Exhibit 10.15

Patterson-UTI Energy, Inc.
2014 Long-Term Incentive Plan

(As Amended and Restated Effective June 29, 2017)

SHARE-SETTLED
PERFORMANCE SHARE AWARD AGREEMENT

____________, 20__

 

1.

Performance Share Award. The Compensation Committee (the “Committee”) of the
Board of Directors of Patterson-UTI Energy, Inc., a Delaware corporation (the
“Company”), pursuant to the Patterson-UTI Energy, Inc. 2014 Long-Term Incentive
Plan, as amended and restated effective as of June 29, 2017 and as thereafter
amended from time to time (the “Plan”), hereby awards to _________________ (the
“Grantee”), effective as of the Date of Award set forth above, a Performance
Share Award (the “Award”) on the terms and conditions as set forth in this
agreement (this “Agreement”).

 

1.1

General Performance Criteria.  The Award provides the Grantee an opportunity to
receive Shares based upon the Company’s total stockholder return for the
Performance Period (as that term is defined below) as compared with the total
stockholder returns of the peer index companies set forth on Exhibit A (the
“Peer Index Companies”) for such period.  Total shareholder return for the
Company will be measured based on $100 invested in the Company’s common stock on
the first day of the Performance Period, with dividends reinvested.

 

1.2

Issuance of Shares Upon Achievement of [Positive Total Shareholder Return and]
Performance Criteria as of the Final Day of the Performance Period.  If (a) the
Company’s total stockholder return (dividends during the Performance Period, if
any, are assumed to be reinvested) for the three-year period (the “Performance
Period”) ending _________, 20___ (the “Final Day of the Performance Period”),
[is positive and] equals or exceeds the 25th percentile of the total stockholder
returns of the Peer Index Companies for the Performance Period, (b) a Change in
Control of the Company has not occurred on or before the Final Day of the
Performance Period, and (c) the Grantee remains in the active employ of the
Company through the Final Day of the Performance Period, then the Company shall
issue to the Grantee the number of Shares determined as follows:

 

(i)

if the Company’s total stockholder return for the Performance Period is equal to
the 50th percentile rank of the Company’s total stockholder return for the
Performance Period as compared to the total stockholder returns of the Peer
Index Companies, _________ Shares (the “Target Amount”);

 

(ii)

if the Company’s total stockholder return for the Performance Period is equal to
or greater than the 25th percentile rank of the Company’s total stockholder
return for the Performance Period as compared to the total stockholder returns
of the Peer Index Companies but less than the 50th

 

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percentile, one half times the Target Amount plus the product of one half times
the Target Amount multiplied by the quotient obtained by dividing the difference
of the percentile rank achieved for the Performance Period (expressed as a
percentage) minus 25 percent (25%) by 25 percent (25%) (i.e., (0.5 x Target
Amount) + [(0.5 x Target Amount) x ((percentile rank (%) – 0.25)/0.25)]); or

E.g., assume that the Target Amount of the Award is 10,000 Shares and the total
stockholder return of the Company for the Performance Period as compared to the
total stockholder returns of the Peer Index Companies ranks in the 40th
percentile.  The total amount of Shares issuable to the Grantee under the Award
would be 8,000 Shares, which is determined as follows:  (0.5 x 10,000) + [(0.5 x
10,000) x ((40% - 25%)/25%)] = 5,000+ [5,000 x (15%/25%)] = 5,000+[5,000 x 60%]
= 5,000+ 3,000= 8,000.

 

(iii)

if the Company’s total stockholder return achieved for the Performance Period is
greater than the 50th percentile rank of the Company’s total stockholder return
for the Performance Period as compared to the total stockholder returns of the
Peer Index Companies but less than the 75th percentile, the Target Amount plus
the product of the Target Amount multiplied by the quotient obtained by dividing
the difference of the percentile rank achieved for the Performance Period
(expressed as a percentage) minus 50 percent (50%) by 25 percent (25%) (i.e.,
(Target Amount) + [(Target Amount) x ((percentile rank (%) – 0.50)/0.25)]); or

E.g., assume that the same facts as the example above in clause (iii) except
that the total stockholder return of the Company for the Performance Period as
compared to the total stockholder returns of the Peer Index Companies ranks in
the 60th percentile.  The total amount of Shares issuable to the Grantee under
the Award would be 14,000 Shares, which is determined as follows:  (10,000) +
[(10,000) x ((60% - 50%)/25%)] = 10,000+ [10,000 x (10%/25%)] = 10,000+[10,000 x
40%] = 10,000 + 4,000= 14,000.

