exv10w1






Exhibit 10.1




NONQUALIFIED STOCK OPTION AGREEMENT

FOR NON-EMPLOYEE DIRECTORS




          THIS AGREEMENT is made by and between Complete Production Services, Inc., a Delaware
corporation hereinafter referred to as “Company,” and «Name», a non-employee director of the
Company, hereinafter referred to as “Director” effective as of «Grant_Date»:




          WHEREAS, the Company wishes to afford the Director the opportunity to purchase shares of its
$0.01 par value Common Stock;




          WHEREAS, the Company wishes to carry out the Complete Production Services, Inc. 2008 Incentive
Award Plan, as amended or restated from time to time (the terms of which are hereby incorporated by
reference and made a part of this Agreement), which provides for the grant of Options to the
Director as an inducement to enter into or remain in the service of the Company or its Subsidiaries
and as an incentive for increased efforts during such service.




          NOW, THEREFORE, in consideration of the mutual covenants herein contained and other good and
valuable consideration, receipt of which is hereby acknowledged, the parties hereto do hereby agree
as follows:




ARTICLE I.




DEFINITIONS




     Whenever the following terms are used in this Agreement, they shall have the meaning specified
below unless the context clearly indicates to the contrary. The masculine pronoun shall include
the feminine and neuter, and the singular the plural, where the context so indicates. Capitalized
terms used but not defined in this Agreement shall have the meaning ascribed to such terms in the
Plan.



Section 1.1. Administrator




          “Administrator” shall mean the entity that conducts the administration of the Plan (including
the grant of Awards) as provided therein and generally shall refer to the Compensation Committee of
the Board, unless and to the extent the Board has assumed the authority for administration of all
or any part of the Plan.




Section 1.2. Board




          “Board” shall mean the Board of Directors of the Company.




Section 1.3. Change of Control




          “Change of Control” shall mean (a) a transaction or series of transactions whereby any
“person” or related “group” of “persons” (as such terms are used in Sections 13(d) and 14(d)(2) of
the Exchange Act) directly or indirectly acquires beneficial ownership (within the meaning of Rule
13d-3 under the Exchange Act) of securities of the Company possessing more than 20% of the total
combined voting power of the Company’s securities outstanding immediately after such acquisition,
other than:




     (i) an acquisition by an employee benefit plan or any trustee holding securities under any
employee benefit plan (or related trust) sponsored or maintained by the Company or any person
controlled by the Company; or



 









 





     (ii) an acquisition by the Company or any Subsidiary; or



     (iii) an acquisition pursuant to the offering of shares of Common Stock by the Company to the
general public through a registration statement filed with the Securities and Exchange Commission;
or



     (iv) an acquisition of voting securities pursuant to a transaction described in clause (c)
below that would not be a Change in Control under clause (c).



     (b) individuals who, as of the date hereof, constitute the Board (the “Incumbent
Board”) cease for any reason to constitute at least a majority of the Board; provided, however,
that any individual becoming a director subsequent to the date hereof whose election, or nomination
for election by the Company’s stockholders, was approved by a vote of at least two thirds of the
directors then comprising the Incumbent Board shall be considered to be members of the Incumbent
Board, but excluding, for this purpose, any such individual whose initial assumption of office was
a result of an actual or threatened election contest with respect to the election or removal of
directors; or



     (c) the consummation by the Company (whether directly involving the Company or indirectly
involving the Company through one or more intermediaries or subsidiaries) of (x) a merger,
consolidation, reorganization, or business combination, including without limitation, a reverse or
forward triangular merger, or (y) the acquisition of assets or stock of another entity, in each
case, other than a transaction, which results in the Company’s stockholders prior to such
transaction owning at least 55% of the outstanding voting securities of the surviving or resulting
corporation or entity.



     (d) a tender offer or exchange offer is made and consummated by a person or group of persons
other than the Company for the ownership of 20% or more of the Company’s voting securities; or



     (e) a disposition, transfer, sale or exchange of all or substantially all of the Company’s
assets, or the Company’s stockholders approve a plan of liquidation or dissolution of the Company.



