JAGGED PEAK ENERGY INC. (NYSE:JAG) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers

JAGGED PEAK ENERGY INC. (NYSE:JAG) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers

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Item 5.02 Departure of Directors or Certain Officers; Election of
Directors; Appointment of Certain Officers; Compensatory
Arrangements of Certain Officers.

Executive Severance Plan
On April 14, 2017, the Board of Directors (the Board) of Jagged
Peak Energy Inc. (the Company) adopted and approved an Executive
Severance Plan (the Severance Plan) based upon recommendation
from the Companys Compensation Committee (the Compensation
Committee). The Severance Plan provides for the payment of
severance and change in control benefits to eligible executives
of the Company. Each executive selected to participate in the
Severance Plan is classified as a group 1, group 2 or group 3
executive, and the severance and change of control obligations
are determined based on this group classification. Joseph N.
Jaggers, the Companys Chief Executive Officer and President, and
Mark R. Petry, the Companys Executive Vice President, Land
Acquisitions, are classified as group 1 executives.
Generally, under the Severance Plan, group 1 executives are not
entitled to a cash severance payment, and group 2 and 3
executives are entitled to cash severance. If an executive is
terminated (i) by the Company without cause, (ii) by the
executive for good reason, or (iii) in the case of death or
disability (each a Qualifying Termination), group 2 and 3
executives will receive a lump sum cash payment in an amount
equal to 200% (for group 2 executives) or 50% (for group 3
executives) of the sum of (i) the executives then current base
salary and (ii) the greater of (A) the annual average of all
short-term incentive awards received by the executive in the
previous two completed fiscal years and (B) the executives
current target bonus. Additionally, upon a Qualifying
Termination, all participants will be paid any accrued
obligations and will also receive subsidized COBRA premiums for a
pre-determined period of time (18 months in the case of group 1
or 2 executives or 12 months in the case of group 3 executives).
With respect to equity awards, upon a Qualifying Termination,
50%, or if such termination is in connection with a change of
control, 50%, of all unvested time-vested equity awards held by
such executive to the Companys 2017 Long Term Incentive Plan
(2017 LTIP) will become vested immediately prior to the
termination date. All performance-vested equity will generally
remain outstanding until the end of the respective performance
periods and will be earned based on actual performance during
such period. Notwithstanding the previous sentence, upon a change
in control, the performance period of all performance-vested
equity awards will be deemed to have ended and such awards will
be measured and paid out as of the date of the change in control,
regardless of whether the executive is terminated. Termination
payments are generally subject to the executives execution of a
release agreement, the form of which is attached to the Severance
Plan, and such payments may be suspended or required to be paid
back to the Company in the event of a breach of any
post-termination obligations of the executive set forth in the
executives Employment Letter Agreement (as described below).
The foregoing description is subject to and qualified in its
entirety by the actual terms of the Severance Plan document,
which is attached to this report as Exhibit 10.1 and is
incorporated by reference.
Form of Employment Letter Agreement
On April 14, 2017, the Board approved a form of employment letter
agreement (the Employment Letter Agreement) based upon
recommendation from the Compensation Committee to be entered into
with certain eligible executives. The Employment Letter Agreement
includes, among other things, information regarding salary,
target 2017 Short-Term Incentive Plan (described below)
percentage for annual bonuses, participation in the Severance
Plan, vacation, holidays, sick days, 401(k) plan contributions
and other information regarding health and wellness benefits.
Additionally, the Employment Letter Agreement includes customary
non-competition, non-solicitation and confidentiality provisions.
Messrs. Jaggers and Petry entered into Employment Letter
Agreements on April 20, 2017.
The foregoing description is subject to and qualified in its
entirety by the actual terms of the form Employment Letter
Agreement document, which is attached to this report as Exhibit
10.2 and is incorporated by reference.
2017 Short-Term Incentive Plan
On April 14, 2017, the Board adopted and approved the 2017
Short-Term Incentive Plan (the 2017 STIP) based upon
recommendation from the Compensation Committee. The 2017 STIP is
based 50% on the quantitative Company performance metrics