 

(iv)

if the Company’s total stockholder return for the Performance Period is equal to
or greater than the 75th percentile rank of the Company’s total stockholder
return for the Performance Period as compared to the total stockholder returns
of the Peer Index Companies, two times the Target Amount.

 

1.3

[Issuance of Shares Upon Achievement of Negative or Zero Total Shareholder
Return and Performance Criteria as of the Final Day of the Performance
Period.  If (a) the Company’s total stockholder return (dividends during the
Performance Period, if any, are assumed to be reinvested) for the Performance
Period, is negative or zero and equals or exceeds the 25th percentile of the
total stockholder returns of the Peer Index Companies for the Performance
Period, (b) a Change in Control of the Company has not occurred on or before the
Final Day of the Performance Period, and (c) the Grantee remains in the active
employ of the Company through

 

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the Final Day of the Performance Period, then the Company shall issue to the
Grantee the number of Shares equal to 50 percent (50%) of the number of Shares
the Grantee would have received pursuant to Section 1.2 had the total
stockholder return for the Performance Period been positive.]

 

1.4

Forfeiture.  Notwithstanding any other provision of this Agreement to the
contrary, the Award pursuant to this Agreement shall lapse and be forfeited on
the Final Day of the Performance Period if (a) the Company’s total stockholder
return for the Performance Period is less than the 25th percentile of the total
stockholder returns of the Peer Index Companies for the Performance Period and
(b) a Change in Control of the Company has not occurred on or before the Final
Day of the Performance Period.

 

1.5

Committee Determination.  Pursuant to Articles 4 and 9 of the Plan, the
Committee shall have the discretion to calculate the total stockholder returns
for the Performance Period for the Peer Index Companies, including the Company,
and to determine the formula to achieve such calculations.

The Committee’s determinations with respect to the Performance Period for
purposes of this Agreement shall be binding upon all persons.  The Committee may
not increase the Shares issuable under this Agreement.  The Committee may, in
its sole discretion, make such adjustments as it deems necessary and
appropriate, if any, in the composition of the group of Peer Index Companies to
address the merger or consolidation of any company in the Peer Index Companies
as of the date hereof with another company, an acquisition or disposition of a
significant portion of such company’s businesses or assets as it exists on the
date hereof, or any other extraordinary event occurring in relation to such
company during the term of this Agreement.

Prior to an issuance of Shares made pursuant to Section 1.2 [or Section 1.3] and
as provided in Section 2 or Section 3.4, the Compensation Committee of the Board
of Directors of the Company shall determine if the performance criteria for such
issuance has been satisfied and, to the extent such performance criteria has
been satisfied, shall certify in writing that such performance criteria has been
satisfied.

2.

TIME OF ISSUANCE OF SHARES.  For purposes of this Agreement, unless otherwise
provided under the Plan or Section 3.4 of this Agreement, the Company shall
cause the Shares to be issued to the Grantee pursuant to Section 1.2 [or Section
1.3] on or before the 75th day following the Final Day of the Performance
Period.  Any Shares issued pursuant to this Agreement will be issued to the
Grantee or, if issuable pursuant to Section 3.3, the Grantee’s legal
representative or the Grantee’s estate, and thereafter the Grantee or, if
applicable, the Grantee’s estate and heirs, executors, administrators and the
Grantee’s legal representatives shall have no further rights with respect to the
Award or this Agreement.

3.

TERMINATION OF EMPLOYMENT/CHANGE IN CONTROL.  The following provisions will
apply in the event the Grantee’s employment with the Company terminates,

 

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or a Change in Control of the Company (as defined below) occurs, before the
Final Day of the Performance Period.

 

3.1

Definitions.  For purposes of this Agreement, the following terms shall have the
meanings ascribed to them under this Section:

 

(i)

The Grantee will have a “Disability” if the Grantee qualifies for long-term
disability benefits under a long-term disability program sponsored by the
Company in which executive officers participate generally or, if the Company
does not sponsor such a long-term disability program, the Grantee is unable to
engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment which can be expected to result in
death or can be expected to last for a continuous period of not less than 12
months.

