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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of

the Securities Exchange Act of 1934

(Amendment No.     )

Filed by the Registrant ☑

Filed by a Party other than the Registrant ☐

Check the appropriate box:

W&T Offshore, Inc.

(Name of Registrant as Specified in Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

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Notice of 2023
Annual Meeting of Shareholders

Meeting Information

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Meeting Agenda

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Only shareholders of record at the close of business on April 20, 2023, will be entitled to notice of, and to vote at, the Annual Meeting, or any adjournment or postponement thereof, notwithstanding the transfer of any shares after such date. A list of these shareholders will be open for examination by any shareholder for ten days prior to

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the Annual Meeting. If you would like to inspect the list of Company shareholders of record, please contact the Investor Relations department at investorrelations@wtoffshore.com to schedule an appointment or request access. For purposes of attendance at the Annual Meeting, all references in this notice and the accompanying proxy statement to “attend,” “present in person” or “in person” shall refer to a shareholder’s virtual presence at the Annual Meeting.

Voting

Pursuant to rules adopted by the Securities and Exchange Commission, we have elected to provide access to our proxy solicitation materials primarily via the Internet, rather than mailing paper copies of these materials to each shareholder. On or about May 1, 2023, we will mail to each shareholder a Notice of Internet Availability of Proxy Materials with instructions on how to access the proxy materials, vote or request paper copies. Your vote is important.

We urge you to review the accompanying Proxy Statement carefully and to submit your proxy as soon as possible so that your shares will be represented at the meeting.

Houston, Texas

May 1, 2023

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE SHAREHOLDERS
MEETING TO BE HELD ON JUNE 14, 2023

This Notice of Annual Meeting and Proxy Statement and our Annual Report to Shareholders are available at www.proxyvote.com.

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Proxy
Summary

This summary highlights information contained elsewhere in this proxy statement and in our other public filings. This summary does not contain all of the information that you should consider, and you should read the entire proxy statement carefully before voting.

About Us

Founded in 1983, W&T Offshore, Inc. (“W&T” or the “Company”) is an independent oil and natural gas producer, active in the exploration, development and acquisition of oil and natural gas properties in the Gulf of Mexico. As of December 31, 2022, the Company holds working interests in 47 offshore producing fields in federal and state waters (45 fields producing and 2 fields capable of producing, which include 39 fields in federal waters and 8 in state waters). The Company currently has under lease approximately 625,000 gross acres (457,000 net acres) spanning across the outer continental shelf off the coasts of Louisiana, Texas, Mississippi and Alabama, with approximately 8,000 gross acres in Alabama State waters, 458,000 gross acres on the conventional shelf and approximately 159,000 gross acres in the deepwater. A majority of the Company’s daily production is derived from wells it operates.

Business Highlights

In 2022, we completed one of the most successful years in our long history. We continued to execute on the strategy that has guided our success for the past four decades, which is focused on maximizing cash flow generation, operating efficiently, improving the profitability of our assets, and opportunistically capitalizing on accretive acquisition opportunities. Some material highlights from 2022 are:

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Results of Shareholder Outreach Program: Changes for 2023

Compensation Changes

Based on numerous meetings we held with shareholders in 2022, last year we changed our compensation program to reflect their highest concerns. First, we adopted a three-year performance period in our long-term incentive plan. With the consent of Mr. Krohn, we eliminated tax gross-up payments provided for in his employment agreement. Further, we followed our shareholders’ advice and described the metrics of our bonus plans with greater particularly in our 2022 proxy statement. This year, we engaged with shareholders again, and we are making substantial changes to our compensation programs based on additional feedback from our shareholders, intended to better align practices with our peer group and confirm our commitment to pay and performance alignment over the long-term.

For more detail on shareholder communications and Company responses to certain compensation issues raised in resultant discussions, please see “—Shareholder Votes on Executive Compensation and Company Responses” and

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“—Compensation Changes for 2023” in the Compensation Discussion and Analysis Section of this proxy statement.

Shareholder Rights and Governance Changes

We have also proposed substantial changes to our shareholder rights and governance practices based on feedback from our shareholders. The changes enacted by the Board include the establishment of an ESG Committee, which will assist in setting the Company’s general strategy relating to ESG matters and in developing, implementing, and monitoring initiatives and policies based on that strategy, and the increase of the size and diversity of the board to five members to add Nancy Chang, the new chair of the ESG Committee.

Mr. Tracy W. Krohn, our Chairman of the Board, Chief Executive Officer and President, and who is our largest shareholder, controlling approximately 32.9% of the voting power entitled to vote at the Annual Meeting as of April 20, 2023, intends to vote “FOR” these changes.

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ESG Highlights

We also continued our ESG journey in 2022, affirming our commitment to environmental stewardship, sound corporate governance, and contributing positively to our employees and the communities where we work and operate. These values have been cornerstones of our culture since we founded the Company nearly 40 years ago.

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Insider Ownership

Our insider ownership is, and has consistently been, one of the highest among our peers. We believe this ownership helps align the interests of our executive management team and Board of Directors with those of our shareholders.

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2022 Executive Compensation Highlights

The primary objectives of our compensation program are to attract, as needed, and retain the best possible executive talent, to stimulate management’s efforts on our behalf in a way that supports our financial performance objectives and business strategy, and to align their incentives with enhancement of long-term shareholder value.

Our Executives’ 2022 target Pay Mix

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Governance Highlights

BOARD NOMINEES OVERVIEW

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Cautionary Note Regarding Forward-Looking Statements

This proxy statement includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including statements regarding our ESG goals, commitments, and strategies and other ESG related information. When used in this proxy statement, the words “could,” “believe,” “anticipate,” “intend,” “estimate,” “expect,” “project,” “forecast,” “may,” “objective,” “plan,” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. These statements involve risks and uncertainties. Actual results could differ materially from any future results expressed or implied by the forward-looking statements for a variety of reasons, including due to the risks and uncertainties that are discussed in our most recently filed Annual Report on Form 10-K and other filings we make with the SEC. We assume no obligation to update any forward-looking statements or information, which speak as of their respective dates.

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The Annual
Meeting

This proxy statement is solicited by and on behalf of the Board of Directors (the “Board” or the “Board of Directors”) of W&T Offshore, Inc. (the “Company”) for use at the 2023 Annual Meeting of Shareholders (the “Annual Meeting”) scheduled to be held on June 14, 2023, virtually at www.virtualshareholdermeeting.com/WTI2023 at 8:00 a.m., Central Daylight Time, or at any adjournments, postponements or relocations thereof. Unless the context requires otherwise, references in this proxy statement to “we,” “us,” “our” and the “Company” refer to W&T Offshore, Inc. The solicitation of proxies by the Board will be conducted primarily electronically, or by mail for those shareholders requesting paper copies of proxy materials. Officers, directors and employees of the Company may also solicit proxies personally or by telephone, e-mail or other forms of wire or facsimile communication. These officers, directors and employees will not receive any extra compensation for these services. The Company will reimburse brokers, custodians, nominees and fiduciaries for reasonable expenses incurred by them in forwarding proxy materials to beneficial owners of common stock of the Company (the “Common Stock”). The costs of the solicitation will be borne by the Company. The Company has retained Georgeson Inc. (“Georgeson”) to assist in the solicitation of proxies. On or after May 1, 2023, we will begin mailing a Notice of Internet Availability of Proxy Materials (the “Notice of Availability”) containing instructions on how to access the proxy materials and vote online. We will make these proxy materials available to you over the Internet or, upon your request, will deliver paper copies of these materials to you by mail, in connection with the solicitation of proxies by the Board for the Annual Meeting.

