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Share Name | Share Symbol | Market | Type |
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Oasis Petroleum Inc | NYSE:OAS | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
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0.00 | 0.00% | 3.10 | 0 | 01:00:00 |
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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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Definitive Proxy Statement
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Definitive Additional Materials
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Soliciting Material Pursuant to § 240.14a-12
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Oasis Petroleum Inc.
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if Other than the Registrant)
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Payment of Filing Fee (Check the appropriate box):
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No fee required.
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Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
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Proposed maximum aggregate value of transaction:
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Fee paid previously with preliminary materials.
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Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
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When commodity prices dropped in 2009, others ran away from the storm. We opportunistically added acreage to our large, consolidated blocks in the Williston Basin.
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In 2010, reliable and cost-effective services in the Williston Basin were scarce, so we created Oasis Well Services to ensure that we could get our work done and minimize potential contract termination exposure.
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Anticipating a potential downturn in commodity price, but not knowing when it might occur, we positioned ourselves to be able to power down our capital activity in an orderly manner, maintain our volume profile, live within cash flow and get to the other side. We did just that and were one of the first, if not the first, Exploration and Production ("E&P") companies to get to cash flow neutral in 2015.
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As our drilling activity consolidated and became more concentrated during the downturn of 2015, we expanded our midstream operations beyond handling produced water to include crude oil gathering, natural gas gathering, natural gas processing, and freshwater sourcing and distribution. These assets became the backbone of Oasis Midstream Partners (“OMP").
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In 2017, we anticipated the need for more gas processing capacity across the Williston Basin than existed at the time, so we embarked on the construction of a new 200 million cubic feet per day ("mmcfd") gas processing plant within OMP so that we could service our production as well as production from adjacent operators. We are now one of the largest processors in the basin, with 280 mmcfd of processing plant capacity, minimizing gas flaring and providing flow assurance.
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To elect two Class III directors, each for a term of three years.
The board recommends voting FOR this proposal and needs a plurality of shares cast with Director Resignation Policy.
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To ratify the selection of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm for 2019.
The board recommends voting FOR this proposal and needs a majority of shares present.
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To approve, on an advisory basis, the compensation of our named executive officers as disclosed in this proxy statement pursuant to Item 402 of Regulation S-K promulgated by the Securities and Exchange Commission.
The board recommends voting FOR this proposal and needs a majority of shares present.
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To approve the First Amendment to the Amended and Restated 2010 Long-Term Incentive Plan (the "LTIP") to increase the maximum number of shares that may be issued under the LTIP by 1,300,000 shares (the "Additional Shares").
The board recommends voting FOR this proposal and needs a majority of shares present
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To transact such other business as may properly come before the Annual Meeting.
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By Order of the Board of Directors,
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Nickolas J. Lorentzatos
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Corporate Secretary
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We recently added majority voting and proxy access to our governance foundation
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Our board is young, short tenured, diverse, and comprised not only of industry-leading experts but of members who worked for major shareholders and investors
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Our executive compensation and performance are well aligned, and our CEO not accepting a salary increase since 2014 reflects his belief that financial conservatism is warranted when commodity prices are low and shareholder returns are held back.
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We successfully entered a second basin through our February 2018 acquisition from Forge Energy LLC of 22,000 net core acres in the over-pressured oil window of the Delaware Basin.
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We added additional acreage at attractive pricing
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bringing our total position in the over-pressured oil window of the Delaware Basin to over 23,000 net acres.
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Oasis Midstream Partners LP (“OMP”) completed the construction and startup of a second natural gas plant in Wild Basin, making Oasis the second largest natural gas processor in North Dakota.
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We executed a “Dropdown” of additional interests in midstream subsidiaries to OMP for $251.4M, which increased our holdings of OMP common units and reduced debt.
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Sales of non-core assets yielded total proceeds of ~$360 million, reducing our financial leverage.
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We grew production ~25% year
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over-year to 82,525 barrels of oil equivalent per day ("Boepd").
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We lowered lease operating expenses ("LOE") per barrels of oil equivalent ("Boe") by over 12% year over year to $6.44 per Boe.
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Net cash provided by operating activities grew 96% year over year to $996.4 million; and we grew Adjusted EBITDA 35% year over year to $958.7 million. For a definition of Adjusted EBITDA and a reconciliation of Adjusted EBITDA to net income (loss) including non-controlling interests and net cash provided by operating activities, see "Non-GAAP Financial Measures" in our Annual Report on Form 10-K for the year ended December 31, 2018.
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Robust marketing and integration benefits with OMP provided access to coastal markets for our Williston barrels and yielded tight oil differentials for most of 2018
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We committed 10,000 barrels a day to the Gray Oak pipeline, which ensures coastal pricing for a large portion of our Delaware Basin crude oil volume.
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Proxy Statement 2019 Annual Meeting of Shareholders
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Adopt a proxy access bylaw;
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Add a total shareholder return ("TSR") cap so that, beginning with performance share units ("PSUs") granted in 2019, Named Executive Officers cannot earn more than 100% of PSUs eligible to vest if the Company’s absolute TSR is negative over the performance cycle;
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Provide that no PSUs will be earned for performance cycles in which the Company’s TSR rank is in the bottom three of the PSU group beginning with PSUs granted in 2019; and
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Cap the number of PSUs that may be earned for 2019 PSUs if the Company’s stock price is at least $25 at the end of the performance cycle.
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Kept Mr. Nusz’s salary unchanged in 2018, as it has remained since 2014; and
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Set a floor share price of $9 for Named Executive Officers long-term incentive awards granted in 2018. This floor was ~$0.70 higher than the stock price at that time. This reduced the number of shares Named Executive Officers would have received if the stock price on the grant date did not exceed this threshold.
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William J. Cassidy
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Paula D. Polito
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John E. Hagale
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Bobby S. Shackouls
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Michael McShane
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Michael McShane
served as a director and President and Chief Executive Officer of Grant Prideco, Inc., a manufacturer and supplier of oilfield drill pipe and other drill stem products, from June 2002 until the completion of the merger of Grant Prideco with National Oilwell Varco, Inc. in April 2008, and Chairman of the Board of Grant Prideco from May 2003 through April 2008.
Currently, Mr. McShane also serves on the board of directors of Superior Energy Services, Inc., Forum Energy Technologies Inc., and NCS Multistage.
PREVIOUS EXPERIENCE
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Prior to joining Grant Prideco, Mr. McShane was Senior Vice President - Finance and Chief Financial Officer and director of BJ Services Company, a provider of pressure pumping, cementing, stimulation and coiled tubing services for oil and gas operators, from 1990 to June 2002.
EDUCATION
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Mr. McShane holds a bachelor's degree from the University of Texas at Austin.
EXPERTISE
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With decades of experience in the energy services industry, Mr. McShane brings a unique perspective to the Board. He has significant experience with issues, trends and opportunities within the oil and gas industry, providing the Board with valuable independent expertise when evaluating potential acquisition opportunities, capital allocation, and capital markets transactions. Mr. McShane serves as our lead independent director, providing executive guidance and presiding over the Board's executive sessions.
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Michael McShane
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DIRECTOR SINCE 2010
LEAD INDEPENDENT
DIRECTOR
AGE:
65
BOARD COMMITTEES:
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Audit, Chair
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Compensation
ALSO
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Mr. McShane serves as an advisor to Advent International, a global private equity firm.
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Thomas B. Nusz
serves as our Chairman of the Board and Chief Executive Officer and as Director and Chairman of the Board of OMP GP LLC. He has served as our Director and Chief Executive Officer (or in similar capacities) since our inception in March 2007.
PREVIOUS EXPERIENCE
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Previously, Mr. Nusz was a Vice President with Burlington Resources Inc., a formerly publicly traded oil and gas exploration and production company or, together with its predecessors, Burlington, and served as President of the International Division (North Africa, Northwest Europe, Latin America and China) from January 2004 to March 2006, as Vice President Acquisitions and Divestitures from October 2000 to December 2003, as Vice President Strategic Planning and Engineering from July 1998 to September 2000, and Chief Engineer for substantially all of such period. He was instrumental in Burlington’s expansion into the Western Canadian Sedimentary Basin from 1999 to 2002.
EDUCATION
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Mr. Nusz holds a Bachelor of Science in Petroleum Engineering from Mississippi State University.
EXPERTISE
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As a co-founder and the Chief Executive Officer of the Company, Mr. Nusz's knowledge of the Company is unparalleled. Mr. Nusz has served in various executive positions, as well as management and operational roles for publicly traded oil and gas companies, and he has deep knowledge of the strategic, financial, risk and compliance issues facing a publicly traded company. In addition, Mr. Nusz's industry experience spans multiple regions, domestically and internationally, which is especially beneficial to the Company in the current challenging market environment.
CHARITABLE, COMMUNITY AND INDUSTRY INVOLVEMENT
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Mr. Nusz serves on, and is prior chairman of, the board of OneGoal Houston, a college entry and persistence initiative for under-privileged students in Houston. He is a member of the Mississippi State University Foundation Board and a member of the investment committee. He also serves as the President of the Mississippi State University Bulldog Club Board. He serves on several industry boards including AXPC, IPAA, and the National Petroleum Council, an advisory committee to the United States Secretary of Energy.
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Thomas B. Nusz
Chief Executive Officer
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DIRECTOR SINCE 2007
AGE: 59
ALSO
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As a co-founder of Oasis, Mr. Nusz developed the business plan for Oasis Petroleum LLC and secured the initial funding for the Company.
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William J. Cassidy
currently serves as the Chief Financial Officer of Artex Energy Group LLC, a privately owned exploration and production company with operations in the Utica Shale.
PREVIOUS EXPERIENCE
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Previously, Mr. Cassidy served as Executive Vice President and Chief Financial Officer at Bonanza Creek Energy, Inc. from 2013 to 2016. Mr. Cassidy served as the Global Head of Corporate Finance and Treasury for Puma Energy, a midstream and downstream oil company with operations spanning 37 countries and a subsidiary of the commodity trading multinational Trafigura Beheer BV. From November 2009 until April 2013, Mr. Cassidy was a Principal at RPA Capital, LLC an asset management fund focused on providing mezzanine capital to commodity producers. He served as a non-executive director of GasValpo, SA, a Chilean gas distribution company, from September 2008 until September 2012.
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Previously, Mr. Cassidy worked at USDCM, LLC, a Greenwich, Connecticut based drilling fund from the end of 2008 until the end of 2009. From 2006 until 2008, Mr. Cassidy served at Barclays Capital as Head of Exploration and Production Investment Banking. From 2002 to 2006, he worked as a senior member of the Energy and Power Investment Banking division at Banc of America Securities
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EDUCATION
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Mr. Cassidy earned a Bachelor of Science in Geology and Math from the National University of Ireland, Cork, a Masters of Science in Petroleum Geophysics from the Royal School of Mines, Imperial College, London and a Masters of Business Administration from the Wharton School of the University of Pennsylvania.
EXPERTISE
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Mr. Cassidy brings a diverse energy-related background to the Board. He has served as a geophysicist and later in management and executive positions at an investment banking firm, an asset management fund, a midstream and downstream energy company, and as CFO of a publicly-traded, independent exploration and production company.
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William J. Cassidy
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DIRECTOR SINCE 2010
INDEPENDENT
AGE:
53
BOARD COMMITTEES:
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Audit
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Compensation
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Nominating & Governance, Chair
ALSO
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Mr. Cassidy began his investment banking career with JPMorgan Chase and spent two years in London, where he focused on the emerging deregulation of the European natural gas industry.
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John E. Hagale
served as Executive Vice President and Chief Financial Officer of Rosetta Resources Inc. from November 2011 until the completion of the merger of Rosetta with Noble Energy, Inc. in July 2015.
PREVIOUS EXPERIENCE
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Previously, Mr. Hagale was Executive Vice President, Chief Financial Officer and Chief Administrative Officer of The Methodist Hospital System from June 2003 through October 2011. He was also employed with Burlington Resources Inc. and its predecessor Burlington Northern Inc. for 15 years where he held a series of executive financial positions with increasing responsibilities, including Executive Vice President and Chief Financial Officer of Burlington Resources
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Mr. Hagale previously served on the Board of Directors of Cobalt International Energy, Inc. as chair of their audit committee
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EDUCATION
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Mr. Hagale holds a Bachelor of Business Administration degree in Accounting from the University of Notre Dame.
EXPERTISE
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Mr. Hagale brings significant oil and gas financial expertise to the Board. The combination of Mr. Hagale's industry and financial experience is invaluable to the Board, especially with respect to the current challenging market environment.
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John E. Hagale
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DIRECTOR SINCE 2016
INDEPENDENT
AGE:
62
BOARD COMMITTEES:
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Audit
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Nominating & Governance
ALSO
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Mr. Hagale began his career with Deloitte Haskins and Sells and is a certified public accountant.
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Paula D. Polito
currently serves as Global Client Strategy Officer and a Group Managing Director at UBS Global Wealth Management. She joined UBS in 2009 as the Wealth Management Americas Chief Marketing Officer.
Ms. Polito has served on the Board of Boston College, her alma mater, where she remains a Trustee Associate. She also sits on the board of Harvard Medical School’s Division of Women’s Health at Brigham and Women’s Hospital; and she is a member of the Executive Board of the Wall Street Council, a network of financial professionals who support academic scholarships.
PREVIOUS EXPERIENCE
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Previously, Ms. Polito served as Senior Vice President and Head of Strategic Marketing and Brand Management at Merrill Lynch & Co., and was a member of the Global Wealth Management Executive Committee. She served as Executive Vice President of Corporate and Retail Marketing at Fidelity Investments Inc. from 1996 to 2000
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EDUCATION
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Ms. Polito holds a Bachelor of Arts from Boston College.
