Summary
Occidental Petroleum Corporation (OXY) filed an 8-K on March 24, 2020, detailing two significant events. First, the company amended its credit agreements to provide greater financial flexibility by excluding non-cash write-downs and impairments from the Total Capitalization calculation, effective after September 30, 2019. This amendment offers a buffer against potential covenant breaches, especially relevant given the uncertain economic climate at the time. As of the filing date, OXY had no outstanding borrowings under its revolving credit facility. Second, the Board of Directors appointed Stephen I. Chazen as Chairman of the Board, increasing the board size to 12 members. Mr. Chazen brings extensive experience to the role, having previously served as OXY's President and CEO and holding various other senior positions within the company, as well as leadership roles at Magnolia Oil & Gas Corporation and other industry organizations. This move signals a potential emphasis on experienced leadership during a challenging period for the energy sector.
Key Highlights
- 1Occidental Petroleum amended its credit agreements to exclude non-cash write-downs and impairments from the 'Total Capitalization' definition, enhancing financial flexibility.
- 2The company had no outstanding borrowings or letters of credit under its revolving credit facility as of March 24, 2020.
- 3Stephen I. Chazen was appointed as the new Chairman of the Board, effective March 18, 2020.
- 4The Board of Directors was increased from 11 to 12 members to accommodate the appointment of Mr. Chazen.
- 5Mr. Chazen possesses significant prior experience with Occidental Petroleum, having served as President and CEO from 2011 to 2016.
- 6Non-employee director compensation, including for the new Chairman, will be subject to a 15% reduction for the remainder of the 2019-2020 period.