The Annual Meeting will be virtual, conducted exclusively via live webcast at www.virtualshareholdermeeting.com/WTI2023. We believe that using a virtual format for the Annual Meeting provides easier and greater access to the Annual Meeting, which enables participation by the broadest number of shareholders, as well as positive environmental impacts. You will not be able to attend the Annual Meeting physically in person.

Purposes of the 2023 Annual Meeting

The purposes of the Annual Meeting are to: (1) elect five directors to hold office until the 2024 Annual Meeting of Shareholders and until their successors are duly elected and qualified; (2) to approve, on an advisory basis, the frequency of future advisory votes on compensation of the Company’s named executive officers, pursuant to Item 402 of Regulation S-K; (3)  approve, on an advisory basis, the compensation of the Company’s named executive officers, pursuant to Item 402 of Regulation S-K; (4) ratify the appointment of Ernst & Young LLP as our independent registered public accountants for the year ending December 31, 2023; (5) amend the Company’s amended and restated articles of incorporation (the “Articles of Incorporation”) to increase the Company’s authorized share capital; (6) amend the Articles of Incorporation to eliminate supermajority voting requirements; (7) amend the Articles of Incorporation to provide shareholders the ability to amend the Company’s Bylaws; (8) amend the Articles of Incorporation to lower the ownership threshold required for shareholders to call a special shareholder meeting; (9) amend the Articles of Incorporation to provide shareholders the ability to act via written consent; (10) approve the W&T Offshore, Inc. 2023 Incentive Compensation Plan; and (11) transact such

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other business as may properly come before the meeting and any adjournment, postponement or relocation thereof. Although the Board does not anticipate that any other matters will come before the Annual Meeting, your executed proxy gives the official proxies the right to vote your shares at their discretion on any other matter properly brought before the Annual Meeting.

Voting Rights and Solicitation

Only shareholders of record at the close of business on April 20, 2023 (the “Record Date”) will be entitled to notice of and to vote at the Annual Meeting. As of the Record Date, there were 146,460,902 shares of Common Stock outstanding, each of which is entitled to one vote on any matter to come before the meeting. Common Stock is the only class of outstanding equity securities of the Company. The holders of issued and outstanding shares of Common Stock representing at least a majority of the outstanding shares of Common Stock, present in person or represented by proxy at the Annual Meeting, will constitute a quorum necessary to hold a valid meeting. The person who is appointed by the chairman of the meeting to be the inspector of election will treat the holders of all shares of Common Stock represented by a returned, properly executed proxy, including shares that abstain from voting, as present for purposes of determining the existence of a quorum at the Annual Meeting. Each share of common stock present or represented at the Annual Meeting will be entitled to one vote on any matter to come before the shareholders. If you hold your shares in “street name,” you will receive instructions from your broker or other nominee describing how to vote your shares. If you do not instruct your broker or nominee how to vote your shares, they may vote your shares as they decide as to each matter for which they have discretionary authority under the rules of the New York Stock Exchange (“NYSE”). For Proposal 4 (Ratification of the Appointment of Independent Accountants) to be voted on at the Annual Meeting, brokers and other nominees will have discretionary authority in the absence of timely instructions from you.

There are also non-discretionary matters for which brokers and other nominees do not have discretionary authority to vote unless they receive timely instructions from you. For Proposal 1 (Election of Directors), Proposal 2 (Frequency of Future Advisory Votes to Approve the Compensation of Named Executive Officers), Proposal 3 (Advisory Vote on Executive Compensation), Proposal 5 (Amendment to the Articles of Incorporation to Increase the Company’s Authorized Share Capital), Proposal 6 (Amendment to the Articles of Incorporation to Eliminate Supermajority Voting Requirements), Proposal 7 (Amendment to the Articles of Incorporation to Provide Shareholders the Ability to Amend the Bylaws), Proposal 8 (Amendment to the Articles of Incorporation to Lower the Ownership Threshold Required for Shareholders to Call a Special Shareholder Meeting), Proposal 9 (Amendment to the Articles of Incorporation to Provide Shareholders the Ability to Act via Written Consent) and Proposal 10 (Approval of the W&T Offshore, Inc. 2023 Incentive Compensation Plan) to be voted on at the Annual Meeting, you must provide timely instructions on how the broker or other nominee should vote your shares. When a broker or other nominee does not have discretion to vote on a particular matter, you have not given timely instructions on how the broker or other nominee should vote your shares and the broker or other nominee indicates it does not have authority to vote such shares on its proxy, a “broker non-vote” results. Although any broker non-vote would be counted as present at the meeting for purposes of determining a quorum, it would be treated as not entitled to vote with respect to non-discretionary matters.

Abstentions occur when shareholders are present at the Annual Meeting but fail to vote or voluntarily withhold their vote for any of the matters upon which the shareholders are voting.

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The following is a summary of the vote required to approve each proposal, as well as the effect of broker non-votes and abstentions.

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Mr. Tracy W. Krohn, our Chairman of the Board, Chief Executive Officer and President, and who is our largest shareholder, controlling approximately 32.9% of the voting power entitled to vote at the Annual Meeting as of April 20, 2023, intends to vote all of his shares of Common Stock in accordance with the Board’s recommendations set forth herein.

The Board has retained Georgeson to act as a proxy solicitor in conjunction with the Annual Meeting. We have agreed to pay Georgeson a fee of approximately $11,000, plus reasonable expenses, costs and disbursements for proxy solicitation services.

Voting Procedures

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

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Revoking Your Proxy

You may revoke your proxy in writing at any time before it is exercised at the Annual Meeting by: (i) delivering to the Corporate Secretary of the Company a written notice of the revocation; (ii) signing, dating and delivering to the Corporate Secretary of the Company a proxy with a later date; or (iii) attending the Annual Meeting virtually and voting your shares in person. Your attendance at the Annual Meeting will not revoke your proxy unless you give written notice of revocation to the Corporate Secretary of the Company before your proxy is exercised or unless you vote your shares in person at the virtual Annual Meeting before your proxy is exercised.

Copies of the Annual Report

Upon written request, we will provide any shareholder, without charge, a copy of our annual report on Form 10-K for the year ended December 31, 2022 (the “Form 10-K”), but without exhibits. Shareholders should direct requests to W&T Offshore, Inc., Attn: Corporate Secretary, 5718 Westheimer Road, Suite 700, Houston, TX 77057. The Form 10-K and the exhibits filed with it are available on our website, www.wtoffshore.com in the “Investors—SEC Filings” section. These materials do not constitute a part of the proxy solicitation material.

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Proposal 1
Election of Directors

Currently, the Company’s Board is composed of the following five directors: Ms. Virginia Boulet, Dr. Nancy Chang and Messrs. Daniel O. Conwill IV, Tracy W. Krohn and B. Frank Stanley. At the Annual Meeting, five directors are to be elected, each of whom will serve until the 2024 Annual Meeting and until his or her successor is duly elected and qualified.

Each nominee has consented to be nominated and to serve if elected. If any nominee is unable to serve as a director, the shares represented by the proxies will be voted, in the absence of contrary indication, for any substitute nominee that the Board may designate or the size of the Board may be reduced. We know of no reason why any nominee would be unable to serve.

Recommendation of the Board

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Information about the Nominees

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Required Vote

To be elected, each nominee for election as a director must receive the affirmative vote of a plurality of the shares present in person or represented by proxy and entitled to vote on the election of directors. Broker non-votes and abstentions will have no effect on the outcome of the election.

Mr. Tracy W. Krohn, our Chairman of the Board, Chief Executive Officer and President, and who is our largest shareholder, controlling approximately 32.9% of the voting power entitled to vote at the Annual Meeting as of April 20, 2023, intends to vote all of his shares of Common Stock in accordance with the Board’s recommendations set forth herein.