EXPERTISE
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Ms. Polito has extensive experience navigating global financial markets through her service in senior executive leadership roles with multiple financial institutions. In addition to her unique insight into the investment community, her ability to think strategically over the long-term, her creativity, and communications experience greatly benefit our board and our management team as we navigate the ever changing macroeconomic and investment environment.
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Paula D. Polito
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DIRECTOR SINCE 2018
INDEPENDENT
AGE:
59
BOARD COMMITTEES:
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Nominating & Governance
ALSO
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Ms. Polito spent the first ten years of her career as a journalist, working as a Producer, News Editor and Managing Editor for WBZ TV in Boston.
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Taylor L. Reid
serves as our Director, President and Chief Operating Officer and as Director and Chief Executive Officer of OMP GP LLC ("OMP GP"). He has served as our Director and Chief Operating Officer (or in similar capacities) since our inception in March 2007 and has 34 years of experience in the oil and gas industry.
PREVIOUS EXPERIENCE
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Previously, Mr. Reid served as Asset Manager Permian and Panhandle Operations with ConocoPhillips from April 2006 to October 2006
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Prior to joining ConocoPhillips, he served as General Manager Latin America and Asia Operations with Burlington from March 2004 to March 2006 and as General Manager Corporate Acquisitions and Divestitures from July 1998 to February 2004. From March 1986 to June 1998, Mr. Reid held various operations and managerial positions with Burlington in several regions of the continental United States, including the Permian Basin, the Williston Basin and the Anadarko Basin.
EDUCATION
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Mr. Reid holds a Bachelor of Science in Petroleum Engineering from Stanford University.
EXPERTISE
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As co-founder and President of the Company, Mr. Reid has exceptional knowledge of the Company and its strategy, finances, and operations. Mr. Reid's deep knowledge of the Company and the industry resulting from his tenure with the Company and various roles at other oil and gas companies make him a critical member of the Board
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CHARITABLE, COMMUNITY AND INDUSTRY INVOLVEMENT
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Mr. Reid serves on the advisory board of the Stanford School of Earth, Energy & Environmental Sciences. He is also on the board of trustees at Presbyterian School in Houston and serves as the Chairman of the Strategic Planning Committee for the school. Mr. Reid recently served as a board member and Chairman of the HAY Center which focuses on helping children transitioning out of foster care in the Houston area. He also is a member of the US Oil & Gas Association.
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Taylor L. Reid
President and Chief Operating Officer
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DIRECTOR SINCE 2007
AGE:
56
ALSO
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As co-founder of Oasis, Mr. Reid worked with Mr. Nusz to form the business plan for Oasis Petroleum LLC and secure funding for the Company.
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Bobby S. Shackouls
has served as our Director since March 2012. Until the merger of Burlington Resources Inc. and ConocoPhillips, which became effective in 2006, Mr. Shackouls was Chairman of the Board of Burlington Resources Inc., a natural resources business, since July 1997 and its President and Chief Executive Officer since December 1995.
Currently, Mr. Shackouls serves as a director of The Kroger Co., PAA GP Holdings LLC, and Quintana Energy Services Inc.
PREVIOUS EXPERIENCE
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Previously, Mr. Shackouls had been a director since 1995 and President and Chief Executive Officer of Burlington Resources Oil and Gas Company (formerly known as Meridian Oil Inc.) since 1994. Subsequent to the merger, Mr. Shackouls served on the ConocoPhillips Board of Directors until 2011
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EDUCATION
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Mr. Shackouls holds a Bachelor of Science in Chemical Engineering from Mississippi State University.
EXPERTISE
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Mr
. Shackouls provides extensive industry and management experience to the Board and given his experience, he is well positioned to provide key insight into asset management, operations and strategy, and the Board benefits from his experience in managing large organizations.
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Bobby S. Shackouls
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DIRECTOR SINCE 2012
INDEPENDENT
AGE:
68
BOARD COMMITTEES:
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Compensation, Chair
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Nominating & Governance
ALSO
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Mr. Shackouls is vice chairman of the Texas Heart Institute; executive board member of the Sam Houston Area Council and National Board of Boy Scouts of America, and Vice President of the Mississippi State University Foundation
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possess the highest personal values and integrity;
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have experience and have exhibited achievements in one or more of the key professional, business, financial, legal
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and other challenges that face a U.S. independent oil and gas company;
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exhibit sound judgment, intelligence, personal character, and the ability to make independent analytical inquiries;
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demonstrate a willingness to devote adequate time to Board of Director duties; and
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are likely to be able to serve for a sustained period if consistent with the Board’s ongoing review of overall board composition.
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Nusz
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Reid
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Cassidy
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Hagale
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McShane
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Polito
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Shackouls
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Corporate communications
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Current or past public company boards
(other than OAS)
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Current or past public company CEO
(other than OAS)
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Current or past public company CFO
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Current or past public company executive
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E&P operations experience
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E&P services experience
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Financial expertise
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Strategic marketing
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serving as chairman of the executive sessions of the independent directors and all other Board meetings at which the Chairman is not present;
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establishing the agenda for each meeting of the non-management directors;
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serving as the Board’s contact for employee and shareholder communications with the Board of Directors;
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calling special meetings of the independent directors when necessary and appropriate;
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serving as a liaison between the Chairman and independent directors;
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consulting with the Chairman to include and provide at meetings of the directors specific agenda items and additional materials suggested by independent directors;
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approving the scheduling of regular and, where feasible, special meetings of the Board to ensure that there is sufficient time for discussion of all agenda items;
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facilitating communications among the other members of the Board; and
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performing other duties as the Board may from time to time delegate.
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the Board oversees management of the Company’s commodity price risk through regular review with executive management of the Company’s derivatives strategy, and, through the Audit Committee, the oversight of the Company’s policy that limits the Company’s authority to enter into derivative commodity price instruments to a specified level of production, above which management must seek Board approval;
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the Board has established specific dollar limits on the commitment authority of members of senior management and requires Board approval of expenditures exceeding that authority and of other material contracts and transactions;
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the Board reviews management’s capital spending plans, approves the Company’s capital budget and requires that management present for Board review significant departures from those plans; and
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the Board reviews quarterly the Company’s performance with respect to environmental, health and safety targets and ethical standards
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Names, Members, and Meetings
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Principal Functions
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Audit Committee
William J. Cassidy
John E. Hagale
Michael McShane, Chair
Meetings in 2018: 5
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Approves appointment and compensation and reviews performance and independence and pre-approves services of Company's independent auditor
Approves appointment and compensation and reviews performance of internal auditor
Meets with management, independent auditor, and internal auditor in connection with annual audit, review of annual and quarterly financial statements, and in executive sessions
Discusses with management the Company's guidelines and policies with respect to risk assessment and risk management, including with respect to significant financial risk exposures
Establishes and maintains procedures for the submission, receipt, retention and treatment of complaints and concerns received by the Company regarding accounting, internal controls or auditing matters
Monitors compliance with legal and regulatory requirements and the business practices and ethical standards of the Company
Discusses the integrity of the Company's accounting policies, internal controls, financial reporting practices and financial statements with management, internal auditor, and independent auditor
Reviews and approves related-person transactions in accordance with the Board’s procedures
Prepares the Audit Committee report, which is on page 22
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Compensation Committee
William J. Cassidy
Michael McShane
Bobby Shackouls, Chair
Meetings in 2018: 6
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Approves and evaluates the Company’s director and officer compensation plans, policies and programs
Conducts an annual review and evaluation of the CEO’s performance in light of the Company’s goals and objectives
Retains, and is directly responsible for the oversight of, compensation or other consultants to assist in the evaluation of director or executive compensation and otherwise to aid the Compensation Committee in meeting its responsibilities. For additional information on the role of compensation consultants, please see Compensation Discussion and Analysis beginning on page 26
Annually reviews the Company’s compensation-related risk profile to confirm that compensation-related risks are not reasonably likely to have a material adverse effect on the Company
Periodically reviews and discusses with its independent compensation consultants and senior management the Company’s policy on executive severance arrangements, and recommends any proposed changes to the Board to the extent required by the Compensation Committee charter
Reviews the Compensation Discussion and Analysis, disclosures for advisory votes by shareholders on executive compensation, including frequency of such votes, and other relevant disclosures made in the proxy statement
Prepares the Compensation Committee report, which is on page 25
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Nominating & Governance Committee
William J. Cassidy, Chair
John E. Hagale
Paula D. Polito
Bobby S. Shackouls
Meetings in 2018: 4
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Recommends nominees for director, including existing Board members, to the Board and ensures such nominees possess the director qualifications set forth in the Committee's Charter
Recommends members of the Board for committee membership
Proposes Corporate Governance Guidelines for the Company and reviews them annually
Develops and oversees an evaluation process for the Board and its committees
Assesses the need for stock ownership guidelines
Reviews and recommends changes to the Company's Certificate of Incorporation and Bylaws
Determines whether each director serving a Board committee is independent under the standards applicable to the committee
Reviews and recommends changes to the Board and committee structure and composition
Discusses succession planning for CEO and senior management
|
|
Guideline
|
|
Holding Period
|
CEO
|
5 x Base Salary
|
|
Until requirement met
|
Other Named Executive Officers
|
2 x Base Salary
|
|
Until requirement met
|
Non-employee Directors
|
3 x Annual Cash Retainer
|
|
Until requirement met
|
•
|
any person who is known by the Company to be the beneficial owner of more than 5.0% of the Company’s common stock;
|
•
|
any immediate family member of any of the foregoing persons, which means any child, stepchild, parent, stepparent, spouse, sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law or sister-in-law of a director, executive officer or a beneficial owner of more than 5% of the Company’s common stock, and any person (other than a tenant or employee) sharing the household of such director, executive officer or beneficial owner of more than 5% of the Company’s common stock; and
|
•
|
any firm, corporation or other entity in which any of the foregoing persons is a partner or principal or in a similar position or in which such person has a 10% or greater beneficial ownership interest.
|
•
|
any employment agreement of an executive officer if his or her compensation is required to be reported in the Company’s proxy statement pursuant to Item 402 of Regulation S-K promulgated by the SEC ("Item 402");
|
•
|
director compensation which is required to be reported in the Company’s proxy statement pursuant to Item 402;
|
•
|
any transaction with another company at which a Related Person’s only relationship is as an employee (other than an executive officer), director or beneficial owner of less than 10% of that company’s shares is pre-approved or ratified (as applicable) if the aggregate amount involved for any particular service does not exceed the greater of $500,000 or 25% of that company’s total annual revenues; and
|
•
|
charitable contribution, grant or endowment by the Company to a charitable organization, foundation or university at which a Related Person’s only relationship is as an employee (other than an executive
|
•
|
an annual cash retainer fee of $70,000, plus cash payments of $1,500 for each Board of Directors’ meeting attended and $1,500 for each committee meeting attended;
|
•
|
lead director retainer of $25,000;
|
•
|
committee chairperson fees in the following amounts: (a) Audit Committee chair-$20,000, (b) Compensation Committee chair-$15,000, and (c) Nominating and Governance Committee chair-$11,250;
|
•
|
an annual equity award for each non-employee director equal to a number of shares of restricted stock having a value of approximately $167,500 on the date of grant, based on the closing price of our common stock on the date of grant.
|
•
|
the annual cash retainer fee increased from $65,000 to $70,000; and
|
•
|
the annual equity award for each non-employee director has been increased from a number of shares of restricted stock having a value of approximately $160,900 to a number of shares having a value of approximately $167,500 on the date of grant.
|
Name
|
|
Fees Earned
or Paid in Cash
($)(1)
|
|
Stock Awards
($)(2)
|
|
All Other
Compensation
($)
|
|
Total
($)
|
||||||||
William J. Cassidy
|
|
$
|
111,250
|
|
|
$
|
167,787
|
|
|
$
|
—
|
|
|
$
|
279,037
|
|
Ted Collins, Jr.
(3)
|
|
$
|
—
|
|
|
$
|
167,787
|
|
|
$
|
—
|
|
|
$
|
167,787
|
|
John E. Hagale
|
|
$
|
91,000
|
|
|
$
|
167,787
|
|
|
$
|
—
|
|
|
$
|
258,787
|
|
Michael McShane
|
|
$
|
139,000
|
|
|
$
|
167,787
|
|
|
$
|
—
|
|
|
$
|
306,787
|
|
Paula D. Polito
(4)
|
|
$
|
22,000
|
|
|
$
|
41,877
|
|
|
$
|
—
|
|
|
$
|
63,877
|
|
Bobby S. Shackouls
|
|
$
|
107,500
|
|
|
$
|
167,787
|
|
|
$
|
—
|
|
|
$
|
275,287
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Includes annual cash retainer fee, board and committee meeting fees, and committee chair fees for each non-employee director during fiscal year 2018 as more fully explained above.
|
(2)
|
Reflects the aggregate grant date fair value of restricted stock awards granted under our LTIP in fiscal year 2018, computed in accordance with FASB ASC Topic 718. See Note 15 to our consolidated financial statements on Form 10-K for the year ended December 31, 2018 for additional detail regarding assumptions underlying the value of these equity awards. The grant date fair value for restricted stock awards is based on the closing price of our common stock on the grant date, which was (i) $9.27 per share on January 24, 2018 for Messrs. Cassidy, Collins, Hagale, McShane, and Shackouls, and (ii) $10.34 per share on November 1, 2018 for Ms. Polito. As of December 31, 2018, Messrs. Cassidy, Hagale, McShane, and Shackouls each held 18,100 outstanding shares of restricted stock, which shares vested in full on January 24, 2019; and Ms. Polito held 4,050 shares which will vest in full on November 1, 2019. Mr. Collins' shares vested upon his death.
|
(3)
|
Mr. Collins served on the Board until his passing in January 2018.
|
(4)
|
Ms. Polito joined the Board of Directors on November 1, 2018, and her annual stock award was prorated for 2018.
|
|
|
Nickolas J. Lorentzatos
has served as our Executive Vice President, General Counsel and Corporate Secretary since January 1, 2014. Mr. Lorentzatos served as our Senior Vice President, General Counsel and Corporate Secretary from September 2010 to December 31, 2013, and has 19 years of experience in the oil and gas industry and 23 years practicing law. Mr. Lorentzatos also serves as Director and Executive Vice President, General Counsel and Corporate Secretary of OMP GP.
