Business Context and Reporting Period
This Form 8-K filing by Western Gas Equity Partners, LP (the "Partnership") reports corporate governance changes effective January 30, 2013. The Partnership is a master limited partnership formed by Anadarko Petroleum Corporation to own the general partner of Western Gas Partners, LP (WES) and a substantial limited partner interest in WES, including all incentive distribution rights.
Key Financial Metrics
The filing does not provide revenue, profit, cash flow, margin, debt, or liquidity metrics. The report focuses exclusively on director elections and associated compensation arrangements.
Material Changes
Effective January 30, 2013, Craig W. Stewart and Thomas R. Hix were elected to the Board of Directors of Western Gas Equity Holdings, LLC (the General Partner). With these additions, the Board now consists of eight directors, three of whom are independent. Both new directors were also elected to the Audit Committee and Special Committee.
Guidance, Outlook, and Compensation
Management expressed confidence that the new directors will bring valuable strategic, financial, and management experience to the company. No financial guidance or outlook was provided in this filing. Compensation details for the new directors include:
- Initial Grant: Each received a phantom unit grant under the 2012 Long-Term Incentive Plan valued at $125,000, vesting on the first anniversary of the grant date.
- Annual Retainer: Each will receive an annual retainer of $60,000 for board services.
- Future Grants: Beginning in 2014, each is eligible for an annual phantom unit grant valued at $70,000, contingent on continued service, vesting on the first anniversary.
Investor Verification Checklist
- Verify the total number of independent directors on the General Partner's Board (stated as three).
- Confirm the vesting schedule and terms of the phantom unit grants under the 2012 Long-Term Incentive Plan.
- Review the press release filed as Exhibit 99.1 for additional biographical details on Messrs. Stewart and Hix.
- Check subsequent filings for the impact of these governance changes on the Partnership's strategic direction.