Document:

Exhibit

RANGER ENERGY SERVICES, INC.
PERFORMANCE STOCK UNIT AWARD INCENTIVE AGREEMENT

THIS PERFORMANCE STOCK UNIT AWARD INCENTIVE AGREEMENT (this “Agreement”) is made and entered into by and between Ranger Energy Services, Inc., a Delaware corporation (the “Company”), and _____________, an individual and employee of the Company (“Grantee”), as of the 20th day of March, 2019 (the “Grant Date”), subject to the terms and conditions of the Ranger Energy Services, Inc. 2017 Long Term Incentive Plan, as it may be amended from time to time thereafter (the “Plan”).  The Plan is hereby incorporated herein in its entirety by this reference. Capitalized terms not otherwise defined in this Agreement shall have the meaning given to such terms in the Plan.
WHEREAS, Grantee is _________________ of the Company, and in connection therewith, the Company desires to grant a Performance-Based Stock-Based Award to Grantee, subject to the terms and conditions of this Agreement and the Plan, with a view to increasing Grantee’s interest in the Company’s success and growth; and  
WHEREAS, Grantee desires to be the holder of a Performance-Based Stock-Based Award subject to the terms and conditions of this Agreement and the Plan;
NOW, THEREFORE, in consideration of the premises, mutual covenants and agreements contained herein, and such other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto, intending to be legally bound, hereby agree as follows:
1.Grant of Performance Stock Units. Subject to the terms and conditions of this Agreement and the Plan, the Company hereby grants to Grantee _______ Performance Stock Units as described herein (the “Performance Stock Units”), which constitute a Performance-Based Stock-Based Award that is referred to as a Performance-Based Award under the Plan. Each Performance Stock Unit shall initially represent the equivalent of one Share as of the Grant Date, with the actual number of Shares to be paid out to be determined under the terms and conditions of this Agreement. With respect to the Performance Stock Units granted under this Agreement, the Committee reserves the right and authority, as exercised in its discretion, to modify, waive or adjust any term or condition of an Award that has been granted, which may include the acceleration of vesting, waiver of forfeiture restrictions, modification of the form of settlement of the Award, early termination of a performance period, or modification of any other condition or limitation regarding an award, at any time before or after the Incentive Award becomes fully vested but prior to actual payment, but at all times subject to Section 6 for Detrimental Conduct.  As a holder of Performance Stock Units, the Grantee has the rights of a general unsecured creditor of the Company unless and until the Performance Stock Units are converted to Shares upon vesting and transferred to Grantee, as set forth herein. 
2.    Transfer Restrictions. Grantee shall not sell, assign, transfer, exchange, pledge, encumber, gift, devise, hypothecate or otherwise dispose of (collectively, “Transfer”) any Performance Stock Units granted hereunder. Any purported Transfer of Performance Stock Units in breach of this Agreement shall be void and ineffective, and shall not operate to Transfer any interest or title to the purported transferee.
3.    Vesting of Performance Stock Units.
(a)    Performance Period. For purposes of this Agreement, the performance period is the three-year period that begins on March 20, 2019 and ends on March 21, 2022 (the “Performance Period”). Subject to the terms and conditions of this Agreement, the Performance Stock Units shall vest and become payable to Grantee at the end of the Performance Period, provided that (i) Grantee is still an Employee at that time and has continuously been an Employee since the Grant Date (the “Service Requirement”) and (ii) the Board, or a duly authorized committee thereof, has certified in writing that the performance criterion established for the Performance Period as described below (the “Performance Criterion”) has been achieved. All Performance Stock Units that do not become vested during or at the end of the Performance Period shall be forfeited. The Board, in its discretion, may adjust the Performance Criterion to recognize special or non-recurring situations or circumstances with respect to the Company or any other company in the Peer Group for any year during the Performance Period arising from the acquisition or disposition of assets, costs associated with exit or disposal activities or material impairments.  There are two Performance Criterion that have been established for the Performance Stock Units awarded under this Agreement, as described in subsections (b) and (c) below.
(b)    RTSR. The first Performance Criterion is the Company’s Relative Total Shareholder Return (“RTSR”) as defined in Exhibit A to this Agreement (the “RTSR Criterion”). The Company’s RTSR is compared to the RTSR of each of the peer group companies, as listed on Exhibit A to this Agreement (each a “Peer Company” and as a group, the “Peer Group”), as of the end of each calendar year within the Performance Period to determine where the Company ranks when compared to the Peer Group. The RTSR Criterion is one-hundred percent (100%) of the total weighting for fifty percent (50%) of the Performance Stock Units awarded under this Agreement.
(c)    Absolute RNGR Stock Price.  The second Performance Criterion is the Absolute Total Shareholder Return (the “Absolute TSR”) as defined in Exhibit A to this Agreement (the “Absolute TSR Criterion”).  The Company’s Absolute TSR will be measured from a base stock price of seven dollars and eighty cents per share ($7.80/share, the “Base Price”), and such Base Price will be compared with the price per share on the last day of trading during the Performance Period to determine the payout.  The Absolute TSR Criterion is one-hundred percent (100%) of the total weighting for fifty percent (50%) of the Performance Stock Units awarded under this Agreement. 
(d)    Changes in Peer Group.  When calculating RTSR for the Performance Period for the Company and the Peer Group, (i) the performance of a company in the Peer Group will not be used in calculating the RTSR of that member of the Peer Group if the company is not publicly traded (i.e., has no ticker symbol) at the end of the Performance Period; (ii) the performance of any company in the Peer Group that becomes bankrupt during the Performance Period will be included in the calculation of Peer Group performance even if it has no ticker symbol at the end of the measurement period; (iii) the performance of the surviving entities will be used in the event there is a combination of any of the Peer Group companies during the measurement period; and (iv) in the event that a company in the Peer Group becomes disqualified as a Peer Company under this subsection (d), then a company from the listing of “Alternate Bench Peer Companies” identified on Exhibit A will be added to the Peer Group during the Performance Period.  Notwithstanding the foregoing provisions of this subsection (d), the Board may disregard any of these guidelines when evaluating changes in the membership of the Peer Group during the Performance Period in any particular situation, as it deems reasonable in the exercise of its discretion.
(e)    Ranking of Company as Compared to the Peer Group for Purposes of the RTSR Criterion.  The Board will rank the Company’s performance against the RTSR Criterion within the Peer Group (set forth on Exhibit A) as of December 31, 2021, and apply the award multiplier from the following table:
	