In addition, Mr. Lorentzatos is responsible for the oversight and management of the Company's human resources, information technology, corporate services, and governmental affairs departments.
PREVIOUS EXPERIENCE
§
Previously, Mr. Lorentzatos served as Senior Counsel with Targa Resources from July 2007 to September 2010. From April 2006 to July 2007, he served as Senior Counsel to ConocoPhillips. Prior to the merger of Burlington Resources Inc. and ConocoPhillips, which became effective in 2006, he served as Counsel and Senior Counsel to Burlington since August 1999. From September 1995 to August 1999, he was an associate with Bracewell & Patterson, LLP
.
EDUCATION
§
Mr. Lorentzatos holds a Bachelor of Arts from Washington and Lee University, a Juris Doctor from the University of Houston, and a Masters of Business Administration from the University of Texas at Austin.
CHARITABLE, COMMUNITY AND INDUSTRY INVOLVEMENT
§
Mr. Lorentzatos is a board member of the HAY Center, which focuses on helping children transitioning out of foster care in the Houston area.
|
Nickolas J. Lorentzatos
|
|
|
Executive Vice President, General Counsel and Corporate Secretary
|
|
•
|
Medical, prescription, dental and vision insurance for all employees and their families
|
•
|
Health care flexible spending account
|
•
|
Health savings account
|
•
|
401(k) plan with company match incentive
|
•
|
Insurance benefits
|
•
|
Paid time off for holidays, sick days, and vacation
|
•
|
Family leave
|
•
|
Other leave of absence benefits
|
•
|
Flexible working arrangements
|
•
|
Wellness benefits
|
•
|
Stock awards for all employees
|
•
|
Annual performance-based cash incentive awards for all employees
|
•
|
Employee referral program
|
•
|
Technical/professional training
|
•
|
Tuition reimbursement
|
•
|
Leadership training, including week-long, university-based, executive education courses (Wharton, Stanford, UVA)
|
•
|
Field leadership development training
|
•
|
Management training
|
•
|
Regular talent reviews and career development guidance
|
•
|
Oasis Academy for Success online learning resource
|
•
|
Annual performance review process
|
•
|
Intern program
|
•
|
Our comprehensive health and safety management system covers 100% of operated assets
|
•
|
We undertake regular internal and external safety audits, including contractor safety audits
|
•
|
We track various accident rate and near miss metrics for employees and contractors
|
•
|
Safety performance is integrated into the annual performance-based cash incentive awards for all employees
|
•
|
Anyone on any worksite is able to halt operations to address a safety issue
|
•
|
The Safety Leadership Team meets regularly with Oasis management to drive continual improvement of our safety strategy
|
•
|
Our audit committee has direct responsibility for health and safety and it is the first agenda item at every audit committee meeting
|
•
|
Oasis contractors must adhere to our contractor health and safety requirements
|
•
|
Regular safety training is provided to all employees throughout the company
|
•
|
We lead industry collaboration efforts to promote worker and environmental safety. For example:
|
◦
|
Ipipe partnership founding member, advancing spill and leak prevention technology
|
◦
|
TrainND program participation, sharing best practice safety training
|
•
|
Our comprehensive environmental management system is designed to achieve 100% coverage of operated assets
|
•
|
We have measurement and monitoring programs, and strive to reduce emissions, waste and water use
|
•
|
We maintain a 24/7 control room designed to monitor and respond to environmental incidents - a public hotline connects directly to the control room
|
•
|
We maintain crisis management and emergency response plans for our basins and critical employees are Incident Command System trained
|
•
|
Our environmental management systems and incident response programs helped us to achieve a 44% reduction in the number of spills from 2017 to 2018, with 99% of spills staying within containment on location
|
•
|
We have programs that are designed to meet all local, state and federal environmental regulations
|
•
|
We engage directly with local stakeholders with a goal of meeting their environmental expectations
|
•
|
We work with NextOp to attract US Military veterans for open positions at Oasis
|
•
|
We support a number of charities and local communities, including:
|
◦
|
the OneGoal initiative in Houston, helping underprivileged high school students reach their full potential and graduate from college
|
◦
|
the HAY Center in Houston, assisting youth graduating out of foster care in becoming independent
|
◦
|
the MS 150 and Bike to the Beach - the Oasis team rides and raises money in an effort to find a cure and treatment for multiple sclerosis and autism, respectively
|
◦
|
Habitat for Humanity, building homes for families in need of decent and affordable housing
|
◦
|
city-wide clean-up days in Williston and Watford City, North Dakota
|
◦
|
the McKenzie County, ND hospital
|
◦
|
the volunteer fire departments of the cities of Williston, Ray, Lignite, Fairview, Culbertson, Froid, Grenora and Alexander, where many of our employees volunteer their time
|
•
|
We see extremely high rates of employee engagement in our community projects
|
•
|
Bylaws
|
•
|
Corporate Governance Guidelines
|
•
|
Financial Code of Ethics for the Chief Executive Officer, Chief Financial Officer and Controller
|
•
|
Code of Business Conduct and Ethics. This includes provisions governing:
|
◦
|
vendors, suppliers, and contractors
|
◦
|
foreign payments
|
◦
|
health and safety
|
◦
|
environmental responsibilities
|
◦
|
non-discrimination
|
◦
|
freedom of association
|
◦
|
political contributions
|
•
|
Related Persons Transactions Policy
|
•
|
Insider Trading Policy
|
◦
|
Anti-hedging policy
|
◦
|
Anti-pledging policy
|
•
|
Short-swing Trading and Reporting Policy
|
•
|
Clawback provisions governing cash and equity incentives for Named Executive Officers
|
•
|
Charters for the Board’s Audit, Compensation and Nominating and Governance Committees
|
•
|
Contractor EH&S requirements
|
•
|
enhancement of the controls over all purchase and sale arrangements;
|
•
|
revision and communication of the accounting controls, policies and procedures relating to the application of Accounting Standards Codification 845,
Nonmonetary Transactions
(“ASC 845”); and
|
•
|
enhancement of integration and documentation of standards within and between accounting, marketing and other key departments to timely identify transactions that are subject to ASC 845.
|
•
|
reviewed and discussed the Company’s audited consolidated financial statements as of and for the year ended December 31, 2018 with management and with the independent registered public accounting firm;
|
•
|
considered the adequacy of the Company’s internal controls and the quality of its financial reporting, and discussed these matters with management and with the independent registered public accounting firm;
|
•
|
reviewed and discussed with the independent registered public accounting firm (1) their judgments as to the quality of the Company’s accounting policies, (2) the written disclosures and letter from the independent registered public accounting firm required by Public Company Accounting Oversight Board Independence Rules, and the independent registered public accounting firm's independence, and (3) the matters required to be discussed by the Public Company Accounting Oversight Board’s AS 1301, Communication with Audit Committees, and by the Auditing Standards Board of the American Institute of Certified Public Accountants;
|
•
|
discussed with management and with the independent registered public accounting firm the process by which the Company’s chief executive officer and chief financial officer make the certifications required by the SEC in connection with the filing with the SEC of the Company’s periodic reports, including reports on Forms 10-K and 10-Q;
|
•
|
pre-approved all auditing services and non-audit services to be performed for the Company by the independent registered public accounting firm as required by the applicable rules promulgated pursuant to the Exchange Act, considered whether the rendering of non-audit services was compatible with maintaining PricewaterhouseCoopers LLP’s independence, and concluded that PricewaterhouseCoopers LLP’s independence was not compromised by the provision of such services (details regarding the fees paid to PricewaterhouseCoopers LLP in 2018 for audit services, tax services and all other services, are set forth at “Item 2-Ratification of Selection of Independent Registered Public Accounting Firm -Audit and All Other Fees” below); and
|
•
|
based on the reviews and discussions referred to above, recommended to the Board of Directors that the consolidated financial statements referred to above be included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018.
|
|
|
2018
|
|
2017
|
||||
Audit Fees(1)(4)
|
|
$
|
1,335
|
|
|
$
|
1,955
|
|
Tax Fees(2)(4)
|
|
626
|
|
|
147
|
|
||
All Other Fees(3)(4)
|
|
3
|
|
|
3
|
|
||
Total
|
|
$
|
1,964
|
|
|
$
|
2,105
|
|
(1)
|
Audit fees represent fees for professional services provided in connection with: (a) the annual audits of the Company’s consolidated financial statements and effectiveness of internal control over financial reporting; (b) the review of the Company’s quarterly consolidated financial statements; and (c) review of the Company’s other filings with the SEC, including review and preparation of registration statements, comfort letters, consents and research necessary to comply with generally accepted auditing standards for the years ended December 31, 2018 and 2017.
|
(2)
|
Tax fees represent tax return preparation and consultation on tax matters.
|
(3)
|
All other fees include any fees billed that are not audit, audit related, or tax fees. In 2018 and 2017, these fees related to accounting research software.
|
(4)
|
Does not include fees paid to PricewaterhouseCoopers LLP for work in their capacity as the independent registered public accounting firm of Oasis Midstream Partners LP.
|
Name
|
|
Title and Position During 2018
|
Thomas B. Nusz
|
|
Chairman and Chief Executive Officer
|
Taylor L. Reid
|
|
President and Chief Operating Officer
|
Michael H. Lou
|
|
Executive Vice President and Chief Financial Officer
|
Nickolas J. Lorentzatos
|
|
Executive Vice President, General Counsel and Corporate Secretary
|
•
|
Mr. Nusz's salary held flat for 2018, for the fifth consecutive year
|
•
|
2018 long-term incentive awards were approved at each executive officer's target award opportunity
|
•
|
however, the Committee set a floor share price of $9.00 to be used for purposes of converting the opportunity (expressed as a dollar amount) for 2018 long-term incentives into a number of shares, thereby reducing the number of shares each such officer would receive if the Company's stock price did not increase above the $9.00 threshold; the floor price was nearly $0.70 higher than the stock price at the time of the Committee's action
|
•
|
Beginning in January 2019, included a cap on the percentage of PSUs that may be earned when the Company's absolute TSR is negative over the performance cycle
|
•
|
Beginning in 2019, equity-based incentive compensation granted to all Named Executive Officers will be allocated 55% performance-based and 45% time-based, whereas previously, only our CEO's incentive awards were allocated in this manner
|
•
|
Enhanced disclosure around our performance goals, our “Initiatives” performance metrics, and the role that safety plays in our compensation determination process
|
•
|
Moved to an annual say-on-pay vote schedule in 2017
|
•
|
added a TSR cap so that a Named Executive Officer cannot earn more than 100% of PSUs eligible to vest if the Company's absolute TSR is negative over the performance cycle;
|
•
|
reduced to 0% the PSUs that will be earned at the end of a performance cycle where the Company's TSR rank falls in the bottom three of the PSU peer group; and
|
•
|
added a cap on the number of PSUs that may be earned if the Company's stock price is at least $25 at the end of the performance cycle
.
|
•
|
Our compensation philosophy is to foster entrepreneurship at all levels of the Company by awarding long-term equity-based incentives, currently in the form of restricted stock and PSUs, as a significant and integral component of compensation.
|
•
|
We determine the appropriate level for each compensation component based in part, but not exclusively, on our view of internal equity and consistency, and other considerations we deem relevant, such as rewarding extraordinary performance.
|
Compensation Element
|
|
Description
|
|
Recent and Upcoming Actions
|
|
|
|
|
|
Base Salary
|
|
•
Fixed pay determined by position and level of responsibility
•
Competitively targeted within peer group
|
|
•
CEO’s salary has remained flat for the past five years
;
•
No increase to NEO salaries in 2018, unless their role was expanded
|
Annual Performance-based Cash Incentive
|
|
•
Aligns executive officers' interests with those of our shareholders
•
Payment made based on achievement of specified Company performance goals (see pages 33-36):
•
20% Production
•
20% Capital Efficiency
•
20% Cost Structure
•
20% EBITDAX
•
20% Strategic Initiatives
•
Final payout subject to “Safety Modifier”
•
Target payout is percentage of executive officer base salary which varies by position
|
|
•
2018 annual cash incentives paid at 100% of target
|
Long-term Equity-based Compensation
Ø
PSU Awards
Ø
Restricted Stock Awards
|
|
•
Target grant is percentage of executive officer base salary which varies by position
•
CEO - 55% performance-based; 45% time-based
•
Other NEOs - 50% PSUs; 50% restricted stock.
•
Aligns executive officers' interests with those of our shareholders
•
Rewards long-term performance relative to industry peers
•
Vest based on TSR relative to a peer group over three overlapping performance periods: 2 years, 3 years, and 4 years.