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Proposal 2
Frequency of Future Advisory Votes to
Approve the Compensation of
Named Executive Officers

Recommendation of the Board

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Introduction

As described in Proposal 3 below, the Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Dodd-Frank Act") affords shareholders an advisory vote to approve the Company’s executive compensation program. The advisory vote on executive compensation is often referred to as a “say-on-pay vote.” As required by the Dodd-Frank Act, this Proposal 2 affords shareholders an advisory vote on the frequency of future say-on-pay votes. The advisory vote on the frequency of the say-on-pay vote is a non-binding vote as to how often future say-on-pay votes should occur: every year, every two years, or every three years. In addition, shareholders may abstain from voting on this Proposal 2. The Dodd-Frank Act requires the Company to hold the advisory vote on the frequency of the say-on-pay vote at least once every six years and, therefore, the Company expects to hold the next such vote at the 2029 annual meeting of shareholders. The Company last held such vote in 2017, and, at that time, the shareholders voted in favor of conducting an advisory vote on executive compensation every year, which the Company has previously done.

The Board believes that conducting an advisory vote on executive compensation every year will best enable shareholders to timely express their views on the Company’s executive compensation program. The Company’s executive compensation programs are designed to promote a long-term connection between pay and performance and holding an advisory vote on executive compensation every year provides the Company with direct and timely feedback on our compensation programs. Conducting an advisory vote on executive compensation every year also aligns with the feedback that we received from our larger shareholders as part of our shareholder outreach program and is consistent with the policies of proxy advisory firms such as Institutional Shareholder Services and Glass Lewis.

Shareholders should note, however, that because the advisory vote on executive compensation occurs well after the beginning of the compensation year, and because the different elements of our executive compensation programs are designed to operate in an integrated manner and to complement one another, in many cases it may

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not be appropriate or feasible to change our executive compensation programs in consideration of any one year’s advisory vote on executive compensation by the time of the following year’s annual meeting of shareholders.

Shareholders are being asked to vote among the following frequency options (not solely for or against the recommendation of the Board):

Choice 1—every year;

Choice 2—every two years;

Choice 3—every three years; or

Choice 4—abstain from voting.

This advisory vote on the frequency of future say-on-pay votes is not binding on the Company or the Board. However, the Board will consider the outcome of the vote when determining the frequency of future say-on-pay votes.

Required Vote

The affirmative vote of a majority of the shares present at the meeting in person or represented by proxy and entitled to vote on the proposal is required to approve, on an advisory basis, the frequency of future advisory votes on the compensation of the Company’s named executive officers to occur every three years, every two years or every year. If none of the frequency alternatives receives the vote of the holders of a majority of the shares present at the meeting in person or represented by proxy and entitled to vote on the proposal, then we will consider shareholders to have approved the frequency selected by holders of a plurality of the votes cast. Broker non-votes and abstentions have no effect on the outcome of the vote.

Mr. Tracy W. Krohn, our Chairman of the Board, Chief Executive Officer and President, and who is our largest shareholder, controlling approximately 32.9% of the voting power entitled to vote at the Annual Meeting as of April 20, 2023, intends to vote all of his shares of Common Stock in accordance with the Board's recommendations set forth herein.

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Proposal 3
Advisory Vote on
Executive Compensation

Recommendation of the Board

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Introduction

We are asking that our shareholders provide advisory, non-binding approval of the compensation paid to our Named Executive Officers, as described in the “Compensation Discussion and Analysis” (“CD&A”) section of this proxy statement. The Board recognizes that executive compensation is an important matter for our shareholders. As described in detail in the CD&A section of this proxy statement, the Compensation Committee is tasked with the implementation of our executive compensation philosophy, and the core of that philosophy has been and continues to be to pay our executive officers based on the Company’s performance. In particular, the Compensation Committee strives to attract, as needed, and retain the best possible executive talent, to incentivize the Named Executive Officers’ efforts on our behalf in a way that supports our financial performance objectives and business strategy, and to align their incentives with enhancement of shareholder value. To do so, the Compensation Committee typically uses a combination of short- and long-term incentive compensation to reward near-term excellent performance and to encourage executives’ commitment to our long-range, strategic business goals. It is always the intention of the Compensation Committee that our executive officers be compensated competitively and consistently with our strategy, sound corporate governance principles, and shareholder interests and concerns, and we believe that the 2022 decisions regarding incentive compensation were consistent with these principles.

As described in the CD&A section of this proxy statement, we believe our historical compensation program is effective, appropriate and strongly aligned with the long-term interests of our shareholders and that the total compensation packages provided to the Named Executive Officers (including potential payouts upon a termination or change of control) are reasonable and not excessive. As you consider this Proposal 3, we urge you to read the CD&A section of this proxy statement for additional details on executive compensation, including more detailed information about our compensation philosophy and objectives and the past compensation of our Named Executive Officers, and to review the tabular disclosures regarding compensation of our Named Executive Officers together with the accompanying narrative disclosures in the “Executive Compensation and Related Information” section of this proxy statement.

In connection with the shareholder outreach program discussed in this proxy statement, we have also conducted a comprehensive review of our compensation practices, and we have proposed changes to our 2023 compensation

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program to more closely align our practices with our peer group and affirm the Company’s commitment to pay and performance alignment over the long-term. Those changes are not the subject of the advisory approval of the shareholders in this proxy statement, although we encourage you to see “Compensation Discussion and Analysis— Compensation Changes for 2023” for more information on such comprehensive changes to our compensation programs. These changes are not reflected in the historical 2022 compensation information presented in this proxy statement. We believe it is important for shareholders, in deciding how they will vote on this matter, to consider not just the historical 2022 compensation information, but also the substantial changes to our compensation practices driven by the recent amendment to Mr. Krohn’s employment agreement and other changes adopted by our Compensation Committee.

We believe that the shareholders, by voting for directors individually as described in Proposal 1, have always had a clear ability to express their approval or disapproval of the performance of our directors and, specifically the directors serving on the Compensation Committee; however, in 2010, Congress enacted the Dodd-Frank Act, which requires, among other things, a non-binding advisory “say-on-pay” vote and gives our shareholders the additional opportunity to express their views on our Named Executive Officers’ compensation. This vote is not intended to address any specific item of compensation, but rather the overall compensation of our Named Executive Officers and the philosophy, policies and practices described in this proxy statement.

As an advisory vote, Proposal 3 is not binding on the Board or the Compensation Committee, will not overrule any decisions made by the Board or the Compensation Committee, or require the Board or the Compensation Committee to take any action. Although the vote is non-binding, the Board and the Compensation Committee value the opinions of our shareholders and will carefully consider the outcome of the vote when making future compensation decisions for executive officers. In particular, to the extent there is any significant vote against the compensation of our Named Executive Officers as disclosed in this proxy statement, we will consider our shareholders’ concerns and the Compensation Committee will evaluate whether any actions are necessary to address those concerns.

Text of the Resolution to be Adopted

We are asking shareholders to vote “FOR” the following resolution:

“RESOLVED, that the Company’s shareholders approve, on an advisory basis, the compensation of the Named Executive Officers, as disclosed in the Company’s Proxy Statement for the 2023 Annual Meeting of Shareholders pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including the Compensation Discussion and Analysis, the 2022 Summary Compensation Table and the other related tables and disclosure.”

Required Vote

The affirmative vote of a majority of the shares present at the meeting in person or represented by proxy and entitled to vote on the proposal is required to approve, by non-binding vote, executive compensation. Abstentions and broker non-votes have no effect on the outcome of the vote.

Mr. Tracy W. Krohn, our Chairman of the Board, Chief Executive Officer and President, and who is our largest shareholder, controlling approximately 32.9% of the voting power entitled to vote at the Annual Meeting as of April 20, 2023, intends to vote all of his shares of Common Stock in accordance with the Board’s recommendations set forth herein.

