UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 29, 2004
Pioneer Natural Resources Company
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(Exact name of Registrant as specified in its charter)
Delaware 1-13245 75-2702753
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(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)
5205 N. O'Connor Blvd., Suite 900, Irving, Texas 75039
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(Address of principal executive offices) (Zip Code)
(972) 444-9001
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(Registrant's telephone number, including area code)
Not applicable
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(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
| | Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
| | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
| | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
| | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
PIONEER NATURAL RESOURCES COMPANY
TABLE OF CONTENTS
Page
Item 1.01. Entry into a Material Definitive Agreement............... 3
Item 1.02. Termination of a Material Definitive Agreement........... 3
Item 9.01. Financial Statements and Exhibits
(c) Exhibits........................................... 3
Signature............................................................ 4
Exhibit Index........................................................ 5
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PIONEER NATURAL RESOURCES COMPANY
Item 1.01. Entry into a Material Definitive Agreement
On October 29, 2004, Pioneer Natural Resources Company (the "Company" or
"Pioneer") entered into a new Non-Competition Agreement with Mark S. Sexton, the
former President, Chief Executive Officer and director of Evergreen Resources,
Inc. ("Evergreen") and a director of the Company since the merger of the Company
and Evergreen on September 28, 2004. The Non-Competition Agreement is attached
hereto as exhibit 10.1.
On May 3, 2004, the Company and Evergreen entered into an Agreement and
Plan of Merger, a Non-Competition Agreement with Mr. Sexton and Consulting and
Non-Competition Agreements with Evergreen's Chief Operating Officer and Chief
Financial Officer. Prior to completion of the merger in September 2004, a
dispute arose concerning the amounts that would be payable to the executives
pursuant to their change in control agreements upon completion of the merger.
Pioneer believed the aggregate amount that would be payable was approximately
$7.6 million based on Pioneer's analysis of the historical cash salaries and
cash bonuses and estimated tax gross-ups for the three Evergreen executives. The
executives asserted that the change in control payment calculation must also
take into account the executives' restricted stock awards granted when their
annual compensation was set and that the aggregate cash payable to them would be
up to $30.0 million, depending on the value attributed to Evergreen common stock
for purposes of the calculation. Pioneer disagreed with the methodology and
stock valuations the executives used to calculate the cash amount that would be
payable to them. Pioneer and the three Evergreen executives had a number of
discussions to attempt to resolve the disagreement prior to the completion of
the merger, but their efforts were unsuccessful.
During October 2004, Pioneer and the three executives settled their
disputes. Associated therewith, Pioneer paid to the three executives $6.4
million of aggregate non-competition payments and $7.6 million of change in
control payments determined in accordance with the change in control agreements,
including a $2.6 million change in control payment to Mr. Sexton.
Mr. Sexton's new Non-Competition Agreement has a two-year term and replaces
the Non-Competition Agreement dated May 3, 2004 between the Company and Mr.
Sexton. The Non-Competition Agreement provides that Mr. Sexton will not:
(i) engage in or be involved with a competing activity with the Company
in the Raton Basin of Colorado or New Mexico,
(ii) solicit with respect to hiring any employee of the Company and
(iii) acquire any oil and gas interests within 20 miles of any oil and gas
interests owned by Evergreen in three areas generally described as
the Uintah and Piceance Basin in Utah and Colorado and the Western
Sedimentary Basin in Canada without providing the Company 30 days
prior written notice and offering the Company the right to acquire
up to 50 percent of the oil and gas interests at cost.
Mr. Sexton was paid $3.1 million as compensation for entering the new Non-
Competition Agreement.
Item 1.02. Termination of a Material Definitive Agreement
As discussed above under "Item 1.01. Entry into a Material Definitive
Agreement", the Non-Competition Agreement dated May 3, 2004 between the Company
and Mr. Sexton has been terminated as of October 29, 2004.
Item 9.01. Financial Statements and Exhibits
(c) Exhibits
10.1 Non-Competition Agreement, dated October 29, 2004, between
Pioneer Natural Resources Company and Mark S. Sexton.
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PIONEER NATURAL RESOURCES COMPANY
S I G N A T U R E
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
PIONEER NATURAL RESOURCES COMPANY
Date: November 4, 2004 By: /s/ Richard P. Dealy
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Richard P. Dealy
Vice President and Chief Accounting Officer
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PIONEER NATURAL RESOURCES COMPANY
EXHIBIT INDEX
Exhibit No. Description
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10.1(a) Non-Competition Agreement, dated October 29, 2004, between
Pioneer Natural Resources Company and Mark S. Sexton.
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(a) filed herewith
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