Sable Offshore Corp

For 2023 and all prior periods, neither we nor Legacy Sable have paid any cash or other compensation to executive officers for their services to us or Legacy Sable.

Employment Agreements with Executive Officers

On November 2, 2022, Legacy Sable entered into employment agreements with each of James C. Flores, Gregory D. Patrinely, Doss R. Bourgeois, Anthony C. Duenner, and J. Caldwell Flores, the effectiveness of which were conditioned upon the consummation of the Business Combination. The employment agreements, became effective on the Closing Date and have been assumed by us. The key terms of the employment agreements are summarized below:

Position; Term

James C. Flores serves as Chairman of the Board of Directors and Chief Executive Officer; Mr. Patrinely serves as Executive Vice President and Chief Financial Officer; Mr. Bourgeois serves as Executive Vice President and Chief Operating Officer; Mr. Duenner serves as Executive Vice President, General Counsel and Secretary; and J. Caldwell Flores serves as President, respectively, of the Company. Each of the employment agreements provides for a fixed three-year employment term with three-year evergreen renewals.

Compensation

Each of the employment agreements provides for an annual base salary, eligibility to participate in the Company’s annual bonus plan once the SYU Assets begin production and the Incentive Plan, and eligibility to participate in the Company’s benefit plans. James C. Flores receives an annual base salary of $1,300,000 and each of the other executive officers receives an annual base salary of $800,000. All base salaries are subject to periodic review by the Company’s Compensation Committee. The annual incentive bonus target is 150% of the base salary for each executive officer.

Following the Closing, each executive officer, other than James C. Flores, received a cash payment equal to $750,000 as compensation for previously uncompensated services provided to the Company before Closing.

Closing Date Equity Award

James C. Flores’ employment agreement provides that equity incentive awards may be granted annually to him at the sole discretion of the Company’s Compensation Committee and Board. The other executive officers will receive, after Closing, an award under the Company’s Incentive Plan of 650,000 shares of Common Stock, subject to the Incentive Plan’s vesting and forfeiture terms, provided that such awards will vest no later than the third anniversary of the Closing Date. Such equity awards may be reduced on a proportionate basis such that the combined number of shares awarded to the executive officers and other Company employees and the 3,000,000 shares issued to the Holdco equityholders as consideration for the Merger does not exceed 15% of the outstanding number of shares of Common Stock immediately after Closing.

Termination

In the event that an executive officer is terminated for “cause” (as defined in the respective executive officer’s employment agreement) or resigns without “good reason” (as defined in the respective executive officer’s employment agreement), then such executive officer will be entitled to any unpaid base salary through the date of termination, reimbursement for any unreimbursed business expenses incurred through the date of termination, any accrued but unused vacation time in accordance with the company’s policy, any earned but unpaid annual bonus, incentive, or other cash bonuses for any prior period that remain unpaid, and all accrued benefits (e.g., benefits plans, and earned and vested equity awards, in each case in accordance with their terms) (collectively, the “Accrued Benefits”). Additionally, if an executive officer other than James C. Flores is terminated without cause, resigns for good reason or is terminated due to non-renewal of his employment agreement by the Company, in each case before a “change in control” (as defined in the respective executive officer’s employment agreement) or more than two years after a change in control, then the executive officer will be entitled to the Accrued Benefits.

If James C. Flores is terminated without cause, resigns for good reason (including any resignation following a change in control) or retires after reaching age 73, he will be entitled to, among other benefits, the Accrued Benefits and cash severance equal to two times (three times in the case of a termination in connection with a change in control) the sum of his base salary and his three-year average annual bonus with such amounts grossed up for excise taxes under Section 4999 of the Code, if applicable. In addition, James C. Flores will be entitled to acceleration of all outstanding equity incentive awards then held and all performance goals will be deemed achieved at maximum levels and 36 months of company-paid healthcare benefits. If any other executive officer is terminated without cause or resigns for good reason in connection with a change in control, he will be entitled to the accrued benefits along with cash severance equal to three times the sum of his base salary and his three-year average annual bonus.