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Proposal 4
Ratification of Appointment of
Independent Accountants

Recommendation of the Board

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The Audit Committee of the Board (the “Audit Committee”) appointed Ernst & Young LLP (“EY”), independent registered public accountants, to audit our consolidated financial statements as of and for the year ending December 31, 2023. We are advised that no member of EY has any direct or material indirect financial interest in our Company or, during the past three years, has had any connection with us in the capacity of promoter, underwriter, voting trustee, director, officer or employee.

If the appointment is not ratified, the Audit Committee will consider the appointment of other independent registered public accountants. A representative of EY is expected to be present at the Annual Meeting, will be offered the opportunity to make a statement if the representative desires to do so and will be available to respond to appropriate questions.

Required Vote

The affirmative vote of a majority of the shares present at the meeting in person or represented by proxy and entitled to vote on the proposal is required to ratify the appointment of our independent registered public accounting firm. An abstention has the same effect as voting “AGAINST” the proposal. Brokers have discretionary authority in the absence of timely instructions from their customers to vote on this proposal. As a result, there may be no broker non-votes with respect to this proposal.

Mr. Tracy W. Krohn, our Chairman of the Board, Chief Executive Officer and President, and who is our largest shareholder, controlling approximately 32.9% of the voting power entitled to vote at the Annual Meeting as of April 20, 2023, intends to vote all of his shares of Common Stock in accordance with the Board’s recommendations set forth herein.

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Proposal 5
Amendment to the Articles of
Incorporation to Increase the
Company’s Authorized Share Capital

Recommendation of the Board

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The Proposal

The Board is asking shareholders to consider and vote upon an amendment to Article IV of the Articles of Incorporation to increase the Company’s authorized capital stock (the “Authorized Capital Amendment”). Article IV of the Articles of Incorporation currently authorizes 200,000,000 shares of Common Stock, par value $0.00001 per share, and 20,000,000 shares of preferred stock, par value $0.00001 per share. The Authorized Capital Amendment would increase the authorized shares of Common Stock to 400,000,000 shares, representing a 100% increase. The authorized shares of preferred stock would remain at 20,000,000. The Authorized Capital Amendment would increase the authorized number of shares of Common Stock by deleting the stricken text in red font from, and adding the double underlined text in blue font to, Article IV as follows:

The aggregate number of shares of capital stock which the Corporation shall have authority to issue is four hundred twenty million 220,000,000(420,000,000) shares, of which two hundred four hundred million (200400,000,000) shares shall be designated as Common Stock, par value $0.00001 per share, and twenty million (20,000,000) shares shall be designated as Preferred Stock, par value $0.00001 per share.

The additional shares of Common Stock authorized by the Authorized Capital Amendment would become a part of the existing class of the Company’s Common Stock and, if and when issued, would have the same rights and privileges as the shares of Common Stock currently authorized and outstanding. The Authorized Capital Amendment will not affect the par value of the Common Stock, which will remain at $0.00001 per share. The newly authorized shares of Common Stock would not (and the shares of Common Stock presently outstanding do not) entitle the holders thereof to preemptive rights to purchase shares of Common Stock or other securities or to cumulative voting rights. In addition, under Texas law, our shareholders are not entitled to dissenters’ or appraisal rights in connection with the proposed increase in the number of shares of Common Stock authorized for issuance.

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Purpose and Effect of the Authorized Capital Amendment

As of March 31, 2022, 146,460,902 shares of Common Stock were outstanding and an additional 33,893,263 shares of Common Stock were reserved for issuance for future purposes, representing usage of 90.2%. The purpose of the Authorized Capital Amendment is to provide the Company with sufficient common share capacity to issue shares of Common Stock for general corporate purposes, including for purposes of raising capital to fund the growth of the Company’s business and to repay the Company’s outstanding indebtedness, without the further approval of the Company’s shareholders and the expense and delay of another shareholders’ meeting. The Board believes that this additional flexibility is warranted.

The Company does not propose the Authorized Capital Amendment with the intention of using the additional shares for anti-takeover purposes, although the Company could theoretically use the additional shares to make more difficult or to discourage an attempt to acquire control of the Company. The Board is not aware of any pending or threatened efforts to acquire control of the Company.

Required Vote

The affirmative vote of the holders of at least two-thirds of the outstanding shares of Common Stock is required to approve the Authorized Capital Amendment. An abstention and a broker non-vote each have the same effect as voting “AGAINST” the Authorized Capital Amendment.

Mr. Tracy W. Krohn, our Chairman of the Board, Chief Executive Officer and President, and who is our largest shareholder, controlling approximately 32.9% of the voting power entitled to vote at the Annual Meeting as of April 20, 2023, intends to vote all of his shares of Common Stock in accordance with the Board’s recommendations set forth herein.

Description of Other Immaterial Changes

If the Authorized Capital Amendment is approved, and assuming all other proposed amendments to the Articles of Incorporation described in this proxy statement are also approved, we intend to file with the Secretary of State of the State of Texas the Second Amended and Restated Certificate of Incorporation in the form attached hereto as Annex A, which includes certain other minor, immaterial changes to streamline and modernize the Articles of Incorporation. Such changes, which do not substantively affect shareholder rights, include (i) adding the date of incorporation of the Company in Texas, (ii) updating references to the Texas Business Organizations Code and (iii) the adoption of gender-neutral terms when referring to particular positions, offices or title holders (the “Immaterial Changes”). The Second Amended and Restated Certificate of Incorporation that we will file with the Secretary of State of the State of Texas will reflect only the proposed amendments that are approved and the Immaterial Changes.

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Proposal 6
Amendment to the Articles of
Incorporation to Eliminate
Supermajority Voting Requirements

Recommendation of the Board

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The Proposal

The Board is asking shareholders to consider and vote upon a proposal to approve an amendment (the “Sixty-Six and Two-Thirds Percent Voting Amendment”) to the Articles of Incorporation to provide shareholders greater opportunity to participate in governance by eliminating all supermajority voting requirements under Texas and other applicable law. Among other supermajority voting requirements, the Texas Business Organizations Code provides that, unless otherwise provided by the certificate of formation, approval of the following actions, subject to certain exceptions, requires the affirmative vote of at least two-thirds of the outstanding shares entitled to vote thereon:

Because the Articles of Incorporation do not provide otherwise, approval of the foregoing actions requires a two-thirds vote of the Company’s shareholders. The Board proposes to lower the vote required to approve such actions to a simple majority vote by adding a new article to the Articles of Incorporation as follows:

Notwithstanding any provision of law requiring the affirmative vote of a greater percentage or proportion than a majority of the outstanding shares of all classes or of any class of stock of the Corporation entitled to vote to take or authorize any action, including without limitation (1) any amendment of these Articles of Incorporation, (2) any disposition or sale of all or substantially all of the Corporation’s assets, (3) any dissolution of the Corporation and (4) any plan of merger, consolidation or exchange, such action may be taken or authorized upon the affirmative vote of a majority of the outstanding shares of all classes or of any class of stock of the Corporation entitled to vote thereon, except as may be otherwise provided in these Articles of Incorporation or in the bylaws.

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Purpose and Effect of the Sixty-Six and Two-Thirds Percent Voting Amendment

Approval of the Sixty-Six and Two-Thirds Percent Voting Amendment proposal would lower the requisite vote to approve fundamental actions that would otherwise require a two-thirds vote under Texas or other law to a simple majority.

