Item 5.02
Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
On July 10, 2018, the Compensation Committee (the “Committee”) of the Board of Directors (the “Board”) of WPX Energy, Inc. (the “Company”) approved amendments to certain equity award agreements between the Company and its executive leadership team, including Clay M. Gaspar, President and Chief Operating Officer, J. Kevin Vann, Executive Vice President and Chief Financial Officer, Dennis C. Cameron, Senior Vice President and General Counsel, and Bryan K. Guderian, Executive Vice President — Business Development. Upon the recommendation of the Committee, the Board approved the same amendments to certain award agreements between the Company and Richard E. Muncrief, Chairman of the Board and Chief Executive Officer.
The following are the equity award agreements to which the amendments apply in the case of each of the officers named above (collectively, the “Award Agreements”):
·
WPX Energy, Inc. 2016 Performance-Based Restricted Stock Unit Agreement dated May 19, 2016
·
WPX Energy, Inc. 2017 Performance-Based Restricted Stock Unit Agreement dated March 3, 2017
·
WPX Energy, Inc. 2018 Performance-Based Restricted Stock Unit Agreement dated March 2, 2018
The amendments to the Award Agreements approved by the Committee and the Board, which will require the consent of the counterparties, modify the vesting provisions applicable upon a change in control of the Company so that, upon such a change in control, the number of shares subject to vesting shall be based on the actual total shareholder return of the Company’s common stock from the beginning of the performance period until the date of the change in control, relative to the total shareholder return of the common stocks of its peer group companies over the same period, rather than upon the number of shares subject to vesting based on 100 percent of target. No other provisions of the Award Agreements were modified, and the double trigger vesting requirement applicable upon a change in control remains in effect — i.e., no vesting will occur unless, following a change in control, the counterparty’s employment is terminated under circumstances set forth in the Award Agreements.
The Committee and the Board approved these amendments in response to a growing trend among the Company’s peer group to vest performance awards upon the basis of actual performance as opposed to target performance. The Committee and the Board each concluded that these amendments enable the Company’s executive compensation to remain competitive with the executive compensation of its peer companies while also aligning such compensation with the Company’s pay-for-performance philosophy, which calls for executives to be rewarded upon the basis of actual results achieved.
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