Form 4: ONEOK Executive Lentz Receives Performance and Restricted Stock Units

ONEOK Inc. executive Randy N. Lentz was granted performance and restricted stock units under the company's Equity Incentive Plan.

Summary

• Randy N. Lentz, an Executive Vice President and Chief Operating Officer at ONEOK Inc., received performance stock units (PSUs) and restricted stock units (RSUs) on February 19, 2025.
• The PSU award is for 15,524 units and will vest on February 19, 2028, based on ONEOK's total shareholder return compared to a peer group, with a potential payout ranging from 0% to 200% of the units awarded.
• The RSU award is for 6,653 units and will also vest on February 19, 2028.
• Both PSU and RSU awards will accrue dividend equivalents, payable in shares of common stock upon vesting.
• The payout for both awards will be one share of ONEOK's common stock for each vested unit, including additional units from dividend equivalents.

Sentiment

Score: 7

Explanation: The document reflects a standard executive compensation practice, which is generally viewed neutrally to positively as it aligns management interests with shareholder value. The specific terms of the awards seem reasonable and in line with industry standards.

Positives

• The equity incentive plan aligns executive compensation with shareholder returns, potentially incentivizing value creation.
• The vesting period of three years encourages long-term focus and commitment from the executive.

Risks

• The actual value of the PSUs is dependent on ONEOK's future performance relative to its peer group, which is subject to market conditions and other external factors.
• The vesting of the awards is contingent upon continued employment, creating a potential risk of forfeiture if the executive leaves the company before the vesting date.

Future Outlook

The awards are designed to incentivize long-term performance and align executive interests with those of shareholders.

Industry Context

Equity-based compensation is a common practice in the energy industry to attract and retain top talent and align their interests with shareholder value creation. The specific terms of the awards, such as the performance metrics and vesting schedule, are tailored to the company's strategic goals and competitive landscape.

Comparison to Industry Standards

• Many companies in the energy sector, such as Kinder Morgan, Enbridge, and Williams Companies, utilize similar equity incentive plans to compensate their executives.
• Performance-based vesting criteria, such as total shareholder return (TSR) relative to peers, are frequently used to ensure that executive compensation is tied to company performance.
• The vesting period of three years is also a common practice in the industry, promoting long-term alignment between executives and shareholders.

Stakeholder Impact

• Shareholders: The equity awards aim to align executive compensation with shareholder returns, potentially leading to increased shareholder value.
• Employees: The equity incentive plan may contribute to a positive work environment by incentivizing executives to achieve company goals.
• Executives: The awards provide executives with a financial stake in the company's success, motivating them to make decisions that benefit the company and its shareholders.

Key Dates