Michael Hodges
About Michael Hodges
Michael Hodges, age 46, serves as Executive Vice President and Chief Financial Officer of Gulfport Energy, a role he has held since April 2023; he holds a BBA in Finance (University of Oklahoma), an MS in Energy Management (Oklahoma City University), and is a Certified Public Accountant in Oklahoma . During 2024, Gulfport delivered strong shareholder returns with common stock appreciation of over 38% and meaningful adjusted free cash flow generation, with $650.0 million of operating cash flows; STI metrics included production, capex, LOE, adjusted free cash flow, safety (TRIR), spills, and strategic initiatives, underpinning pay-for-performance alignment . The company’s 2024 Say‑On‑Pay received 97.8% approval, reflecting shareholder support for the compensation program linking a large portion of NEO pay to operational and TSR outcomes .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Leon Capital Group | SVP, Finance & Accounting | Prior to GPOR (dates not specified) | Senior finance leadership in private investment context |
| Montage Resources Corporation | EVP & CFO | Until merger with Southwestern Energy in Nov 2020; joined Montage in 2018 | Positioned for strategic combination; prior CFO responsibility for a public E&P |
| Multiple upstream energy companies | CFO | 2012–2018 | Focused on near‑term value creation via acquisition and early-stage development of O&G resources |
External Roles
- No external public company directorships disclosed for Hodges in the proxy .
Fixed Compensation
| Metric | 2023 | 2024 |
|---|---|---|
| Base Salary ($) | $345,106 | $508,662 |
| Year-end base salary rate ($) | $485,000 | $515,000 |
| Percent increase YoY (%) | — | 6.2% |
| All Other Compensation ($) | $21,440 | $24,547 |
| 401(k) Company Contribution ($) | — | $17,250 |
| Other Perquisites & Benefits ($) | — | $7,297 |
Notes:
- Perquisites include group life insurance and long-term disability imputed income; no excessive perquisites, pensions, or SERPs are offered to NEOs beyond the broad-based 401(k) plan .
Performance Compensation
Annual Incentive (STI) – Structure and Results (2024)
| Metric | Weight | Target | Actual | Approved Payout |
|---|---|---|---|---|
| Production (MMcfe/day) | 20% | 1,057 | 1,060 | 22% |
| Capex ($MM) | 20% | 408 | 385 | 34% |
| LOE per Mcfe ($/Mcfe) | 15% | 0.19 | 0.18 | 22% |
| Adjusted Free Cash Flow ($MM) | 15% | 231 | 261 | 22% |
| TRIR | 10% | 0.6 | 0.3 | 20% |
| Spills | 10% | 4 | 1 | 20% |
| Strategic Initiatives | 10% | Qualitative | Qualitative | 10% |
| Total Achievement | — | — | — | 150% |
| CFO STI Target and Payout (2024) | Value |
|---|---|
| Incentive Target ($) | $515,000 |
| Achievement (% of Target) | 150% |
| Actual Incentive Earned ($) | $772,500 |
Design Notes:
- Annual metrics explicitly tied to financial health (production/day, capex, LOE, free cash flow) plus safety/ESG; targets adjusted mid-year to reflect capital program changes approved by the Board .
Long-Term Incentives (2024 grants)
| Award Type | Shares Granted | Grant Date Fair Value ($) | Vesting |
|---|---|---|---|
| RSUs (time-based) | 5,634 | $800,028 | 3-year, equal annual installments |
| PSUs (performance-based) | 9,411 (target) | $1,468,116 (target FV) | 3-year performance; vesting based on absolute and relative TSR vs peer group |
PSU payout grid uses absolute TSR bands and relative TSR percentiles; performance-based equity comprised 60% of NEO equity mix in 2024, reinforcing pay-for-performance alignment .
Equity Ownership & Alignment
| Ownership Detail (as of dates specified) | Amount | Value/Notes |
|---|---|---|
| Beneficial Ownership (Mar 7, 2025) | 6,255 shares; <1% of outstanding | Includes 3,354 RSUs vesting within 60 days |
| Unvested RSUs (Dec 31, 2024) | 12,342 | Market value $2,273,396 at $184.20/share |
| Unvested PSUs (Dec 31, 2024, at target) | 24,505 | Payout value $4,513,821 at $184.20/share |
| 2024 Stock Vested | 3,354 shares; $543,449 value | Reflects vested awards; valuation per vest date |
Alignment Policies:
- Stock ownership guideline: 3x base salary for NEOs within five years; policy amended in Feb 2025 to maintain compliance once achieved despite subsequent price declines; Hodges is on track to comply within the required timeframe .