•
Makes our compensation program competitive from a total remuneration standpoint;
•
Encourages executive retention
•
Vest ratably annually over three years
|
|
Change for 2019
•
Mix for NEOs other than CEO will shift to 55% performance-based; 45% time-based
Changes for 2019
•
If absolute TSR is negative over the performance cycle, PSUs eligible to vest are capped at 100% of target, regardless of relative TSR ranking
•
No PSUs will vest if the company falls in the bottom three of the PSU peer group
•
Added a cap on the number of PSUs that may be earned if the Company's stock price is at least $25 at the end of the performance cycle
|
Other Employee Benefits
|
|
•
benefits available to all employees, including medical, dental, short and long-term disability, health club subsidy and 401(k) plan with employer matching of first 6% eligible compensation contributed
•
limited perquisites
|
|
|
Change of Control and Severance Benefits
|
|
•
provide financial security to help ensure that officers remain focused on our performance and the continued creation of shareholder value rather than on the potential uncertainties associated with their own employment
• change in control benefits are "double trigger"
|
|
|
Percentage of 50th
Percentile Total Compensation
(3 Year Avg)
|
|
97.0
|
95.3
|
63.4
|
|
|
|
|
CEO Target Pay(1)
|
|
CEO Reported Pay(2)
|
|
CEO Realized Pay
|
||||||
|
|
|
2018 Target Compensation
($)
|
|
2018 Summary Compensation Table($)
|
|
2018 Actual Compensation Paid($)
|
||||||
|
|
|
|
|
|
|
|
||||||
Salary
|
|
820,000
|
|
|
820,000
|
|
|
820,000
|
|
||||
Non-Equity Incentive Plan Compensation(3)
|
|
984,000
|
|
|
984,000
|
|
|
787,200
|
|
||||
Stock Awards - Restricted Stock(4)
|
|
2,050,000
|
|
|
2,049,597
|
|
|
1,583,348
|
|
||||
Stock Awards - Performance Share Units(5)
|
|
2,460,000
|
|
|
3,373,234
|
|
|
2,001,556
|
|
||||
All Other Compensation(6)
|
|
N/A
|
|
|
31,869
|
|
|
31,869
|
|
||||
Total 2018 Compensation
|
|
$
|
6,314,000
|
|
|
$
|
7,258,700
|
|
|
$
|
5,223,973
|
|
|
|
|
|
|
|
|
|
|
(1)
|
As disclosed under "2018 Executive Compensation Decisions—Annual Performance-Based Cash Incentive Awards" and "—Long-Term Equity-Based Incentives," target annual and long-term award opportunities are set at a multiple of Mr. Nusz's base salary. The Compensation Committee may determine to grant awards above or below the target level taking into account Company performance, market conditions, and other factors it deems appropriate.
|
(2)
|
The amounts indicated as Reported Pay in the table reflect the total direct compensation (calculated as Salary, Non-Equity Incentive Plan Compensation, and the grant value of Long-Term Incentive Awards) for 2018 as reported in the 2018 Summary Compensation Table on page 45. The grant date fair values for PSUs and restricted stock awards are described in footnote (2) to the 2018 Summary Compensation Table.
|
(3)
|
The Realized Pay column reflects the Non-Equity Incentive Plan Compensation Mr. Nusz earned under the Company’s Amended and Restated 2010 Annual Incentive Compensation Plan (the “Incentive Plan”) for the 2017 performance year, which was paid in February 2018.
|
(4)
|
The Realized Pay column reflects the value at vesting of restricted stock that vested during 2018 (36,740 shares valued at vesting of $340,580; 93,466 shares at $826,239; and 44,933 shares at $416,529). See the Options Exercised and Stock Vested Table on page 50 for more details.
|
(5)
|
The value included in the Reported Pay column is based on the weighted average grant date fair value price per unit of $12.71, as computed using a Monte Carlo simulation model in accordance with FASB ASC Topic 718. The value of the award using the NYSE closing price of the Company's common stock on January 24, 2018, the grant date, of $9.27 was $2,460,258. The Realized Pay column reflects the value at vesting of PSUs that were earned during 2018 (99,195 units valued at vesting of $799,512; and 149,137 units valued at vesting at $1,202,044). See the Option Exercised and Stock Vested Table on page 50 for more details.
|
(6)
|
Both the Reported Pay and Realized Pay columns in the table reflect the value of "All Other Compensation" that Mr. Nusz received in 2018 as reported in the 2018 Summary Compensation Table on page 45. No value is included in the Target Pay column because the Company has not established targets for these compensation items.
|
|
What We Do
|
|
þ
|
Pay for Performance
- Our executives' total compensation is substantially weighted toward performance-based pay. Our annual performance-based cash incentive awards are based on performance against metrics set in advance which reflect key financial, operational and strategic objectives. At least 50%, and beginning in 2019, at least 55% of our long-term equity compensation awards to Named Executive Officers are PSUs, which are earned based on our relative total shareholder return against our peers.
|
|
þ
|
Robust Stock Ownership
- We have adopted robust stock ownership guidelines for our executives and directors. Named Executive Officers, other than Mr. Nusz, are required to own shares having a value equal to 200% of their respective annual base salaries; and for Mr. Nusz, 500% of his annual base salary. Our executives are required to hold shares until such ownership requirements are met.
|
|
þ
|
Double-Trigger Change in Control Benefits
- The Employment Agreements contain a "double trigger" accelerated vesting provision, which requires certain termination of employment events to occur in addition to a change in control in order for accelerated vesting of equity awards to occur. No cash payments are made unless a "double trigger" event occurs.
|
|
þ
|
TSR Cap
- Beginning with 2019 awards, we added a TSR cap so that a Named Executive Officer cannot earn more than 100% of PSUs eligible to vest if the Company's absolute TSR is negative over the performance cycle.
|
|
þ
|
External Benchmarking
- Our independent Compensation Committee reviews competitive compensation data based on an appropriate group of exploration and production peer companies, which group is reviewed on an annual basis, prior to making annual compensation decisions.
|
|
þ
|
Independent Compensation Consultant
- We have engaged an independent executive compensation consultant who reports directly to the independent Compensation Committee and provides no other services to the Company.
|
|
þ
|
Annual Say on Pay Advisory Vote
- Beginning in 2017, we have held annual Say-on-Pay Advisory Votes, consistent with our policy of seeking input from, and engaging in discussions with, our shareholders regularly.
|
|
þ
|
Mitigation of Undue Risk
- We carefully consider the degree to which compensation plans and decisions affect risk taking. We do not believe that any of the compensation arrangements in place are reasonably likely to have a material adverse impact on the Company.
|
|
þ
|
Clawback in our Employment Agreements
- In the Employment Agreements, we included clawback provisions applicable to compensation payable or paid pursuant to the Employment Agreements that is deemed incentive compensation and subject to recovery pursuant to the provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act.
|
|
|
What We Don't Do
|
ý
|
Excise Tax Gross-Ups
- Neither our change in control plans nor our employment agreements with each of our Named Executive Officers (the "Employment Agreements") provide for excise tax gross-ups or any other tax gross-ups for perquisites.
|
ý
|
Evergreen Employment Agreements
- The Employment Agreements have three-year terms, expiring March 20, 2021. They were most recently entered into in March 2018. Whether or not the terms of any of these agreements will be extended is a decision that our Compensation Committee will make closer to the time the terms are due to expire.
|
ý
|
Single-trigger Vesting or Payments in Employment Agreements
- None of our equity incentive plans nor any of the Employment Agreements provide for automatic single trigger vesting of unvested equity awards or cash payments solely upon the occurrence of a "change in control" (as defined in the LTIP).
|
ý
|
Hedging or Derivative Transactions in Company Stock
- We prohibit our executives from engaging in any short-term trading, short sales, option trading and hedging transactions related to our common stock. We also prohibit our executives from purchasing our common stock on margin. In addition, our executives are prohibited from pledging Company stock without approval of the Board.
|
ý
|
Perquisites
- We offer minimal perquisites to the Company's executives, including a 401(k) retirement plan, parking and health club dues, which are available to all Company employees.
|
ý
|
No Stock Option Repricing, Reloads, or Exchange without Shareholder Approval
- Our LTIP prohibits stock option repricing, reloading or exchange without shareholder approval. In addition, in 2015, we amended our LTIP in order to limit potential recycling of shares subject to stock options and stock appreciation rights.
|
ý
|
Guaranteed Bonuses
- Annual performance-based cash incentive awards to our NEOs are determined based solely on the performance of the Company with respect to annual Company performance goals.
|
|
|
|
|
2017 Base Salary
|
|
% Increase
|
|
2018 Base Salary
|
|||||
Thomas B. Nusz
|
|
$
|
820,000
|
|
|
—
|
|
|
$
|
820,000
|
|
Taylor L. Reid
|
|
$
|
600,000
|
|
|
—
|
|
|
$
|
600,000
|
|
Michael H. Lou
|
|
$
|
480,000
|
|
|
—
|
|
|
$
|
480,000
|
|
Nickolas J. Lorentzatos
|
|
$
|
380,000
|
|
|
11.8
|
%
|
|
$
|
425,000
|
|
|
|
Threshold
(as % of base salary)
|
|
Target
(as % of base salary)
|
|
Maximum
(as % of base salary)
|
|||
Thomas B. Nusz
|
|
60
|
%
|
|
120
|
%
|
|
240
|
%
|
Taylor L. Reid
|
|
50
|
%
|
|
100
|
%
|
|
200
|
%
|
Michael H. Lou
|
|
50
|
%
|
|
100
|
%
|
|
200
|
%
|
Nickolas J. Lorentzatos
|
|
40
|
%
|
|
80
|
%
|
|
160
|
%
|
Performance Metric
|
|
Description and Rationale
|
Production
(Boe/day)
|
|
Measured in equivalent average annual volumes;
Target is derived from existing (or PDP) and new (or capital) volumes;
Over or under performance is driven primarily by production optimization, weather impacts, well performance, the timing of tying in new wells from our capital program, and access to take-away and processing capacity for produced fluids and hydrocarbons.
|
Capital Efficiency
($/Boe)
|
|
Measures the investment efficiency of our capital program and is demonstrated by finding and development costs;
Determined by dividing our capital investment in our E&P operations during the year by the estimated ultimate recovery of the wells completed during the year in barrels of oil equivalent.
|
Cost Structure
|
|
|
LOE
($/Boe)
|
|
Lease Operating Expense is the routine operating cost on a per barrel of oil equivalent of production basis;
Includes cost elements such as produced water handling, labor, production chemicals, electricity, equipment rentals, equipment replacements, well workover expense.
|
G&A
($MM)
|
|
Total general and administrative expenses for our E&P, midstream and wells services operations;
Includes all administrative costs, such as cash and non-cash employee compensation; facility leasing and operating costs; third party fees such as legal, accounting, and tax; recruiting, travel and office expenses; and information technology and data services expenses;
These costs are net of field labor costs, which are charged to operating expenses, and intercompany eliminations.
|
EBITDAX
($MM)
|
|
Earnings before interest, taxes, depreciation, and exploration costs;
This measure is a non-GAAP proxy for cash flow which is routinely used in the exploration and production sector and is driven by our volumes, realized prices and cash costs needed to run our business;
This is the same measure that we discuss in connection with quarterly earnings, and to which we provide proper reconciliations to GAAP measures on our website.
|
Initiatives
|
|
Strategic and operational goals that do not have numerical targets, but rather measure performance by accomplishment of stated objectives;
2018 Initiatives include: organization and manpower efficiency, Permian integration, enterprise resource optimization, key performance indicators, and big data and analytics.
|
•
|
In order to create additional incentive for exceptional Company performance, at the discretion of our Compensation Committee, awards can be up to the maximum levels designated for each Named Executive Officer, but it is not expected that payment at this level would occur in most years.
|
•
|
In fact, to date, we have not awarded cash incentives at the maximum percentage for any Named Executive Officer in any year since our initial public offering.
|
•
|
The 2018
Production
and
EBITDAX
targets were
set higher than target and actual performance in 2017
.
|
•
|
The 2018
Capital Efficiency
and
LOE
targets reflect expected levels of achievement
based on 2017 actual performance
. The Board anticipated a rise in service costs in an environment of improving oil prices and, therefore, did not foresee the team's ability to further reduce costs.
|
•
|
The
G&A target for 2018 was set higher due to an expected increase in headcount during 2018 primarily related to higher levels of both capital and operating activity
, including the launch of Oasis Well Services LLC's second frac crew, rapidly growing midstream business at the second gas plant, and operations in the Delaware Basin.
|
Metric
|
|
Weighting
|
|
2018
Performance Goal
|
|
2017
Performance Goal
|
|
2016
Performance Goal
|
|||||||
Production
|
|
|
|
|
|
|
|
|
|||||||
Volume (Boe/d)
|
|
20
|
%
|
|
79,000
|
|
|
70,901
|
|
|
48,100
|
|
|||
Capital Efficiency
|
|
|
|
|
|
|
|
|
|||||||
Proved Developed finding and development cost ($/Boe)
|
|
20
|
%
|
|
$
|
11.13
|
|
|
$
|
8.58
|
|
|
$
|
17.07
|
|
Cost Structure
|
|
|
|
|
|
|
|
|
|||||||
LOE ($/Boe)
|
|
10
|
%
|
|
$
|
7.35
|
|
|
$
|
7.00
|
|
|
$
|
8.00
|
|
G&A ($MM)
|
|
10
|
%
|
|
$
|
111.0
|
|
|
$
|
97.9
|
|
|
$
|
93
|
|
EBITDAX
($MM)
|
|
20
|
%
|
|
$
|
925
|
|
|
$
|
795
|
|
|
$
|
409
|
|
Initiatives
|
|
20
|
%
|
|
|
|
|
|
|
Initiative
|
|
Objectives
|
|
|
|
Organization and Manpower Efficiency
|
|
Prepare the organization for growth and a focus on top quartile returns through organizational structure and alignment, effective decision making process improvement and eliminating waste and re-work.
