Western Midstream Partners, LP 8-K, filed Nov 1, 2024
Western Midstream Partners, LP (WES)
8-K
2024-11-01
For: 2024-10-28
View Original
Added on
April 11, 2026
About this 8-K
Western Midstream Partners, LP filed this 8-K on November 1, 2024, reporting on events of October 28, 2024.
Items reported
- Item 5.02: Director or officer change, or executive pay
- Item 7.01: Regulation FD disclosure
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): October 28, 2024
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation or organization) | (Commission File Number) | (IRS Employer Identification No.) | ||||||||||||
(Address of principal executive office) (Zip Code)
(346 ) 786-5000
(Registrant’s telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading symbol | Name of exchange on which registered | ||||||||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Departure of President and Chief Executive Officer and Appointment of New President and Chief Executive Officer
Western Midstream Partners, LP (“WES” or the “Partnership”) announced Oscar K. Brown, an independent director of Western Midstream Holdings, LLC, WES’s general partner (the “General Partner”) has been appointed President and Chief Executive Officer of the General Partner, effective October 28, 2024. The Board of Directors of the General Partner (the “Board”) and Michael P. Ure agreed that he will step down from his position as President and Chief Executive Officer of the General Partner and as a director of the Board, effective October 28, 2024 (the “Transition Date”). Mr. Ure has entered into a Transition and Separation Agreement with the Partnership, which sets forth the terms of Mr. Ure’s transition and departure. Mr. Ure’s departure is not the result of any disagreement with the General Partner or the Partnership.
Mr. Brown, age 54, has served on the Board since August 2019, where he served as the Chair of the Environmental, Social and Governance Committee of the Board. He has a 30-year history in the energy sector, including senior positions with Occidental Petroleum Corporation (“Occidental”) and energy-sector roles at several global financial institutions. Previously, he served on the Board of Directors of Plains All-American Pipeline company. Most recently, he served as CFO of FREYR Battery from April 2022 to June 2024. Mr. Brown previously served as Senior Vice President, Strategy, Business Development and Supply Chain of Occidental from November 2018 to March 2020, and as Senior Vice President, Corporate Strategy and Business Development from July 2017 to November 2018. He holds a BBA in Finance and Marketing from the University of Texas at Austin. He has served on the Board of Directors of Houston’s Alley Theatre, Junior Achievement of Southeast Texas and The Children’s Fund, Inc.
Concurrent with the appointment, the Board, upon approval and recommendation by the Compensation Committee of the Board, approved, effective as of October 28, 2024, compensatory arrangements for Mr. Brown as follows: (1) an annual base salary of $950,000; (2) a special target bonus of $300,000 for 2024 under the WES Cash Bonus Program of WES’s Incentive Compensation Program; and (3) a special grant of time-based units valued at $6,000,000, which vest annually over a three-year period subject to Mr. Brown’s continued service through the applicable vesting periods.
There are no arrangements or understandings between Mr. Brown and any other persons pursuant to which he was selected as President and Chief Executive Officer. There are also no family relationships between Mr. Brown and any director or executive officer of the General Partner, and he has no direct or indirect material interest in any transaction required to be disclosed pursuant to Item 404(a) of Regulation S-K.
Transition and Separation Agreement
Pursuant to the terms of the Transition and Separation Agreement, Mr. Ure will continue his employment with the Partnership in the role of advisor during the period beginning on the Transition Date and ending on December 31, 2024 or such earlier date as designated by the Partnership (the “Separation Date”) (such period, the “Transition Period”). During the Transition Period, Mr. Ure will (a) continue to receive his current base salary and (b) be eligible to receive the full target bonus under the Annual Incentive Plan in respect of the year 2024. The target bonus in respect of the year 2024 will be in lieu of any other amount payable to Mr. Ure under the Annual Incentive Plan in respect of the year 2024. Mr. Ure will continue to participate in the employee benefit plans and programs of the Partnership during the Transition Period pursuant to their terms, except that benefit accruals under the Partnership’s paid time off policy will cease on the Transition Date.