- Anti-hedging and anti-pledging: Hedging, pledging, margin accounts, and speculative trading are prohibited; insider trading policy governs transactions; to the Company’s knowledge, all comply .
- No stock options outstanding; equity mix is RSUs/PSUs; no option repricing and no stock options granted in 2024 .
Employment Terms
Core Agreement Terms:
- Initial term through December 31, 2026; auto-renews for successive one-year terms unless notice of non-renewal given 90+ days before term end; term extends to at least 24 months post-change-of-control if a CoC occurs during the term .
- Severance outside CoC: 100% of annual base salary + target annual bonus; pro‑rated target bonus; pro‑rated vesting of unvested equity (performance awards based on actual performance through termination); 12 months COBRA .
- Severance within 24 months post-CoC: 200% of base salary + target annual bonus (CEO at 300%); pro‑rated target bonus; immediate vesting of unvested equity (performance awards based on actual performance through termination); 18 months COBRA .
- Definitions: “Good reason” includes elimination/material reduction of role/authority, material salary reduction (subject to cure), or relocation >50 miles; “Cause” includes willful failure to perform or willful illegal/gross misconduct injurious to the Company .
- RSU/PSU award agreements: Full RSU acceleration on death/disability/termination without cause/resignation for good reason; PSUs prorate based on actual achievement at performance period end, with Committee discretion if terminated within first 18 months; change-in-control provisions differentiate between awards assumed vs not assumed; Special CiC Event triggers full acceleration .
Termination Economics (as of Dec 31, 2024; $184.20/share):
| Scenario | Cash Severance ($) | RSUs ($) | PSUs ($) | COBRA ($) | Total ($) |
|---|---|---|---|---|---|
| Death/Disability | — | $2,273,396 | $1,854,389 | — | $4,127,785 |
| Qualifying Termination (no CoC) | $1,545,000 | $2,273,396 | $1,854,389 | $22,686 | $5,695,472 |
| Qualifying Termination within 24 months after CoC | $2,575,000 | $2,273,396 | $4,513,821 | $34,030 | $9,396,247 |
| Change-in-Control with no Qualifying Termination | — | $2,273,396 | $4,513,821 | — | $6,787,217 |
Restrictive Covenants:
- One-year post-employment non-solicitation; confidentiality, trade secrets, and cooperation provisions .
Clawbacks:
- Executive compensation clawback policy adopted July 31, 2023; recovery of incentive-based pay in the event of accounting restatement due to material non-compliance; forfeiture provisions for misconduct; awards subject to applicable law and Company policy .
Compensation Structure Notes
- Peer benchmarking by WTW; 2024 compensation peer group includes CNX, Comstock, Magnolia, Range, SM Energy, Talos, Berry, Callon, Civitas, Matador, Murphy, SilverBow, Vital Energy, among others; targeting competitive pay at peer median with higher realized pay when performance warrants .
- Program design emphasizes pay at risk: 60% of equity awards in PSUs tied to absolute and relative TSR; no single-trigger equity vesting; no tax gross-ups; no liberal share recycling .
Investment Implications
- High performance leverage: Hodges’ pay mix is equity- and performance-heavy (RSUs/PSUs), with 2024 STI paying 150% on exceeding targets; incentives emphasize adjusted free cash flow, capital discipline, and TSR, aligning CFO decision-making with shareholder returns .
- Retention risk appears contained: Robust severance/change-of-control protections (200% cash multiple; equity acceleration mechanics) reduce voluntary departure risk during strategic transitions; stock ownership guidelines further align incentives over a multi-year horizon .
- Insider selling pressure: Near-term vesting of RSUs (3,354 within 60 days of Mar 7, 2025) and sizeable unvested awards could create episodic liquidity events; however, anti-hedging/pledging policies and ownership guidelines mitigate misalignment concerns .
- Governance and shareholder support: 97.8% Say‑On‑Pay and explicit prohibition of tax gross-ups/single-trigger vesting signal disciplined compensation governance; clawbacks and risk assessments add downside protection for investors .