Amplify Energy (AMPY) DEF 14ADefinitive proxy

If any other business properly comes before the stockholders for a vote at the Annual Meeting, your shares will be voted at the discretion of the holders of the proxy. The Board knows of no matters, other than those previously stated herein, to be presented for consideration at the Annual Meeting.

If you are a registered stockholder, you may vote your shares or submit a proxy to have your shares voted by one of the following methods:

Regardless of whether or not you plan to virtually attend the Annual Meeting, we urge you to vote by proxy to ensure your vote is counted. Even if you have submitted a proxy before the Annual Meeting, you may still virtually attend the Annual Meeting and vote online. In order to virtually attend, you must register in advance at www.cesonlineservices.com/ampy24_vm prior to May 14, 2024 at 9:00 a.m. Houston time. You will also be able to vote your shares electronically at the Annual Meeting. In such case, your previously submitted proxy will be disregarded.

If your shares are held in “street name,” you will receive instructions from the holder of record that you must follow in order for your shares to be voted. Internet and/or telephone voting will also be offered to stockholders owning shares through most banks and brokers.

We provide Internet proxy voting to allow you to vote your shares online, with procedures designed to ensure the authenticity and correctness of your proxy vote instructions. However, please be aware that you must bear any costs associated with your Internet access, such as usage charges from Internet service providers and telephone companies.

If your shares are held by your broker, bank, dealer or other agent, you should follow the instructions provided by them.

With respect to Proposal 1, directors will be elected by the affirmative vote of a majority of the shares of common stock present or represented by proxy and entitled to vote at the Annual Meeting. You may vote “FOR” a nominee to the Board, “AGAINST” a nominee to the Board or you may “ABSTAIN” from voting with respect to one or more nominees to the Board. Abstentions are considered shares of common stock present and entitled to vote and will have the same effect as votes “against” a nominee to the Board.

Each of Proposals 2, 3, 4 and 5 requires the affirmative vote of a majority of the shares of common stock present or represented by proxy and entitled to vote at the Annual Meeting. You may vote (with respect to Proposals 3 and 5, on an advisory basis) “FOR,” “AGAINST” or “ABSTAIN” for each of Proposals 2, 3, 4 and 5. Abstentions are considered shares of common stock present and entitled to vote and will have the same effect as votes “against” Proposals 2, 3, 4 and 5.

Abstentions and broker non-votes are counted for purposes of determining whether a quorum is present. Abstentions will have the same effect as votes against Proposals 1, 2, 3, 4 and 5. Broker non-votes will have no effect on the outcome of each of the proposals.

If you are a stockholder of record and you do not vote online at the Annual Meeting or vote by proxy, then your shares will not be voted.

If you hold your shares in “street name,” your broker should ask you how you want your shares to be voted. If you give the broker instructions, your shares will be voted as you direct. If you do not give instructions, one of two things can happen, depending on the type of proposal. For certain “routine” matters, even if you do not give your broker instructions on how to vote your shares, the broker may vote your shares in its discretion. This is a broker discretionary vote. The ratification of the appointment of Deloitte as our independent registered public accounting firm for the fiscal year ending December 31, 2024 (Proposal 2) is considered routine under applicable rules. For matters not considered “routine,” if you do not give your broker instructions on how to vote your shares, the broker will return the proxy card without voting on that proposal. This is a broker non-vote. The proposals to elect directors (Proposal 1), to approve, on an advisory basis, the Company’s executive compensation (Proposal 3), to approve the Amplify Energy Corp. 2024 Equity Incentive Plan (Proposal 4) and the stockholder proposal requesting the Company to take the necessary steps to achieve a sale, merger, or orderly liquidation in three years or less (Proposal 5) are not considered routine. As a result, no broker should vote your shares on these proposals without your specific instructions.

We have engaged Morrow Sodali LLC, as our independent agent, to receive and tabulate votes at the Annual Meeting. Morrow Sodali LLC will separately tabulate “For,” “Against” or “Abstain” votes, abstentions and broker non-votes, as applicable. Morrow Sodali LLC has also been retained to be our election inspector to certify the results, determine the existence of a quorum and the validity of proxies, and perform any other acts required under the Delaware General Corporation Law (the “DGCL”).

A quorum of stockholders is necessary to hold a valid meeting. A quorum will be present if the holders of a majority in voting power of the shares of common stock outstanding and entitled to vote at the Annual Meeting are present or represented by proxy at the Annual Meeting.