 

(ii)

“Retirement” means the voluntary termination of the Grantee’s employment
relationship with the Company (i) on or after the date on which the Grantee
attains age 55 and (ii) on or after the date on which the sum of the Grantee’s
age and number of full years of service total 70.

 

(iii)

A “Change in Control of the Company” shall mean the occurrence of any of the
following after the Grant Date and prior to the date on which the Award is
forfeited in accordance with Section [1.3][1.4] or Section 3.2:

 

(1)

The acquisition by any individual, entity or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended)
(a “Covered Person”) of beneficial ownership (within the meaning of rule 13d-3
promulgated under the Exchange Act) of 35% or more of either (A) the then
outstanding shares of the common stock of the Company (the “Outstanding Company
Common Stock”), or (B) the combined voting power of the then outstanding voting
securities of the Company entitled to vote generally in the election of
directors (the “Outstanding Company Voting Securities”); provided, however, that
for purposes of this subclause (1) of this Section 3.1(iii), the following
acquisitions shall not constitute a Change in Control of the Company: (A) any
acquisition directly from the Company, (B) any acquisition by the Company,
(C) any acquisition by any employee benefit plan (or related trust) sponsored or
maintained by the Company or any entity controlled by the Company, or (D) any
acquisition by any corporation pursuant to a transaction which complies with
clauses (A), (B) and (C) of subclause (3) of this Section 3.1(iii); or

 

(2)

Individuals who, as of the Grant Date, constitute the Board (the “Incumbent
Board”) cease for any reason to constitute at least a majority of the Board;
provided, however, that any individual

 

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becoming a director subsequent to the Grant Date whose election, or nomination
for election by the Company’s stockholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board shall be
considered as though such individual were a member of the Incumbent Board, but
excluding, for this purpose, any such individual whose initial assumption of
office occurs as a result of an actual or threatened election contest with
respect to the election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a Covered Person other
than the Board; or

 

(3)

Consummation of (xx) a reorganization, merger or consolidation or sale of the
Company or any subsidiary of the Company, or (yy) a disposition of all or
substantially all of the assets of the Company (a “Business Combination”), in
each case, unless, following such Business Combination, (A) all or substantially
all of the individuals and entities who were the beneficial owners,
respectively, of the Outstanding Company Common Stock and Outstanding Company
Voting Securities immediately prior to such Business Combination beneficially
own, direct or indirectly, more than 65% of, respectively, the then outstanding
shares of common stock and the combined voting power of the then outstanding
voting securities entitled to vote generally in the election of directors, as
the case may be, of the corporation resulting from such Business Combination
(including, without limitation, a corporation which as a result of such
transaction owns the Company or all or substantially all of the Company’s assets
either directly or through one or more subsidiaries) in substantially the same
proportions as their ownership immediately prior to such Business Combination of
the Outstanding Company Common Stock and Outstanding Company Voting Securities,
as the case may be, (B) no Covered Person (excluding any employee benefit plan
(or related trust) of the Company or such corporation resulting from such
Business Combination) beneficially owns, directly or indirectly, 35% or more of,
respectively, the then outstanding shares of common stock of the corporation
resulting from such Business Combination or the combined voting power of the
then outstanding voting securities of such corporation, except to the extent
that such ownership existed prior to the Business Combination, and (C) at least
a majority of the members of the board of directors of the corporation resulting
from such Business Combination were members of the Incumbent Board at the time
of the execution of the initial agreement, or, if earlier, of the action of the
Board, providing for such Business Combination.

 

3.2

Termination Generally.  Except as specified in Section 3.3 and 3.4 below, all of
the Grantee’s rights in this Agreement, including all rights to the Award
granted to the Grantee, will lapse and be completely forfeited on the date the
Grantee’s

 

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employment terminates if the Grantee’s employment with the Company terminates on
or before the Final Day of the Performance Period for Shares issuable pursuant
to Section 1.2 [or Section 1.3], if any, for any reason other than death,
Disability or Retirement.

