ERIN ENERGY CORPORATION (NYSEMKT:ERN) Files An 8-K Results of Operations and Financial Condition
Item 2.02 Results of Operations and Financial Condition
On May 10, 2017, Erin Energy Corporation (the Company) issued a
press release announcing financial results for the quarter ended
March 31, 2016. A copy of the press release is attached as Exhibit
99.1 and incorporated herein by reference. As announced in that
press release, the Company hosted a conference call on Thursday,
May 11, 2017 at 10:00 a.m. CT (11:00 a.m. ET) to discuss the
Companys financial results and provide an update on its current
operations. A transcript of that call is attached as Exhibit 99.2
and incorporated herein by reference. All information in this Item
2.02, including Exhibits 99.1 and 99.2, is being furnished and
shall not be deemed filed with the SEC for purposes of Section 18
of the Securities Exchange Act of 1934, as amended (the Exchange
Act), or otherwise subject to the liability of that Section, and
shall not be deemed to be incorporated by reference into any filing
under the Securities Act of 1933, as amended (the Securities Act),
or the Exchange Act, except to the extent the registrant
specifically incorporates it by reference.
press release announcing financial results for the quarter ended
March 31, 2016. A copy of the press release is attached as Exhibit
99.1 and incorporated herein by reference. As announced in that
press release, the Company hosted a conference call on Thursday,
May 11, 2017 at 10:00 a.m. CT (11:00 a.m. ET) to discuss the
Companys financial results and provide an update on its current
operations. A transcript of that call is attached as Exhibit 99.2
and incorporated herein by reference. All information in this Item
2.02, including Exhibits 99.1 and 99.2, is being furnished and
shall not be deemed filed with the SEC for purposes of Section 18
of the Securities Exchange Act of 1934, as amended (the Exchange
Act), or otherwise subject to the liability of that Section, and
shall not be deemed to be incorporated by reference into any filing
under the Securities Act of 1933, as amended (the Securities Act),
or the Exchange Act, except to the extent the registrant
specifically incorporates it by reference.
Item 5.02 Departure of Directors or Certain Officers; Election of
Directors; Appointment of
Directors; Appointment of
Certain Officers; Compensatory Arrangements of Certain Officers.
Appointment of Chief Executive Officer
The board of directors (the Board) of the Company has appointed
Sakiru Adefemi (Femi) Ayoade as the Companys Chief Executive
Officer to replace the Interim Chief Executive Officer, Jean-Michel
Malek, effective as of May 18, 2017 (the Effective Date). Mr.
Ayoade has served as Vice President of Production Operations for
the Company since 2016 and the Managing Director of Erin Petroleum
Nigeria Limited since 2013. He has more than 20 years of experience
in the oil and gas industry, substantial knowledge of the
regulatory and political environment of Nigeria and extensive
experience on exploration and production operations offshore
Nigeria. From 2008 to 2013, he was a Senior Technical Executive at
CAMAC Petroleum Limited and Allied Energy Plc Nigeria, and from
2006 to 2008, he was a Senior Drilling Engineer at Nigeria Agip
Exploration (a subsidiary of ENI). Mr. Ayoade also served as a
Senior Petroleum Engineer at Allied Energy Resources Nigeria
Limited from 1997 to 2005. Mr. Ayoade earned a Master of Science in
petroleum engineering from the University of Houston and a Higher
National Diploma from the Petroleum Training Institute and has had
extensive training in drilling, completion and subsea engineering.
Sakiru Adefemi (Femi) Ayoade as the Companys Chief Executive
Officer to replace the Interim Chief Executive Officer, Jean-Michel
Malek, effective as of May 18, 2017 (the Effective Date). Mr.
Ayoade has served as Vice President of Production Operations for
the Company since 2016 and the Managing Director of Erin Petroleum
Nigeria Limited since 2013. He has more than 20 years of experience
in the oil and gas industry, substantial knowledge of the
regulatory and political environment of Nigeria and extensive
experience on exploration and production operations offshore
Nigeria. From 2008 to 2013, he was a Senior Technical Executive at
CAMAC Petroleum Limited and Allied Energy Plc Nigeria, and from
2006 to 2008, he was a Senior Drilling Engineer at Nigeria Agip
Exploration (a subsidiary of ENI). Mr. Ayoade also served as a
Senior Petroleum Engineer at Allied Energy Resources Nigeria
Limited from 1997 to 2005. Mr. Ayoade earned a Master of Science in
petroleum engineering from the University of Houston and a Higher
National Diploma from the Petroleum Training Institute and has had
extensive training in drilling, completion and subsea engineering.