|
Permian Integration
|
|
Focus on developing our tactics, organization, skills and knowledge to have a successful first year in a new basin while understanding where that success fits in the five-year Permian plan.
|
Enterprise Resource Optimization
|
|
Improve efficiency, efficacy, and scalability of our people, processes, and systems to allow for optimal and critical business decisions to be efficiently made across our entire enterprise which includes diverse assets, multiple business verticals, and multiple geographic locations.
|
Key Performance Indicators
|
|
Develop current and forward looking metrics, communication process, and cycle that clearly and efficiently convey the organization's progress delivering returns consistent with the Company's expectations.
|
Big Data and Analytics
|
|
Use big data and data analytics to produce quality information for the development of actionable new opportunities, evaluation and transfer of leading edge technology, and quality competitive and competitor intelligence in order to generate peer leading investment opportunities and corporate financial returns.
|
Metric
|
|
2017 Actual
Performance
|
|
2018
Performance Goal
|
|
Weight
|
|
2018 Result
|
|||||
|
|
|
|
Actual Performance
|
|
Assessment
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|||
Production
|
|
|
|
|
|
|
|
|
|
|
|||
Volume (Boe/d)
|
|
66,144
|
|
79,000
|
|
|
20
|
%
|
|
82,525
|
|
Above Target
|
|
Capital Efficiency
|
|
|
|
|
|
|
|
|
|
|
|||
Proved Developed finding and development cost ($/Boe)
|
|
$10.26
|
|
$
|
11.13
|
|
|
20
|
%
|
|
$15.13
|
|
Below Target
|
Cost Structure
|
|
|
|
|
|
|
|
|
|
|
|||
LOE ($/Boe)
|
|
$7.34
|
|
$
|
7.35
|
|
|
10
|
%
|
|
$6.44
|
|
Above Target
|
G&A ($MM)
|
|
$91.8
|
|
$
|
111.0
|
|
|
10
|
%
|
|
$121.3
|
|
Below Target
|
EBITDAX
($MM)
|
|
$708
|
|
$
|
925
|
|
|
20
|
%
|
|
$959
|
|
Above Target
|
Initiatives
(1)
|
|
|
|
|
|
20
|
%
|
|
|
|
Above Target
|
||
|
|
|
|
|
|
|
|
|
|
|
Named Executive Officer
|
|
2018 Cash Incentive Award
|
Thomas B. Nusz
|
|
$984,000
|
Taylor L. Reid
|
|
$600,000
|
Michael H. Lou
|
|
$480,000
|
Nickolas J. Lorentzatos
|
|
$340,000
|
•
|
balances short and long-term objectives;
|
•
|
aligns our executives' interests with the long-term interests of our shareholders;
|
•
|
rewards long-term performance relative to industry peers;
|
•
|
makes our compensation program competitive and helps us attract and retain the most qualified employees, directors and consultants in the oil and gas industry; and
|
•
|
gives executives the opportunity to share in our long-term value creation.
|
|
|
PSU
(multiple of base salary)
|
|
Value of Target Grant
|
|
2018 Annual PSU Grant
|
|
Restricted Stock
(multiple of base salary)
|
|
Value of Target Grant
|
|
2018 Annual
RS Grant
|
||||
Thomas B. Nusz
|
|
3.00
|
|
$
|
2,460,000
|
|
|
265,400
|
|
2.50
|
|
$
|
2,050,000
|
|
|
221,100
|
Taylor L. Reid
|
|
2.00
|
|
$
|
1,200,000
|
|
|
129,500
|
|
2.00
|
|
$
|
1,200,000
|
|
|
129,500
|
Michael H. Lou
|
|
2.00
|
|
$
|
960,000
|
|
|
103,600
|
|
2.00
|
|
$
|
960,000
|
|
|
103,600
|
Nickolas J. Lorentzatos
|
|
1.50
|
|
$
|
637,500
|
|
|
68,800
|
|
1.50
|
|
$
|
637,500
|
|
|
68,800
|
a)
|
a two-year performance period beginning on January 24, 2018 and ending on January 23, 2020 for the first 1/3 tranche of the PSUs;
|
b)
|
a three-year performance period beginning on January 24, 2018 and ending on January 23, 2021 for the second 1/3 tranche of PSUs; and
|
c)
|
a four-year performance period beginning on January 24, 2018 and ending on January 23, 2022 for the third 1/3 tranche of PSUs.
|
• Carrizo Oil & Gas, Inc.
|
|
• Range Resources Corporation
|
• Energen Corp.
|
|
• RSP Permian, Inc.
|
• Gulfport Energy Corp.
|
|
• SM Energy Co.
|
• Laredo Petroleum Inc.
|
|
• Whiting Petroleum Corporation
|
• Newfield Exploration Company
|
|
• WPX Energy, Inc.
|
• PDC Energy, Inc.
|
|
• The Standard & Poor’s Oil & Gas Exploration & Production Select Industry Index, weighted as a single company
|
• QEP Resources Inc.
|
|
|
|
|
Total Shareholder Return Rank
|
|
% Initial PSUs Eligible to Vest for Performance Period that will become Earned Performance Units
|
|
% Initial PSUs Eligible to Vest for Performance Period that will become Earned Performance Units
|
|
% Initial PSUs Eligible to Vest for Performance Period that will become Earned Performance Units
|
1
|
|
200%
|
|
200%
|
|
200%
|
2
|
|
185%
|
|
183%
|
|
182%
|
3
|
|
169%
|
|
167%
|
|
164%
|
4
|
|
154%
|
|
150%
|
|
145%
|
5
|
|
138%
|
|
133%
|
|
127%
|
6
|
|
123%
|
|
117%
|
|
109%
|
7
|
|
108%
|
|
100%
|
|
91%
|
8
|
|
92%
|
|
83%
|
|
73%
|
9
|
|
77%
|
|
67%
|
|
55%
|
10
|
|
62%
|
|
50%
|
|
36%
|
11
|
|
46%
|
|
33%
|
|
18%
|
12
|
|
31%
|
|
17%
|
|
—%
|
13
|
|
15%
|
|
—%
|
|
|
14
|
|
—%
|
|
|
|
|
•
|
added a TSR cap so that a Named Executive Officer cannot earn more than 100% of PSUs eligible to vest if the Company's absolute TSR is negative over the performance cycle, regardless of the Company's relative TSR performance;
|
•
|
reduced to 0% the PSUs that will be earned at the end of a performance cycle where the Company's TSR rank falls in the bottom three of the PSU peer group;
|
•
|
added a cap on the number of PSUs that may be earned if the Company's stock price is at least $25 at the end of the performance cycle.
|
• Carrizo Oil & Gas, Inc.
|
|
• QEP Resources Inc.
|
• Energen Corp.
|
|
• Range Resources Corporation
|
• Gulfport Energy Corp.
|
|
• RSP Permian, Inc.
|
• Laredo Petroleum, Inc.
|
|
• SM Energy Co.
|
• Newfield Exploration Company
|
|
• Whiting Petroleum Corporation
|
• PDC Energy, Inc.
|
|
• WPX Energy, Inc.
|
•
|
Company performance relative to the Company's performance goal guidelines established by the Board at the beginning of the year;
|
•
|
Company performance relative to the Company's operational, financial and strategic initiatives established at the beginning of the year; and
|
•
|
The current year’s economic environment, commodity price fluctuations and other unforeseen influences (adverse or beneficial) that should be considered in the Committee’s evaluation of company and individual officer performance.
|
•
|
competitive benchmarking;
|
•
|
incentive plan design;
|
•
|
peer group selection; and
|
•
|
other trends and developments affecting executive compensation.
|
•
|
whether Longnecker provides any other services to us;
|
•
|
the policies of Longnecker that are designed to prevent any conflict of interest between Longnecker, the Compensation Committee and us
|
•
|
any personal or business relationship between Longnecker and a member of the Compensation Committee or one of our executive officers; and
|
•
|
whether Longnecker owns any shares of our common stock.
|
•
|
assessing the relationship between executive pay and performance;
|
•
|
apprising the Compensation Committee of compensation-related trends, developments in the marketplace and industry best practices;
|
•
|
informing the Compensation Committee of compensation-related regulatory developments;
|
•
|
providing peer group survey data to establish compensation ranges for the various elements of compensation;
|
•
|
providing an evaluation of the competitiveness of the Company’s executive and director compensation and benefits programs; and
|
•
|
advising on the design of the Company’s incentive compensation programs.
|
•
|
Restricted stock and PSU agreements covering grants made to our Named Executive Officers and other service providers in 2011 and later years include language providing that the award may be cancelled and the award recipient may be required to reimburse us for any realized gains to the extent required by applicable law or any clawback policy that we adopt.
|
•
|
The LTIP and the Incentive Plan include provisions specifying that awards under those arrangements are subject to any clawback policy we adopt.
|
•
|
The employment agreements described in more detail under "-Employment Agreements" above contain a clawback provision that enables us to recoup any compensation that is deemed incentive compensation if required by any law, government regulation, stock exchange listing requirement, or Company policy adopted as required by such law, government regulation, or stock exchange listing requirement.
|
•
|
Our Compensation Committee is currently evaluating the practical, administrative and other implications of implementing and enforcing a clawback policy, and intends to adopt a clawback policy in compliance with the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 once final rules are promulgated by the SEC.
|
Name and
Principal Position
|
|
Year
|
|
Salary
($)(1)
|
|
Bonus ($)
|
|
Stock
Awards
($)(2)
|
|
Option Awards
($)(3)
|
|
Non-Equity Incentive Plan Compensation
($)(4)
|
|
All Other
Compensation
($)(5)
|
|
Total
($)
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Thomas B. Nusz
|
|
2018
|
|
$
|
820,000
|
|
|
$
|
—
|
|
|
$
|
5,422,831
|
|
|
$
|
—
|
|
|
$
|
984,000
|
|
|
$
|
31,869
|
|
|
$
|
7,258,700
|
|
Chairman and
Chief Executive Officer
|
|
2017
|
|
$
|
820,000
|
|
|
$
|
—
|
|
|
$
|
4,781,421
|
|
|
$
|
350,400
|
|
|
$
|
787,200
|
|
|
$
|
30,267
|
|
|
$
|
6,769,288
|
|
|
2016
|
|
$
|
820,000
|
|
|
$
|
—
|
|
|
$
|
2,220,528
|
|
|
$
|
—
|
|
|
$
|
1,574,400
|
|
|
$
|
21,189
|
|
|
$
|
4,636,117
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Taylor L. Reid
|
|
2018
|
|
$
|
600,000
|
|
|
$
|
—
|
|
|
$
|
2,846,410
|
|
|
$
|
—
|
|
|
$
|
600,000
|
|
|
$
|
22,553
|
|
|
$
|
4,068,963
|
|
President and Chief Operating Officer
|
|
2017
|
|
$
|
591,667
|
|
|
$
|
—
|
|
|
$
|
2,532,690
|
|
|
$
|
321,200
|
|
|
$
|
480,000
|
|
|
$
|
24,564
|
|
|
$
|
3,950,121
|
|
|
2016
|
|
$
|
500,000
|
|
|
$
|
—
|
|
|
$
|
1,048,956
|
|
|
$
|
—
|
|
|
$
|
800,000
|
|
|
$
|
19,908
|
|
|
$
|
2,368,864
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Michael H. Lou
|
|
2018
|
|
$
|
480,000
|
|
|
$
|
—
|
|
|
$
|
2,277,128
|
|
|
$
|
—
|
|
|
$
|
480,000
|
|
|
$
|
22,114
|
|
|
$
|
3,259,242
|
|
Executive Vice
President and Chief Financial Officer
|
|
2017
|
|
$
|
475,000
|
|
|
$
|
—
|
|
|
$
|
2,025,510
|
|
|
$
|
321,200
|
|
|
$
|
384,000
|
|
|
$
|
22,967
|
|
|
$
|
3,228,677
|
|
2016
|
|
$
|
420,000
|
|
|
$
|
—
|
|
|
$
|
881,328
|
|
|
$
|
—
|
|
|
$
|
672,000
|
|
|
$
|
20,208
|
|
|
$
|
1,993,536
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Nickolas J. Lorentzatos
|
|
2018
|
|
$
|
421,250
|
|
|
$
|
—
|
|
|
$
|
1,512,224
|
|
|
$
|
—
|
|
|
$
|
340,000
|
|
|
$
|
20,508
|
|
|
$
|
2,293,982
|
|
Executive Vice
President, General
Counsel and
Corporate Secretary
|
|
2017
|
|
$
|
378,333
|
|
|
$
|
—
|
|
|
$
|
1,203,750
|
|
|
$
|
321,200
|
|
|
$
|
243,200
|
|
|
$
|
24,564
|
|
|
$
|
2,171,047
|
|
2016
|
|
$
|
360,000
|
|
|
$
|
—
|
|
|
$
|
579,744
|
|
|
$
|
—
|
|
|
$
|
460,800
|
|
|
$
|
19,908
|
|
|
$
|
1,420,452
|
|
(1)
|
Reflects the base salary earned by each Named Executive Officer during the fiscal year indicated.
|
(2)
|
Reflects the aggregate grant date fair value of restricted stock awards and PSUs granted under our LTIP in the fiscal year indicated, computed in accordance with FASB ASC Topic 718, and does not necessarily reflect the actual value that may be realized by the executive. See Note 15 to our consolidated financial statements contained in our Annual Report on Form 10-K for the year ended December 31, 2018 for additional detail regarding assumptions underlying the value of these equity awards. For fiscal year 2018, the grant date fair value for restricted stock awards is based on the closing price of our common stock on January 24, 2018, the grant date for those awards, which was $9.27 per share. The grant date fair value for the PSUs granted on January 24, 2018 was calculated based on the initial number of PSUs granted at a weighted average grant date fair value price per unit of $12.71, as computed using a Monte Carlo simulation model in accordance with FASB ASC Topic 718. Assuming that the highest level of the performance condition is achieved, the grant date fair value for these awards would have been: for Mr. Nusz – $6,746,468, Mr. Reid – $3,291,890, Mr. Lou – $2,633,512, and Mr. Lorentzatos – $1,748,896.
