Company: REI
Filing Date: 2025-04-11
Form Type: DEF 14A
Source: 0001628280-25-017570
Chunk: 47

Company: RING ENERGY, INC.
Filing Date: 2025-04-11
Form: DEF 14A
Chunk 47
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| (1) Net Lifting Costs is calculated as Lease operating expenses, expressed on a barrel of oil equivalent basis. 
 (2) The payouts for performance levels achieved between the values will be interpolated.                        
 (3) Funding level is calculated as the Weighting multiplied by the Performance Factor.                          |     |           |     |           |     |           |     |           |     |                |     |                       |     |                  |

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#### 2025 PROXY STATEMENT
Equity-Based Long-Term Incentive Compensation – PSU Awards and RSU Awards

The Compensation Committee intends that long-term equity compensation for our NEOs should be the largest component of their compensation and directly linked to enhancing stockholders’ value. The purpose of granting equity-based compensation is to incentivize and reward the NEOs for the Company’s achievement of its long-term objectives and goals, each individual’s contribution to meeting those goals and to encourage continued dedication and loyalty to the Company by providing NEOs with meaningful amount of Common Stock, the majority of which is considered "at risk" compensation. The quantum of these awards is determined by the Compensation Committee and may be reduced in size to align with our stock performance.

In 2024, the LTIP awards were designed to align executive management and senior level employees with stockholder value and the long-term financial success of the Company. In 2024, we continued to grant LTIP awards with 60% in the form of PSUs and 40% in the form of service-based RSUs.

■ PSUs have a three-year performance period (“performance period”) to focus on long-term stockholder returns and financial performance. These awards cliff-vest at the end of the three year performance period and the value of the award will be determined by Ring's performance against set targets.

■ 50% of PSUs measure the Company’s absolute total shareholder return (“TSR”) and the Company's TSR relative to a peer group of companies. See TSR Table below for the pre-established goals and applicable percentages.

■ The remaining 50% of PSUs measure the Company’s cash return on capital employed (“CROCE”) as a performance goal. (See CROCE Table below). The Compensation Committee utilizes CROCE as a performance measure to provide a broad view of Ring’s strategic, operational and financial performance and to further emphasize the importance of capital efficiency and financial returns.

■ PSUs earned can vary from 0% to a maximum of 200% of target based on actual performance