There are no arrangements or understandings between Mr. Ayoade and
any other person to which he was selected as Chief Executive
Officer, nor are there any family relationships between Mr. Ayoade
and any of the Companys directors or executive officers. There are
no transactions between Mr. Ayoade and the Company that would be
reportable under Item 404(a) of Regulation S-K promulgated under
the Exchange Act.
any other person to which he was selected as Chief Executive
Officer, nor are there any family relationships between Mr. Ayoade
and any of the Companys directors or executive officers. There are
no transactions between Mr. Ayoade and the Company that would be
reportable under Item 404(a) of Regulation S-K promulgated under
the Exchange Act.
As the Chief Executive Officer, Mr. Ayoades compensation will
consist of a base salary of $330,000 per year, a discretionary cash
performance bonus of 0-50% of base salary and an annual long-term
incentive equity award valued at up to 200% of base salary awarded
in accordance with the Companys Amended 2009 Equity Incentive Plan,
as amended. Additionally, he will receive 29,166 shares of the
Companys restricted stock, with fifty percent vesting on the first
anniversary and fifty percent on the second anniversary of the
Effective Date, and 133,333 options to purchase the Companys stock
at a price per share set at the market close price on the grant
date, which is the Effective Date, with one-third vesting on the
first anniversary, one-third vesting on the second anniversary and
one-third vesting on the third anniversary of the Effective Date.
consist of a base salary of $330,000 per year, a discretionary cash
performance bonus of 0-50% of base salary and an annual long-term
incentive equity award valued at up to 200% of base salary awarded
in accordance with the Companys Amended 2009 Equity Incentive Plan,
as amended. Additionally, he will receive 29,166 shares of the
Companys restricted stock, with fifty percent vesting on the first
anniversary and fifty percent on the second anniversary of the
Effective Date, and 133,333 options to purchase the Companys stock
at a price per share set at the market close price on the grant
date, which is the Effective Date, with one-third vesting on the
first anniversary, one-third vesting on the second anniversary and
one-third vesting on the third anniversary of the Effective Date.
Resignation of Senior Vice President, General Counsel and Secretary
On May 23, 2017, Jean-Michel Malek, Senior Vice President, General
Counsel and Secretary of the Company, and previously Interim Chief
Executive Officer, entered into a Separation Agreement with the
Company (the Separation Agreement) to which he acknowledged his
decision to resign as Senior Vice President, General Counsel and
Secretary effective May 31, 2017. Under the Separation Agreement,
Mr. Malek will receive a severance payment of $291,000 payable over
a 12-month period, less any legally required deductions and
withholdings, and the Company will accelerate by 12 months the
vesting of all outstanding restricted common stock and options
exercisable for commo
Counsel and Secretary of the Company, and previously Interim Chief
Executive Officer, entered into a Separation Agreement with the
Company (the Separation Agreement) to which he acknowledged his
decision to resign as Senior Vice President, General Counsel and
Secretary effective May 31, 2017. Under the Separation Agreement,
Mr. Malek will receive a severance payment of $291,000 payable over
a 12-month period, less any legally required deductions and
withholdings, and the Company will accelerate by 12 months the
vesting of all outstanding restricted common stock and options
exercisable for commo
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n stock previously granted to Mr. Malek under the Companys 2009
Equity Incentive Plan, with all vested options (including
accelerated options) remaining exercisable for a period 12 months
thereafter. The Separation Agreement included Mr. Maleks release
and waiver of claims against the Company. Further, Mr. Malek
entered into a Consulting Agreement on May 23, 2017 with the
Company (the Consulting Agreement) to which he will be paid $8,333
per month in exchange for his services. The Consulting Agreement
commences on June 1, 2017 and ends May 31, 2018, unless either
party terminates the Consulting Agreement by providing 30 days
written notice. The preceding descriptions of the Separation
Agreement and the Consulting Agreement do not purport to be
complete and are qualified in their entirety by reference to the
Separation Agreement and the Consulting Agreement, which are
attached as Exhibits 10.1 and 10.2, respectively, to this Current
Report on Form 8-K and are incorporated herein by reference.
Equity Incentive Plan, with all vested options (including
accelerated options) remaining exercisable for a period 12 months
thereafter. The Separation Agreement included Mr. Maleks release
and waiver of claims against the Company. Further, Mr. Malek
entered into a Consulting Agreement on May 23, 2017 with the
Company (the Consulting Agreement) to which he will be paid $8,333
per month in exchange for his services. The Consulting Agreement
commences on June 1, 2017 and ends May 31, 2018, unless either
party terminates the Consulting Agreement by providing 30 days
written notice. The preceding descriptions of the Separation
Agreement and the Consulting Agreement do not purport to be
complete and are qualified in their entirety by reference to the
Separation Agreement and the Consulting Agreement, which are
attached as Exhibits 10.1 and 10.2, respectively, to this Current
Report on Form 8-K and are incorporated herein by reference.
