Summary
ConocoPhillips (COP) filed an 8-K on May 2, 2022, reporting leadership changes and executive compensation arrangements. Effective May 1, 2022, Timothy A. Leach transitioned from Executive Vice President, Lower 48 to Advisor to the Chief Executive Officer. Concurrently, Jack Harper was appointed Executive Vice President, Lower 48, succeeding Mr. Leach. This filing also details the compensatory arrangements for Mr. Leach in his new advisory role, including a specific salary, continued eligibility for incentive programs, and notably, protection against adjustments or proration for certain performance-based awards in the near term.
Key Highlights
- 1Timothy A. Leach, formerly EVP Lower 48, is now Advisor to the CEO, effective May 1, 2022.
- 2Jack Harper, previously President Permian, assumes the role of EVP Lower 48, succeeding Mr. Leach.
- 3Mr. Leach's advisory role compensation includes an annual salary of $700,008.
- 4Mr. Leach will continue to be eligible for the Variable Cash Incentive Program, Performance Share Program (PSP), and Executive Restricted Stock Unit Program.
- 5Mr. Leach's target award for the 2022 PSP performance period will not be adjusted.
- 6Awards for 2023 and 2024 PSP performance periods will not be prorated if Mr. Leach serves less than 36 months.
- 7Mr. Leach entered into a Non-Compete, Non-Solicitation, and Confidentiality Agreement in exchange for $3 million, payable in two installments.
Frequently Asked Questions
This transition signifies a shift in responsibilities for Mr. Leach, moving from an operational executive role (EVP, Lower 48) to an advisory capacity, likely to leverage his experience and expertise in a different capacity while facilitating a leadership transition in the Lower 48 segment.
Mr. Leach will receive an annual salary of $700,008 and will remain eligible for several incentive programs (Variable Cash Incentive, PSP, Executive Restricted Stock Unit). Importantly, his 2022 PSP target award will not be adjusted, and future awards for 2023-2024 will not be prorated if he serves less than the full 36-month period, offering him a degree of compensation certainty.
In exchange for $3 million, Mr. Leach has agreed to non-competition and non-solicitation covenants for two years following his separation of service. He is also bound by an indefinite confidentiality covenant. The $3 million will be paid in two equal installments of $1.5 million on May 1, 2023, and May 1, 2024.
Jack Harper, who was previously President of the Permian region, has been appointed Executive Vice President, Lower 48, effective May 1, 2022, taking over the operational leadership duties previously held by Mr. Leach.