As of the Separation Date, Mr. Ure will cease to perform services for the Partnership and will become entitled to receive certain payments and benefits (collectively “Severance Benefits”), subject to continued compliance with the terms of the Transition and Separation Agreement and execution of a Supplemental Release Agreement no earlier than the Separation Date and within twenty-one calendar days after the Separation Date. Severance benefits include the following: (a) an amount equal to 2.0 times the sum of his (i) current annual base salary and (ii) target bonus under the Annual Incentive Plan in respect of the year 2024; payable over a 24-month period; (b) the target bonus under the Annual Incentive Plan in respect of year 2024 as described in the preceding paragraph; and (c) continued participation in the Partnership’s basic life, medical and dental plans at the same rates and levels in accordance with the terms of such plans for a two-year period beginning on the Separation Date. Outstanding awards held by Mr. Ure under any equity incentive plan maintained by the Partnership on the Separation Date will become vested on a pro rata basis as follows: (a) with respect to time-based awards, the award will vest on a pro rata basis on the Separation Date; and (b) with respect to performance-based awards, the awards will vest on a pro-rata basis with the achievement of any performance conditions determined as set forth in the applicable award agreement (or, if no such treatment is provided, the performance conditions will be based upon actual performance as determined by the Board). Such awards will generally be settled within sixty (60) days following the applicable vesting date.
The Transition and Separation Agreement includes a release of claims, a confidentiality covenant, a non-solicitation covenant, a mutual non disparagement covenant, a non-competition covenant and other provisions customary for an agreement of this type. The term of the non-solicitation, mutual non-disparagement, and non-competition covenants are for a duration of twenty-four months following the Separation Date. The Supplemental Release, which is attached as an exhibit to the Transition and Separation Agreement, contains release of claims provisions that mirror those in the Transition and Separation Agreement.
The foregoing description of the Transition and Separation Agreement is qualified in its entirety by the text of the Transition and Separation Agreement, a copy of which will be filed as an exhibit to the Partnership’s Annual Report on Form 10-K for the fiscal year ending December 31, 2024.
Item 7.01 Regulation FD Disclosure.
A copy of the Partnership’s related press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
The information in the press release is being furnished, not filed, pursuant to Item 7.01. Accordingly, the information in the press release will not be incorporated by reference into any registration statement filed by the Partnership under the Securities Act of 1933, as amended, unless specifically identified therein as being incorporated therein by reference.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
| Exhibit Number | Description | |||||||
| 99.1 | ||||||||
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). | |||||||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| WESTERN MIDSTREAM PARTNERS, LP | ||||||||||||||
| By: | Western Midstream Holdings, LLC, its general partner | |||||||||||||
| Dated: | November 1, 2024 | By: | /s/ Kristen S. Shults | |||||||||||
| Kristen S. Shults Senior Vice President and Chief Financial Officer | ||||||||||||||
EXHIBIT 99.1
WESTERN MIDSTREAM APPOINTS OSCAR BROWN AS PRESIDENT AND CHIEF EXECUTIVE OFFICER
Michael Ure Steps Down Following Successful Transformation of Western Midstream into Leading Midstream Operator
Partnership Reaffirms 2024 Adjusted EBITDA and Free Cash Flow Guidance
HOUSTON — October 28, 2024 – Today Western Midstream Partners, LP (NYSE: WES) (“WES” or the “Partnership”) announced Oscar K. Brown, an independent director of Western Midstream Holdings, LLC, WES’s general partner (the “General Partner”), has been appointed President and Chief Executive Officer of the General Partner, effective immediately. The Board of Directors of the General Partner (the “Board”) and Michael Ure agreed that he will step down from his position, including as Director. To ensure a smooth transition, Mr. Ure will continue as an advisor to the CEO until the end of the year. Mr. Brown will remain a director on the Board.
“The Board identified Mr. Brown as the ideal CEO to lead the Partnership’s next chapter,” said Jeff Bennett, Chairman of the Board. “He is a seasoned executive who has been a deeply involved member of the Board since 2019. Oscar possesses extensive knowledge of the Partnership’s strategy, mission and vision. With more than 30 years of energy and industrial experience, Oscar brings a wealth of knowledge and a proven track record of success."
