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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As previously disclosed, on July 9, 2018, Legacy Reserves Inc.,
a Delaware corporation (the Company), entered into the Amended and Restated Agreement and Plan of Merger (the Merger Agreement), by and among the Company, Legacy Reserves LP, a Delaware limited partnership (the
Partnership), Legacy Reserves GP, LLC, a Delaware limited liability company and the general partner of the Partnership (the General Partner), and Legacy Reserves Merger Sub LLC, a Delaware limited liability company and a
wholly owned subsidiary of the Company (Merger Sub), pursuant to which Merger Sub will be merged with and into the Partnership, with the Partnership continuing as the surviving entity and as a wholly owned subsidiary of the Company (the
Merger).
Amendments to Grant of Phantom Units Agreements
On September 18, 2018, the Compensation Committee of the board of directors of the General Partner (the GP Board) approved
and adopted, subject to the approval of the GP Board and the board of directors of the Company (the Legacy Board), a form of Amendment to Grant of Phantom Units Agreement to be entered into by the Partnership, the Company and certain of
the General Partners executive officers, including each of the General Partners named executive officers (the Amendment). On September 18, 2018, the GP Board approved and adopted the Amendment and on September 18,
2018, the Legacy Board approved and adopted the Amendment.
In connection with the Merger, each award previously granted pursuant to the
Amended and Restated Legacy Reserves LP Long-Term Incentive Plan, as amended (the Partnership LTIP), that is outstanding and unvested immediately prior to the consummation of the Merger will, automatically and without any action on the
part of the holder, fully vest or become exercisable in full, as the case may be, and shall be settled in accordance with each awards applicable award agreement. Certain of these award agreements relating to outstanding phantom units under the
Partnership LTIP granted to certain of the General Partners executive officers, including each of the named executive officers, provide that such phantom units be settled in cash (the Cash Settled Awards). Pursuant to the
Amendment, each of the General Partners executive officers that are to receive Cash Settled Awards, including each of the named executive officers, will have the option to elect to reinvest any portion of the cash received pursuant to the Cash
Settled Awards in shares of the Companys common stock (a Stock Purchase Election). Additionally, pursuant to the Amendment, each of the General Partners executive officers that are to receive Cash Settled Awards will agree to
make a Stock Purchase Election as necessary such that the aggregate amount of cash paid in settlement of any incentive equity-based awards to be settled in connection with the Merger (including all Cash Settled Awards) will not exceed
$30 million. The settlement of the Cash Settled Awards will occur on a date or dates selected by the Company within 74 days after the consummation of the Merger.
The foregoing description of the Amendment does not purport to be complete and is qualified in its entirety by reference to the full text of
the Form of Amendment to Grant of Phantom Units Agreement, which is filed as Exhibit 10.1 to this Current Report on Form
8-K
and incorporated by reference herein.
Item 8.01 Other Events.
The information
set forth in Item 5.02 above is incorporated herein by reference.
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