason” generally means the occurrence of any of the following events without the named executive officer’s consent:
|
(i)
|
a reduction in his base salary or target bonus, other than any such reduction that applies generally to similarly situated employees (or, in the case of Mr. Inglis, that applies to senior executives of the Company);
|
(ii)
|
relocation of his principal place of employment by more than 50 miles; or
|
(iii)
|
a material reduction in his duties or responsibilities (in the case of our named executive officers other than Mr. Inglis, that occurs within two years after a change in control).
|
■
|
the median of the annual total compensation of all our employees (except our Chief Executive Officer) was $247,985;
|
■
|
the annual total compensation of our Chief Executive Officer was $4,763,573; and
|
■
|
the ratio of these two amounts was approximately 19 to 1. We believe that this ratio is a reasonable estimate calculated in a manner consistent with the requirements of the Pay Ratio Rule.
|
■
|
Minimum vesting requirements. The LTIP continues to require that awards be subject to
|
■
|
Restricted dividends and dividend equivalents on awards. The LTIP continues to prohibit the payment of dividends or dividend equivalents in respect of an award prior to the time such award (or the applicable portion thereof) vests (and, in the case of performance awards, the applicable performance condition is achieved).
|
■
|
No repricings. Repricing of options and SAR awards continues following the amendment and restatement to not be permitted without stockholder approval, except for adjustments with respect to certain specified extraordinary corporate transactions.
|
■
|
No “liberal” change in control definition. The change in control definition under the LTIP continues to only be triggered in those instances where an actual change in control occurs (see “Executive Compensation—Compensation Discussion & Analysis—Potential Payments Upon
|
■
|
No evergreen provision. The LTIP continues to not contain an “evergreen” feature pursuant to which the shares authorized for issuance under the plan can be increased automatically without stockholder approval.
|
■
|
Clawback of awards. The LTIP continues to provide the Compensation Committee with the authority to subject awards granted under the LTIP to any clawback or recoupment policies that the Company has in effect from time to time (including our recoupment policy, as described in more detail in “Executive Compensation—Compensation Discussion & Analysis—Recoupment Policy” above).
|
■
|
Share ownership guidelines. Our executive officers (including all of our NEOs) and directors are subject to share ownership guidelines to ensure that they face the same downside risk and upside potential as our stockholders. For additional details regarding our share ownership guidelines, see “Executive Compensation—Compensation Discussion and Analysis—Share Ownership Guidelines.”
|
■
|
No tax gross-ups. No participant is entitled under the LTIP to any tax gross-up payments for any excise tax pursuant to Sections 280G or 4999 of the Code that may be incurred in connection with awards under the LTIP.
|
■
|
independent, within the meaning of and to the extent required (unless controlled
|
■
|
non-employee directors within the meaning of Rule 16b-3 under the Exchange Act.
|
■
|
designate participants;
|
■
|
determine the types of awards to grant, the number of shares to be covered by awards, the terms and conditions of awards, whether awards may be settled or exercised in cash, shares, other awards, other property or net settlement, the circumstances under which awards may be canceled, repurchased, forfeited or suspended, and whether awards may be deferred automatically or at the election of the holder or the committee;
|
■
|
amend the terms of any outstanding awards, including, without limitation, to accelerate the time(s) at which the awards become vested or unrestricted, will be settled or may be exercised;
|
■
|
correct any defect, supply any omission or reconcile any inconsistency in the plan or any award agreement, in the manner and to the extent it shall deem desirable to carry the plan into effect;
|
■
|
interpret and administer the plan and any instrument or agreement relating to, or award made under, the plan; and
|
■
|
establish, amend, suspend or waive rules and regulations, appoint agents and make any other determination and take any other action that it deems necessary or desirable to administer the plan, in each case, as it deems appropriate for the proper administration of the plan and compliance with applicable law, stock market or exchange rules and regulations or accounting or tax rules and regulations.
|
■
|
a substitute award that preserves the intrinsic value of the canceled award (i.e., the excess, if any, of the value of the underlying shares over the exercise price); or
|
■
|
the full acceleration of the award and either (i) a period of ten days to exercise the award or (ii) a payment in cash or other consideration in an amount equal to the intrinsic value of the canceled award.