For purposes of subsection (a) above, the calculation of voting power shall be made as if the date
of the acquisition were a record date for a vote of the Company’s stockholders, and for purposes of
subsection (c) above, the calculation of voting power shall be made as if the date of the
consummation of the transaction or at the consummation of the last of a series of related
transactions were a record date for a vote of the Company’s stockholders.



Section 1.4. Code




          “Code” shall mean the Internal Revenue Code of 1986, as amended.




Section 1.5. Common Stock




          “Common Stock” shall mean the common stock of the Company, par value $0.01 per share.




Section 1.6. Company




          “Company” shall mean Complete Production Services, Inc., a Delaware corporation, or any
successor corporation.




Section 1.7. Exchange Act




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          “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.




Section 1.8. Option




          “Option” shall mean the non-qualified stock option granted under this Agreement and Article
VII of the Plan, as specified herein.




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Section 1.9. Plan




          “Plan” shall mean the Complete Production Services, Inc. 2008 Incentive Award Plan, as amended
and/or restated from time to time.




Section 1.10. DRO




          “DRO” shall mean a qualified domestic relations order as defined by the Code or Title I of the
Employee Retirement Income Security Act of 1974, as amended, or the rules thereunder.




Section 1.11. Rule 16b-3




          “Rule 16b-3” shall mean that certain Rule 16b-3 under the Exchange Act, as such Rule may be
amended from time to time.




Section 1.12. Secretary




          “Secretary” shall mean the Secretary of the Company.




Section 1.13. Securities Act




          “Securities Act” shall mean the Securities Act of 1933, as amended.




Section 1.14. Subsidiary




          “Subsidiary” shall mean any entity (other than the Company), whether domestic or foreign, in
an unbroken chain of entities beginning with the Company if each of the entities other than the
last entity in the unbroken chain beneficially owns, at the time of the determination, securities
or interests representing more than fifty percent (50%) of the total combined voting power of all
classes of securities or interests in one of the other entities in such chain.




Section 1.15. Termination of Service




          “Termination of Service” As to a Non-Employee Director, the time when a Holder who is a
Non-Employee Director ceases to be a Director for any reason, including, without limitation, a
termination by resignation, failure to be elected, death or retirement, but excluding terminations
where the Holder simultaneously commences or remains in employment or service with the Company or
any Subsidiary. The Board, in its sole and absolute discretion, shall determine the effect of all
matters and questions relating to Termination of Service.




ARTICLE II.




GRANT OF OPTION




Section 2.1. Grant of Option




          In consideration of the Director’s agreement to serve as an independent director of the
Company or its Subsidiaries until the next annual meeting of stockholders of the Company and for
other good and valuable consideration, on «Grant_Date» the Company irrevocably grants to the
Director the option to purchase any part or all of an aggregate of five thousand (5,000) shares of
its Common Stock upon the terms and conditions set forth in this Agreement and the Plan.




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Section 2.2. Purchase Price




          The purchase price of the shares of Common Stock covered by the Option shall be
$«Exercise_Price» per share (which is the Fair Market Value of a share of Common Stock on the date
of the granting of this Option) without commission or other charge.




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Section 2.3. Consideration to Company




          In consideration of the granting of this Option by the Company, the Director agrees to render
faithful and efficient services to the Company or a Subsidiary, with such duties and
responsibilities as the Company shall from time to time prescribe, until the next annual meeting of
stockholders of the Company. Nothing in the Plan or this Agreement shall confer upon any Director
any right to continue as a director of the Company, or shall interfere with or restrict in any way
the rights of the Company and any Subsidiary, which are hereby expressly reserved, to discharge the
Director at any time for any reason whatsoever, with or without good cause.




Section 2.4. Adjustments in Option




          (a) In the event that the outstanding shares of the Common Stock subject to the Option are
changed into or exchanged for a different number or kind of shares of the Company or other
securities of the Company, or of another corporation, by reason of reorganization, merger,
consolidation, recapitalization, reclassification, stock split-up, stock dividend or combination of
shares, or other distribution of shares of Common Stock, the Administrator shall make equitable
adjustments, if any, in the number and kind of shares as to which the Option, or portions thereof
then unexercised, shall be exercisable, to the end that after such event the Director’s
proportionate interest shall be maintained as before the occurrence of such event. Such adjustment
in the Option may include any necessary corresponding adjustment in the Option price per share, but
shall be made without change in the total price applicable to the unexercised portion of the Option
(except for any change in the aggregate price resulting from rounding-off of share quantities or
prices). Any such adjustment made by the Administrator shall be final and binding upon the
Director, the Company and all other interested persons.