specified below and 50% on an individuals performance for the
year. The 2017 STIP award targets are set as a percentage of each
participants base salary, with threshold and maximum
opportunities available depending upon individual performance and
Company performance against the pre-established performance
criteria. to their respective Employment Letter Agreements,
target 2017 STIP awards for Messrs. Jaggers and Petry were set as
50% and 70%, respectively.
Under the 2017 STIP, threshold performance against the Company
performance metrics will result in payouts equal to 50% of
target, while maximum performance (outperform) will result in
payouts capped in the aggregate at 200% of target, with payouts
between such benchmark levels generally distributed on a straight
line basis. Performance below the threshold level will result in
no payouts. The quantitative performance metrics for the 2017
STIP (and respective weightings for each metric) are as follows:
Performance Metric
Metric Weight %
Production (based on operated oil)
25%
Capital Efficiency (based on Proved Developed Producing
Finding Development costs)
10%
Lease Operating Expenses (LOE)
10%
Safety (based on employee recordable incidents)
5%
Form Equity Documents
On April 14, 2017, the Board approved long-term incentive awards
to the Companys 2017 LTIP based upon recommendation from the
Compensation Committee. The awards include time-vested restricted
stock units (RSUs) granted to non-employee directors and certain
employees and performance-based stock units (PSUs) granted to
officers. The Board also approved grants of Series B Units in JPE
Management Holdings LLC (the Series B Units) to certain service
providers, employees and officers. Upon vesting, the Series B
Units are convertible on a one-for-one basis into shares of
common stock of the Company.
The time-vested RSUs granted to non-employee directors will
generally vest in full on the date immediately prior to the date
of the Companys annual meeting occurring in the year following
the date of grant. The time-vested RSUs granted to employees will
generally vest in equal annual increments over a three-year
period beginning on the first anniversary of the grant date. The
PSUs will vest, if at all, based on the Companys total
stockholder return relative to a selected peer group of companies
for the performance period of March 1, 2017 through December 31,
2019. The Series B Units generally vest in equal annual
increments over a three-year period beginning on the first
anniversary of the grant date.
The foregoing descriptions of the RSU awards, the PSU awards and
the Series B Unit awards are qualified in their entirety by
reference to the form of director Notice of Grant of RSUs and RSU
Agreement, the form of employee Notice of Grant of RSUs and RSU
Agreement, the form of employee Notice of Grant of PSUs and PSU
Agreement and the form of Series B Restricted Unit Agreement,
which are attached to this report as Exhibits 10.3, 10.4, 10.5,
10.6, 10.7, 10.8 and 10.9, respectively, and are incorporated by
reference.
Item 9.01
Financial Statements and Exhibits.
(d) Exhibits
Exhibit No.
Description
10.1
Executive Severance Plan
10.2
Form of Employment Letter Agreement
10.3
Form of Director Notice of Grant of Restricted Stock
Units
10.4
Form of Director Restricted Stock Unit Agreement
10.5
Form of Employee Notice of Grant of Restricted Stock
Units
10.6
Form of Employee Restricted Stock Unit Agreement
10.7
Form of Employee Notice of Grant of Performance Stock
Units
10.8
Form of Employee Performance Stock Unit Agreement
10.9
Form of Series B Restricted Unit Agreement


About JAGGED PEAK ENERGY INC. (NYSE:JAG)

Jagged Peak Energy Inc. is an independent oil and natural gas company focused on the acquisition and development of unconventional oil and associated liquids-rich natural gas reserves in the Southern Delaware Basin. The Company’s acreage is located on contiguous blocks in the adjacent counties of Winkler, Ward, Reeves and Pecos, with original oil-in-place within multiple stacked hydrocarbon-bearing formations. As of September 30, 2016, it drilled and completed 16 horizontal wells. As of September 30, 2016, it held approximately 90% working interest in approximately 68,121 gross leased or acquired acres. It classifies its acreage position into three project areas: Whiskey River, Cochise and Big Tex. As of September 30, 2016, it drilled and completed eight operated wells in the Whiskey River project area targeting the Lower Wolfcamp A, Upper Wolfcamp A and Wolfcamp B. As of September 30, 2016, it also drilled and completed six operated wells in the Cochise project area.

JAGGED PEAK ENERGY INC. (NYSE:JAG) Recent Trading Information

JAGGED PEAK ENERGY INC. (NYSE:JAG) closed its last trading session up +0.04 at 11.99 with 655,233 shares trading hands.

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