|
(3)
|
In May 2017, Messrs. Nusz, Reid, Lou, and Lorentzatos, along with other officers and management employees, were each issued Class B Units in OMP GP LLC, all of which were unvested as of December 31, 2018. We believe that, despite the fact that the Class B Units do not require the payment of an exercise price, they are most similar economically to stock options, and as such, they are properly classified as "options" under the definition provided in Item 402(a)(6)(i) of Regulation S-K as an instrument with an "option-like feature." As discussed under "Executive Compensation—Potential Payments Upon Termination and Change in Control—OMP GP LLC Class B Units" in this proxy statement, the Class B Units in OMP GP LLC are intended to constitute "profits interests" for federal tax purposes and are not traditional options. Amounts included in this column reflect the grant date fair value of the Class B Units, calculated in accordance with FASB ASC Topic 718.
|
(4)
|
For fiscal year 2018, reflects amounts earned for services performed in 2018 pursuant to the annual performance-based cash incentive awards granted to the Named Executive Officers under the Incentive Plan. The amounts reported in the table were paid to the Named Executive Officers in February 2019. The
|
(5)
|
The following items are reported in the “All Other Compensation” column for fiscal year 2018:
|
Name
|
|
Parking
|
|
401(k) Plan
Match
|
|
|
Tax Reimbursement(a)
|
|
Total
|
||||||||
Thomas B. Nusz
|
|
$
|
4,008
|
|
|
$
|
16,500
|
|
|
|
$
|
11,361
|
|
|
$
|
31,869
|
|
Taylor L. Reid
|
|
$
|
4,008
|
|
|
$
|
16,500
|
|
|
|
$
|
2,045
|
|
|
$
|
22,553
|
|
Michael H. Lou
|
|
$
|
4,008
|
|
|
$
|
16,500
|
|
|
|
$
|
1,606
|
|
|
$
|
22,114
|
|
Nickolas J. Lorentzatos
|
|
$
|
4,008
|
|
|
$
|
16,500
|
|
|
|
—
|
|
|
$
|
20,508
|
|
Name
|
|
Grant Date
|
|
Date of
Compensation
Committee
Action (if
different from
Grant Date)
|
|
Estimated Possible Payouts Under Non-Equity Incentive Plan Awards(1)
|
|
Estimated Future Payouts Under Equity Incentive Plan Awards(2)
(In Shares)
|
|
All Other
Stock Awards:
Number of
Shares
of
Stock or Units
(#)(3)
|
|
Grant Date Fair Value of Stock and Option Awards
($)(4)
|
||||||||||||||||||||
Threshold
|
|
Target
|
|
Maximum
|
|
Threshold
|
|
Target
|
|
Maximum
|
|
|
||||||||||||||||||||
Thomas B. Nusz
|
|
1/24/2018
|
|
12/14/2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
221,100
|
|
|
$
|
2,049,597
|
|
|||||||||
|
|
1/24/2018
|
|
12/14/2017
|
|
|
|
|
|
|
|
39,810
|
|
|
286,632
|
|
|
530,800
|
|
|
|
|
$
|
3,373,234
|
|
|||||||
|
|
|
|
|
|
$
|
492,000
|
|
|
$
|
984,000
|
|
|
$
|
1,968,000
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Taylor L. Reid
|
|
1/24/2018
|
|
12/14/2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
129,500
|
|
|
$
|
1,200,465
|
|
|||||||||
|
|
1/24/2018
|
|
12/14/2017
|
|
|
|
|
|
|
|
19,425
|
|
|
139,860
|
|
|
259,000
|
|
|
|
|
$
|
1,645,945
|
|
|||||||
|
|
|
|
|
|
$
|
300,000
|
|
|
$
|
600,000
|
|
|
$
|
1,200,000
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Michael H. Lou
|
|
1/24/2018
|
|
12/14/2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
103,600
|
|
|
$
|
960,372
|
|
|||||||||
|
|
1/24/2018
|
|
12/14/2017
|
|
|
|
|
|
|
|
15,540
|
|
|
111,888
|
|
|
207,200
|
|
|
|
|
$
|
1,316,756
|
|
|||||||
|
|
|
|
|
|
$
|
240,000
|
|
|
$
|
480,000
|
|
|
$
|
960,000
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Nickolas J. Lorentzatos
|
|
1/24/2018
|
|
12/14/2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
68,800
|
|
|
$
|
637,776
|
|
|||||||||
|
|
1/24/2018
|
|
12/14/2017
|
|
|
|
|
|
|
|
10,320
|
|
|
74,304
|
|
|
137,600
|
|
|
|
|
$
|
874,448
|
|
|||||||
|
|
|
|
|
|
$
|
170,000
|
|
|
$
|
340,000
|
|
|
$
|
680,000
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Represents annual performance-based cash incentive awards granted under the Incentive Plan during fiscal year 2018 for services performed in 2018. The awards were paid at the "target" level for each Named Executive Officer, as reported in the "Non-Equity Incentive Plan Compensation" column of the Summary Compensation Table for 2018. The awards (including performance goals and targets) are described in more detail above under “—Compensation Discussion and Analysis—Annual Performance-Based Cash Incentive Awards.”
|
(2)
|
Reflects PSUs granted under our LTIP in 2018. Amounts reported (a) in the “Threshold” column reflect 15% of the initial number of PSUs granted in 2018, which is the minimum amount payable under the PSU awards (assuming a TSR rank of 13th of 14 peers), (b) in the “Target” column reflect 108% of the initial number of PSUs granted in 2018, which is the target amount payable under the PSU awards (assuming a TSR rank of 7th of 14 peers), and (c) in the “Maximum” column reflect 200% of the initial number of PSUs granted in 2018, which is the maximum amount that may be earned pursuant to the awards (assuming a TSR rank of 1st of 14 peers). If relative TSR is below the 15th percentile, then 0% of the initial number of PSUs granted in 2018 will be earned. The number of our common shares actually received by the Named Executive Officer at the end of each designated performance period may vary from the initial number allocated to that period, based on our relative TSR as compared to the TSR of the other peer group companies. The PSUs are subject to designated two-year, three-year, and four-year performance periods, each of which began on January 24, 2018. The PSUs (including performance goals and targets) are described in more detail above under “—Compensation Discussion and Analysis—2018 Executive Compensation Decisions—Long-Term Equity-Based Incentives.”
|
(3)
|
Reflects restricted stock awards granted under our LTIP in 2018. These awards will vest over a three-year period. The first 1/3 tranche vested on January 24, 2019, the second 1/3 tranche will vest on January 24, 2020, and the final 1/3 tranche will vest on January 24, 2021, in each case, subject to the Named Executive Officer's continued employment. The awards are described in more detail above under “—Compensation Discussion and Analysis—2018 Executive Compensation Decisions—Long-Term Equity-Based Incentives.”
|
(4)
|
Reflects the aggregate grant date fair value of restricted stock awards and PSUs granted under our LTIP in the fiscal year indicated, computed in accordance with FASB ASC Topic 718, and does not necessarily reflect the actual value that may be realized by the executive. See Note 15 to our consolidated financial statements contained in our Annual Report on Form 10-K for the year ended December 31, 2018 for additional detail regarding assumptions underlying the value of these equity awards. For fiscal year 2018, the grant date fair value for restricted stock awards is based on the closing price of our common stock on January 24, 2018, the grant date for those awards, which was $9.27 per share. The grant date fair value for the PSUs granted on January 24, 2018 was calculated based on the initial number of PSUs granted at a weighted average grant date fair value price per unit of $12.71, as computed using a Monte Carlo simulation model in accordance with FASB ASC Topic 718.
|
|
|
Stock Awards
|
|
Option Awards
|
|||||||||||||||||
|
|
Restricted Stock Awards
|
|
PSUs
|
|
GP Unit Awards
|
|||||||||||||||
Name
|
|
Number of Shares of Stock
That Have
Not Vested(1)
|
|
Market Value of
Shares of Stock
That Have
Not Vested(2)
|
|
Equity Incentive Plan Awards:
Number of
Unearned Shares
that Have
Not Vested(3)
|
|
Equity Incentive
Plan Awards: Market or
Payout Value of
Unearned Shares
that Have
Not Vested(4)
|
|
Number of Securities Underlying Unexercised Options Unexercisable(5)
|
|
Option Exercise Price(6)
|
|
Option Expiration Date(6)
|
|||||||
Thomas B. Nusz
|
|
468,834
|
|
|
$
|
2,592,652
|
|
|
829,488
|
|
|
$
|
4,587,071
|
|
|
12,000
|
|
|
N/A
|
|
N/A
|
Taylor L. Reid
|
|
268,447
|
|
|
$
|
1,484,512
|
|
|
382,893
|
|
|
$
|
2,117,398
|
|
|
11,000
|
|
|
N/A
|
|
N/A
|
Michael H. Lou
|
|
219,940
|
|
|
$
|
1,216,268
|
|
|
312,074
|
|
|
$
|
1,725,767
|
|
|
11,000
|
|
|
N/A
|
|
N/A
|
Nickolas J. Lorentzatos
|
|
138,020
|
|
|
$
|
763,251
|
|
|
201,605
|
|
|
$
|
1,114,877
|
|
|
11,000
|
|
|
N/A
|
|
N/A
|
Name
|
|
One-Time
Retention Grant (a)
|
|
2016 Annual Award (b)
|
|
2017 Annual Award (c)
|
|
2018 Annual Award (d)
|
|
Total
|
|||||
Thomas B. Nusz
|
|
64,400
|
|
|
93,467
|
|
|
89,867
|
|
|
221,100
|
|
|
468,834
|
|
Taylor L. Reid
|
|
38,580
|
|
|
47,767
|
|
|
52,600
|
|
|
129,500
|
|
|
268,447
|
|
Michael H. Lou
|
|
34,140
|
|
|
40,133
|
|
|
42,067
|
|
|
103,600
|
|
|
219,940
|
|
Nickolas J. Lorentzatos
|
|
17,820
|
|
|
26,400
|
|
|
25,000
|
|
|
68,800
|
|
|
138,020
|
|
(a)
|
The shares subject to the One-Time Retention Grant vest in full on the earlier to occur of a change in control or the Named Executive Officer’s termination of employment due to death or disability, by us without cause, by the executive for good reason, or upon retirement (upon attaining age 60 and continuous employment from the date of grant until the third anniversary of the grant date of the award).
|
(b)
|
The shares subject to the 2016 Annual Award vest in three substantially equal annual installments. The first 1/3 tranche vested on January 20, 2017. The second tranche vested on January 20, 2018 and the final tranche vested on January 20, 2019. The accelerated vesting provisions applicable to these awards are described below under “—Potential Payments upon Termination and Change in Control.”
|
(c)
|
The shares subject to the 2017 Annual Award vest in three substantially equal annual installments. The first 1/3 tranche vested on January 12, 2018. The second tranche vested on January 12, 2019 and the final tranche will vest on January 12, 2020. The accelerated vesting provisions applicable to these awards are described below under “—Potential Payments upon Termination and Change in Control.”
|
(d)
|
The shares subject to the 2018 Annual Award vest in three substantially equal annual installments. The first 1/3 tranche vested on January 24, 2019. The second tranche will vest on January 24, 2020 and the final tranche will vest on January 24, 2021. The accelerated vesting provisions applicable to these awards are described below under “—Potential Payments upon Termination and Change in Control.”
|
(2)
|
This column reflects the closing price of our common stock on December 31, 2018 (the last trading day of fiscal year 2018), which was $5.53, multiplied by the number of outstanding shares of restricted stock.
|
(3)
|
For the PSU awards granted in 2015, 2016, 2017, and 2018, reflects the initial number of PSUs granted to each of the Named Executive Officers on the date indicated, multiplied by the performance level percentage indicated, which in accordance with SEC rules is the next higher performance level for each award that exceeds 2018 performance. The number of shares reported in the table above are shown for PSUs granted:
|
•
|
On January 15, 2015, at a performance level of 125% applied to the following initial number of PSUs: (a) Mr. Nusz—132,260, (b) Mr. Reid—53,760, (c) Mr. Lou—45,160, and (d) Mr. Lorentzatos—29,030. The initial performance period for these awards commenced on January 15, 2015 and ended on January 14, 2018.
|
•
|
On January 20, 2016, at a performance level of 133% applied to the following initial number of PSUs: (a) Mr. Nusz—336,400, (b) Mr. Reid—143,300, (c) Mr. Lou—120,400, and (d) Mr. Lorentzatos—79,200. The designated performance periods for these awards each commenced on January 20, 2016 and end on January 19, 2018, 2019, and 2020.
|
•
|
On January 12, 2017, at a performance level of 106% applied to the following initial number of PSUs: (a) Mr. Nusz—161,700, (b) Mr. Reid—78,900, (c) Mr. Lou—63,100, and (d) Mr. Lorentzatos—37,500. The designated performance periods for these awards each commenced on January 12, 2017 and end on January 11, 2019, 2020, and 2021.
|
•
|
On January 24, 2018, at a performance level of 120% applied to the following initial number of PSUs: (a) Mr. Nusz—265,400, (b) Mr. Reid—129,500, (c) Mr. Lou—103,600, and (d) Mr. Lorentzatos—68,800. The designated performance periods for these awards each commenced on January 24, 2018 and end on January 23, 2020, 2021, and 2022.