The Board currently is composed of eight members: Deborah G. Adams, James E. Craddock, Patrice Douglas, Christopher W. Hamm (Chairman), Randal T. Klein, Vidisha Prasad, Todd R. Snyder and Martyn Willsher. As previously announced, Mr. Klein informed the Company of his intention not to seek reelection at the Annual Meeting and that his departure from the Board would be effective immediately following the Annual Meeting. Mr. Klein has served as a member of the Board since November 2018, and his decision not to stand for reelection was not due to any disagreements with the Company on any matter relating to the Company’s operations, policies, or practices.

The Nominating and Governance Committee has recommended, and our Board has nominated, Mses. Adams, Douglas and Prasad and Messrs. Craddock, Hamm, Snyder and Willsher for election as directors at the Annual Meeting.

After the Annual Meeting, assuming the stockholders elect the nominees of the Board as set forth in “Proposal 1 — Election of Directors” above, the members of the Board will be:

The Board believes Ms. Adams’ extensive leadership experience in the midstream and downstream businesses, procurement and information systems in the oil and natural gas industry and her HSE expertise brings significant value to the Board.

The Board believes Mr. Craddock’s extensive experience in both the technical and operational aspects of the oil and natural gas industry, including his service as Chief Executive Officer and a board member of a large oil and natural gas producer, brings significant value to the Board.

The Board believes Ms. Douglas’ considerable financial experience, as well as her extensive prior experience as a director and/or audit committee member of other exploration and production companies and financial institutions, brings valuable strategic and analytical skills to the Board.

The Board believes Mr. Hamm’s extensive investment experience and intimate familiarity with the Company brings significant value to the Board.

The Board believes Ms. Prasad’s experience in the energy industry, particularly in the areas of capital markets, finance and M&A, as well as her knowledge and understanding of strategic planning and risk management brings significant value to the Board.

The Board believes that Mr. Snyder’s extensive financial expertise and experience in representing public and private companies in complex financial transactions brings important experience and skill to the Board.

The Board believes Mr. Willsher’s extensive experience in the oil and natural gas industry and intimate familiarity with the Company brings significant value to the Board.

The Board believes that sound governance practices and policies provide an important framework to assist it in fulfilling its duty to stockholders. The Company’s Corporate Governance Guidelines cover the following principal subjects:

The “Corporate Governance Guidelines” are posted on the Company’s website at www.amplifyenergy.com. The Corporate Governance Guidelines will be reviewed periodically and as necessary by the Company’s Nominating and Governance Committee, and any proposed additions to or amendments of the Corporate Governance Guidelines will be presented to the Board for its review, consideration, and approval. The New York Stock Exchange (the “NYSE”) has adopted rules that require listed companies to adopt governance guidelines covering certain matters. The Company believes that the Corporate Governance Guidelines comply with the NYSE rules.

Leadership of the Board is vested in a Chairman of the Board. Christopher W. Hamm has served as the Chairman of the Board the Company since January 19, 2021.

As stated in our Corporate Governance Guidelines, the Board believes that whether to have the same person occupy the offices of Chairman of the Board and Chief Executive Officer should be decided by the Board, from time to time, in its business judgment after considering relevant circumstances. Our Board presently believes that having a separate Chairman and CEO provides the best Board leadership structure for the Company and its present needs. This structure, together with our other corporate governance practices, provides strong independent oversight of management, while ensuring clear strategic alignment throughout the Company. The Board also recognizes that one of its key responsibilities is to evaluate and determine its optimal leadership structure so as to provide independent oversight of management. The Board understands that the optimal Board leadership structure may vary as circumstances warrant. Consistent with this understanding, non-employee directors consider the Board’s leadership structure on an annual basis.

The Company’s standards for determining director independence require the assessment of directors’ independence each year. A director cannot be considered independent unless the Board affirmatively determines that he or she does not have any relationship with management or the Company that may interfere with the exercise of his or her independent judgment, including any of the relationships that would disqualify the director from being independent under the rules of the NYSE.

In 2023, the Board held 6 meetings. All directors attended at least 75% of such aggregate meetings of the Board and any committees on which they served occurring during 2023.

The non-employee directors meet regularly in executive session without management participation. The presiding director at such executive sessions is selected by the Board, and the Nominating and Governance Committee may make a recommendation as to whom should be selected to preside.

The Board has three standing committees: the Audit Committee, the Compensation Committee and the Nominating and Governance Committee.

The current members of the Audit Committee are Messrs. Klein and Snyder (Chair) and Mses. Douglas and Prasad. Mr. Klein will serve as a member of the Audit Committee for the remainder of his term until the Annual Meeting. The Audit Committee held 4 meetings during 2023.