 

3.3

Death, Disability or Retirement.  Notwithstanding any other provision of this
Agreement to the contrary, if the Grantee’s employment with the Company
terminates due to the Grantee’s death, Disability, or Retirement after the
completion of at least one month of the Performance Period and on or before the
Final Day of the Performance Period for Shares issuable pursuant to Section 1.2
[or Section 1.3], if any, then the Company will cause Shares to be issued to the
Grantee, at such time as provided in Section 2, an amount equal to the product
of (1) and (2) where (1) is the amount the Grantee would have received under
this Agreement if the Grantee’s employment with the Company had not been
terminated due to the Grantee’s death, Disability or Retirement before such
Final Day of the Performance Period and (2) is a fraction, the numerator of
which is the number of days from the beginning of the Performance Period through
the date of the Grantee’s death, or the Grantee’s termination of employment with
the Company due to a Disability or Retirement up to a maximum of 1095 days and
the denominator of which is 1095.

 

3.4

Change in Control.  Notwithstanding anything in the Agreement to the contrary,
the Company (or its successor) will cause to be issued to the Grantee
immediately preceding a Change in Control of the Company a number of Shares in
an amount equal to the Target Amount, and thereafter the Company (or its
successor) will have no further obligations to the Grantee pursuant to this
Agreement; provided, however, that this Section 3.4 shall not apply if the
Grantee is the Covered Person or forms part of the Covered Person below that
acquires 35% or more of either the Outstanding Company Common Stock or
Outstanding Company Voting Securities and such acquisition constitutes a Change
in Control of the Company.

4.

[DIVIDEND EQUIVALENTS. No Dividend Equivalents shall be paid with respect to any
Shares during the Performance Period.]

5.

TAX WITHHOLDING.  To the extent that the grant, vesting or issuance of Shares
under the Agreement results in income to the Grantee for federal, state or local
income, employment, excise or other tax purposes with respect to which the
Company or any of its Subsidiaries has a withholding obligation, the Grantee
shall deliver to the Company or such Subsidiary at the time of such receipt or
lapse, as the case may be, such amount of money as the Company or such
Subsidiary may require to meet its obligation under applicable tax laws or
regulations.  If the Grantee fails to do so, the Company or its Subsidiary is
authorized to withhold from wages or other amounts otherwise payable to such
Grantee the minimum statutory withholding taxes as may be required by law or to
take such other action as may be necessary to satisfy such withholding
obligations.  Subject to restrictions that the Committee, in its sole
discretion, may impose, the Grantee may satisfy such obligation for the payment
of such taxes by tendering previously acquired Shares (either actually or by
attestation, valued at their then Fair Market Value) that have been owned for a
period of at least six months (or such other period to avoid accounting charges
against the

 

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Company’s earnings), or by directing the Company to retain Shares (up to the
Grantee’s minimum required tax withholding rate or such other rate that will not
trigger a negative accounting impact) otherwise deliverable under this
Agreement.  The Company shall not be obligated to issue any Shares granted
hereunder until all applicable federal, state and local income, employment,
excise or other tax withholding requirements have been satisfied.

6.

SECTION 409A. This Award is subject to the payment timing and other restrictions
set forth in Section 13.14 of the Plan.  

7.

TRANSFER RESTRICTIONS.  The Award granted hereby may not be sold, assigned,
pledged, exchanged, hypothecated or otherwise transferred, encumbered or
disposed of, to the extent then subject to the forfeiture pursuant to this
Agreement.  Any such attempted sale, assignment, pledge, exchange,
hypothecation, transfer, encumbrance or disposition in violation of this
Agreement shall be void and the Company shall not be bound
thereby.  Notwithstanding the foregoing, the Grantee may assign or transfer the
Award granted hereby pursuant to a qualified domestic relations order (as
defined in Section 414(p) of the Code, or Section 206(d)(3) of the Employee
Retirement Income Security Act of 1974, as amended), or with the consent of the
Committee (i) for charitable donations; (ii) to the Grantee’s spouse, children
or grandchildren (including any adopted and stepchildren and grandchildren), or
(iii) a trust for the benefit of the Grantee or the persons referred to in
clause (ii) (each transferee thereof, a “Permitted Assignee”); provided that
such Permitted Assignee shall be bound by and subject to all of the terms and
conditions of the Plan and this Award Agreement; and provided further that the
Grantee shall remain bound by the terms and conditions of the Plan.  Further,
the Shares granted hereby that are no longer subject to forfeiture may not be
sold or otherwise disposed of in any manner which would constitute a violation
of any applicable federal or state securities laws, and the Grantee agrees (i)
that the Company may refuse to cause the transfer of the Shares to be registered
on the applicable stock transfer records if such proposed transfer would, in the
opinion of counsel satisfactory to the Company, constitute a violation of any
applicable securities law, and (ii) that the Company may give related
instructions to the transfer agent, if any, to stop registration of the transfer
of the Shares.