|
|
|
| |
Service Awards(1)(3)
|
| |
Performance Awards(2)(3)
|
| ||||||
|
Name and Position
|
| |
(#)
|
| |
($)
|
| |
(#)
|
| |
($)
|
|
|
Andrew G. Inglis
Chairman and Chief Executive Officer
|
| |
157,500
|
| |
384,300
|
| |
837,500
|
| |
3,274,625
|
|
|
Neal D. Shah(4)
Senior Vice President and Chief Financial Officer
|
| |
77,000
|
| |
187,880
|
| |
423,000
|
| |
1,653,930
|
|
|
Richard R. Clark
Senior Vice President and Head of Gulf of Mexico Business Unit
|
| |
77,000
|
| |
187,880
|
| |
493,000
|
| |
1,927,630
|
|
|
Christopher J. Ball
Senior Vice President, Planning and Business Development
|
| |
77,000
|
| |
187,880
|
| |
493,000
|
| |
1,927,630
|
|
|
Jason E. Doughty
Senior Vice President, General Counsel
|
| |
55,353
|
| |
135,061
|
| |
344,647
|
| |
1,347,570
|
|
|
Thomas P. Chambers(4)
Former Senior Vice President and Chief Financial Officer
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
All current executive officers as a group (5 persons)
|
| |
443,853
|
| |
1,083,001
|
| |
2,591,147
|
| |
10,131,385
|
|
|
All current directors who are not executive officers as a group (5 persons)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
All employees, including current officers who are not executive officers, as a group (199 persons)
|
| |
2,029,943
|
| |
4,965,024
|
| |
3,933,491
|
| |
15,379,950
|
|
(1)
|
These amounts reflect service awards that are scheduled to vest one-third each year over three years, based solely on service. The grant date fair values of the service awards reflected in this table were calculated by multiplying the number of shares underlying the service awards by the closing price of a share on the applicable grant date.
|
(2)
|
These amounts reflect performance awards, assuming achievement of the applicable performance condition at the target performance level. The performance awards are scheduled to vest between 0% and 200% of the target number of shares underlying the award based on attainment of both a service condition that will lapse one-third each year over three years and the specified relative TSR performance condition that will be
|
(3)
|
If our stockholders do not approve this Proposal 4, the participant may receive on each vesting date, in lieu of any shares that would have otherwise been distributed to the participant, an amount in cash equal to the aggregate fair market value of such shares as of such vesting date.
|
(4)
|
Mr. Shah was promoted to the position of Senior Vice President and Chief Financial Officer, effective May 11, 2020, when Mr. Chambers ceased serving in that role. From May 11, 2020 through December 31, 2020, Mr. Chambers served as Senior Advisor to the Company’s Chairman and Chief Executive Officer, working on strategic projects and helping to ensure an orderly transition of his duties to Mr. Shah. Mr. Chambers retired from the Company on December 31, 2020.
|
|
|
| |
The Board recommends a vote “FOR” Proposal 4. If not otherwise specified, proxies will be voted “FOR” Proposal 4.
|
|
|
Plan Category
|
| |
Number of
securities to be
issued upon
exercise of
outstanding
options,
warrants and
rights
(a)
|
| |
Weighted-
average
exercise price
of
outstanding
options,
warrants and
rights
(b)
|
| |
Number of
securities
remaining
available
(excluding
securities
reflected in
column (a))
(c)
|
|
|
Equity compensation plans approved by security holders
|
| |
12,698,679(1)
|
| |
—
|
| |
6,506,224(2)
|
|
|
Equity compensation plans not approved by security holders
|
| |
—
|
| |
—
|
| |
—
|
|
|
Total
|
| |
12,698,679
|
| |
—
|
| |
6,506,224
|
|
(1)
|
Represents the number of common shares underlying service and performance restricted stock units outstanding under the LTIP. See Note 12 to Consolidated Financial Statements included in “Item 8. Financial Statements and Supplementary Data” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020.
|
(2)
|
Represents the number of common shares remaining available for issuance under the LTIP. This number does not include the shares that are issuable on vesting and settlement of the outstanding service and performance restricted stock units.
|
|
|
| |
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