The Company has named Aaron Ball as Senior Counsel. Mr. Ball will
assume the legal responsibilities for the Company from Mr. Malek
and will likewise be assisted by Mr. Malek to Mr. Malek’s
Consulting Agreement. Mr. Ball has 20 years experience, in domestic
and international, corporate and commercial transactions in the
upstream oil and gas, oilfield services and manufacturing
industries. Mr. Ball received a L.L.M. in taxation from DePaul
University, his J.D. from The American University, Washington and a
B.A. from Butler University.
assume the legal responsibilities for the Company from Mr. Malek
and will likewise be assisted by Mr. Malek to Mr. Malek’s
Consulting Agreement. Mr. Ball has 20 years experience, in domestic
and international, corporate and commercial transactions in the
upstream oil and gas, oilfield services and manufacturing
industries. Mr. Ball received a L.L.M. in taxation from DePaul
University, his J.D. from The American University, Washington and a
B.A. from Butler University.
Item 5.07 Submission of Matters to a Vote of Security Holders.
On May 17, 2017, the Company held the 2017 annual meeting of
stockholders (the Annual Meeting). At the Annual Meeting, four
items were submitted to the stockholders for a vote: (i) the
election of seven directors to the Board, each to serve until the
next annual meeting of stockholders of the Company or until such
person shall resign, be removed or otherwise leave office (the
Election of Directors); (ii) the proposal to ratify the appointment
of Pannell Kerr Forster of Texas, PC, independent registered public
accounting firm, as the Companys auditors for fiscal year 2017 (the
Auditor Ratification); (iii) to approve the compensation of the
named executive officers, on a nonbinding advisory basis, as set
forth in the Companys proxy statement; and (iv) on a non-binding
advisory basis, on whether the stockholder vote on executive
compensation should occur every one, two or three years.
stockholders (the Annual Meeting). At the Annual Meeting, four
items were submitted to the stockholders for a vote: (i) the
election of seven directors to the Board, each to serve until the
next annual meeting of stockholders of the Company or until such
person shall resign, be removed or otherwise leave office (the
Election of Directors); (ii) the proposal to ratify the appointment
of Pannell Kerr Forster of Texas, PC, independent registered public
accounting firm, as the Companys auditors for fiscal year 2017 (the
Auditor Ratification); (iii) to approve the compensation of the
named executive officers, on a nonbinding advisory basis, as set
forth in the Companys proxy statement; and (iv) on a non-binding
advisory basis, on whether the stockholder vote on executive
compensation should occur every one, two or three years.
There were no solicitations in opposition to the Boards
solicitations. Out of a total of 215,276,175 shares of common stock
outstanding and eligible to vote on April 7, 2017, 188,465,259
shares of common stock (87.55%) were present at the meeting in
person or by proxy. The proposals and the final results of the
stockholder vote are set forth below:
solicitations. Out of a total of 215,276,175 shares of common stock
outstanding and eligible to vote on April 7, 2017, 188,465,259
shares of common stock (87.55%) were present at the meeting in
person or by proxy. The proposals and the final results of the
stockholder vote are set forth below:
Election of Directors
The individuals nominated for election to the Board at the Annual
Meeting were Mahmud Yayale Ahmed, Sakiru Adefemi (Femi) Ayoade, Dr.
Lee Patrick Brown, Dudu Hlatshwayo, Frank C. Ingriselli, Dr. John
Rudley, and J. Michael Stinson. Except for Messrs. Ahmed, Ayoade,
Ingriselli, and Rudley, each of the nominees for election to the
Board was a director at the time of the Annual Meeting.
Meeting were Mahmud Yayale Ahmed, Sakiru Adefemi (Femi) Ayoade, Dr.
Lee Patrick Brown, Dudu Hlatshwayo, Frank C. Ingriselli, Dr. John
Rudley, and J. Michael Stinson. Except for Messrs. Ahmed, Ayoade,
Ingriselli, and Rudley, each of the nominees for election to the
Board was a director at the time of the Annual Meeting.