The Audit Committee assists the Board by overseeing responsibilities regarding the integrity of the Company’s financial statements, the Company’s compliance with legal and regulatory requirements, the qualifications, independence and performance of the Company’s independent registered public accounting firm and the effectiveness and performance of the Company’s internal audit function.

Additional information regarding the functions performed by the Audit Committee and its membership is set forth in the “Report of the Audit Committee of the Board” section included herein and also in the “Audit Committee Charter,” which is posted on the Company’s website at www.amplifyenergy.com.

The current members of the Compensation Committee are Messrs. Craddock (Chair) and Snyder and Ms. Adams. The Compensation Committee held 7 meetings during 2023.

Responsibilities of the Compensation Committee, which are discussed in detail in the “Compensation Committee Charter” that is posted on the Company’s website at www.amplifyenergy.com, include, among other duties:

We believe that it is of the utmost importance to conduct our business in a way that is consistent with our reputation of operating in a responsible and ethical manner that will serve to protect our employees and contractors, and the environments in which we operate, while supporting the communities in which we live and work. Consistent with this mission, the Board and specifically the Nominating and Governance Committee, along with management, oversees the Company’s environmental, social and governance initiatives with a focus on long-term, sustainable investments in our operations, team member development, and protecting the environment in the best interests of all of our stakeholders. The Board is also committed to effective and sustainable corporate governance, which we believe strengthens Board and management accountability, promotes the long-term interests of our stockholders, and helps build public trust in our Company. We continuously evaluate the business to identify risks and opportunities, including risk associated with climate change and current and potential related regulations. Our commitment to sustainability is outlined in our inaugural Sustainability Report, which we published in November 2023. In developing our inaugural Sustainability Report, we considered various frameworks, including the Sustainability Accounting Standards Board’s Oil and Gas and Exploration and Production Sustainability Accounting Standards, the Global Sustainability Standards Board’s Global Reporting Initiative and associated Oil & Gas Sector Standards, and the United Nations Sustainable Development Goals. Information included in our Sustainability Report is not incorporated by reference into this Proxy Statement or any of our other filings with the SEC or considered to be part of this document.

We look for opportunities to reduce direct greenhouse gas (“GHG”) emissions associated with our operations. We report total Scope 1 emissions resulting from our operations to the U.S. Environmental Protection Agency and other agencies consistent with regulatory requirements. We seek to limit and reduce GHG emissions throughout the development and production lifecycle, primarily by focusing on operational efficiencies and innovative technologies.

We strive to reduce the environmental impact of our operations by practicing responsible water usage, disposal and consumption while seeking to apply best practices in connection with our drilling, completion and production operations. We have no operations in areas with High or Extremely High Baseline Water Stress as classified by the World Resource Institute’s Water Risk Atlas tool (i.e., Aqueduct). The substantial majority of the water used in our onshore operations is produced saltwater. Any water that is produced in our operations is processed and treated according to strict EPA regulations before it is injected back into the producing reservoirs to maintain pressure.

We monitor and identify trends in oil spills, and we look to mitigate and reinforce prevention with employees and contractors. We track, record, and determine the cause of spills, maintain spill prevention plans, employ routine inspections and maintenance by trained personnel to verify that controls are functioning properly, and require annual training for our operations personnel to review the requirements of the plan and personnel responsibilities.

Safety is our highest priority, and we are dedicated to the wellbeing of our employees, contractors, business partners, stakeholders and the environment. We promote safety with a robust health and safety program, which includes employee orientation and training, contractor management, risk assessments, hazard identification and mitigation, audits, incident reporting and investigation, and corrective and preventative action development.

On August 6, 2019, the Company entered into an amended and restated registration rights agreement (the “Registration Rights Agreement”) with certain holders of our common stock (the “Holders”), including funds associated with Fir Tree, Brigade, Axys and Avenue. The Registration Rights Agreement provides resale registration rights for the Holders’ Registrable Securities (as defined in the Registration Rights Agreement).

Pursuant to the Registration Rights Agreement, the Company is required to file a Shelf Registration Statement (as defined in the Registration Rights Agreement) with respect to the Registrable Securities within 90 days of August 6, 2019. On September 9, 2019, the Company filed a Registration Statement on Form S-3 (as amended by Amendment No. 1 thereto, filed on October 2, 2019), which went effective on October 11, 2019. The Company is required to maintain the effectiveness of any such registration statement until the Registrable Securities covered by the registration statement are no longer Registrable Securities.