As part of its ongoing review of corporate governance matters and in deciding to approve the Sixty-Six and Two-Thirds Percent Voting Amendment proposal and to recommend that the shareholders vote to adopt the Sixty-Six and Two-Thirds Percent Voting Amendment proposal, the Board considered the existing supermajority voting requirement, including the enhanced benefit of providing shareholders greater opportunity to participate in corporate governance. In addition, the Board considered the views and opinions of the Company’s largest shareholders that engaged in the Company’s shareholder outreach program, shareholder voting guidelines of proxy advisory firms such as Institutional Shareholder Services and Glass Lewis and the opinions of various advisors on corporate governance.

Therefore, following careful consideration of the matter, and due to its belief that a majority of the outstanding voting shares standard provides greater accountability to shareholders and promotes stronger corporate governance, the Board has adopted resolutions to approve the Sixty-Six and Two-Thirds Percent Voting Amendment proposal, to declare the Sixty-Six and Two-Thirds Percent Voting Amendment proposal advisable and in the best interests of the Company and its shareholders and to submit the Sixty-Six and Two-Thirds Percent Voting Amendment proposal to its shareholders for consideration.

Required Vote

The affirmative vote of the holders of at least two-thirds of the outstanding shares of Common Stock is required to approve the Sixty-Six and Two-Thirds Percent Voting Amendment. An abstention and a broker non-vote each have the same effect as voting “AGAINST” the Sixty-Six and Two-Thirds Percent Voting Amendment.

Mr. Tracy W. Krohn, our Chairman of the Board, Chief Executive Officer and President, and who is our largest shareholder, controlling approximately 32.9% of the voting power entitled to vote at the Annual Meeting as of April 20, 2023, intends to vote all of his shares of Common Stock in accordance with the Board’s recommendations set forth herein.

Description of Other Immaterial Changes

If the Sixty-Six and Two-Thirds Percent Voting Amendment is approved, and assuming all other proposed amendments to the Articles of Incorporation described in this proxy statement are also approved, we intend to file with the Secretary of State of the State of Texas the Second Amended and Restated Certificate of Incorporation in the form attached hereto as Annex A, which includes the Immaterial Changes. The Second Amended and Restated Certificate of Incorporation that we will file with the Secretary of State of the State of Texas will reflect only the proposed amendments that are approved and the Immaterial Changes.

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Proposal 7
Amendment to the Articles of
Incorporation to Provide Shareholders the
Ability to Amend the Bylaws

Recommendation of the Board

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The Proposal

The Board is asking shareholders to consider and vote upon a proposal to approve an amendment (the “Shareholder Bylaw Amendment”) to the Articles of Incorporation to provide shareholders the ability to amend the Bylaws. Article XIII of the Articles of Incorporation currently provides that the Company’s shareholders are expressly prohibited from amending or repealing the Bylaws. The Shareholder Bylaw Amendment would delete the stricken text in red font from, and add the double underlined text in blue font to, Article XIII as follows:

The Board of Directors is expressly authorized to adopt, amend and repeal the bylaws. The corporation’s shareholders are hereby expressly prohibited fromauthorized to adopt, amending orand repealing the bylaws.

Purpose and Effect of the Shareholder Bylaw Amendment

The effect of the Shareholder Bylaw Amendment is to provide shareholders the ability to amend the Bylaws pursuant to Section 21.058 of the Texas Business Organizations Code, which provides that unless the certificate of formation or a bylaw adopted by the shareholders provides otherwise as to all or a part of a corporation’s bylaws, a corporation’s shareholders may amend, repeal, or adopt the corporation’s bylaws.

As part of its ongoing review of corporate governance matters, the Board considered the advantages and disadvantages of maintaining the Company’s position that reserves the exclusive right to amend the Bylaws to the Board. The Board believes in the importance of maintaining shareholder confidence by demonstrating that it is responsive and accountable to shareholders and committed to strong corporate governance. This requires the Board to carefully balance sometimes competing interests. In this regard, the Board considered shareholder feedback supporting the ability of shareholders to amend the Bylaws, as well as the fact that under certain circumstances, allowing the Bylaws to be amended by shareholders could not be in the best long-term interests of the Company because of the potential risk of abuse by a single shareholder or special interest group of shareholders with no fiduciary duties to other shareholders. Lastly, the Board considered the views and opinions of the Company’s largest shareholders that engaged in the Company’s shareholder outreach program, shareholder

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voting guidelines of proxy advisory firms such as Institutional Shareholder Services and Glass Lewis and the opinions of various advisors on corporate governance. After balancing these interests, the Board decided to submit the Shareholder Bylaw Amendment to a shareholder vote.

Required Vote

The affirmative vote of the holders of at least two-thirds of the outstanding shares of Common Stock entitled to vote is required to approve the adoption of the Shareholder Bylaw Amendment. An abstention and a broker non-vote each have the same effect as voting “AGAINST” the Shareholder Bylaw Amendment.

Mr. Tracy W. Krohn, our Chairman of the Board, Chief Executive Officer and President, and who is our largest shareholder, controlling approximately 32.9% of the voting power entitled to vote at the Annual Meeting as of April 20, 2023, intends to vote all of his shares of Common Stock in accordance with the Board’s recommendations set forth herein.

Description of Other Immaterial Changes

If the Shareholder Bylaw Amendment is approved, and assuming all other proposed amendments to the Articles of Incorporation described in this proxy statement are also approved, we intend to file with the Secretary of State of the State of Texas the Second Amended and Restated Certificate of Incorporation in the form attached hereto as Annex A, which includes the Immaterial Changes. The Second Amended and Restated Certificate of Incorporation that we will file with the Secretary of State of the State of Texas will reflect only the proposed amendments that are approved and the Immaterial Changes.

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Proposal 8
Amendment to the Articles of
Incorporation to Lower the Ownership
Threshold Required for Shareholders to
Call a Special Shareholder Meeting

Recommendation of the Board

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The Proposal

The Board is asking shareholders to consider and vote upon a proposal to approve an amendment (the “Special Meeting Amendment”) to the Articles of Incorporation to lower the threshold ownership required for shareholders to call a special meeting from 30% to 25%. The Special Meeting Amendment would amend Article VI of the Articles of Incorporation by deleting the stricken text in red font from, and adding the double underlined text in blue font to, Article VI as follows:

An annual meeting of the shareholders shall be held at such times as may be stated or fixed in accordance with the bylaws. Special meetings may only be called (1) by the Chairman of the Board (if any), the President, the Board of Directors, or such other person or persons as may be authorized in the articles of incorporation or the bylaws or (2) by the holders of not less than thirtytwenty-five percent (3025%) percent of all the shares entitled to vote at the proposed special meeting. No action of the stockholders may be taken by written consent or consents of stockholders.

Purpose and Effect of the Special Meeting Amendment

The Special Meeting Amendment would permit shareholders who own at least 25% of our outstanding common stock in the aggregate to call a special meeting of shareholders. The current minimum stock ownership requirement set forth in our Articles of Incorporation to call a special meeting is 30% of our outstanding common stock.

The Board is committed to high standards of corporate governance, including taking steps to achieve greater transparency and accountability to our shareholders. As part of its regular and ongoing review of the Company’s corporate governance practices, the Board carefully reviewed the appropriate threshold for shareholders to be

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able to request a special meeting. The Board considered the views and opinions of the Company’s largest shareholders that engaged in the Company’s shareholder outreach program, shareholder voting guidelines of proxy advisory firms such as Institutional Shareholder Services and Glass Lewis and the opinions of various advisors on corporate governance.

In considering the appropriate threshold, the Board also evaluated the Company’s strong corporate governance policies and practices, including the many ways shareholders can contact the Board and senior management on important matters outside of the annual meeting cycle. The Board believes that a 25% threshold strikes an appropriate balance between addressing shareholder concerns, enhancing shareholder access and minimizing the potential harms associated with allowing a small number of shareholders to call special meetings.