“On behalf of the entire Board, I would like to thank Michael for his contributions to WES,” Mr. Bennett continued. “Under Michael’s leadership, WES went through an impressive transformation including significant organic growth in the Delaware Basin and growth in the Powder River Basin through the strategic purchase of Meritage Midstream. The team also lowered costs and prioritized capital-efficient growth, leading to the return of approximately $4.6 billion to unitholders through distributions and unit repurchases and significantly lower leverage. We wish him the best as he shifts his focus to his greatest passions: his faith, his family, and giving back to the community.”
“I am truly honored to step into the role of CEO and to lead this exceptional company. I look forward to partnering with our talented team to drive WES’s growth and success and continuing to execute against
1
the proven strategies that have strengthened the Partnership. By cultivating a culture focused on upholding its foundational principles and core values, WES has achieved remarkable growth and delivered strong value to its stakeholders,” said Mr. Brown.
“It’s been a great privilege to lead Western Midstream over the past five years. I want to thank the Board and all of our dedicated team members for their support. I am incredibly proud of all we accomplished together,” commented Mr. Ure. “I’m confident that this is the right time to hand over the reins to Oscar, whom I’ve known for nearly a decade. I know he will work with the exceptional WES team to drive the Partnership forward, continuing to deliver best-in-class solutions for customers.”
Mr. Brown has been a director on the General Partner's Board since August 2019, where he served as the Chair of the ESG committee. He has a 30-year history in the energy sector, including senior positions with Occidental Petroleum Corporation and energy-sector roles at several global financial institutions. Previously, he served on the board of directors of Plains All American Pipeline, L.P. Most recently, he served as Chief Financial Officer of FREYR Battery. He holds a BBA in Finance and Marketing from The University of Texas at Austin. He has served on the boards of Houston’s Alley Theatre, Junior Achievement of Southeast Texas and The Children’s Fund, Inc.
Reaffirming 2024 Adjusted EBITDA and Free Cash Flow Guidance
In addition to today’s leadership transition, the Partnership also reaffirmed its previously stated 2024 Adjusted EBITDA and Free Cash Flow guidance ranges of $2.2 billion to $2.4 billion and $1.05 billion to $1.25 billion, respectively, and continues to expect 2024 results to be toward the high end of these ranges.
As previously disclosed, the Partnership plans to report its third-quarter 2024 results after market close on Wednesday, November 6, 2024. Management will host a conference call on Thursday, November 7, 2024, at 1:00 p.m. Central (2:00 p.m. Eastern) to discuss the Partnership's quarterly results.
Please visit the WES website at www.westernmidstream.com for further information on the senior management and Board changes.
ABOUT WESTERN MIDSTREAM
Western Midstream Partners, LP (“WES”) is a master limited partnership formed to develop, acquire, own, and operate midstream assets. With midstream assets located in Texas, New Mexico, Colorado, Utah, and Wyoming, WES is engaged in the business of gathering, compressing, treating, processing, and transporting natural gas; gathering, stabilizing, and transporting condensate, natural-gas liquids, and
2
crude oil; and gathering and disposing of produced water for its customers. In its capacity as a natural-gas processor, WES also buys and sells natural gas, natural-gas liquids, and condensate on behalf of itself and its customers under certain gas processing contracts. A substantial majority of WES’s cash flows are protected from direct exposure to commodity price volatility through fee-based contracts.
For more information about WES, please visit www.westernmidstream.com.
This news release contains forward-looking statements. WES's management believes that its expectations are based on reasonable assumptions. No assurance, however, can be given that such expectations will prove correct. A number of factors could cause actual results to differ materially from the projections, anticipated results, or other expectations expressed in this news release. These factors include our ability to meet financial guidance or distribution expectations; our ability to safely and efficiently operate WES's assets; the supply of, demand for, and price of oil, natural gas, NGLs, and related products or services; our ability to meet projected in-service dates for capital-growth projects; construction costs or capital expenditures exceeding estimated or budgeted costs or expenditures; and the other factors described in the "Risk Factors" section of WES's most-recent Form 10-K filed with the Securities and Exchange Commission and other public filings and press releases. WES undertakes no obligation to publicly update or revise any forward-looking statements.
# # #
Source: Western Midstream Partners, LP
WESTERN MIDSTREAM CONTACTS
Daniel Jenkins
Director, Investor Relations
Investors@westernmidstream.com
866.512.3523
Rhianna Disch
Manager, Investor Relations
Investors@westernmidstream.com
866.512.3523
3