Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Executive Transition
On January 30, 2020, Earthstone Energy, Inc. (the "Company") announced that its
current Chairman, Chief Executive Officer and Principal Executive Officer, Mr.
Frank A. Lodzinski, age 70, will be appointed by the Board of Directors of the
Company (the "Board") as Executive Chairman and its current President, Mr.
Robert J. Anderson, age 57, will be appointed Chief Executive Officer, President
and Principal Executive Officer of the Company, effective on April 1, 2020, at
which time Mr. Lodzinski's annual salary will be reduced from $500,000 to
$250,000.
Mr. Anderson has served as President of the Company since April 2018 and prior
to that served as Executive Vice President, Corporate Development and
Engineering from December 2014 until his appointment as President. Mr.
Anderson's annual salary will remain unchanged, as well as all other executive
officers of the Company.
There are no transactions to which the Company is or was a participant and in
which Mr. Anderson has a material interest subject to disclosure under Item
404(a) of Regulation S-K. No arrangement or understanding exists between Mr.
Anderson and any other person pursuant to which Mr. Anderson was appointed as an
officer of the Company.
Approval of New Form of Award Agreements
On January 30, 2020, the Compensation Committee (the "Committee") of the Board
approved (i) the form of performance unit award agreement for executive officers
that are granted performance units (the "Executive PSU Agreement") pursuant to
the Company's Amended and Restated 2014 Long-Term Incentive Plan (the "Plan");
(ii) the form of restricted stock unit award agreement for executive officers
that are granted restricted stock units (the "Executive RSU Agreement") pursuant
to the Plan; and (iii) the form of restricted stock unit award agreement for
members of the Board that are granted restricted stock units (the "Director RSU
Agreement") pursuant to the Plan. The Company expects to use the foregoing newly
approved forms for future equity award grants under the Plan.
The description of the form of Executive PSU Agreement, Executive RSU Agreement
and Director RSU Agreement contained in this Item 5.02 do not purport to be
complete and are qualified in their entirety by reference to the form of
Executive PSU Agreement, Executive RSU Agreement and Director RSU Agreement
included as Exhibit 10.1, Exhibit 10.2 and Exhibit 10.3, respectively, to this
Current Report on Form 8-K and incorporated herein by reference.
Item 7.01 Regulation FD Disclosure.
On January 29, 2020, the Company issued a press release providing an operations
update and 2020 capital budget and guidance. A copy of the press release is
attached to this Current Report on Form 8-K as Exhibit 99.1 and is incorporated
herein by reference.
Additionally, on January 29, 2020, the Company posted to its website a company
presentation (the "Presentation Materials") that management intends to use from
time to time about the Company's 2020 guidance. The Company may use the
Presentation Materials, possibly with modifications, in presentations to current
and potential investors, lenders, creditors, vendors, customers and others with
an interest in the Company and its business. A copy of the Presentation
Materials is attached to this Current Report on Form 8-K as Exhibit 99.2 and is
incorporated herein by reference.
On January 30, 2020, the Company issued a press release announcing the
transition of certain executive officers. A copy of the press release is
attached to this Current Report on Form 8-K as Exhibit 99.3 and is incorporated
herein by reference.
The information in this Current Report on Form 8-K furnished pursuant to Item
7.01, including Exhibit 99.1, Exhibit 99.2 and Exhibit 99.3, shall not be deemed
to be "filed" for the purposes of Section 18 of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), or otherwise subject to liability under
that section, and they shall not be deemed incorporated by reference in any
filing under the Securities Act of 1933, as amended, or the Exchange Act, except
as shall be expressly set forth by specific reference in such filing. By filing
this Current Report on Form 8-K and furnishing this information pursuant to Item
7.01, the Company makes no admission as to the materiality of any information in
this Current Report on Form 8-K, including Exhibit 99.1, Exhibit 99.2 and
Exhibit 99.3, that is required to be disclosed solely by Regulation FD.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
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The following exhibits are included with this Current Report on Form 8-K:
Exhibit No. Description
10.1 Form of Performance Unit Agreement (Executive Management)
10.2 Form of Restricted Stock Unit Agreement (Executive Management)
10.3 Form of Restricted Stock Unit Agreement (Director)
99.1 Press Release dated January 29, 2020
99.2 Presentation Materials dated January 29, 2020
99.3 Press Release dated January 30, 2020
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