Required Vote

The affirmative vote of the holders of at least two-thirds of the outstanding shares of Common Stock is required to approve the Special Meeting Amendment. An abstention and a broker non-vote each have the same effect as voting “AGAINST” the Special Meeting Amendment.

Mr. Tracy W. Krohn, our Chairman of the Board, Chief Executive Officer and President, and who is our largest shareholder, controlling approximately 32.9% of the voting power entitled to vote at the Annual Meeting as of April 20, 2023, intends to vote all of his shares of Common Stock in accordance with the Board’s recommendations set forth herein.

Description of Other Immaterial Changes

If the Special Meeting Amendment is approved, and assuming all other proposed amendments to the Articles of Incorporation described in this proxy statement are also approved, we intend to file with the Secretary of State of the State of Texas the Second Amended and Restated Certificate of Incorporation in the form attached hereto as Annex A, which includes the Immaterial Changes. The Second Amended and Restated Certificate of Incorporation that we will file with the Secretary of State of the State of Texas will reflect only the proposed amendments that are approved and the Immaterial Changes.

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Proposal 9
Amendment to the Articles of
Incorporation to Provide Shareholders the
Ability to Act Via Written Consent

Recommendation of the Board

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The Proposal

The Board is asking shareholders to consider and vote upon a proposal to approve an amendment (the “Written Consent Amendment”) to the Articles of Incorporation to provide shareholders the ability to act via written consent. The Written Consent Amendment would amend Article VI of the Articles of Incorporation by deleting the stricken text in red font as follows:

An annual meeting of the shareholders shall be held at such times as may be stated or fixed in accordance with the bylaws. Special meetings may only be called (1) by the Chairman of the Board (if any), the President, the Board of Directors, or such other person or persons as may be authorized in the articles of incorporation or the bylaws or (2) by the holders of not less than thirty (30) percent of all the shares entitled to vote at the proposed special meeting. No action of the stockholders may be taken by written consent or consents of stockholders.

The Written Consent Amendment would also add a new article to the Articles of Incorporation as follows:

Any action required by the Texas Business Organizations Code, as presently in effect and as hereafter amended, to be taken at any annual or special meeting of shareholders, or any action which may be taken at any annual or special meeting of shareholders, may be taken without a meeting, without prior notice, and without a vote, if a consent or consents in writing, setting forth the action so taken, shall be signed by the holder or holders of shares having not less than the minimum number of votes that would be necessary to take such action at a meeting at which the holders of all shares entitled to vote on the action were present and voted.

Purpose and Effect of the Written Consent Amendment

The Board is committed to strong corporate governance and responsiveness to shareholders and believes in maintaining policies and practices that serve the best interests of all shareholders. The Board recognizes that the

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right of shareholders to act by written consent may provide an effective balance between ensuring the Board’s accountability to shareholders and enabling the Board and management to operate in an effective manner and may provide a complementary mechanism for shareholders to raise matters between annual meetings. The Board also considered the views and opinions of the Company’s largest shareholders that engaged in the Company’s shareholder outreach program, shareholder voting guidelines of proxy advisory firms such as Institutional Shareholder Services and Glass Lewis and the opinions of various advisors on corporate governance.

In addition, the Texas Business Organizations Code includes important procedural safeguards that the Board believes are sufficient to prevent abuse while also making the written consent process available to shareholders under appropriate circumstances. Accordingly, after balancing the foregoing interests and considerations, the Board believes that it would be appropriate to allow shareholders to act by written consent.

Required Vote

The affirmative vote of the holders of at least two-thirds of the outstanding shares of Common Stock is required to approve the Written Consent Amendment. An abstention and a broker non-vote each have the same effect as voting “AGAINST” the Written Consent Amendment.

Mr. Tracy W. Krohn, our Chairman of the Board, Chief Executive Officer and President, and who is our largest shareholder, controlling approximately 32.9% of the voting power entitled to vote at the Annual Meeting as of April 20, 2023, intends to vote all of his shares of Common Stock in accordance with the Board’s recommendations set forth herein.

Description of Other Immaterial Changes

If the Written Consent Amendment is approved, and assuming all other proposed amendments to the Articles of Incorporation described in this proxy statement are also approved, we intend to file with the Secretary of State of the State of Texas the Second Amended and Restated Certificate of Incorporation in the form attached hereto as Annex A, which includes the Immaterial Changes. The Second Amended and Restated Certificate of Incorporation that we will file with the Secretary of State of the State of Texas will reflect only the proposed amendments that are approved and the Immaterial Changes.

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Proposal 10
The W&T Offshore, Inc.
2023 Incentive Compensation Plan
Proposal

Recommendation of the Board

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The Proposal

The Board believes that stock-based or incentive awards, including restricted stock units and performance awards, can play an important role in the success of the Company by encouraging and enabling our employees, officers, non-employee directors, and consultants, upon whose judgment, initiative, and efforts we largely depend for the success of our business, to acquire a proprietary interest in the Company. The Board anticipates that providing such persons with a direct stake in the Company will assure a closer alignment of the interests of such individuals with those of the Company and its shareholders, thereby stimulating their efforts on the Company’s behalf and strengthening their desire to remain with the Company.

On April 20, 2023, the Board approved the W&T Offshore, Inc. 2023 Incentive Compensation Plan, or the “2023 Plan”, subject to approval by the shareholders, primarily for the purpose of providing sufficient reserves of shares of our Common Stock to ensure our ability to continue to provide new hires, employees and management with equity incentives. If approved, the number of shares reserved and available for issuance under the 2023 Plan would be 10,000,000 shares.

Background and Rationale for Replacing the Prior Plans

The W&T Offshore, Inc. Amended and Restated Incentive Compensation Plan, as amended, and the 2004 Directors Compensation Plan of the Company, as amended on March 4, 2020 (referred to herein as the “Prior Plans”), authorize awards to be granted covering up to 19,834,210 shares of our Common Stock, subject to adjustment in accordance with the terms of the Prior Plans upon certain changes in capitalization and similar events. As of March 31, 2023, there were 6,125,546 shares of our common stock remaining available for new awards under the Prior Plans, after counting outstanding performance-based awards at the maximum payout level. The Company has not granted any awards under the Prior Plans since March 15, 2023, and will not grant any future awards under the Prior Plans after May 2023 if the 2023 Plan is approved by our shareholders at the Annual Meeting. Any awards granted after May 2023 will reduce the 2023 Plan reserve, assuming shareholder approval.

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If the 2023 Plan is approved by our shareholders, 10,000,000 shares of our Common Stock will be authorized for issuance thereunder, subject to the share recycling and adjustment provisions of the 2023 Plan described below. As of March 31, 2023, the Company has 146,460,902 common shares outstanding. Assuming approval of the 2023 Plan, the potential dilution and overhang would be as follows:

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We believe that aligning the interests of employees and other service providers with those of long-term shareholders is a key element of compensation at the Company; accordingly, it is essential that the Company maintain the flexibility and sufficient share reserve to appropriately incentivize employees and other service providers. The 2023 Plan is intended to replace the Prior Plans and is needed to continue our equity compensation program, which is an important element in our ability to remain competitive in attracting and retaining experienced talent. We believe that our ability to recruit, retain and incentivize top talent will be adversely affected if the 2023 Plan Proposal is not approved.

2023 Plan Best Practices

The 2023 Plan includes several features that are consistent with the interests of shareholders and corporate governance best practices, including the following:

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Summary of the 2023 Plan

The 2023 Plan will provide for the grant of both incentive stock options (“ISOs”), which are intended to qualify for favorable tax treatment under Section 422 of the Code, and nonqualified stock options, as well as the grant of stock appreciation rights, restricted stock, restricted stock units, performance awards, stock awards, dividend equivalents, other stock-based awards, cash awards and substitute awards intended to align the interests of our service providers with those of our shareholders. This section summarizes material features of the 2023 Plan. The

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summary is qualified in its entirety by reference to the complete text of the 2023 Plan, which is attached as Annex B to this proxy statement.

