James C. Flores

About James C. Flores

James C. Flores (age 65) is Chairman and Chief Executive Officer of Sable Offshore Corp. (SOC), serving since February 2024 following the company’s business combination; he is also a Class III director with a term through the 2027 annual meeting . He holds a B.S. in corporate finance and petroleum land management from Louisiana State University and has led multiple public E&P companies over four decades, including PXP, Freeport-McMoRan Oil & Gas, Ocean Energy and Sable Permian Resources (which filed for bankruptcy in 2020 and emerged in 2021) . Under his tenure, SOC restarted production at SYU on May 15, 2025, a key operational milestone that also triggered the company’s senior term loan’s accelerated maturity schedule .

Past Roles

External Roles

Board Governance and Director Service at SOC

• Dual role: Flores is Chairman and CEO; there is no Lead Independent Director. Independent directors meet in executive session, presided by Michael Dillard .
• Board composition and committees: 75% of directors are independent; Audit (Chair: Sarofim), Compensation (Chair: Pipkin), and Nominating & Corporate Governance (Chair: Dillard) committees are fully independent .
• Attendance: In 2024, the board met 7 times; no director attended fewer than 75% of meetings across the board and committees .
• Tenure/classification: Flores is a Class III director with term expiring at the 2027 annual meeting .
• Governance note: The CEO/Chair combined structure is justified by the board based on Flores’ industry knowledge and equity stake; independent directors conduct regular executive sessions .

Fixed Compensation

2024 compensation (first year post-Business Combination; salaries pro-rated from February 14, 2024):

Notes:

• Contracted annual base salary is $1,300,000, subject to periodic review by the Compensation Committee .
• Non-employee director pay does not apply to Flores; he received no additional compensation for director service in 2024 .

Performance Compensation

• Annual incentive framework: Each executive officer, including the CEO, has a target annual bonus equal to 150% of base salary, with eligibility under the annual bonus plan commencing once SYU assets begin production .
• 2024 CEO equity: No 2024 equity awards were granted to Flores; he had no unvested stock awards outstanding as of December 31, 2024 .
• Milestone-linked vesting (context for broader team and trading signals): Other named executive officers received 650,000 restricted shares each after Closing, vesting on the earlier of (i) restart of SYU production or (ii) three years from February 14, 2024; SOC restarted SYU production on May 15, 2025, satisfying the milestone (vesting requires continued service) .

Equity Ownership & Alignment

As of April 14, 2025:

Additional alignment, restrictions, and policies:

• Registration Rights Agreement includes a lock-up: Flores agreed not to transfer the Merger Shares for three years following the February 14, 2024 Closing (i.e., through February 14, 2027) .
• Hedging/pledging: Company policy prohibits hedging and pledging of company securities by directors and officers, unless pledging is pre-cleared by the General Counsel .
• Capital structure context: 89,338,358 common shares outstanding as of the record date (April 14, 2025) .

Employment Terms

Related Party Transactions (Governance Red Flags)

• Sable Aviation asset purchase: On October 3, 2024, SOC purchased transportation assets from Sable Aviation, an entity controlled by Flores, for 600,000 SOC shares (valued at $15.2 million) .
• Founder reimbursement: On the Closing Date, Flores was reimbursed $2.9 million for documented transaction-related expenses, capped at $3.0 million .
• PIPE participation: In the First PIPE concurrent with closing, investors included Flores ($7.0 million), Flores Family Limited Partnership #2 ($25.0 million), and JCF Capital, LLC ($3.0 million), among others .

Director Compensation (for context on dual roles)

• Non-employee directors received an initial/annual restricted share grant totaling 52,778 shares on April 19, 2024 (vesting after one year). Each received $578,447 in grant-date fair value; no cash retainer in 2024 .
• Flores received no additional director compensation beyond his executive pay .

Performance & Track Record

• Historical leadership: Flores has led multiple public E&P platforms and held senior roles at PXP, FM O&G/FCX, Ocean Energy, and Sable Permian (which went through 2020 bankruptcy) .
• SOC operational milestone: SYU production restart on May 15, 2025 (announced May 19, 2025) under his leadership; this triggered an accelerated maturity timeline for the senior term loan (key financial constraint to manage) .

Compensation Committee Analysis

• Committee composition and independence: Compensation Committee comprises independent directors (Chair: Pipkin; members: Dillard, Sarofim) .
• Consultant authority: Committee is authorized to retain independent compensation consultants, counsel, and advisors; no interlocks or insider participation reported .

Risk Indicators & Red Flags

• Golden parachute economics: CEO has 3x cash severance upon CoC, full equity acceleration at maximum, and 4999 excise tax gross-up (shareholder-unfriendly) .
• Key-man covenant: Debt documents require Flores’ active day-to-day involvement, increasing key-person risk and lender leverage in governance .
• Related party dealings: Sable Aviation share issuance for asset purchase and founder reimbursement raise optics on conflicts; Audit Committee oversees related party transactions on a go-forward basis under formal policy .
• Dual-role governance: Combined CEO/Chair with no Lead Independent Director; independent directors meet in executive session (Dillard presiding) .
• Prior bankruptcy involvement: Flores led Sable Permian Resources when it filed for Chapter 11 in 2020 (emerged in 2021) .

Equity Ownership & Incentive Detail (Selected Tables)

Ownership detail (as of April 14, 2025):

Vesting and selling constraints:

Investment Implications

• Alignment vs. liquidity overhang: Flores’ 18% beneficial stake and three-year lock-up on Merger Shares support alignment and reduce near-term selling pressure; however, sizeable exercisable warrants represent potential future supply depending on market conditions .
• Governance risk premium: Dual CEO/Chair without a Lead Independent Director, robust CoC severance (3x cash, full equity acceleration at max) and an excise tax gross-up suggest elevated governance risk and potential pay-for-performance misalignment in downside scenarios .
• Key-man concentration: Debt covenants mandating Flores’ day-to-day role create continuity but add key-person risk and lender influence; any transition could necessitate lender consent, affecting strategic flexibility .
• Related party optics: The Sable Aviation share-for-assets transaction and founder reimbursement invite scrutiny; continued strict Audit Committee oversight will be important for investor confidence .
• Execution track record and milestone: The SYU production restart is a tangible operational win under Flores, but it accelerates near-term debt maturity and heightens focus on cash generation, deleveraging, and safety/environmental execution at SYU .

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