ITEM 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On January 17, 2020, Panhandle Oil and Gas Inc. (the "Company") announced the
appointment of Chad L. Stephens as Chief Executive Officer of the Company,
effective January 16, 2020. Mr. Stephens previously served as Interim Chief
Executive Officer of the Company and currently serves as a member of the
Company's board of directors (the "Board").
Mr. Stephens, 64, had served as the Company's Interim Chief Executive Officer
since August 2019. Mr. Stephens previously served as Senior Vice President -
Corporate Development of Range Resources Corporation, an independent natural gas
company ("Range Resources"), a position he held from 2002 until his retirement
effective December 31, 2018. Mr. Stephens joined Range Resources in 1990 as
Senior Vice President - Southwest. While at Range Resources, he was responsible
for the origination, valuation and acquisition or divestiture of over $6.0
billion of oil and gas producing properties. Mr. Stephens served on the internal
hedging committee and was responsible for the oversight of all gas, oil and NGL
marketing and sales for Range Resources. Mr. Stephens holds a Bachelor of Arts
degree in Finance and Land Management from the University of Texas. He was
appointed to the Board in 2017 and previously served as its Lead Independent
Director.
The Company does not have a written employment agreement with Mr. Stephens. Mr.
Stephens will receive an initial annual base salary of $345,000, to be reviewed
at least annually by the Compensation Committee of the Board. Mr. Stephens will
receive a signing bonus of $500,000 in the form of a restricted stock award with
a three-year cliff vesting period. If a change-in-control were to occur, the
restricted stock award would fully vest. If termination were to occur for any
reason other than "for cause," vesting of the restricted stock would be
pro-rata. Mr. Stephens will be eligible for an annual cash bonus based on the
Company's financial and operating performance and subjective performance goals,
with a target cash bonus award of 100% of his base salary (for a target cash
bonus of $345,000). Mr. Stephens will also be eligible to participate in the
Company's long-term incentive programs available to executive officers of the
Company, including the Company's Amended 2010 Restricted Stock Plan and the
Employee Stock Ownership and 401(k) Plan and Trust Agreement (the "ESOP Plan").
Mr. Stephens' target performance-based long-term incentive stock award for 2020
is equal to 155% of his annual base salary (for a target performance-based
long-term incentive opportunity of $534,750). Additionally, Mr. Stephens is
eligible to participate in the health and welfare benefits available to all
Company employees.
Mr. Stephens will enter into a Change-in-Control Executive Severance Agreement
("Change-in-Control Agreement") with the Company. Under such Change-in-Control
Agreement, if, within two years following a change-in-control event, the Company
terminates Mr. Stephens' employment without cause or he resigns for good reason
as defined in the Change-in-Control Agreement, he would be entitled to a
severance payment, payable as a lump sum, in cash, following his termination, in
an amount equal to (i) two times the average base salary paid to him and
contributions made by the Company to its ESOP Plan on his behalf during the two
calendar years preceding the change-in-control event (or the annual average of
any shorter period) plus (ii) two times his target bonus amount for the calendar
year in which the change-in-control occurs (or, if not yet determined for that
year, two times his targeted bonus for the preceding calendar year). Further,
under the Change-in-Control Agreement, if Mr. Stephens qualifies, and the
Company is required to provide coverage under COBRA, the Company also would be
required to reimburse Mr. Stephens for the costs of purchasing continuing
coverage under COBRA for him and his dependents for as long as he qualifies for
COBRA coverage. The foregoing description of the Change-in-Control Agreement is
qualified in its entirety by reference to the Change-in-Control Agreement, which
is filed as Exhibit 10.1 hereto and incorporated herein by reference.
Additionally, Mr. Stephens will be entitled to participate in all employee
benefit plans, practices and programs that are generally made available to
executive officers of the Company.
There are no arrangements or understandings between Mr. Stephens and any other
person pursuant to which he was selected as Chief Executive Officer. There are
no family relationships between Mr. Stephens and any of the Company's directors
or executive officers, and there are no relationships between Mr. Stephens and
the Company that would require disclosure under Item 404(a) of Regulation S-K of
the Securities Exchange Act of 1934, as amended.
ITEM 7.01 Regulation FD Disclosure
On January 17, 2020, the Company issued a press release announcing the
appointment of Chad L. Stephens as Chief Executive Officer.
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A copy of this press release is attached as Exhibit 99.1 to this Current Report
on Form 8-K and is incorporated herein by reference. This information shall not
be deemed to be "filed" for purposes of Section 18 of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), or otherwise subject to the
liabilities of that section, and is not incorporated by reference into any
filing under the Securities Act of 1933, as amended, or the Exchange Act, except
as expressly set forth by specific reference in such filing.
ITEM 9.01 Financial Statements and Exhibits
(d) Exhibits
Exhibit
NumberDescription
10.1* Change-in-Control Agreement
99.1* Press Release dated January 17, 2020
*Filed herewith
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