These registration rights are subject to certain conditions and limitations, including the right of the underwriters to limit the number of shares to be included in a registration statement and our right to delay or withdraw a registration statement under certain circumstances. The Company will generally pay all registration expenses in connection with our obligations under the Registration Rights Agreement, regardless of whether a registration statement is filed or becomes effective. The registration rights granted in the Registration Rights Agreement are subject to customary indemnification and contribution provisions, as well as customary restrictions such as blackout periods and, if an underwritten offering is contemplated, limitations on the number of shares to be included in the underwritten offering that may be imposed by the managing underwriter. Additionally, the Holders have customary demand, underwritten offering and piggyback registration rights, subject to the limitations set forth in the Registration Rights Agreement.

The Company employs a compensation philosophy that emphasizes pay-for-performance based on a combination of Company and individual performance and places the majority of each officer’s compensation at risk based on key performance indicators or stock price performance over the long term. We believe this pay-for-performance approach generally aligns the interests of our executive officers with that of our stockholders. The Company’s executive compensation program is designed to attract and retain individuals with the background and skills necessary to successfully execute on our business strategy in a demanding environment, to motivate those individuals to reach near-term and long-term goals, and to reward success in achieving such goals. As our needs evolve and as circumstances require, we periodically reevaluate our executive compensation philosophy, principal objectives and programs. Certain best practice elements of our compensation program are described below.

For our CEO and our other NEOs, 75% and 69% of the total target compensation is allocated to performance-based compensation, respectively. Target compensation in the chart below reflects the sum of base salary, target annual incentive, and target long-term incentive opportunities.

Annual incentive bonuses represent the short-term performance-based element of the Company’s compensation program. Annual incentive bonus awards may be determined by the Board based on financial and/or individual performance. We review individual performance and overall contribution to Company performance for our NEOs annually to determine award payments for the most recently completed fiscal year. At the end of each fiscal year, we meet with each NEO to discuss our performance goals for the upcoming fiscal year and what each NEO is expected to contribute to help us achieve those performance goals.

Generally, the determination of each NEO’s actual annual bonus payout will reflect corporate and individual actual performance against predetermined performance goals.

The Board considers several factors in funding the total bonus opportunity for the NEOs (the “Total Bonus Opportunity”) and determining the discretionary bonus component for each NEO, such as company performance, individual performance and strategic initiatives. For the 2023 fiscal year, the Total Bonus Opportunity established for each NEO was 0% to 150% of their respective target bonus opportunity. Our annual bonus program measured achievement of performance measures related to:

These performance objectives were selected to incentivize our NEOs to execute our business strategies as measured against the above quantitative operational and financial measures. In order to be more in line with industry peers, the Compensation Committee increased the weighting of quantitative metrics in the 2023 annual incentive bonus plan from 50% to 75% and reduced the discretionary component from 40% to 20%. In addition, the discretionary component for the ESG performance metrics in 2023 was reduced from 10% to 5% weight. Target performance levels for each performance objective were established by the Board in the first quarter of 2023 and set at challenging levels that were both consistent with our long-term goals and intended to incentivize and reward superior performance. In addition, a threshold level of performance is established for each performance objective, and if threshold performance for a performance objective is not achieved, no bonus amount is earned in respect of that performance objective.

For 2023, the predetermined performance goals, and the Company’s actual performance with respect to such goals, were as follows:

Each of Messrs. Willsher, Frew and Furbee are party to an employment agreement with the Company and Amplify Energy Services LLC, effective as of November 1, 2023 (collectively, the “Employment Agreements”), which supersede the prior employment agreements between the Company and each of Messrs. Willsher, Frew and Furbee (the “Prior Agreements”). The Employment Agreement terms are substantially similar to the Prior Agreement terms, except as noted below. The Employment Agreements memorialize each NEO’s initial base salary and target annual bonus, each as discussed above. Each Employment Agreement subjects the NEO to non-competition, non-solicitation and non-interference covenants that apply during the term of employment and for 12 months thereafter, as well as perpetual assignment of inventions, non-disparagement and confidentiality covenants. See “Potential Payments upon Termination or Change in Control-Severance Benefits under Employment Agreements” below for further details regarding the payments that our NEOs are eligible to receive upon a termination of employment or a change in control.