Securities to be Offered

The aggregate number of shares of common stock that may be issued or used for reference purposes or with respect to which awards may be granted under the 2023 Plan is 10,000,000 shares (the “Share Reserve”). The aggregate number of shares that may be issued or used under the 2023 Plan pursuant to ISOs shall not exceed an amount equal to the Share Reserve. Shares of Common Stock subject to an award under the 2023 Plan or the Prior Plans that expires or is canceled, forfeited or otherwise terminated without delivery of shares will again be available for delivery pursuant to other awards under the 2023 Plan, but shares tendered in payment of an option, shares covered by a stock-settled stock appreciation right (“SAR”) that were not issued upon settlement, and shares delivered or withheld to satisfy any tax withholding obligations with respect to options and SARs will not be available for delivery pursuant to other awards under the 2023 Plan. The number of shares of Common Stock available for issuance under the 2023 Plan will not be reduced by shares issued pursuant to awards issued or assumed in connection with a merger or acquisition as contemplated by applicable stock exchange rules.

Administration

The 2023 Plan is administered by the Compensation Committee. The Compensation Committee has full power to select, from among the individuals eligible for awards, the individuals to whom awards will be granted, to make any combination of awards to participants, and to determine the specific terms and conditions of each award, subject to the provisions of the 2023 Plan. The Compensation Committee may delegate to an officer of the Company the authority to grant awards to employees who are not subject to the reporting and other provisions of Section 16 of the Exchange Act, subject to certain limitations and guidelines.

Eligibility

Employees, consultants and non-employee directors of our company and its affiliates and subsidiaries will be eligible to receive awards under the 2023 Plan. As stated above, the basis for participation in the 2023 Plan is the Compensation Committee’s decision to select, in its sole discretion, participants from among those eligible. As of March 31, 2023, approximately 350 employees, 320 consultants and 3 non-employee directors will be eligible to participate in the 2023 Plan.

Non-Employee Director Compensation Limits

The fair value of any awards granted under the 2023 Plan to a non-employee director as compensation for services on the Board, during any one fiscal year, taken together with any cash fees paid to such non-employee director during such period in respect of the non-employee director’s services as a member of the Board during such year, may not exceed $550,000, provided that the Board can make exceptions to this limit so long as the applicable non-employee director does not participate in the decision and for any calendar year in which a non-employee director (a) first commences service on the Board, (b) serves on a special committee of the Board, or (c) serves as lead director or non-executive chair of the Board, such limit shall be increased to $750,000, provided, that the limit shall be applied without regard to awards or other compensation, if any, provided to a non-employee director during any period in which such individual was an employee of the Company or any affiliate or was otherwise providing services to the Company or to any affiliate other than in the capacity as a non-employee director.

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Types of Awards

Options

The 2023 Plan provides for the grant of both ISOs intended to qualify under Section 422 of the Code and nonstatutory stock options (“NSOs”).We may grant options to eligible persons, except that ISOs may only be granted to persons who are our employees or employees of one of our parents or subsidiaries, in accordance with Section 422 of the Code. The exercise price of an option cannot be less than 100% of the fair market value of a share of common stock on the date on which the option is granted and the option must not be exercisable for longer than ten years following the date of grant. However, in the case of an ISO granted to an individual who owns (or is deemed to own) at least 10% of the total combined voting power of all classes of our equity securities, the exercise price of the option must be at least 110% of the fair market value of a share of common stock on the date of grant and the option must not be exercisable more than five years from the date of grant.

Options granted under the 2023 Plan generally must be exercised by the optionee before the earlier of the expiration of such option or at such time or times as shall be determined by the Committee at the time of grant. Each option award agreement will set forth the extent to which the optionee will have the right to exercise the option following the termination of the optionee’s service with us, and the right to exercise the option of any executors or administrators of the optionee’s estate or any person who has acquired such options directly from the optionee by bequest or inheritance.

Payment of the exercise price may be made in a manner approved by the Compensation Committee, which may include (a) immediately available funds in U.S. dollars, (b) delivery of common stock having a value equal to the exercise price, (c) a broker assisted cashless exercise, or (d) any other means approved by the Compensation Committee.

SARs

A SAR is the right to receive an amount equal to the excess of the fair market value of one share of common stock on the date of exercise over the grant price of the SAR. SARs entitle the recipient to shares of common stock, or cash, equal to the value of the appreciation in the stock price over the exercise price. The grant price of a SAR cannot be less than 100% of the fair market value of a share of common stock on the date on which the SAR is granted. The term of a SAR may not exceed ten years. The Committee has the discretion to determine other terms and conditions of a SAR award.

Restricted Stock Awards

A restricted stock award is a grant of shares of common stock subject to the restrictions on transferability and risk of forfeiture imposed by the Compensation Committee. Unless otherwise determined by the Compensation Committee and specified in the applicable award agreement, the holder of a restricted stock award has rights as a shareholder, including the right to vote the shares of common stock subject to the restricted stock award or to receive dividends on the shares of common stock subject to the restricted stock award during the restriction period. Dividends distributed prior to vesting may be subject to the same restrictions and risk of forfeiture as the restricted shares with respect to which the distribution was made.

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Restricted Stock Units

A restricted stock unit is a right to receive cash, shares of common stock or a combination of cash and shares of common stock at the end of a specified period equal to the fair market value of one share of common stock on the date of vesting. Restricted stock units may be subject to the restrictions, including a risk of forfeiture, imposed by the Compensation Committee. The Compensation Committee may determine that a grant of restricted stock units will provide a participant a right to receive dividend equivalents, which entitles the participant to receive the equivalent value (in cash or shares of common stock) of dividends paid on the underlying shares of common stock. Dividend equivalent rights may be paid currently or credited to an account, settled in cash or shares, and may be subject to the same restrictions as the restricted stock units with respect to which the dividend equivalent rights are granted.

Performance Awards

A performance award is an award that vests and/or becomes exercisable or distributable subject to the achievement of certain performance goals during a specified performance period, as established by the Compensation Committee. Performance awards may be granted alone or in addition to other awards under the 2023 Plan, and may be paid in cash, shares of common stock, other property or any combination thereof, in the sole discretion of the Compensation Committee.

Other Stock-Based Awards

Other stock-based awards are awards denominated or payable in, valued in whole or in part by reference to, or otherwise based on or related to, the value of shares of common stock.

Cash Awards

Cash awards may be granted on a free-standing basis or as an element of, a supplement to, or in lieu of any other award.

Substitute Awards

Awards may be granted under the 2023 Plan in substitution for similar awards held for individuals who become participants as a result of a merger, consolidation or acquisition of another entity by or with the Company or one of its affiliates; provided, however, that options and SARs may not be repriced without shareholder approval.

Dividend Equivalents Rights

Dividend equivalent rights may be granted at the discretion of the Compensation Committee, and represent the right to receive the value of dividends, if any, paid by in respect of the number of shares of common stock underlying an award. Dividend equivalent rights will be subject to the same vesting or performance conditions as the underlying award and will be paid only when the underlying award has become fully vested and will be forfeited if the related award becomes forfeited. Dividend equivalent rights may be settled in cash, shares or other property, or a combination thereof as determined by the Compensation Committee. Dividend equivalent rights may not be granted in respect of awards of options or SARs.