          (b) Notwithstanding the foregoing, in the event of a Change of Control, the Option shall be
assumed or an equivalent Option substituted by the successor corporation or a parent or subsidiary
of the successor corporation. In the event that the successor corporation refuses to assume or
substitute for the Option, the Administrator may cause any or all of such Options to become fully
exercisable immediately prior to the consummation of such transaction and all forfeiture
restrictions on any or all of such Options to lapse. If an Option is exercisable in lieu of
assumption or substitution in the event of a Change in Control, the Administrator shall notify the
Director that the Option shall be fully exercisable for a period of fifteen (15) days from the date
of such notice, and the Option shall terminate upon the expiration of such period.




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ARTICLE III.




PERIOD OF EXERCISABILITY




Section 3.1. Vesting




          (a) Subject to Section 5.6, the Option shall vest and become exercisable in three (3) equal
cumulative installments of 33% of the shares covered by the Option, with each such annual
installment shall commence vesting on the earlier of (i) the anniversary of the date of grant or
(ii) the date of the next annual meeting of stockholders of the Company at which one or more
members of the Board are standing for re-election.




          (b) No portion of the Option that is unvested and unexercisable at Termination of Service
shall thereafter become vested and exercisable.




Section 3.2. Duration of Exercisability




          The installments provided for in Section 3.1 are cumulative. Each such installment that
becomes vests and becomes exercisable pursuant to Section 3.1 shall remain exercisable until it
becomes unexercisable under Section 3.3.




Section 3.3. Expiration of Option




          The Option may not be exercised to any extent by anyone after the first to occur of the
following events:




          (a) The expiration of ten (10) years from the date the Option was granted; and




          (b) The expiration of one year from the date of the Director’s Termination of Service for any
reason.




Section 3.4. Acceleration of Exercisability upon Retirement




          To the extent consistent with the requirements of Rule 16b-3, this Option shall be fully
vested and exercisable as to all the shares covered hereby, notwithstanding that this Option may
not yet have become fully vested and exercisable under Section 3.1(a), upon the retirement of the
Director in accordance with the Company’s retirement policy applicable to Directors.




ARTICLE IV.




EXERCISE OF OPTION




Section 4.1. Person Eligible to Exercise




          During the lifetime of the Director, only he or she may exercise the Option or any portion
thereof, or, to the extent the Option or any portion thereof is transferred in accordance with the
terms of the Plan, such permitted transferee may exercise the Option or such portion thereof so
transferred. After the death of the Director, any exercisable portion of the Option may, prior to
the time when the Option becomes unexercisable under Section 3.3, be exercised by his or her
personal representative or by any person empowered to do so under the Director’s will or under the
then applicable laws of descent and distribution.




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Section 4.2. Partial Exercise




          Any exercisable portion of the Option or the entire Option, if then wholly exercisable, may be
exercised in whole or in part at any time prior to the time when the Option or portion thereof
becomes unexercisable under Section 3.3; provided, however, that each partial exercise shall be for
not less than one hundred (100) shares (or the minimum installment set forth in Section 3.1, if a
smaller number of shares) and shall be for whole shares only.




