Diversified Energy Co 8-K

What Happened

• Diversified Energy Company filed an 8-K reporting that on December 31, 2025 its Compensation Committee adopted the Diversified Energy Company Executive Severance Plan. The Company’s CEO participates as a Tier 1 participant and its CFO as a Tier 2 participant. The Plan sets severance benefits for qualifying terminations and contains enhanced protections around a Change in Control.

Key Details

• Outside the “Protection Period” (not within six months before a Change in Control through 24 months after one): lump-sum severance = 2.0x the sum of base salary plus target bonus; health continuation = 24 months for the CEO, 18 months for the CFO; time-based equity accelerates; performance equity vests pro rata based on actual performance as of the most recent fiscal quarter.
• If termination occurs during the Protection Period: lump-sum severance = 2.99x base salary plus target bonus; pro‑rata target bonus for the year; health continuation = 36 months (CEO) or 18 months (CFO); equity accelerates with performance awards measured at the greater of target or actual as of the Change in Control.
• Payments require the executive’s signed, non‑revoked general release and continued compliance with confidentiality, non‑competition, non‑solicitation and non‑disparagement obligations. Participation agreements replace prior employment/change‑in‑control agreements.

Why It Matters

• This establishes formal severance and equity acceleration rules for the company’s top executives (CEO and CFO), clarifying potential cash and benefit obligations for the company in the event of terminations or a Change in Control. Investors can use these specifics—severance multipliers, health continuation periods, and vesting mechanics—to assess potential executive-related costs and governance terms if leadership changes or a transaction occurs.