Form 4: Hess Senior VP Disposes of Shares and Derivatives in Anticipated Chevron Merger Conversion
Insider Transaction Report
A senior executive at Hess Corporation has reported the disposition of common stock, performance share units, and stock options, which are being converted into Chevron Corporation securities and cash awards as per the terms of the October 2023 merger agreement.
Summary
- Richard D. Lynch, Senior Vice President of Hess Corporation (HES), reported the disposition of various securities in connection with the merger agreement with Chevron Corporation.
- A total of 60,843 shares of Hess Common Stock, $1.00 par value, were disposed of, including 26,114 shares held in escrow under the Corporation's Long Term Incentive Plans.
- Under the merger agreement dated October 22, 2023, each outstanding share of Hess common stock was converted into the right to receive 1.025 shares of Chevron common stock.
- 6,711 2023 Performance Share Units (PSUs) were deemed earned at the maximum level and converted into a restricted cash award.
- The cash award for PSUs is calculated based on the average closing trading price of Chevron common stock for the 20 business days ending prior to the merger's effective time, multiplied by the 1.025 exchange ratio.
- Multiple tranches of Hess stock options, with exercise prices ranging from $75.04 to $141.55, were converted into corresponding Chevron stock options based on the 1.025 exchange ratio.
- Following these reported transactions, Richard D. Lynch holds 0 shares of Hess Common Stock and 0 derivative securities of Hess.
Sentiment
Score: 5
Explanation: The document is a factual report of a transaction mandated by a merger agreement, thus it carries a neutral sentiment. The 'maximum earning' of PSUs is a positive for the insider, but the overall context is procedural.
Positives
- Performance Share Units (PSUs) were deemed earned at the maximum level, which is favorable for the reporting person.
Future Outlook
The document details the conversion of Hess securities into Chevron securities and cash awards as a result of the merger agreement, indicating the anticipated completion or effective time of the merger.
Industry Context
This filing reflects the ongoing consolidation within the energy sector, specifically the acquisition of Hess Corporation by Chevron Corporation, a significant transaction impacting the global oil and gas landscape.
Stakeholder Impact
- Shareholders of Hess Corporation will have their shares converted into Chevron Corporation shares at the specified exchange ratio.
- Employees holding Hess equity awards, such as Performance Share Units and stock options, will see these awards converted into cash or Chevron equity awards under the merger terms.
Key Dates
| Date | Description |
|---|---|
| 10/22/2023 | Date of the Agreement and Plan of Merger between Hess, Yankee Merger Sub Inc., and Chevron Corporation. |
| 03/06/2024 | Date exercisable for certain tranches of Hess stock options that were converted to Chevron options. |
| 03/06/2025 | Date exercisable for certain tranches of Hess stock options that were converted to Chevron options. |
| 03/06/2026 | Date exercisable for certain tranches of Hess stock options that were converted to Chevron options. |
| 03/06/2031 | Expiration date for certain tranches of Hess stock options that were converted to Chevron options. |
| 03/06/2032 | Expiration date for certain tranches of Hess stock options that were converted to Chevron options. |
| 03/06/2033 | Expiration date for certain tranches of Hess stock options that were converted to Chevron options. |
| 07/18/2025 | Date of earliest transaction and signature date for the Form 4 filing, indicating the effective date of the reported dispositions/conversions. |
Keywords
Hess Corporation, Chevron Corporation, SEC Form 4, Merger Agreement, Stock Disposition, Performance Share Units, Stock Options, Insider Trading, Corporate Governance, Executive Compensation
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