|
(4)
|
This column reflects the closing price of our common stock on December 31, 2018 (the last trading day of fiscal year 2018), which was $5.53, multiplied by a number of PSUs based on the performance level percentage indicated in footnote (3) with respect to each PSU award.
|
(5)
|
We believe that, despite the fact that the Class B Units do not require the payment of an exercise price, they are most similar economically to stock options, and as such, they are properly classified as “options” under the definition provided in Item 402(a)(6)(i) of Regulation S-K as an instrument with an "option-like feature." As of December 31, 2018, these Class B Units were unvested, and Messrs. Nusz, Reid, Lou, and Lorentzatos were not eligible to receive distributions from OMP GP. The Class B Units will vest on the tenth anniversary of the date of grant, which was May 22, 2017, contingent on continuous service through such anniversary date; and such officers will be eligible to receive distributions from OMP GP on the second anniversary of the date of grant, including distributions paid for periods prior to such anniversary (see "Executive Compensation—Potential Payments Upon Termination and Change in Control—OMP GP LLC Class B Units").
|
(6)
|
The Class B Units are not traditional options and, therefore, there is no exercise price or expiration date associated with them.
|
|
|
Stock Awards
|
|||||
Name
|
|
Number of Shares Acquired
on Vesting(1)
|
|
Value Realized on Vesting (2)
|
|||
Thomas B. Nusz
|
|
423,471
|
|
|
$
|
3,584,904
|
|
Taylor L. Reid
|
|
195,836
|
|
|
$
|
1,669,202
|
|
Michael H. Lou
|
|
163,467
|
|
|
$
|
1,392,513
|
|
Nickolas J. Lorentzatos
|
|
105,462
|
|
|
$
|
897,450
|
|
(1)
|
Reflects the following restricted stock awards and PSUs held by our Named Executive Officers that vested during fiscal year 2018:
|
Name
|
|
2015 Annual
Award (a)
|
|
2016 Annual Award (b)
|
|
2017 Annual
Award (c)
|
|
2015 PSU Award (d)
|
|
2016 PSU Award (e)
|
|
Total
|
||||||
Thomas B. Nusz
|
|
36,740
|
|
|
93,466
|
|
|
44,933
|
|
|
99,195
|
|
|
149,137
|
|
|
423,471
|
|
Taylor L. Reid
|
|
17,920
|
|
|
47,766
|
|
|
26,300
|
|
|
40,320
|
|
|
63,530
|
|
|
195,836
|
|
Michael H. Lou
|
|
15,053
|
|
|
40,134
|
|
|
21,033
|
|
|
33,870
|
|
|
53,377
|
|
|
163,467
|
|
Nickolas J. Lorentzatos
|
|
9,677
|
|
|
26,400
|
|
|
12,500
|
|
|
21,773
|
|
|
35,112
|
|
|
105,462
|
|
(a)
|
The final 1/3 tranche of shares subject to the 2015 Annual Award vested on January 15, 2018.
|
(b)
|
The second 1/3 tranche of shares subject to the 2016 Annual Award vested on January 20, 2018.
|
(c)
|
The first 1/3 tranche of shares subject to the 2017 Annual Award vested on January 12, 2018.
|
(d)
|
The performance period for the PSUs granted in 2015 ended on January 14, 2018. On February 20, 2018, the Compensation Committee determined that 75% of the initial performance units had been earned and authorized settlement of such number of the initial performance units in the form of shares for each Named Executive Officer.
|
(e)
|
The 2-year performance period for the PSUs granted in 2016 ended on January 19, 2018. On February 20, 2018, the Compensation Committee determined that 133% of the first third of the initial performance units had been earned and authorized settlement of such number of the initial performance units in the form of shares for each Named Executive Officer.
|
(2)
|
The value realized upon vesting of restricted stock or PSUs, as applicable, is based on the following:
|
Named Executive Officer
|
|
Termination Due to
Death or Disability
|
|
Termination
Without Cause or
for Good Reason(1)
|
|
Termination
Without Cause or
for Good Reason
Following a Change
in Control
|
|
Change in
Control
|
||||||||
Thomas B. Nusz
|
|
|
|
|
|
|
|
|
||||||||
Salary(2)
|
|
$
|
820,000
|
|
|
$
|
1,845,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Bonus Amounts(2)
|
|
$
|
984,000
|
|
|
$
|
3,198,000
|
|
|
$
|
984,000
|
|
|
$
|
984,000
|
|
COBRA Premiums(3)
|
|
$
|
37,833
|
|
|
$
|
37,833
|
|
|
$
|
37,833
|
|
|
$
|
—
|
|
Change in Control Payments(4)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
6,276,608
|
|
|
$
|
—
|
|
Accelerated Equity Vesting(5)
|
|
$
|
12,499,758
|
|
|
$
|
8,690,135
|
|
|
$
|
8,690,135
|
|
|
$
|
5,112,419
|
|
Class B Units(6)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
350,400
|
|
|
$
|
—
|
|
Total(7)
|
|
$
|
14,341,591
|
|
|
$
|
13,770,968
|
|
|
$
|
16,338,976
|
|
|
$
|
6,096,419
|
|
Taylor L. Reid
|
|
|
|
|
|
|
|
|
||||||||
Salary(2)
|
|
$
|
600,000
|
|
|
$
|
1,350,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Bonus Amounts(2)
|
|
$
|
600,000
|
|
|
$
|
1,950,000
|
|
|
$
|
600,000
|
|
|
$
|
600,000
|
|
COBRA Premiums(3)
|
|
$
|
37,833
|
|
|
$
|
37,833
|
|
|
$
|
37,833
|
|
|
$
|
—
|
|
Change in Control Payments(4)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,887,000
|
|
|
$
|
—
|
|
Accelerated Equity Vesting(5)
|
|
$
|
5,968,900
|
|
|
$
|
4,231,943
|
|
|
$
|
4,231,943
|
|
|
$
|
2,315,013
|
|
Class B Units(6)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
321,200
|
|
|
$
|
—
|
|
Total(7)
|
|
$
|
7,206,733
|
|
|
$
|
7,569,776
|
|
|
$
|
9,077,976
|
|
|
$
|
2,915,013
|
|
Michael H. Lou
|
|
|
|
|
|
|
|
|
||||||||
Salary(2)
|
|
$
|
480,000
|
|
|
$
|
1,080,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Bonus Amounts(2)
|
|
$
|
480,000
|
|
|
$
|
1,560,000
|
|
|
$
|
480,000
|
|
|
$
|
480,000
|
|
COBRA Premiums(3)
|
|
$
|
37,833
|
|
|
$
|
37,833
|
|
|
$
|
37,833
|
|
|
$
|
—
|
|
Change in Control Payments(4)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,157,440
|
|
|
$
|
—
|
|
Accelerated Equity Vesting(5)
|
|
$
|
4,891,064
|
|
|
$
|
3,471,336
|
|
|
$
|
3,471,336
|
|
|
$
|
1,898,101
|
|
Class B Units(6)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
321,200
|
|
|
$
|
—
|
|
Total(7)
|
|
$
|
5,888,897
|
|
|
$
|
6,149,169
|
|
|
$
|
7,467,809
|
|
|
$
|
2,378,101
|
|
Nickolas J. Lorentzatos
|
|
|
|
|
|
|
|
|
||||||||
Salary(2)
|
|
$
|
425,000
|
|
|
$
|
956,250
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Bonus Amounts(2)
|
|
$
|
340,000
|
|
|
$
|
1,105,000
|
|
|
$
|
340,000
|
|
|
$
|
340,000
|
|
COBRA Premiums(3)
|
|
$
|
37,833
|
|
|
$
|
37,833
|
|
|
$
|
37,833
|
|
|
$
|
—
|
|
Change in Control Payments(4)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,414,126
|
|
|
$
|
—
|
|
Accelerated Equity Vesting(5)
|
|
$
|
3,135,952
|
|
|
$
|
2,222,803
|
|
|
$
|
2,222,803
|
|
|
$
|
1,228,987
|
|
Class B Units(6)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
321,200
|
|
|
$
|
—
|
|
Total(7)
|
|
$
|
3,938,785
|
|
|
$
|
4,321,886
|
|
|
$
|
5,335,962
|
|
|
$
|
1,568,987
|
|
(1)
|
Also reflects amounts for termination due to non-extension of the Employment Agreements.
|
(2)
|
Based on annualized base salary and target bonus percentage in effect for each Named Executive Officer as of December 31, 2018. For purposes of calculating any pro-rata bonus, the dollar value of the bonus awards actually awarded to each Named Executive Officer by our Compensation Committee for 2018 service was used, without pro-ration, since December 31, 2018 was the last day of the calendar year to which such bonus related. For purposes of quantifying the amount of the severance payments to Messrs. Nusz, Reid, Lou and Lorentzatos in the event of their termination without “cause” or for “good reason,” that does not occur on or within two years following a change in control, (a) the “Salary” amount was calculated as the base salary that the Named Executive Officer would have received for a period of 12 months, for Messrs. Lou and Lorentzatos, and 24 months, for Messrs. Nusz and Reid, and (b) the “Bonus Amount” was calculated, for Messrs. Lou and Lorentzatos, as the target bonus in effect for 2018, plus the pro-rata bonus
|
(3)
|
Reflects 18 months’ worth of COBRA premiums at $2,101.82 per month.
|
(4)
|
The amount of severance payments to each Named Executive Officer in the event of his termination without "cause" or for "good reason" on or within two years following a change in control, was calculated as the sum of (a) 2.99 times annualized base salary for 2018, plus (b) 2.99 times the average bonus paid to each Named Executive Officer for 2016 and 2017.
|
(5)
|
The value of accelerated equity awards is based upon the closing price per share of our common stock on December 31, 2018 (the last trading day of fiscal year 2018), which was $5.53, multiplied by the number of outstanding shares of restricted stock or PSUs that would vest upon the occurrence of the event indicated. We calculated the number of PSUs that would become earned upon the occurrence of the event indicated according to the provisions of the Notice of Grant of Performance Awards for each PSU award as follows: (i) upon termination due to death or disability, 200% of the initial PSUs; (ii) upon occurrence of a change in control, the percentage of initial PSUs earned depends on which quartile or percentile the Company's TSR percentage falls relative to the other companies in the PSU comparator group, assuming the applicable performance period ended on the date of the change in control; and (iii) upon termination without cause or for good reason, the percentage of initial PSUs earned is determined at the end of the originally stated performance period; however, for purposes of the event indicated in this clause (iii), we have calculated assumed performance at the end of the applicable originally stated performance period using the same formula stated in footnote (3) to the "Outstanding Equity Awards at Fiscal Year End" table above because we believe it represents a reasonable estimate of the Company's TSR performance at the end of each originally stated performance period. The values reported in the table above only take into account awards that were outstanding on December 31, 2018, and do not include the awards granted to our Named Executive Officers in January 2019, which are discussed above in the CD&A.
|
(6)
|
The Class B Units are intended to constitute “profits interests" for federal tax purposes and as such, the actual value of the Class B Units was not readily quantifiable as of December 31, 2018. For purposes of this table, the value of the accelerated Class B Units is based upon the grant date fair value of the Class B Units, calculated in accordance with FASB ASC Topic 718, multiplied by the number of outstanding Class B Units that would become vested upon the occurrence of the event indicated.
|
(7)
|
The aggregate total amount of compensation payable in connection with the triggering events has not been reduced to reflect any cut back in benefits or payments that would be made in connection with a change in control pursuant to the terms of the Employment Agreements. The Employment Agreements provide that golden parachute payments will be paid in full or reduced to fall within the 280G safe harbor amount, whichever will provide a better net after-tax position for a Named Executive Officer. For purposes of this disclosure, we have reflected the maximum amount potentially payable to each Named Executive Officer under each given scenario even though such maximum amounts could be reduced pursuant to the cutback language included in the Employment Agreements.
|
•
|
The median of the annual total compensation of all employees of our company (other than the CEO) was $138,464; and
|
•
|
The annual total compensation of our CEO, as reported in the Summary Compensation Table included elsewhere within this Proxy Statement, was $7,258,700.
|
•
|
Based on this information, for 2018 the ratio of the annual total compensation of our CEO to the median of the annual total compensation of all employees was reasonably estimated to be 52 to 1.
|
•
|
We determined that, as of December 31, 2018, our employee population consisted of approximately 725 individuals with all of these individuals located in the United States (as reported in Item 1, Business, in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 1, 2019 (our “Annual Report”)). This population consisted of our full-time, part-time, and temporary employees.
|
•
|
We used a consistently applied compensation measure to identify our median employee of comparing the amount of salary reflected in our payroll records as reported to the Internal Revenue Service on Form W-2 for 2018; the annual cash incentive award granted in respect of 2018 performance; and the annual equity awards granted to our employees in 2018.
|
•
|
We identified our median employee by consistently applying this compensation measure to all of our employees included in our analysis. Since all of our employees, including our CEO, are located in the United States, we did not make any cost of living adjustments in identifying the median employee.
|
•
|
After we identified our median employee, we combined all of the elements of such employee’s compensation for the 2018 year in accordance with the requirements of Item 402(c)(2)(x) of Regulation S-K, resulting in annual total compensation of $138,464. The difference between such employee’s salary, wages and overtime pay and the employee’s annual total compensation represents the value of such employee’s annual equity awards granted in 2018 and contributions in the amount of $6,082 that we made on the employee’s behalf to our 401(k) plan for the 2018 year.
|
•
|
With respect to the annual total compensation of our CEO, we used the amount reported in the “Total” column of our 2018 Summary Compensation Table included in this Proxy Statement and incorporated by reference under Item 11 of Part III of our Annual Report.
|
•
|
Be competitive.