Pursuant to the Employment Agreement with Mr. Willsher, upon certain qualifying terminations described below under “Potential Payments upon Termination or Change in Control-Severance Benefits under Employment Agreements”, Mr. Willsher’s cash severance will be paid in a lump sum instead of installments. Mr. Willsher’s Employment Agreement also memorialized the Compensation Committee and Board’s decision to increase his target bonus from 75% to 100% of base salary, which increase was previously approved by the Compensation Committee and the Board on January 19, 2021. Additionally, the Employment Agreements with Messrs. Willsher, Frew and Furbee provide that upon certain qualifying terminations, the NEO would be entitled to a pro rata portion of the target annual bonus for the year in which the termination date occurs, payable within 70 days following the termination date, rather than a pro rata portion based on actual performance and paid at the time such bonus annual bonuses are paid to actively employed employees as provided under the Prior Agreements. The Employment Agreements also provide for additional payments and benefits upon a qualifying termination that occurs within the 18-month period following a change of control, as described below under “Potential Payments upon Termination or Change in Control-Severance Benefits under Employment Agreements”.

Additionally, the Prior Agreements with Messrs. Frew and Furbee provided that upon a qualifying termination that occurs prior to April 17, 2024 and March 20, 2024, respectively, the NEO would have been entitled to an amount equal to one-times annual base salary, and if the qualifying termination occurs after such date, the NEO would be entitled to an amount equal to two-times annual base salary. The Employment Agreements provide that upon such qualifying termination, regardless of date, the NEO will be entitled to two-times annual base salary, paid in a lump sum within 70 days following the termination date. See “Potential Payments upon Termination or Change in Control-Severance Benefits under Employment Agreements” below for further details.

We maintain the EIP for key personnel who perform services for us. The purpose of the EIP is to align the interests of eligible service providers with the interests of our stockholders by providing long term incentive compensation awards tied to Company performance.

With respect to the 2023 long-term incentive awards, PSUs represent 50% of total award value for our NEOs and vest based on the Company’s relative total shareholder return. If the Company’s absolute shareholder return is negative over the performance period, the performance share award payout will be capped at 100% of target. The remaining 50% of 2023 long-term incentive value is delivered in the form of RSUs. See “Potential Payments upon Termination or Change in Control-Accelerated Vesting under Award Agreements” below for details regarding the payments that our Named Executive Officers are eligible to receive pursuant to their award agreements upon certain terminations of employment or a change in control. As part of the Company’s ongoing efforts to strengthen the alignment of pay and performance, for 2024, Mr. Willsher’s long-term incentive awards will be allocated 60% PSUs and 40% RSUs.

The Compensation Committee has adopted a clawback policy (the “Clawback Policy”) that complies with NYSE’s new clawback rules promulgated under Section 10D of the Exchange Act and the rules promulgated thereunder. In the event the Company is required to prepare an accounting restatement of its financial statements due to the Company’s material noncompliance with any such financial reporting requirement, the Clawback Policy requires that covered executives must reimburse the Company, or forfeit, any excess incentive-based compensation received by such covered executive during the three completed fiscal years immediately preceding the date on which the Company is required to prepare the restatement. Executives covered by the Clawback Policy are current and former executive officers, as determined by the Compensation Committee in accordance with Section 10D of the Exchange Act and the NYSE listing standards. Incentive-based compensation subject to the Clawback Policy includes any cash or equity compensation that is granted, earned or vested based wholly or in part on the attainment of a financial reporting measure. The amount subject to recovery is the excess of the incentive-based compensation received based on the erroneous data over the incentive-based compensation that would have been received had it been based on the restated results. The Clawback Policy will only apply to incentive-based compensation received on or after the effective date of Section 303A.14 of the NYSE Listed Company Manual.

The following table sets forth certain information with respect to outstanding equity awards at December 31, 2023.

The following table sets forth information concerning the change of control and severance payments to be made to each of our NEOs in connection with a change of control or termination of employment, presuming a termination or change of control date of December 31, 2023 and the fair market value of a share of common stock on December 31, 2023 ($5.93 per share). The below table only includes information for employment termination or change of control events that trigger vesting or severance-related payments and assumes that each executive will take all action necessary or appropriate for such person to receive the maximum available benefit, such as execution of a release of claims. The precise amount that each of our NEOs would receive cannot be determined with any certainty until a change of control has occurred.

Under the Employment Agreements (as in effect on December 31, 2023), upon any termination of employment with the Company, Messrs. Willsher, Frew and Furbee will be entitled to (i) accrued but unpaid base salary through the termination date, (ii) any unreimbursed business expenses incurred through the termination date, and (iii) payment of any amounts accrued and vested under any employee benefit plans or programs of the Company, and any payments or benefits required to be made or provided under applicable law (collectively, the “Accrued Amounts”).

