Chad McAllaster
Diamondback EnergyAbout Chad McAllaster
Executive Vice President – Operations at Diamondback Energy (FANG) since September 2024; age 50; B.S. Petroleum Engineering (Texas Tech) and MBA (University of Denver) . Prior to Diamondback, he led development roles at Endeavor Energy Resources (2019–2024) and spent ~22 years at Anadarko Petroleum (1998–2019) . Company performance context under his tenure: 2024 free cash flow of $3.6B, 57% of adjusted FCF returned to shareholders, and a top‑quartile one‑year TSR versus oil‑weighted peers; 2024 base dividend raised to $4.00/share .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Diamondback Energy | EVP – Operations | Sep 2024–present | Oversees operations following integration of Endeavor; supports delivery of merger synergies and operational execution . |
| Endeavor Energy Resources | SVP Development | Jan 2023–Sep 2024 | Led development across core Midland Basin assets prior to Diamondback merger . |
| Endeavor Energy Resources | VP, Southern Basin Asset Development & Supply Chain | Dec 2019–Dec 2022 | Managed asset development and supply chain scaling in Midland Basin . |
| Anadarko Petroleum | Various roles | 1998–2019 | Long-tenured technical and leadership roles across development/operations . |
External Roles
No public company directorships or external roles disclosed for McAllaster .
Fixed Compensation
Not individually disclosed in the proxy (only Named Executive Officers are detailed) .
Performance Compensation
Diamondback emphasizes at-risk, performance-linked pay: annual cash incentives use a scorecard that includes environmental and safety metrics at 25% weighting; long-term equity is split 60% PSUs (relative TSR with absolute TSR modifier) and 40% time-based RSUs for executive awards in 2024–2025 . All employees (including executives) are eligible for discretionary annual cash and long-term equity tied to the same scorecard framework .
McAllaster’s recent equity awards and vesting
| Grant Date | Instrument | Units | Performance Period / Vesting | Notes |
|---|---|---|---|---|
| Sep 10, 2024 | PSUs | 1,900 | Three-year relative TSR performance period; vests per certified outcomes | Granted post-Endeavor merger; subject to relative TSR vs FANG peer group . |
| Mar 1, 2025 | RSUs | 2,160 | Time-based; two remaining substantially equal annual installments beginning Mar 1, 2026 | Standard executive RSU vesting cadence . |
| Mar 1, 2025 | PSUs | 4,862 | Three-year relative TSR performance period ending Dec 31, 2027 | Relative TSR with absolute TSR modifier . |
Mechanics of PSUs: payouts depend on relative TSR vs the PSU peer group, modified down for negative absolute TSR, paid at target for 0–15% annualized TSR, and up for >15% annualized TSR over the period . Diamondback’s TSR peer group methodology double-weights the S&P 500 and XOP Index in performance assessments for 2024 grants .
2024 annual incentive context (for plan design insight)
- The compensation committee applied a 25% discretionary multiplier to the scorecard outcome for NEOs given transformational execution (Endeavor merger integration and top-quartile TSR), resulting in 170% of target payouts; this framework cascades to employees on the same scorecard, although McAllaster’s individual payout is not disclosed .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial ownership (4/1/2025) | 732 common shares; less than 1% of outstanding shares . |
| Unvested RSUs (scheduled) | 2,160 RSUs from Mar 1, 2025 grant; two remaining installments starting Mar 1, 2026 . |
| Unvested PSUs (open cycles) | 1,900 PSUs (Sep 10, 2024 award; 3-year period) and 4,862 PSUs (Mar 1, 2025 award; through Dec 31, 2027) . |
| Stock ownership guidelines | EVPs must hold stock equal to 3x base salary; retention of 50% of net shares until compliant; five-year transition typical (committee may adjust) . |
| Hedging/pledging | Prohibited for directors/executives; no margin accounts; trading restricted to window periods and pre-approval (10b5‑1 plans permitted) . |
| Options | Company has not been granting options/SARs in recent years; equity is RSUs/PSUs . |
Implications for selling pressure:
- Near-term: time-based RSU tranches from the Mar 1, 2025 grant vest annually beginning Mar 1, 2026; trades remain subject to window/preclearance policies and 10b5‑1 rules .
Employment Terms
Diamondback maintains an Amended & Restated Senior Management Severance Plan for selected executives; terms for EVPs are summarized below (participation determined by the company) .
- Termination without cause / for good reason (outside change in control):
- Base salary continuation at 1x for 18 months (EVP), pro‑rated target bonus for year of termination, and up to 18 months COBRA reimbursement; equity vests/forfeits per award terms .
- Change in control (double-trigger within two years post‑CoC):
- Lump sum cash severance equal to 2.5x (EVP) annual base salary plus the greater of target bonus or 3‑year average bonus; COBRA reimbursement; equity treatment per award agreements (NEO RSUs have double-trigger vesting) .
- Restrictive covenants and release:
- Severance conditioned on waiver and general release; non‑compete, non‑solicit, and non‑interference covenants generally apply during employment and for one year post‑termination (with certain exceptions for CoC/death/disability); company may elect to apply covenants with monthly payments if termination is otherwise ineligible for severance .
- Clawback policy:
- Nasdaq Rule 10D‑1 compliant; recoupment of excess incentive-based compensation upon a financial restatement (3‑year lookback from 10/2/2023) .
Investment Implications
- Alignment and retention: A material portion of McAllaster’s pay is in multi‑year PSUs tied to relative/absolute TSR, plus time-based RSUs with 2026–2027 vesting; combined with 3x salary stock ownership requirements and anti‑hedging/pledging policies, this supports alignment with shareholder value and reduces misalignment risk .
- Selling pressure: Anticipate potential trading activity around annual RSU vest dates (beginning Mar 1, 2026), though constrained by preclearance, trading windows, and potential 10b5‑1 plans; PSU outcomes hinge on TSR through 2027, further anchoring retention through that horizon .
- Change‑of‑control economics: EVP tier severance of 2.5x base plus bonus metric under CoC scenarios is competitive but not excessive; double‑trigger equity treatment (per award terms) balances retention with shareholder protection .
- Execution context: Following the Endeavor merger, Diamondback delivered integration milestones, strong FCF, and top‑quartile peer TSR in 2024—an operating backdrop that supports incentive realizability if sustained, but maintains rigor via relative TSR hurdles and absolute TSR modifiers .