				
	Relative TSR Performance

	Relative TSR Performance Rank
	Percentile 
Ranking
	Award 
Payout
	Payout vs. 
Target

	1
	100%
	Maximum
	200%

	2
	90%
	 
	180%

	3
	80%
	 
	160%

	4
	70%
	Stretch
	140%

	5
	60%
	 
	120%

	6
	50%
	Target
	100%

	7
	40%
	 
	75%

	8
	30%
	Threshold
	50%

	9
	20%
	 
	0%

	10
	10%
	 
	0%

Should the stock price fall to $6.63 per share or less (a price that is 15% below the closing stock price of $7.80 on the day the Grant was authorized by the Board), then the maximum payout available is the Target Level of 100%, regardless of relative rank.
(f)    Determination of Payout for Purposes of the Absolute TSR Criterion.  The Board will rank the Company’s performance against the Absolute TSR Criterion as of December 31, 2021, and apply the award multiplier from the following table:
	
			
	Absolute TSR

	Stock Price Growth
	Award Payout
	Payout vs. Target

	75%
	Maximum
	200%

	69%
	 
	175%

	63%
	 
	150%

	56%
	 
	125%

	50%
	Target
	100%

	37%
	 
	75%

	23%
	 
	50%

	10%
	Threshold
	25%

4.    Termination of Employment. If Grantee’s Employment is voluntarily or involuntarily terminated during the Performance Period, then Grantee shall immediately forfeit the outstanding Performance Stock Units, except as provided below in this Section 4. Upon the forfeiture of any Performance Stock Units hereunder, the Grantee shall cease to have any rights in connection with such Performance Stock Units as of the date of forfeiture. 
(a)    Termination of Employment. Except as provided in Section 4(c), if the Grantee’s Employment is terminated for any reason, other than due to death or Disability during the Performance Period, any non-vested Performance Stock Units at the time of such termination shall automatically expire and terminate and no further vesting shall occur after the termination of Employment date. In such event, the Grantee will receive no payment for unvested Performance Stock Units.
(b)    Disability or Death. Upon termination of Grantee’s Employment as the result of Grantee’s Disability (as defined below) or death during the Performance Period, then all of the outstanding Performance Stock Units shall become 100% vested on such date at the 1.0 multiplier award level.  For purposes of this Agreement, “Disability” means (i) a disability that entitles the Grantee to benefits under the Company’s long-term disability plan, as may be in effect from time to time, as determined by the plan administrator of the long-term disability plan or (ii) a disability whereby the Grantee is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than 12 months.
(c)    Change in Control. If there is a Change in Control of the Company (as defined in the Plan) during the Performance Period, then in the event of the Grantee’s Involuntary Termination Without Cause (as defined below) within two (2) years following the effective date of the Change in Control and during the same Performance Period, all the outstanding Performance Stock Units shall automatically become 100% vested on the Grantee’s termination of Employment date at the 1.0 multiplier award level.  
(d)    For purposes of this Agreement, “Involuntary Termination Without Cause” means the Employment of Grantee is involuntarily terminated by the Company (or by any successor to the Company) for any reason, including, without limitation, as the result of a Change in Control, except due to death, Disability or Cause; provided, that in the event of a dispute regarding whether Employment was terminated voluntarily or involuntarily, or with or without Cause, such dispute will be resolved by the Board, in good faith, in the exercise of its discretion.
5.    Payment for Performance Stock Units. Payment for the vested Performance Stock Units subject to this Agreement shall be made to the Grantee as soon as practicable following the time such Performance Stock Units become vested in accordance with Section 3 or Section 4 prior to their expiration, but not earlier than thirty (30) days, and not later than ninety (90) days following the date of such vesting event. The number of Performance Stock Units that vest and are payable hereunder shall be determined by the Board, in its discretion, in accordance with the Payout Schedule in Section 3. 