Section 4.3. Manner of Exercise




          The Option, or any exercisable portion thereof, may be exercised solely by delivery to the
Secretary or his office of all of the following prior to the time when the Option or such portion
becomes unexercisable under Section 3.3:




          (a) Notice in writing signed by the Director or the other person then entitled to exercise the
Option or portion, stating that the Option or portion is thereby exercised, such notice complying
with all applicable rules established by the Administrator or its designee;




          (b) Full payment to the Company of the aggregate exercise price, which payment shall be by any
of the following, or a combination thereof:





          (i) In cash or check;




          (ii) Through the delivery of a notice that the Director has placed a market sell order
with a broker with respect to the shares of Common Stock then issuable upon exercise of the
Option, and the broker pays a sufficient portion of the net proceeds of the sale to the
Company in satisfaction of the Option exercise price; or




          (iii) With the consent of the Administrator, through the surrender of shares of Common
Stock then issuable upon exercise of the Option having a Fair Market Value on the date of
Option exercise equal to the aggregate exercise price of the Option or exercised portion
thereof;




          (iv) With the consent of the Administrator, through the delivery (actually or
constructively) of shares of Common Stock to the Company with a Fair Market Value on the
date of Option exercise equal to the aggregate exercise price of the Option or exercised
portion thereof; or




          (v) With the consent of the Administrator, through any other consideration permitted
under the Plan and applicable law.



          (c) Full payment to the Company (or Subsidiary employer) of all amounts which, under federal,
state, local or foreign tax law, it is required to withhold upon exercise of the Option, which,
with the consent of the Administrator, may be in the form of consideration used by the Director to
pay for such shares under Section 4.3(b); provided, however, that if such payment is in the form of
shares of Common Stock withheld from exercise or delivered (actually or constructively) by the
Director, the Fair Market Value of such shares shall not exceed the sums necessary to pay the tax
withholding based on the minimum statutory withholding rates for federal and state tax purposes,
including payroll taxes, that are applicable to such supplemental taxable income; and




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          (d) In the event the Option or portion shall be exercised pursuant to Section 4.1 by any
person or persons other than the Director, appropriate proof of the right of such person or persons
to exercise the Option.




          (e) Such representations and documents as the Administrator, in its sole discretion, deems
necessary or advisable to effect compliance with all applicable provisions of the Securities Act
and any other federal, state or foreign securities laws or regulations.




Section 4.4. Conditions to Issuance of Stock Certificates




          The shares of Common Stock deliverable upon the exercise of the Option, or any portion
thereof, may be either previously authorized but unissued shares or issued shares, which have then
been reacquired by the Company. Such shares shall be fully paid and nonassessable. The Company
shall not be required to issue or deliver any shares of Common Stock purchased upon the exercise of
the Option or portion thereof prior to fulfillment of all of the following conditions, in addition
to any other condition specified in the Plan:




          (a) The admission of such shares to listing on all stock exchanges on which such class of
stock is then listed;




          (b) The completion and continued availability of any registration or other qualification of
such shares, or an exemption for issuance of such shares, under any state or federal law or under
rulings or regulations of the Securities and Exchange Commission or of any other governmental
regulatory body, which the Administrator shall, in its absolute discretion, deem necessary or
advisable;




          (c) The obtaining of any approval or other clearance from any state or federal governmental
agency which the Administrator shall, in its absolute discretion, determine to be necessary or
advisable;




          (d) The receipt by the Company (or Subsidiary employer) of full payment for such shares,
including payment of all amounts which, under federal, state or local tax law, it is required to
withhold upon exercise of the Option; and




          (e) The lapse of such reasonable period of time following the exercise of the Option as the
Administrator may from time to time establish for reasons of administrative convenience.




Section 4.5. Rights as Stockholder




          The Director shall not be, nor have any of the rights or privileges of, a stockholder of the
Company in respect of any shares purchasable upon the exercise of any part of the Option unless and
until such shares of Common Stock shall have been issued by the Company to the Director, as
evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer
agent of the Company, or by the issuance of a stock certificate in Director’s name.




ARTICLE V.




OTHER PROVISIONS




Section 5.1. Administration




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          The Administrator shall have the power to interpret the Plan and this Agreement and to adopt
such rules for the administration, interpretation and application of the Plan as are consistent
therewith and to interpret or revoke any such rules. All actions taken and all interpretations and
determinations made by the Administrator in good faith shall be final and binding upon the
Director, the Company and all other interested persons. No member of the Administrator shall be
personally liable for any action, determination or interpretation made in good faith with respect
to the Plan or the Option. In its absolute discretion, the Board may at any time and from time to
time exercise any and all rights and duties of the Administrator under this Plan except with
respect to matters which under Rule 16b-3 or Section 162(m) of the Code, or any regulations or
rules issued thereunder, are required to be determined in the sole discretion of the Administrator.




