GOVERNANCE
Comstock strives to conduct our business in a responsible and ethical manner that is aligned with the interests of all of our stakeholders, including shareholders, debt investors, employees and the communities in which we operate. Our commitment to sustainable corporate governance results in increased transparency and accountability. Comstock’s Corporate Governance Guidelines and Code of Business Conduct and Ethics drive our commitment to high ethical standards across the organization.

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Board of Directors

The primary responsibility of Comstock’s Board of Directors is to exercise governance over the affairs of the Company and to provide oversight, counseling and direction to the Company’s management team from the perspective of the long-term interests of the Company and all of its stakeholders. The Board is comprised of five members, of which three members are independent to meet NYSE listing standards. In addition to the Executive Committee, the Board has three committees that are composed entirely of independent directors:

  • Audit Committee – Reviews and approves our financial statements and earnings releases, oversees the internal audit function, reviews the Company’s internal accounting controls, oversees the implementation of compliance policies and programs and reviews related party transactions.
  • Compensation Committee – Oversees and approves our compensation programs, including the compensation plans and decisions for all executive officers and non-employee directors.

  • Corporate Governance/Nominating Committee – Responsible for developing, overseeing, reviewing and monitoring compliance with the Company’s policies, programs and practices relating to corporate governance and reviewing and recommending director nominees.

Changes to 2020 Annual Incentive Plan

With an increased focus on delivering improved return on equity and free cash flow, Comstock’s 2020 Annual Incentive Plan (AIP) was changed to remove growth-oriented objectives. As a result, performance measures for Return on Average Equity and Free Cash Flow generation representing 30% of the total AIP weighting were added and replaced Production Growth and EBITDAX Growth measures that represented a 35% weighting of the 2019 AIP. At the same time, the 2020 AIP now incorporated a Well Cost Efficiency metric to complement our existing Operating Efficiency metric. The changes to the 2020 AIP were designed to drive increased margins and returns on our development activities which should result in improved stakeholder value.

Stock Ownership Guidelines and Hedging Policy

To further our goal of increasing stockholder value and to align the interests of our key executives and directors with shareholders, Comstock has established stock ownership requirements for our executive officers and directors. Under the policy, within 5 years the CEO, President and Directors are required to attain and retain holdings of common stock with a cost basis of 5x the base salary or director’s cash retainer fee and all other executive officers are required to attain and retain holdings of common stock with a cost basis of 3x the base salary. Comstock has also implemented an anti-hedging policy that prohibits executive officers and directors from entering into transactions that can hedge against decreases in our stock price and encourage risky behavior.

Ethics Hotline and Non-Retaliatory Policy

As set forth in our Code of Business Conduct and Ethics, Comstock encourages our employees to attempt to resolve any issues with a supervisor or our Human Resources department. Comstock also utilizes an anonymous reporting hotline that our employees, vendors and other stakeholders are encouraged to use if an issues relating to accounting, internal accounting controls, financial reporting, auditing practices or any other suspected non-compliance behavior. The toll-free ethics hotline phone number and website address are available on our corporate website. Comstock will not retaliate against any employee for reporting suspected violations of law, regulations or Company policies.

COVID-19 Response

Comstock believes the health and safety of our employees is paramount. In response to the COVID-19 pandemic, Comstock has implemented a COVID-19 Exposure Prevention, Preparedness and Response Plan that incorporates the latest information available from the CDC and OSHA and other public officials. We have put a team in place to monitor the related guidance that U.S. Center for Disease Control and Prevention (CDC) and Occupational Safety and Health Administration (OSHA) continue to make available.

Non-Discrimination Policy

Comstock seeks to attract qualified applicants for positions throughout the Company without regard to race, color, religion, national origin, sex, age, veteran/military status or disability in accordance with all federal and state laws. This policy embraces the equality of compensation, benefits, promotions, transfers and terminations, among other things. Comstock does not tolerate discrimination of any kind in its workplace or against its employees.

Anti-Harassment Policy

Comstock is committed to a work environment free from all forms of harassment that violate both Company policy and federal discrimination laws. The policy specifically prohibits sexual harassment as well as all other forms of harassment and covers both our employees and non-employees including contractors, vendors, customers or guests. Any employee found to have violated this policy will be subject to immediate disciplinary action to preserve the right of every employee to enjoy a workplace free of any type of harassment.

Bribery Policy

Comstock and its employees are expected to maintain high ethical and professional standards with government officials and members of the private sector. As such, employees may not directly or indirectly promise, offer or make payment to anyone with the intent to induce favorable business treatment or to improperly affect business or government decisions.

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