Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Appointment of Chief Executive Officer
On
As President and Chief Executive Officer,
Awards for Service as Chief Awards for Service as Financial Officer President and Chief Executive Officer
Restricted Stock Units 14,861, which vest 2,119, which vest
one-third on each of one-third on each of October 11, 2022, May 28, October 11, 2022, 2023 and 2023 and May 28, 2024 2024 Performance Stock Units 29,722 at 100% payout 4,237 at 100% payout (absolute TSR) level, which cliff vest in level, which cliff vest in full or in part on May 28, full or in part on 2024 based on absolute TSR October 11, 2024 based on from February 10, 2021 to absolute TSR from December 29, 2023 September 30, 2021 through September 30, 2024 Performance Stock Units 14,861 at 100% payout 2,119 at 100% payout (relative TSR) level, which cliff vest in level, which cliff vest in full or in part on May 28, full or in part on 2024 based on relative TSR October 11, 2024 based on from February 10, 2021 to relative TSR from December 29, 2023 September 30, 2021 through September 30, 2024
Appointment of New Executive Chairman
On
As Executive Chairman of the Company,
Restricted Stock 1,520, vest one-third on each ofOctober 11, 2022 , 2023 and Units 2024
Performance Stock 3,040 at 100% payout level, cliff vest in full or in part on
Units (absolute TSR)
2021 throughSeptember 30, 2024
Performance Stock 1,520 at 100% payout level, cliff vest in full or in part on
Units (relative TSR)
2021 throughSeptember 30, 2024 Executive Severance Plan
On
Upon a Qualifying Termination outside of a Change in Control Protection Period, participants in the Executive Severance Plan will be eligible to receive the following benefits:
· a cash payment equal to 2.0 (for Tier 1 Executives) and 1.0 (for Tier 2 and
Tier 3 Executives) times the sum of the participant's (i) annualized Base Salary then in effect and (ii) Target Annual Bonus, payable in substantially equal installments on the Company's regular payroll schedule for the period commencing on the participant's applicable period (24 months for Tier 1 Executives and 12 months for Tier 2 and Tier 3 Executives); and
· a lump sum cash payment equal to the product of (i) 12 and (ii) the monthly
amount of the Company's contribution to the premiums for such participant's group health plan coverage (including coverage for such participant's spouse and eligible dependents), determined under the Company's group health plans as in effect immediately prior to the date of the termination of such participant's employment.
Upon a Qualifying Termination during a Change in Control Protection Period, participants in the Executive Severance Plan will be eligible to receive the following benefits:
· a lump sum cash payment equal to 3.0 (for Tier 1 Executives), 2.0 (for Tier 2
Executives) and 1.0 (for Tier 3 Executives) times the sum of the participant's
(i) annualized Base Salary then in effect and (ii) Target Annual Bonus; and
· a lump sum cash payment equal to the product of (i) 12 and (ii) the monthly
amount of the Company's contribution to the premiums for such participant's group health plan coverage (including coverage for such participant's spouse and eligible dependents), determined under the Company's group health plans as in effect immediately prior to the date of the termination of such participant's employment.
In order to receive any of the foregoing severance benefits under the Executive Severance Plan, a participant must timely execute (and not revoke) a release of claims in favor of the Company and its affiliates. Further, the Executive Severance Plan requires continued compliance with certain confidentiality, non-solicitation and non-disparagement covenants. If the severance benefits under the Executive Severance Plan would trigger an excise tax for a participant under Section 4999 of the Internal Revenue Code of 1986, as amended, the Executive Severance Plan provides that the participant's severance benefits will be reduced to a level at which the excise tax is not triggered, unless the participant would receive a greater amount without such reduction after taking into account the excise tax and other applicable taxes.
The foregoing description of the Executive Severance Plan and the participation agreements thereunder is not complete and is qualified in its entirety by . . .
Item 8.01 Other Events
On
CAUTIONARY STATEMENTS REGARDING FORWARD LOOKING STATEMENTS
This filing contains certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1955 and other federal securities laws. Words such as "anticipates," "believes," "expects," "intends," "will," "should," "may," "plans," "targets," "forecasts," "projects," "believes," "seeks," "schedules," "estimates," "positions," "pursues," could," "budgets," "outlook," "trends," "guidance," "focus," "on schedule," "on track," "is slated," "goals," "objectives," "strategies," "opportunities," "poised," "potential" and similar expressions may be used to identify forward-looking statements. Forward-looking statements are not statements of historical fact and reflect the Company's current views about future events. Such forward-looking statements may include, but are not limited to, statements about the benefits of the proposed merger (the "Merger") involving the Company and Vine Energy Inc. ("Vine"), including future financial and operating results, the Company's and Vine's plans, objectives, expectations and intentions, the expected timing and likelihood of completion of the Merger, and other statements that are not historical facts, including estimates of oil and natural gas reserves and resources, estimates of future production, assumptions regarding future oil and natural gas pricing, planned drilling activity, future results of operations, projected financial information (including projected cash flow and liquidity), business strategy, other plans and objectives for future operations or any future opportunities. These statements are not guarantees of future performance and no assurances can be given that the forward-looking statements contained in this filing will occur as projected. Actual results may differ materially from those projected. Forward-looking statements are based on current expectations, estimates and assumptions that involve a number of risks and uncertainties that could cause actual results to differ materially from those projected.
