DEF: Par Pacific Proposes New Incentive Plan Amid Strong 2025 Results

Par Pacific Holdings, Inc. announces its 2026 Annual Meeting agenda, featuring director elections, auditor ratification, executive compensation votes, and a new Long-Term Incentive Plan following a year of robust financial performance.

Summary

• The 2026 Annual Meeting of Stockholders will be held virtually on Thursday, April 30, 2026, at 8:30 a.m. (Central Time).
• Stockholders will vote on five proposals: Election of Directors, Ratification of Deloitte & Touche LLP as independent auditor for fiscal year 2026, an advisory vote on executive compensation, an advisory vote on the frequency of future executive compensation votes (Board recommends every 1 year), and approval of the Par Pacific Holdings, Inc. 2026 Long-Term Incentive Plan (LTIP).
• The 2026 LTIP, if approved, will authorize 3,000,000 new shares of common stock, in addition to 849,557 shares remaining from the 2012 LTIP, for a total of 3,849,557 shares available for issuance.
• The company reported strong financial results in 2025, including significant Adjusted EBITDA and the highest annual retail segment Adjusted EBITDA in company history.
• Named Executive Officers (NEOs) received cash bonuses between 125% and 212% of their targets for 2025 performance, driven by strong financial and operational execution.
• The company received $202.6 million in Small Refinery Exemptions (SREs) from the U.S. Environmental Protection Agency in 2025, which were capped at the lesser of the actual benefit or 25% of Adjusted EBITDA (excluding SRE benefit) for Annual Incentive Program calculations.
• The Board recommends a vote FOR all ten director nominees, FOR the ratification of Deloitte & Touche LLP, FOR the advisory approval of executive compensation, FOR the option of every 1 Year for future advisory votes on executive compensation, and FOR the approval of the 2026 LTIP.

Sentiment

Score: 8

Explanation: StockSavvy.ai views this filing positively, reflecting strong financial performance in 2025, a well-structured executive compensation program with high stockholder approval, and a forward-looking approach to long-term incentives and sustainability.

Positives

• Achieved strong financial results in 2025, including robust Adjusted EBITDA and solid operational execution.
• The retail segment recorded its highest annual Adjusted EBITDA in company history during 2025.
• Successfully completed a joint venture for renewable fuel production in Hawaii and the largest turnaround in company history at its Montana refinery.
• Executive compensation program is designed to align leadership incentives with company success and stockholder interests, emphasizing performance-based and equity-based compensation.
• Stockholders demonstrated strong support for the executive compensation program in May 2023, with approximately 99% of votes cast in favor.
• The proposed 2026 Long-Term Incentive Plan incorporates several stockholder-friendly features, including no discounted awards, no liberal share recycling, no repricing without stockholder approval, and double-trigger change in control vesting.
• The company maintains a reasonable three-year average equity share usage (burn rate) of approximately 1.3% and a potential overhang of 11.5% if the 2026 LTIP is approved, which is considered within peer group practices.
• The Board has a robust oversight structure for sustainability, climate, cybersecurity, and information technology, with dedicated committees and regular management reports.

Risks

• The potential dilutive effect of compensatory share awards, although the company states it manages this through burn rate and overhang analysis.
• Uncertainty regarding the timing and magnitude of Small Refinery Exemptions (SREs) from the U.S. Environmental Protection Agency.
• General strategic, operational, financial, compensation, and compliance risks inherent in the company's business, which are overseen by the Board and its committees.
• Cybersecurity and IT risks, including data protection, system availability, third-party service providers, and evolving cyber threats.

Future Outlook

The company expects its executive compensation program to continue incentivizing profitable operation across its refining, retail, and logistics business segments, support its ongoing acquisition strategy, and encourage stockholder value creation. The Compensation Committee is committed to enhancing the executive compensation program in response to trends and regulatory developments. The proposed 2026 Long-Term Incentive Plan is anticipated to provide sufficient shares for awards for at least five years. The company also recognizes the future need for decarbonization of liquid fuels and is assessing and evaluating long-term sustainability initiatives.

Management Comments

• Management believes it is appropriate for the company's employees and management to benefit from the Adjusted EBITDA improvement resulting from the SREs.
• Management seeks to preserve pay-for-performance integrity, align management and stockholder incentives, and structure the Annual Incentive Program (AIP) to prevent unpredictable factors from outweighing core financial performance.

Industry Context

StockSavvy.ai notes that Par Pacific's focus on decarbonization of liquid fuels and renewable feedstock processing aligns with broader energy transition trends in the refining industry. The company's emphasis on retail growth strategies and an ongoing acquisition strategy indicates a proactive approach to diversification and market expansion within the downstream energy sector. The use of a customized peer group for compensation benchmarking reflects standard industry practice to ensure competitive executive and director pay structures.

Comparison to Industry Standards

• The company's three-year average equity share usage (burn rate) of 1.3% falls within the share usage practices of its compensation peer group, which includes companies like CVR Energy, Inc., Delek U.S. Holdings, Inc., HF Sinclair Corporation, PBF Energy Inc., and Sunoco LP.
• The potential overhang of 11.5% (if the 2026 LTIP is approved) is considered reasonable for a company of its size and in its industry, aligning with overhang levels of its compensation peer group.
• The expected life of the requested share authorization for the 2026 LTIP, estimated at approximately five years, falls within the practices of its compensation peer group.

Management Changes

Corporate Governance

Related Party Transactions

• The Audit Committee is delegated to review and approve related party transactions, ensuring they are fair to the company and consistent with stockholder best interests. Any director with an interest in such a transaction recuses themselves.

Stakeholder Impact

• Shareholders: Benefit from strong financial performance, alignment of executive compensation with value creation, and enhanced corporate governance practices. Potential dilution from the new LTIP is acknowledged and managed.
• Employees: Benefit from competitive compensation packages, 401(k) plan, Employee Stock Purchase Plan (ESPP), and long-term incentive awards designed for retention and motivation. The company promotes a safe workplace.
• Customers: Implied benefit from operational excellence, innovation, and sustainable business practices.
• Communities: The company's commitment to sustainability principles aims to create long-term social, environmental, and economic benefits in the communities where it operates.

Next Steps

• Hold the 2026 Annual Meeting of Stockholders on April 30, 2026, to vote on the proposed matters.
• Implement the 2026 Long-Term Incentive Plan if approved by stockholders, with new shares available for issuance from April 30, 2026.
• Continue to incentivize profitable operation of refining, retail, and logistics business segments.
• Support the ongoing acquisition strategy and encourage the creation of stockholder value.
• Evaluate and improve sustainability efforts and report progress on the company website.
• The Board and Compensation Committee will take into account the outcome of the advisory votes on executive compensation and its frequency when considering future decisions.

Key Dates

Recommendation

The company's strong financial performance in 2025, marked by significant Adjusted EBITDA and record retail segment results, indicates robust operational health. The proposed 2026 Long-Term Incentive Plan, with its stockholder-friendly features and reasonable dilution metrics, suggests a commitment to long-term value creation and effective talent retention. Coupled with sound corporate governance, including independent board oversight and a focus on sustainability and cybersecurity, the company presents a compelling investment case for growth-oriented investors.

Keywords

Proxy Statement, Executive Compensation, Long-Term Incentive Plan, Corporate Governance, Annual Meeting, Director Election, Auditor Ratification, Adjusted EBITDA, Renewable Fuels, Refining, Retail, Logistics, Cybersecurity, Sustainability, Stockholder Vote