Form 4: Magnolia Oil & Gas Corp: SVP & CFO Brian Corales Reports Acquisition of Restricted Stock Units and Performance Share Units

Brian Corales, SVP & CFO of Magnolia Oil & Gas Corp, reports the acquisition of restricted stock units and performance share units.

Summary

• On February 12, 2025, Brian Corales, SVP & CFO of Magnolia Oil & Gas Corporation, reported the acquisition of 36,246 Class A Common Stock restricted stock units (RSUs) and 36,246 performance share units (PSUs).
• The RSUs will vest in three equal installments on March 1, 2026, 2027, and 2028, contingent upon continued employment.
• The PSUs can result in earning between 0% and 150% of the target number of PSUs, based on the company's relative total shareholder return compared to a peer group from January 1, 2025, to December 31, 2027, also subject to continued employment through the settlement date.

Sentiment

Score: 7

Explanation: The document reflects a standard executive compensation practice, aligning management interests with shareholder value. The sentiment is neutral to positive, as it indicates a commitment to long-term performance.

Positives

• The grant of RSUs and PSUs aligns the executive's interests with those of the shareholders, incentivizing long-term performance and value creation.
• The vesting schedule of the RSUs encourages continued employment and commitment to the company's success.
• The PSU performance metrics are tied to relative total shareholder return, promoting competitive performance within the industry.

Risks

• The value of the RSUs and PSUs is dependent on the future performance of Magnolia Oil & Gas Corp's Class A Common Stock.
• The executive must remain employed through the vesting and settlement dates to realize the full value of the awards.
• The PSU payout is subject to the Compensation Committee's certification of the company's relative total shareholder return, which may be influenced by factors outside of the executive's control.

Future Outlook

The document outlines future vesting dates for RSUs and a performance period for PSUs, indicating a focus on long-term incentives and shareholder value.

Industry Context

The granting of RSUs and PSUs is a common practice in the oil and gas industry to align executive compensation with company performance and shareholder returns. The specific terms of the grants, such as the vesting schedule and performance metrics, are tailored to the company's specific goals and circumstances.

Comparison to Industry Standards

• Many oil and gas companies use similar equity-based compensation plans, such as RSUs and PSUs, to incentivize executives.
• Performance metrics often include total shareholder return (TSR) relative to a peer group, which is a common benchmark in the industry.
• The vesting schedules for RSUs typically range from three to five years, which is consistent with industry standards.
• Peer groups for TSR comparisons often include companies of similar size and focus within the oil and gas sector, such as Devon Energy, Pioneer Natural Resources, and EOG Resources.

Stakeholder Impact

• Shareholders: The equity grants aim to align management's interests with shareholder value creation.
• Employees: The grants may serve as a positive signal regarding the company's commitment to its executives.
• Executive: The executive is incentivized to drive long-term performance and increase shareholder returns.

Key Dates