The following nominees were elected as directors by the votes
indicated below for a term that will expire on the date of the
Companys 2018 annual meeting of the stockholders.
indicated below for a term that will expire on the date of the
Companys 2018 annual meeting of the stockholders.
|
Nominee
|
For
|
Withheld
|
Broker Non-Vote
|
|
Mahmud Yayale Ahmed
|
188,094,475
|
370,784
|
|
|
Sakiru Adefemi (Femi) Ayoade
|
188,077,351
|
387,908
|
|
|
Dr. Lee Patrick Brown
|
188,094,366
|
370,893
|
|
|
Dudu Hlatshwayo
|
188,290,040
|
175,219
|
|
|
Frank C. Ingriselli
|
188,270, 830
|
194,429
|
|
|
Dr. John Rudley
|
188,094,502
|
370,757
|
|
|
J. Michael Stinson
|
188,290,067
|
175,192
|
|
Auditor Ratification
Active 25105432.2
The Auditor Ratification was approved by the votes indicated below.
|
For
|
Against
|
Abstain
|
Broker Non-Vote
|
|
188,405,148
|
45,265
|
14,846
|
|
|
Advisory Vote on Executive Compensation
The stockholders approved on a non-binding advisory basis
the compensation of the Companys named executive officers by the votes indicated below. |
|
For
|
Against
|
Abstain
|
Broker Non-Vote
|
|
187,903,157
|
434,977
|
127,125
|
|
Advisory Vote on the Frequency of Future Advisory Votes on
Executive Compensation
Executive Compensation
The Companys stockholders cast their votes with respect to the
advisory vote on the frequency of future advisory votes on
executive compensation as follows:
advisory vote on the frequency of future advisory votes on
executive compensation as follows:
|
1 Year
|
2 Years
|
3 Years
|
Abstain
|
Broker Non-Vote
|
|
65,568,532
|
116,348
|
122,697,015
|
83,364
|
|
Based on the recommendation of the Board of Directors in the
Companys proxy statement and the voting results with respect to the
advisory vote on the frequency of future advisory votes on
executive compensation, the Company has decided to hold an advisory
vote on executive compensation every three years.
Companys proxy statement and the voting results with respect to the
advisory vote on the frequency of future advisory votes on
executive compensation, the Company has decided to hold an advisory
vote on executive compensation every three years.
Item 8.01. Other Events.
On May 18, 2017, the Company issued a press release relating to the
changes in management and the results of the Annual Meeting. This
press release is attached as Exhibit 99.3 to this Current Report on
Form 8-K and is incorporated herein by reference. This information
shall not be deemed filed for purposes of Section 18 of the
Exchange Act, or incorporated by reference in any other filing
under the Securities Act or the Exchange Act, except as expressly
set forth by specific reference in such a filing
changes in management and the results of the Annual Meeting. This
press release is attached as Exhibit 99.3 to this Current Report on
Form 8-K and is incorporated herein by reference. This information
shall not be deemed filed for purposes of Section 18 of the
Exchange Act, or incorporated by reference in any other filing
under the Securities Act or the Exchange Act, except as expressly
set forth by specific reference in such a filing
|
Item 9.01
|
Financial Statements and Exhibits.
|
|
10.1
|
Separation Agreement, effective as of May 31, 2017, by
and between Erin Energy Corporation and Jean-Michel Malek. |
|
10.2
|
Consulting Agreement, effective as of June 1, 2017, by
and between Erin Energy Corporation and Jean-Michel Malek. |
|
99.1
|
Erin Energy Corporation Press Release, dated May 10,
2017. |
|
99.2
|
Erin Energy Corporation Transcript of Conference Call
held on May 11, 2017. |
|
99.3
|
Erin Energy Corporation Press Release, dated May 18,
2017. |
Active 25105432.2
About ERIN ENERGY CORPORATION (NYSEMKT:ERN)
Erin Energy Corporation is an independent oil and gas exploration and production company. The Company is focused on energy resources in Africa. It is focused on exploration for and production of hydrocarbons where commercial reserves have been found and developed. As of December 31, 2016, the Company’s asset portfolio consisted of seven licenses across four countries covering an area of approximately five million acres (approximately 19,000 square kilometers). The Company’s geographical segments include Nigeria, Kenya, The Gambia and Ghana. The Company owns producing properties and conducts exploration activities offshore Nigeria, conducts exploration activities offshore Ghana and The Gambia, and onshore Kenya. The Company has 100% interest in Oil Mining Leases 120 and 121; four Production Sharing Contracts in the Lamu Basin of Kenya; two exploration licenses offshore The Gambia, and interest in Expanded Shallow Water Tano (ESWT) block offshore Ghana. ERIN ENERGY CORPORATION (NYSEMKT:ERN) Recent Trading Information
ERIN ENERGY CORPORATION (NYSEMKT:ERN) closed its last trading session down -0.05 at 1.85 with 25,954 shares trading hands.