Compensation should help to attract and retain the most qualified individuals in the oil and gas industry by being competitive with compensation paid to persons having similar responsibilities and duties in other companies in the same and closely related industries;
|
•
|
Be aligned with shareholder interests.
Compensation should align the interests of the individual with those of our shareholders with respect to long-term value creation;
|
•
|
Pay for performance.
Compensation should pay for performance, whereby an individual’s total direct compensation is heavily influenced by company performance and directly tied to the attainment of annual company performance targets; and
|
•
|
Encourage individual accountability.
Compensation should reflect each individual's contribution to the attainment of annual company performance targets, and the unique qualifications, skills, experience and responsibilities of the individual.
|
•
|
Equity-based awards generally incorporate a three-year vesting period to emphasize long-term performance and executive officer commitment;
|
•
|
Our annual performance-based cash incentive awards incorporate numerous financial and/or strategic performance metrics in order to properly balance risk with the incentives to drive our key annual financial and/or strategic initiatives and impose maximum payouts to further manage risk and the possibility of excessive payments;
|
•
|
We have focused our executives on long-term shareholder value creation through our use of equity-based awards, including PSUs tied to relative TSR performance, and the adoption of stock ownership guidelines that encourage our senior executives to own a significant amount of the Company’s stock; and
|
•
|
Change in control related payments under the employment agreements with our Named Executive Officers, including equity-based award acceleration, require a double trigger (i.e., a termination of employment on, or within two years following, a change in control).
|
|
|
|
|
|
•
|
attract and retain the most qualified employees, directors and consultants ("participants") in the oil and gas industry by being competitive with compensation paid to persons having similar responsibilities and duties in other companies in the same and closely related industries;
|
•
|
reflect the unique qualifications, skills, experience and responsibilities of each participant:
|
•
|
pay for performance, whereby a participant's compensation is influenced by company performance;
|
•
|
align the interests of the participant with those of our shareholders with respect to long-term value creation; and
|
•
|
provide participants with additional incentive and reward opportunities designed to enhance the profitable growth of the Company.
|
•
|
No discounted options or other awards may be granted;
|
•
|
Awards are non-transferrable, except to an award recipient’s immediate family member or related family trust, pursuant to a qualified domestic relations order or by will or the laws and descent and distribution;
|
•
|
No automatic award grants are made to any eligible individual;
|
•
|
Awards granted prior to January 1, 2018 may be designed to meet the requirements for deductibility as “performance-based compensation” under Section 162(m);
|
•
|
Limitations on the maximum number or amount of awards that may be granted to certain individuals during any calendar year;
|
•
|
No repricing of stock options or stock appreciation rights without shareholder approval;
|
•
|
Awards are subject to potential reduction, cancellation, forfeiture or other clawback under certain specified circumstances; and
|
•
|
No recycling of shares subject to options or stock appreciation rights that are withheld or tendered to pay the exercise price of the Award or to satisfy any tax withholding obligation or that are covered by an option or stock appreciation right that is exercised.
|
Total Restricted Stock Awards Outstanding (Unvested)
|
|
7,207,796
|
|
Total Performance Share Unit Awards Outstanding (Unvested)(1)
|
|
3,420,742
|
|
Total Stock Option Awards Outstanding
|
|
None
|
|
Total Shares Available for Grant Under the LTIP
|
|
7,496,641
|
|
Total Common Shares Outstanding
|
|
322,082,014
|
|
(1)
|
As of March 5, 2019, represents shares subject to performance share unit, or PSU, awards outstanding, assuming the payout level of 108% of the initial number of PSUs awarded.
|
Equity Compensation Plan Information as of December 31, 2018
|
|||||
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 for future issuance under equity compensation plans (excluding securities reflected in column(a))(c)
|
||
Equity compensation plans approved by security holders
|
4,064,424(2)
|
0
|
|
10,988,180(3)
|
|
Equity compensation plans not approved by security holders (1)
|
0
|
0
|
|
0
|
|
Total
|
4,064,424(2)
|
$
|
—
|
|
10,988,180(3)
|
(3)
|
Does not take into account grants under the 2010 Long Term Incentive Plan in January 2019. For awards outstanding and shares remaining available for issuance under the 2010 Long Term Incentive Plan as of the Record Date, please see the chart in this Item above.
|
Name of Person or Identity of Group
|
|
Number of OAS
Shares
|
|
Percentage
of Class(1)
|
|
Number of OMP Common Units
|
|
Percentage of Class
|
|||
BlackRock, Inc.(2)
|
|
32,748,275
|
|
|
10.2
|
%
|
|
|
|
|
|
EnCap Investments, LLC (3)
|
|
30,524,106
|
|
|
9.5
|
%
|
|
|
|
|
|
The Vanguard Group, Inc. (4)
|
|
28,413,198
|
|
|
8.8
|
%
|
|
|
|
|
|
Dimensional Fund Advisors LP (5)
|
|
21,523,088
|
|
|
6.7
|
%
|
|
|
|
|
|
State Street Corporation(6)
|
|
16,498,312
|
|
|
5.1
|
%
|
|
|
|
|
|
Thomas B. Nusz(7)(8)
|
|
1,924,532
|
|
|
*
|
|
|
5,000
|
|
|
*
|
Taylor L. Reid(7)(9)
|
|
1,967,759
|
|
|
*
|
|
|
20,000
|
|
|
*
|
Michael H. Lou(7)
|
|
576,017
|
|
|
*
|
|
|
25,000
|
|
|
*
|
Nickolas J. Lorentzatos(7)
|
|
373,181
|
|
|
*
|
|
|
5,900
|
|
|
*
|
William J. Cassidy(7)
|
|
114,370
|
|
|
*
|
|
|
|
|
|
|
John E. Hagale(7)
|
|
90,480
|
|
|
*
|
|
|
10,000
|
|
|
*
|
Michael McShane(7)
|
|
249,070
|
|
|
*
|
|
|
|
|
|
|
Paula D. Polito(7)
|
|
32,330
|
|
|
*
|
|
|
|
|
|
|
Bobby S. Shackouls(7)(10)
|
|
106,670
|
|
|
*
|
|
|
|
|
|
|
All directors and executive officers as a group (9 persons)(7)
|
|
5,434,409
|
|
|
1.7
|
%
|
|
65,900
|
|
|
*
|
*
|
Less than 1%.
|
(1)
|
Based upon an aggregate of 322,082,014 shares outstanding as of March 5, 2019.
|
(2)
|
According to a Schedule 13G/A, dated January 29, 2019, filed with the SEC by BlackRock, Inc., it has sole voting power over 31,764,629 of these shares, sole dispositive power over 32,748,275 of these shares. BlackRock, Inc. filed this 13G as a parent holding company for the following subsidiaries: BlackRock (Netherlands) B.V.; BlackRock Advisors, LLC; BlackRock Asset Management Canada Limited; BlackRock Asset Management Ireland Limited; BlackRock Asset Management Schweitz AG; BlackRock Financial Management, Inc.; BlackRock Fund Advisors; BlackRock Institutional Trust Company, N.A.; BlackRock International Limited; BlackRock Investment Management (Australia) Limited; BlackRock Investment Management (UK) Ltd; BlackRock Investment Management, LLC; BlackRock Japan Co Ltd; and BlackRock Life Limited. The address of BlackRock, Inc. is 55 East 52nd Street, New York, New York 10055.
|
(3)
|
According to a Schedule 13G, dated January 30, 2019, jointly filed with the SEC by Forge Energy, LLC, EnCap Energy Capital Fund VIII, L.P. ("EnCap Fund VIII"), EnCap Energy Capital Fund VIII Co-investors, L.P. (“EnCap Fund VIII Co-Invest”), and EnCap Partners GP, LLC (“EnCap Partners GP”), EnCap Partners GP has shared voting and dispositive poser of 30,524,106 shares, including: (i) 18,166,002 shares of Common Stock owned by EnCap Fund VIII, (ii) 6,818,511 shares of Common Stock owned by EnCap Energy Capital Fund VIII Co-Invest and (iii) 5,539,593 shares of Common Stock held by Forge Energy. Forge Energy is a wholly-owned subsidiary of Forge Holdings. EnCap Fund VIII is a member of Forge Holdings that holds the right to appoint four of the seven representatives to the board of managers of Forge Holdings. Each of the managers of Forge Holdings has one vote and decisions are made by a majority vote. As a result, EnCap Fund VIII may be deemed to have the power to vote or direct the vote or to dispose or
|
(4)
|
According to a Schedule 13G/A, dated February 11, 2019, filed with the SEC by The Vanguard Group, Inc., it has sole voting power over 265,207 of these shares, sole dispositive power over 28,142,247 of these shares, shared voting power over 35,381 of these shares, and shared dispositive power over 270,951 of these shares. Vanguard Fiduciary Trust Company, a wholly-owned subsidiary of The Vanguard Group, Inc. is the beneficial owner of 235,570 of these shares and Vanguard Investments Australia, Ltd., a wholly owned subsidiary of The Vanguard Group, Inc., is the beneficial owner of 65,018 of these shares. The address of The Vanguard Group, Inc. is 100 Vanguard Blvd., Malvern, Pennsylvania 19355.
|
(5)
|
According to a Schedule 13G, dated February 8, 2019, filed with the SEC by Dimensional Fund Advisors LP ("Dimensional"), Dimensional has sole voting power over 21,148,191 of these shares and sole dispositive power over 21,523,088 of these shares. The address of Dimensional is Building One, 6300 Bee Cave Road, Austin, Texas 78746.
|
(6)
|
According to a Schedule 13G, dated February 11, 2019, filed with the SEC by State Street Corporation, it has sole voting power over
0
of these shares, sole dispositive power over
0
of these shares, shared voting power over 15,589,125 of these shares, and shared dispositive power over 16,498,312 of these shares. The following subsidiaries of State Street Corporation beneficially own the shares: SSGA Funds Management, Inc., State Street Global Advisors Limited (UK), State Street Global Advisors LTD (Canada), State Street Global Advisors, Australia Limited, State Street Global Advisors Asia LTD, State Street Global Advisors Singapore LTD, State Street Global Advisors GmbH, State Street Global Advisors Trust Company. The address of State Street Corporation is State Street Financial Center, One Lincoln Street, Boston, MA 02111.
|
(7)
|
Executive officer or director of the Company.
|
(8)
|
Mr. Nusz previously disclosed in the Company's proxy statement for the 2018 annual meeting a pledge of shares as security for personal loans. During 2018, Mr. Nusz reduced the number of his pledged shares to zero, and as of March 5, 2019, Mr. Nusz continues to have zero pledged shares. Except with respect to Mr. Nusz's previous pledge, the Board has not approved any pledges of Company securities by any of our executive officers or directors and does not expect to do so in the future.
|
(9)
|
Mr. Reid has sole voting power over 1,442,759 of these shares and shared voting power over 525,000 of these shares. 525,000 of these shares are held by West Bay Partners, Ltd., a limited partnership formed for family investment purposes. The sole general partner of West Bay, a Texas limited liability company, is controlled by Mr. Reid and his wife, and the limited partners of West Bay consist of Mr. Reid, his immediate family members and trusts formed for their benefit.
|
(10)
|
Mr. Shackouls has sole voting power over 67,475 of these shares, of which 39,195 are held by grantor retained annuity trusts of which Mr. Shackouls is trustee. The remaining 39,195 shares are held by grantor retained annuity trusts of which Mr. Shackouls's wife is trustee.
|
Proposal
|
|
Board Vote Recommendation
|
Item 1 — Election of Directors
|
|
FOR
|
Item 2 — Ratification of PricewaterhouseCoopers LLP as the Company's independent registered public accounting firm for 2019
|
|
FOR
|
Item 3 — Advisory vote to approve the Company's Named Executive Officer 2018 compensation
|
|
FOR
|
Item 4 — Approval of the First Amendment to the LTIP to increase the maximum number of shares by 1,300,000 shares
|
|
FOR
|
•
|
voting at a later time by Internet or telephone until 11:59 p.m. (Eastern Time) on Monday, April 29, 2019;
|
•
|
voting in person at the Annual Meeting;
|
•
|
delivering to the Company's Corporate Secretary a proxy with a later date or a written revocation of your most recent proxy; or
|
•
|
giving notice to the inspector of elections at the Annual Meeting.
|
Proposal
|
|
Vote
Required
|
|
Page Number
|
||
Item 1 — Election of Directors
|
|
Plurality of shares cast
Director Resignation Policy - Directors required to submit resignation to the Board if more "withheld" votes than "for" votes are received
Effect of Abstentions - None
Effect of Broker Non-vote - None
|
|
2
|
||
Item 2 — Ratification of PricewaterhouseCoopers LLP as the Company's independent registered public accounting firm for 2019
|
|
Majority of shares present
Effect of Abstentions - vote against
No Broker Non-votes - Discretionary Item
|
|
24
|
||
Item 3 — Advisory vote to approve the Company's Named Executive Officer 2018 compensation
|
|
Majority of shares present
Effect of Abstentions - vote against
Effect of Broker Non-vote - None
|
|
58
|
||
Item 4 — Item 4 — Approval of the First Amendment to the LTIP to Increase the Maximum Number of Shares by 1,300,000 Shares
|
|
Majority of shares present
Effect of Abstentions - vote against
Effect of Broker Non-vote - None
|
|
60
|
|
|
|
By Order of the Board of Directors
|
|
|
|
|
|
|
|
Nickolas J. Lorentzatos
|
|
Corporate Secretary
|
1 Year Oasis Petroleum Chart |
1 Month Oasis Petroleum Chart |
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