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Item 5.02
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Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of
Certain Officers
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(b) and (c) On April 1,
2021, Robert J. Packer notified the Board of his retirement, to be effective May 31, 2021. Chris Steddum, the Company’s current
Vice President, Finance and Investor Relations, will succeed Mr. Packer as the Company’s Chief Financial Officer, effective
June 1, 2021. The Company has also appointed Stephanie Buffington, the Company’s current Vice President, Accounting, to the
newly created role of Chief Accounting Officer, also effective June 1, 2021. Mr. Packer will serve as an advisor to the Company
through the end of 2021 to ensure a smooth transition.
Mr. Steddum, age 40, serves as TPL Corporation’s Vice President,
Finance and Investor Relations and also served as Vice President, Finance and Investor Relations of Texas Pacific Land Trust. Prior to
joining TPL Trust in 2019, Mr. Steddum spent 10 years working in oil and gas investment banking, most recently as a Director at Stifel
Financial Corporation from 2016 to 2019, and prior to that served as a Director at GMP Securities from 2014 to 2016. Mr. Steddum
holds an MBA from Rice University and a B.S. in Business Administration from the South Carolina Honors College. Mr. Steddum does
not have any family relationship with any director or executive officer of the Company.
Mr. Steddum and the Company entered into an Employment Agreement
on August 8, 2019 (the “Steddum Agreement”). Pursuant to the Steddum Agreement, Mr. Steddum receives a base salary
of $450,000 per annum, subject to annual review, and is eligible for an annual cash bonus of up to 150% of such base salary for achievement
of specified performance targets as established by the Compensation Committee. Mr. Steddum was also eligible for a relocation allowance
of $75,000 to cover his expenses in connection with his move to Dallas. The term of the Steddum Agreement ends on December 31, 2022,
with automatic one (1) year extensions unless notice not to renew is given by either party at least 120 days prior to the relevant
end date.
The Steddum Agreement provides for payment of severance benefits if
the officer’s employment is terminated by the Company without cause or by Mr. Steddum for good reason, provided that Mr. Steddum
executes a general waiver and release of claims and complies with the restrictive covenants described below. The severance benefits include
(i) accrued but unpaid bonuses and vested long-term incentive benefits (ii) a pro rata bonus for the year of termination (if
such termination occurs after the first calendar quarter), (iii) up to 12 months of COBRA premiums for continued group health, dental
and vision coverage for the officer and his dependents, paid for by the Company, and (iv) an amount equal to one times the average
of his base salary and cash bonus for the preceding two years. If Mr. Steddum’s employment is terminated by the Company without
cause, by the officer for good reason, or upon failure of the Company to renew the term of the Agreement, in all such cases, within 24
months following a change in control of the Company as defined in the Steddum Agreement, then, in lieu of the amount specified in clause
(iv), Mr. Steddum will be entitled to an amount equal to 1.5 times the greater of (a) the average of his base salary and cash
bonus for the two years preceding the change in control and (b) his base salary and target cash bonus for the year of the change
in control. If Mr. Steddum’s employment terminates due to death or disability, he will be entitled to the benefits described
in clauses (i) and (ii) above. Mr. Steddum will also be entitled to payment of accrued but unpaid salary, accrued but unused
vacation, unsubsidized COBRA benefits, and unreimbursed business expenses following termination of employment for any reason.
The Steddum Agreement provides that Mr. Steddum will be entitled
to participate in all benefit plans provided to the Company’s executives of like status from time to time in accordance with the
applicable plan, policy or practices of the Company, as well as in any long-term incentive program established by the Company. It also
provides for four weeks of annual paid vacation, reimbursement of business expenses, and indemnification rights.
The Steddum Agreement contains restrictive covenants prohibiting Mr. Steddum
from disclosing the Company’s confidential information at any time, from competing with the Company in specified counties where
the Trust does business during his employment, subject to certain exceptions, and for one year thereafter (or six months thereafter if
he terminates his employment voluntarily without good reason), and from soliciting the Company’s clients, suppliers and business
partners during his employment and for one year thereafter.
Ms. Buffington, age 54, serves as TPL Corporation’s Vice
President, Accounting and also served as Vice President, Accounting of Texas Pacific Land Trust. Prior to joining Texas Pacific Land Trust
in 2017, Ms. Buffington most recently served as Vice President of Financial Reporting at Monogram Residential Trust, Inc., a
publicly traded REIT, from 2014 to 2017. Ms. Buffington has over 20 years of public company experience and began her career at KPMG.
She is a licensed Certified Public Accountant in the State of Texas. Ms. Buffington does not have any family relationship with any
director or executive officer of the Company.
Ms. Buffington does not have a written employment agreement with
the Company. She currently receives an annual salary of $265,000, is eligible for an annual cash bonus of up to 65% of such base salary,
and is eligible to participate in all benefit plans provided to the Company’s executives of like status from time to time in accordance
with the applicable plan, policy or practices of the Company, as well as in any long-term incentive program established by the Company.