Section 5.2. Option Not Transferable




          (a) Subject to Section 5.2(b) and except to the extent permitted by the Plan, neither the
Option nor any interest or right therein or part thereof shall be liable for the debts, contracts
or engagements of the Director or his successors in interest or shall be subject to disposition by
transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means whether such
disposition be voluntary or involuntary or by operation of law by judgment, levy, attachment,
garnishment or any other legal or equitable proceedings (including bankruptcy), and any attempted
disposition thereof shall be null and void and of no effect; provided, however, that this Section
5.2(a) shall not prevent transfers by will or by the applicable laws of descent and distribution
or, to the extent not prohibited by the Code, pursuant to a DRO.




          (b) Notwithstanding the foregoing provisions of Section 5.2(a), the Administrator, in its sole
discretion, may permit the transfer of the Option by the Director, by gift or contribution, to a
“family member” of the Director (as defined under the instructions to use of Form S-8). Any Option
that has been so transferred or transferred pursuant to a DRO shall continue to be subject to all
of the terms and conditions as applicable to the original Director, and the transferee shall
execute any and all such documents requested by the Administrator in connection with the transfer,
including without limitation to evidence the transfer and to satisfy any requirements for an
exemption for the transfer under applicable federal and state securities laws.




Section 5.3. Shares to Be Reserved




          The Company shall at all times during the term of the Option reserve and keep available such
number of shares of Common Stock as will be sufficient to satisfy the requirements of this
Agreement.




Section 5.4. Notices




          Any notice to be given under the terms of this Agreement to the Company shall be addressed to
the Company in care of its Secretary, and any notice to be given to the Director shall be addressed
to him at the address given beneath his signature hereto. By a notice given pursuant to this
Section 5.4, either party may hereafter designate a different address for notices to be given to
him. Any notice, which is required to be given to the Director, shall, if the Director is then
deceased, be given to the Director’s personal representative if such representative has previously
informed the Company of his status and address by written notice under this Section 5.4. Any
notice shall be deemed duly given when enclosed in a properly sealed envelope or wrapper addressed
as aforesaid, deposited (with postage prepaid) in a post office or branch post office regularly
maintained by the United States Postal Service.




Section 5.5. Titles




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          Titles are provided herein for convenience only and are not to serve as a basis for
interpretation or construction of this Agreement.




Section 5.6. Construction




          This Agreement shall be administered, interpreted and enforced under the laws of the State of
Texas.




Section 5.7. Conformity to Securities Laws




          The Director acknowledges that the Plan and this Agreement are intended to conform to the
extent necessary with all provisions of the Securities Act and the Exchange Act and any and all
regulations and rules promulgated by the Securities and Exchange Commission thereunder, including
without limitation Rule 16b-3. Notwithstanding anything herein to the contrary, the Plan shall be
administered, and the Option is granted and may be exercised, only in such a manner as to conform
to such laws, rules and regulations. To the extent permitted by applicable law, the Plan and this
Agreement shall be deemed amended to the extent necessary to conform to such laws, rules and
regulations.




Section 5.8. Amendments.




          This Agreement may not be modified or amended in any way that adversely affects the Director’s
rights hereunder, except by an instrument in writing signed by the Director or such other person as
may be permitted to exercise the Option pursuant to Section 4.1 and by a duly authorized
representative of the Company.




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          IN WITNESS WHEREOF, this Agreement has been executed and delivered by the parties hereto.




	 	 	 	 	 
	 	COMPLETE PRODUCTION SERVICES, INC.

 	 
	 	By:  	 	 
	 	 	Joseph C. Winkler, 	 
	 	 	Chief Executive Officer 	 
	 
	 	 	 
	 	By:  	
 	 
	 	 	James F. Maroney, 	 
	 	 	Vice President, Secretary and General Counsel 	 
	 



	 	 	 	 	 
	 	 
	 	 
	«Name» 	 
	«Address»
 	 
	«City», «State»  «Zip_Code»



Director’s Taxpayer Identification Number:



«Tax_ID» 	 
	 




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