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Minimum Vesting

Awards under the 2023 Plan will be subject to a minimum one year vesting period provided that (i) up to five percent of the shares of Common Stock reserved for issuance under the 2023 Plan as of the effective date of the 2023 Plan may be issued pursuant to awards that do not comply with such minimum one year vesting period and (ii) an award granted to a non-employee director may vest on the earlier of (a) the date that is one year following the date on which such award is granted or (b) the first annual meeting of the Company’s shareholders that occurs following the date such award is granted, provided that such vesting period may not be less than 50 weeks following the date such award is granted.

Certain Transactions

If any change is made to our capitalization, such as a stock split, stock combination, stock dividend, exchange of stock or other recapitalization, merger or otherwise, which results in an increase or decrease in the number of outstanding shares of common stock, appropriate adjustments will be made by the Compensation Committee in the shares subject to an award under the 2023 Plan. The Compensation Committee will also have the discretion to make certain adjustments to awards in the event of a change in control of the Company, such as the assumption or substitution of outstanding awards, the purchase of any outstanding awards in cash based on the applicable change in control price, the ability for participants to exercise any outstanding stock options, SARs or other stock-based awards upon the change in control (and if not exercised such awards will be terminated), and the acceleration of vesting or exercisability of any outstanding awards.

Clawback

All awards granted under the 2023 Plan are subject to reduction, cancelation or recoupment under our clawback policy.

Plan Amendment and Termination

The Compensation Committee may amend or terminate any award, award agreement or the 2023 Plan at any time, provided that the rights of a participant granted an award prior to such amendment or termination may not be impaired without such participant’s consent. In addition, shareholder approval will be required for any amendment to the extent necessary to comply with applicable law or exchange listing standards. The Compensation Committee will not have the authority, without the approval of shareholders, to amend any outstanding option or share appreciation right to reduce its exercise price per share, or to otherwise replace such award in a manner that constitutes a repricing of such award. The 2023 Plan will remain in effect for a period of ten years (unless earlier terminated by the Board).

Material U.S. Federal Income Tax Consequences

The following is a general summary under current law of the principal U.S. federal income tax consequences related to awards under the 2023 Plan. This summary describes the general federal income tax principles that apply, as based on current law and interpretational authorities which are subject to change at any time, and is provided only for general information. This summary does not purport to be complete discussion of all potential tax effects relevant to recipients of awards under the 2023 Plan. No attempt has been made to discuss any potential non-U.S., state, or local tax consequences. This summary is not intended as tax advice to participants, who should consult their own tax advisors.

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Tax Consequences to Participants under the 2023 Plan

Non-Qualified Stock Options and Stock Appreciation Rights

If a participant is granted a NSO or SAR under the 2023 Plan, the participant should not have taxable income on the grant of the NSO or SAR. Upon the exercise of a NSO or SAR, a participant will recognize ordinary compensation income, subject to withholding obligations for an employee, in an amount equal to the fair market value of the shares acquired on the date of exercise, less the exercise price paid for the shares. The participant’s basis in the common stock received upon the exercise of a NSO or SAR for purposes of determining gain or loss on a subsequent sale or disposition of such shares generally will be the fair market value of our common stock on the date the participant exercises such option or SAR. When a participant sells the common stock acquired as a result of the exercise of a NSO or SAR, any appreciation or depreciation in the value of the common stock after the exercise date will be taxable as a long-term or short-term capital gain or loss for federal income tax purposes, depending on the holding period. The common stock must be held for more than twelve (12) months to qualify for long-term capital gain treatment. Subject to the discussion under “— Tax Consequences to the Company” below, the Company and its subsidiaries or affiliates generally should be entitled to a federal income tax deduction at the time and for the same amount as the participant recognizes ordinary income.

Incentive Stock Options

A participant receiving ISOs should not recognize taxable income upon grant. Additionally, if applicable holding period requirements are met, the participant should not recognize taxable income at the time of exercise. However, the excess of the fair market value of the shares of our common stock received over the option exercise price is an item of tax preference income potentially subject to the alternative minimum tax. If stock acquired upon exercise of an ISO is held for a minimum of two years from the date of grant and one year from the date of exercise and otherwise satisfies the ISO requirements, the gain or loss (in an amount equal to the difference between the fair market value on the date of disposition and the exercise price) upon disposition of the stock will be treated as a long-term capital gain or loss, and we will not be entitled to any deduction. If the holding period requirements are not met, the ISO will be treated as one that does not meet the requirements of the Code for ISOs and the participant will recognize ordinary income at the time of the disposition equal to the excess of the amount realized over the exercise price, but not more than the excess of the fair market value of the shares on the date the ISO is exercised over the exercise price, with any remaining gain or loss being treated as capital gain or capital loss. The Company and its subsidiaries or affiliates generally are not entitled to a federal income tax deduction upon either the exercise of an ISO or upon disposition of the shares acquired pursuant to such exercise, except to the extent that the participant recognizes ordinary income on disposition of the shares.

Other Awards

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. Individuals will not have taxable income at the time of grant of a restricted stock unit (an “RSU”), but rather, will generally recognize ordinary compensation income at the time he or she receives cash or a share of common stock in settlement of the RSU, as applicable, in an amount equal to the cash or the fair market value of the common stock received. The current federal income tax consequences of other awards authorized under the 2023 Plan generally follow certain basic patterns: nontransferable restricted stock subject to a substantial risk of forfeiture results in income recognition equal to the excess of the fair market value over the price paid, if any, only at the time the restrictions

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lapse (unless, with respect to grants of restricted stock, the recipient elects to accelerate recognition as of the date of grant through a Section 83(b) election); dividend equivalents and other stock or cash based awards are generally subject to tax at the time of payment. We or our subsidiaries or affiliates generally should be entitled to a federal income tax deduction at the time and for the same amount as the award recipient recognizes ordinary income.

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.

Tax Consequences to the Company

Reasonable Compensation

In order for the amounts described above to be deductible by the Company, such amounts must constitute reasonable compensation for services rendered or to be rendered and must be ordinary and necessary business expenses.

Golden Parachute Payments

The Company’s ability (or the ability of one of our subsidiaries) to obtain a deduction for future payments under the 2023 Plan could also be limited by the golden parachute rules of Section 280G of the Code, which prevent the deductibility of certain excess parachute payments made in connection with a change in control of a corporation.

Compensation of Covered Employees

Our ability to obtain a deduction for amounts paid under the 2023 Plan could be limited by Section 162(m) of the Code. Section 162(m) of the Code limits our ability to deduct compensation, for federal income tax purposes, paid during any year to a “covered employee” (within the meaning of Section 162(m) of the Code) in excess of $1,000,000.

New Plan Benefits

Grants under the 2023 Plan will be made at the discretion of the Compensation Committee. No benefits or amounts have been granted, awarded or received under the 2023 Plan that were subject to shareholder approval. In addition, the Compensation Committee will determine the number and types of awards that will be granted under the 2023 Plan. Thus, it is not possible to determine the benefits that will be received by eligible participants if the 2023 Plan is approved by our shareholders and therefore, the benefits or number of shares subject to awards that may be granted in the future to our executive officers, employees and directors is not currently determinable. Therefore, a New Plan Benefits Table is not provided.

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Securities Authorized for Issuance under Equity Compensation Plans

See “Equity Compensation Plan Information - Securities Authorized for Issuance Under Equity Compensation Plans”.

Required Vote

The affirmative vote of a majority of the shares present at the meeting in person or represented by proxy and entitled to vote on the proposal is required to approve the 2023 Plan Proposal. An abstention has the same effect as voting “AGAINST” the proposal. Broker non-votes have no effect on the outcome of the vote.

Mr. Tracy W. Krohn, our Chairman of the Board, Chief Executive Officer and President, and who is our largest shareholder, controlling approximately 32.9% of the voting power entitled to vote at the Annual Meeting as of April 20, 2023, intends to vote all of his shares of Common Stock in accordance with the Board’s recommendations set forth herein.

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