8.

CAPITAL ADJUSTMENTS AND REORGANIZATIONS.  The existence of the Award shall not
affect in any way the right or power of the Company to make or authorize any
adjustment, recapitalization, reorganization or other change in its capital
structure or its business, engage in any merger or consolidation, issue any debt
or equity securities, dissolve or liquidate, or sell, lease, exchange or
otherwise dispose of all or any part of its assets or business, or engage in any
other corporate act or proceeding.

9.

PERFORMANCE SHARE AWARD DOES NOT AWARD ANY RIGHTS OF A STOCKHOLDER.  The Grantee
shall not have the voting rights or any of the other rights, powers or
privileges of a holder of the stock of the Company with respect to the Award
that are awarded hereby.  Only after the Shares are issued in exchange for the
Grantee’s rights under this Agreement will the Grantee have all of the rights of
a shareholder with respect to such Shares issued in exchange for such rights.

 

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10.

EMPLOYMENT RELATIONSHIP.  For purposes of this Agreement, the Grantee shall be
considered to be in the employment of the Company as long as the Grantee has an
employment relationship with the Company and any of its Subsidiaries.  The
Committee shall determine any questions as to whether and when there has been a
termination of such employment relationship, and the cause of such termination,
under the Plan, and the Committee’s determination shall be final and binding on
all persons.

11.

NOT AN EMPLOYMENT AGREEMENT.  This Agreement is not an employment agreement, and
no provision of this Agreement shall be construed or interpreted to guarantee
the right to remain employed by the Company or any Affiliate for any specified
term.

12.

LIMIT OF LIABILITY.  Under no circumstances will the Company or an Affiliate be
liable for any indirect, incidental, consequential or special damages (including
lost profits) of any form incurred by any person, whether or not foreseeable and
regardless of the form of the act in which such a claim may be brought, with
respect to the Plan.

13.

COMPANY LIABLE FOR ISSUANCE OF SHARES. Except as specified in Section 3.4, the
Company is liable for the issuance of any Shares that become issuable under this
Agreement.

14.

SECURITIES ACT LEGEND.  The Grantee consents to the placing on the certificate
for the Shares of an appropriate legend restricting resale or other transfer of
the Shares except in accordance with all applicable securities laws and rules
thereunder, as well as any legend under Section 13.5 of the Plan as determined
by the Committee.

15.

NO FRACTIONAL SHARES.  All provisions of this Agreement concern whole
Shares.  Notwithstanding anything contained in this Agreement to the contrary,
if the application of any provision of this Agreement would yield a fractional
share, such fractional share shall be rounded down to the next whole Share.

16.

MISCELLANEOUS.  This Agreement is awarded pursuant to and is subject to all of
the provisions of the Plan, including amendments to the Plan, if
any.  Capitalized terms that are not defined herein shall have the meanings
ascribed to such terms in the Plan.

[SIGNATURE PAGE TO FOLLOW]

 

 

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In accepting the Performance Share Award set forth in this Agreement the Grantee
accepts and agree to be bound by all the terms and conditions of the Plan and
this Agreement.

PATTERSON-UTI ENERGY, INC.

 

 

By:

Name:

Title:

 

 

 

(“GRANTEE”)

 

 

 

 

 

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EXHIBIT A

 

Peer Index

 

The Peer Index Companies shall be [Basic Energy Services Inc., Diamond Offshore
Drilling, Inc., Ensco plc, Forum Energy Technologies, Inc., Halliburton Company,
Helmerich & Payne Inc., Nabors Industries Ltd., National Oilwell Varco, Inc.,
Noble Corporation plc, Oceaneering International, Inc., Oil States
International, Inc., Precision Drilling Corporation, Rowan Companies plc,
Superior Energy Services, Inc., TechnipFMC plc, Transocean Ltd., Unit
Corporation and Weatherford International plc], as such group of companies may
be adjusted pursuant to Section [1.4][1.5].