In the event of a termination of the NEO’s employment with the Company without “cause” ​(as defined below) or for “good reason” ​(as defined below) (each, a “Good Leaver Termination”), then in addition to the Accrued Amounts and subject to the NEO’s execution and non-revocation of a release of claims and continued compliance with the restrictive covenants, the NEO will be entitled to: (i) any unpaid annual bonus with respect to the calendar year ending on or preceding the termination date, in an amount equal to the annual bonus amount the NEO would have received (if any) had the NEO been employed on the payment date (the “Prior Year Bonus”); (ii) a pro rata portion of the target Annual Bonus for the calendar year in which the termination occurs (the “Pro Rata Bonus Amount”), payable within 70 days following the termination date; (iii) an amount equal to two times the NEO’s annual base salary as in effect on the day before the termination date, payable in a lump sum within 70 days following the termination date and (iv) up to 12 months of continued health insurance benefits under the Company group health plan (at the employee rate), subject to the NEO’s continued eligibility for COBRA coverage and terminable if the NEO obtains other employment offering group health plan coverage.

If an NEO’s employment with the Company is terminated due to death or “disability” ​(as defined in the Employment Agreements), then in addition to the Accrued Amounts and subject to the NEO’s execution and non-revocation of a general release of claims and continued compliance with the restrictive covenants, as applicable, the NEO is entitled to: (i) the Prior Year Bonus, payable at the same time annual bonuses for such year are paid to actively employed senior executives of the Company; and (ii) Pro Rata Bonus Amount.

In the event of a termination of the NEO’s employment with the Company without “cause” or for “good reason” within the 18-month period following a change of control (as defined in the Employment Agreement), then in addition to the Accrued Amounts and subject to the NEO’s execution and non-revocation of a general release of claims and continued compliance with the restrictive covenants, the NEO will be entitled to: (i) the Prior Year Bonus, if any; (ii) the Pro Rata Bonus Amount, if any; (iii) an amount equal to two times the sum of (x) the NEO’s annual base salary as in effect on the day before the termination date, and (y) the target annual bonus, payable in a lump sum within 70 days following the termination date and (iv) up to 12 months of continued health insurance benefits under the Company group health plan (at the employee rate), subject to the NEO’s continued eligibility for COBRA coverage and terminable if the NEO obtains other employment offering group health plan coverage.

The Employment Agreements provide for a Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”), “best-net” cutback, which would cause an automatic reduction in any payments or benefits the NEOs would receive that constitute parachute payments within the meaning of Section 280G of the Code, in the event such reduction would result in the NEOs receiving greater payments and benefits on an after-tax basis.

For purposes of the Employment Agreements, the Company will have “cause” to terminate an NEO’s employment upon the occurrence of the NEO’s: (i) conviction of a felony, or plea of guilty or nolo contendere to, any felony or any crime of moral turpitude; (ii) repeated intoxication by alcohol or drugs during the performance of the NEO’s duties; (iii) embezzlement or other willful and intentional misuse of any of the funds of the Company or its direct or indirect subsidiaries; (iv) commission of a demonstrable act of fraud; (v) willful and material misrepresentation or concealment on any written reports submitted to the Company or its direct or indirect subsidiaries; (vi) material breach of the Employment Agreement or any other agreement with the Company; (vii) failure to follow or comply with the reasonable, material and lawful written

For purposes of the Employment Agreement, the NEO will have “good reason” to terminate their employment with the Company upon the occurrence of any of the following without their written consent: (i) a relocation of the NEO’s principal work location to a location in excess of 40 miles from its then current location (provided that, a relocation shall not include: (A) the NEO’s travel for business in the course of performing the NEO’s duties for the Company, (B) the NEO working remotely or (C) the Company requiring the NEO to report to the office within the NEO’s principal place of employment (instead of working remotely)); (ii) a reduction in the NEO’s then current base salary or target annual bonus, or both; (iii) a material breach of any provision of the Employment Agreement by the Company or (iv) any material reduction in the NEO’s title, authority, duties, responsibilities or reporting relationship from those in effect as of the effective date of the Employment Agreement, except to the extent such reduction occurs in connection with the NEO’s termination of employment for “cause” or due to the NEO’s death or disability.

Pursuant to the applicable RSU award agreement, in the event of a termination of the participant’s service by the Company without “cause” or by the participant for “good reason”, any unvested RSUs will vest. Pursuant to the applicable PSU agreement, in the event of a termination of the participant’s service by the Company without “cause” or by the participant for “good reason”, a pro-rata portion of all unvested PSUs will vest based on actual performance through (x) the end of the applicable performance period to occur immediately following such termination (with respect to the 2021 PSUs) or (y) the date of termination (with respect to the 2022 PSUs and 2023 PSUs), as applicable. In the event such termination occurs during the 18-month period immediately following a change in control, each incomplete performance period will be deemed to have ended as of the Measurement Date and a number of unvested PSUs will vest equal to the greater of (A) the number of PSUs that would vest based on actual performance through the Measurement Date and (B) the number of PSUs that would vest based on target performance, as set forth in the applicable award agreement.