The risks and uncertainties that could cause actual results to differ materially from those in forward looking statements include, without limitation, the ability to obtain the approval of the Merger by Vine's stockholders; the risk that the Company or Vine may be unable to obtain governmental and regulatory approvals required for the Merger, or required governmental and regulatory approvals may delay the Merger or result in the imposition of conditions that could cause the parties to abandon the Merger; the risk that an event, change or other circumstances could give rise to the termination of the Merger Agreement; the risk that a condition to closing of the transactions may not be satisfied; the timing to consummate the proposed transactions; the risk that the assets and the businesses will not be integrated successfully; the risk that the cost savings and any other synergies from the proposed transaction may not be fully realized or may take longer to realize than expected; the risk that any announcement relating to the proposed transaction could have adverse effects on the market price of the Company's common stock or Vine's common stock; the risk of litigation related to the proposed transactions; the risk of any unexpected costs or expenses resulting from the proposed transactions; disruption from the transactions making it more difficult to maintain relationships with customers, employees or suppliers; the diversion of management time from ongoing business operations due to transaction-related issues; the volatility in commodity prices for crude oil and natural gas, the presence or recoverability of estimated reserves, particularly during extended periods of low prices for crude oil and natural gas during the COVID-19 pandemic; the ability to replace reserves; environmental risks, drilling and operating risks, including the potential liability for remedial actions or assessments under existing or future environmental regulations and litigation; exploration and development risks; competition, government regulation or other actions; the ability of management to execute its plans to meet its goals and other risks inherent in the Company's and Vine's businesses; public health crises, such as pandemics (including COVID-19) and epidemics, and any related government policies and actions; the potential disruption or interruption of the Company's or Vine's operations due to war, accidents, political events, civil unrest, severe weather, cyber threats, terrorist acts, or other natural or human causes beyond the Company's or Vine's control; the risk that the announcement or consummation of the Merger, or any other intervening event results in a requirement under certain of Vine's indebtedness to make a change of control offer with respect to some or all of such debt; and the Company's ability to identify and mitigate the risks and hazards inherent in operating in the global energy industry. Other unpredictable or unknown factors not discussed in this report could also have material adverse effects on forward looking statements.
All such factors are difficult to predict and are beyond the Company's or Vine's
control, including those detailed in the Company's annual reports on Form 10-K,
quarterly reports on Form 10-Q and current reports on Form 8-K that are
available on its website at http://investors.chk.com/ and on the
Forward-looking statements are based on the estimates and opinions of management at the time the statements are made. Neither the Company nor Vine undertakes any obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date hereof.
IMPORTANT INFORMATION FOR INVESTORS AND STOCKHOLDERS; ADDITIONAL INFORMATION AND WHERE TO FIND IT
This communication does not constitute an offer to sell or the solicitation of
an offer to buy any securities or a solicitation of any vote or approval, nor
shall there be any sale, issuance, exchange or transfer of the securities
referred to in this document in any jurisdiction in contravention of applicable
law. In connection with the proposed transaction, the Company has filed with the
INVESTORS AND SECURITY HOLDERS OF THE COMPANY AND VINE ARE URGED TO READ THE REGISTRATION STATEMENT, PROXY STATEMENT/PROSPECTUS AND OTHER DOCUMENTS THAT MAY BE FILED WITH THE SEC CAREFULLY AND IN THEIR BECAUSE THEY CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION.
Investors and security holders will be able to obtain free copies of these
documents (if and when available) and other documents containing important
information about the Company and Vine, once such documents are filed with the
PARTICIPANTS IN THE SOLICITATION
The Company, Vine and certain of their respective directors, executive officers
and other persons may be deemed to be participants in the solicitation of
proxies in respect of the proposed transaction. Information regarding the
directors and executive officers of the Company is available in its Amendment to
Form 10-K, filed with the
Other information regarding the participants in the proxy solicitations and a
description of their direct and indirect interests, by security holdings or
otherwise, are contained in the proxy statement/prospectus and other relevant
materials filed with the
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits Exhibit No. Description 10.1Chesapeake Energy Corporation Executive Severance Plan. 10.2 Form of Participation Agreement pursuant to theChesapeake Energy Corporation Executive Severance Plan. 10.3 Amendment to theChesapeake Energy Corporation 2021 Long Term Incentive Plan. 10.4 Executive Chairman Agreement by and betweenMichael Wichterich and the Company, datedOctober 11, 2021 . 99.1 Press Release, datedOctober 11, 2021 . 104 Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document.
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