As required by Section 953(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, and Item 402(v) of Regulation S-K, we are providing the following information about the relationship between ‘compensation actually paid’ to the Principal Executive Officer of the Company (“PEO”) and to our non-PEO NEOs and certain financial performance of the Company. Compensation actually paid, as determined under SEC requirements, does not reflect the actual amount of compensation earned by or paid to our NEOs during a covered year. For further information concerning the Company’s pay-for-performance philosophy and how the Company aligns executive compensation with the Company’s performance, refer to the section titled “Narrative Disclosure to Summary Compensation Table.”

On March 4, 2024, the Audit Committee appointed Deloitte as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2024. The Audit Committee is seeking ratification of such appointment by our stockholders at the Annual Meeting. Representatives of Deloitte are expected to be present at the Annual Meeting. They will have an opportunity to make a statement if they so desire and will be available to respond to appropriate questions.

Neither our Bylaws nor other governing documents or law require stockholder ratification of the appointment of Deloitte as our independent registered public accounting firm. However, the Audit Committee is submitting the appointment of Deloitte to our stockholders for ratification as a matter of good corporate practice. If our stockholders fail to ratify the appointment, the Audit Committee will reconsider whether or not to retain Deloitte. Even if the appointment is ratified, the Audit Committee in its discretion may direct the appointment of a different independent registered public accounting firm at any time during the year if they determine that such a change would be in the best interests of the Company and our stockholders.

The following table summarizes the aggregate Deloitte fees for independent auditing, tax and related services for each of the years ended December 31, 2023 and 2022 (dollars in thousands), respectively:

We manage our long-term stockholder dilution by closely managing the number of equity awards granted annually and regularly engaging with our compensation consultant. We grant what we believe is an appropriate amount of equity necessary to attract, reward and retain employees. Our three-year average burn rate, which we define as the number of shares subject to equity awards granted under the Equity Incentive Plan in a fiscal year divided by the weighted average shares outstanding for that fiscal year, was 2.84% for fiscal years 2021 through 2023.

Our equity plan dilution rate (or overhang) as of February 20, 2024 was 5.73% (calculated by dividing (1) the number of shares subject to awards outstanding plus the number of shares remaining available for issuance, by (2) the total number of common shares outstanding. If shareholders approve our share request, the issuance of 2,250,000 additional shares would increase our dilution rate by 5.75% to 11.48%

A brief summary of the 2024 Plan is outlined below. The following summary is not a complete description of all of the provisions of the 2024 Plan and is qualified in its entirety by reference to the 2024 Plan, a copy of which is attached hereto as Appendix A, which is incorporated by reference into this proposal.

The 2024 Plan will be administered by (A) the Compensation Committee of the Board, (B) such other committee of the Board appointed by the Board to administer the 2024 Plan or (C) the Board, as determined by the Board (any of the foregoing, the “Committee”). Subject to the terms of the 2024 Plan, the Committee has authority to administer the 2024 Plan and control its operation, including, but not limited to, the power to (i) determine the eligible persons who will receive awards under the 2024 Plan, (ii) prescribe the restrictions, terms and conditions of all awards, (iii) interpret the 2024 Plan and terms of the awards, (iv) adopt rules for the administration, interpretation and application of the 2024 Plan, (v) make all determinations with respect to a participant’s service and the termination of such service for purposes of any award, (vi) correct any defect(s) or omission(s) or reconcile any ambiguity(ies) or inconsistency(ies) in the 2024 Plan or any award, (vii) make all determinations it deems advisable for the administration of the 2024 Plan, (viii) decide all disputes arising in connection with the 2024 Plan and to otherwise supervise the administration of the 2024 Plan, (ix) subject to the terms of the 2024 Plan, amend the terms of an award in any manner that is not inconsistent with the 2024 Plan, (x) accelerate the vesting or, to the extent applicable, exercisability of any award at any time (including, but not limited to, upon a Change of Control (as defined in the 2024 Plan) or upon termination of service under certain circumstances, subject to Section 5.3 of the 2024 Plan, and (xi) adopt such procedures, modifications or subplans as are necessary or appropriate to permit participation in the 2024 Plan by eligible persons who are foreign nationals or employed outside of the United States. The Committee has the right to delegate to one or more officers of the Company the authority of the Committee to grant and determine the terms and conditions of awards granted under the 2024 Plan, subject to the terms of the 2024 Plan and applicable law.

The 2024 Plan provides for the grant of “incentive stock options” intended to qualify under Section 422 of the Code, nonstatutory stock options, stock appreciation rights, restricted stock, restricted stock units, other stock-based awards and cash awards. Unless otherwise indicated, the term “stock option” refers to both nonstatutory stock options and incentive stock options.

The U.S. federal income tax consequences of the 2024 Plan under current federal law, which is subject to change, are summarized in the following discussion of the general tax principles applicable to the 2024 Plan. This summary is not intended to be exhaustive and, among other considerations, does not describe state, local, or foreign tax consequences. Tax considerations may vary from locality to locality and depending upon individual circumstances.

A participant will recognize ordinary compensation income upon receipt of cash pursuant to a cash award or, if earlier, at the time the cash is otherwise made available for the participant to draw upon.

A participant who is an employee will be subject to withholding for federal, and generally for state and local, income taxes at the time he or she recognizes income under the rules described above. The tax basis in the common stock received by a participant will equal the amount recognized by the participant as compensation income under the rules described in the preceding paragraph, and the participant’s capital gains holding period in those shares will commence on the later of the date the shares are received or the restrictions lapse. Subject to the discussion below under “Tax Consequences to the Company,” we will be entitled to a deduction for federal income tax purposes that corresponds as to timing and amount with the compensation income recognized by a participant under the foregoing rules.

The table below sets forth the contingent cash-settlement awards (“Contingent Awards”) granted under the Prior Plan in February 2024 that will be settled in shares of stock, subject to stockholder approval of the 2024 Plan. In the event our stockholders do not approve the 2024 Plan, the Contingent Awards will be settled in cash pursuant to the terms of the applicable award agreement.

The current CEO and his management team have made a valiant attempt to turn the company around. But their ability to accomplish such a turnaround has been hampered by market conditions and other unfortunate circumstances.

Seven years is long enough. Amplify shareholders now deserve an opportunity to realize the full value of our company’s assets so that we can redeploy our capital into more promising investment opportunities.

As a fellow shareholder, I believe the best way to accomplish such an objective is through a sale, merger, or orderly liquidation of the corporation. And I urge you to vote FOR this proposal.

The Board unanimously believes that implementing the proposal would not be in the best interests of stockholders for the following reasons:

The Board will carefully evaluate any indications of interest and proposals for strategic transactions that the Company receives consistent with its fiduciary duties and commitment to acting in the best interests of all of the Company’s stockholders. However, at this time the Board does not believe that running a sales process to sell the Company to the highest bidder is in the best interests of the Company and its stockholders. Further, the Board has engaged in consistent director refreshment to introduce new perspectives to the boardroom and ensure that the Company is continually exploring and evaluating all potential avenues for value creation. For example, in February 2023 and October 2023, the Board appointed James E. Craddock and Vidisha Prasad to the Board. Mr. Craddock is a seasoned upstream executive and director who possesses broad-based technical, operational and transactional knowledge with over 30 years of experience. Ms. Prasad brings more than two decades of experience in energy investments, strategic and board advisory, corporate mergers and asset acquisitions and divestitures.

Amplify’s current CEO was appointed by the Board in April 2020 at the onset of the worldwide COVID-19 pandemic. Facing unprecedented economic uncertainty and commodity price volatility, the Company’s management team successfully led the Company through a period of turbulent operational activity and commodity price volatility and rapidly assessed and implemented liquidity preserving initiatives to ensure the continuity of the Company. As a result, and in contrast to many of the Company’s industry peers, several of which filed for bankruptcy, Amplify is currently on stable footing.

Moreover, the Company worked through the operational disruption and litigation arising from the pipeline oil incident that occurred off the coast of Southern California at the Beta Field in October 2021 (the “Incident”), which resulted from the anchor strikes from two containerships that damaged the pipeline. The owners and operators of the vessels ultimately paid the Company $96.5 million as part of a settlement. Despite the headwinds created by the operational and litigation impact from the Incident, the Company made, and continues to make, strides towards increasing stockholder value.

The purpose of the Amplify Energy Corp. 2024 Equity Incentive Plan is to further align the interests of eligible participants with those of the Company’s stockholders by providing long-term incentive compensation opportunities tied to the performance of the Company and its Common Stock. The Plan is intended to advance the interests of the Company and increase stockholder value by attracting, retaining and motivating key personnel upon whose judgment, initiative and effort the successful conduct of the Company’s business is largely dependent.