The number of Shares payable to the Grantee pursuant to this Agreement shall be an amount equal to the number of vested Performance Stock Units multiplied by the award multiplier for the level of achievement of the Performance Criterion determined in Section 3(d).  The maximum payout for each Performance Stock Unit is two (2.0) Shares because the maximum award multiplier on the Payout Schedule is 2.00.
Any amount paid in respect of the vested Performance Stock Units shall be payable in Class A Common Stock Shares. Prior to any payments under this Agreement, the Board shall certify in writing, by resolution or otherwise, the amount to be paid in respect of the Performance Stock Units as a result of the achievement of the Performance Criterion.
Any Shares delivered to or on behalf of Grantee in respect of vested Performance Stock Units shall be subject to any further transfer or other restrictions as may be required by securities law or other applicable law, as determined by the Company.
6.    Detrimental Conduct. In the event that the Board should determine, in its sole and absolute discretion, that, during Employment or within two (2) years following Employment termination for any reason, the Grantee engaged in Detrimental Conduct (as defined below), the Board may, in its sole and absolute discretion, if Shares have previously been transferred to the Grantee pursuant to Section 5 upon vesting of his Performance Stock Units, direct the Company to send a notice of recapture (a “Recapture Notice”) to such Grantee.  Within ten (10) days after receiving a Recapture Notice from the Company, the Grantee will deliver to the Company either (i) the actual number of Shares that were transferred to the Grantee upon vesting of Performance Stock Units or (ii) a cash equivalent payment in an amount equal to the Fair Market Value of such Shares at the time when transferred to the Grantee, unless the Recapture Notice demands repayment of a lesser sum.  All repayments hereunder shall be net of the taxes that were withheld by the Company when the Shares were originally transferred to Grantee following vesting of the Performance Stock Units pursuant to Section 5.  For purposes of this Agreement, a Grantee has committed “Detrimental Conduct” if the Grantee (a) violated a confidentiality, non-solicitation, non-competition or similar restrictive covenant between the Company or one of its Affiliates and such Grantee, including violation of a Company policy relating to such matters, or (b) engaged in willful fraud that causes harm to the Company or one of its Affiliates or that is intended to manipulate the performance results of any Incentive Award, including, without limitation, any material breach of fiduciary duty, embezzlement or similar conduct that results in a restatement of the Company’s financial statements.
7.    Grantee’s Representations. Notwithstanding any provision hereof to the contrary, the Grantee hereby agrees and represents that Grantee will not acquire any Shares, and that the Company will not be obligated to issue any Shares to the Grantee hereunder, if the issuance of such Shares constitutes a violation by the Grantee or the Company of any law or regulation of any governmental authority. Any determination in this regard that is made by the Board, in good faith, shall be final and binding. The rights and obligations of the Company and the Grantee are subject to all applicable laws and regulations.
8.    Tax Withholding. To the extent that the receipt of the payment of Shares hereunder results in compensation income to Grantee for federal, state or local income tax purposes, Grantee shall deliver to Company at such time the sum that the Company requires to meet its tax withholding obligations under applicable law or regulation, and, if Grantee fails to do so, Company is authorized to (a) withhold from any cash or other remuneration (including any Shares), then or thereafter payable to Grantee, any tax required to be withheld; or (b) sell such number of Shares as is appropriate to satisfy such tax withholding requirements before transferring the resulting net number of Shares to Grantee in satisfaction of its obligations under this Agreement.
9.    Independent Legal and Tax Advice. The Grantee acknowledges that (a) the Company is not providing any legal or tax advice to Grantee, and (b) the Company has advised the Grantee to obtain independent legal and tax advice regarding this Agreement and any payment hereunder.
10.    No Rights in Shares. The Grantee shall have no rights as a stockholder in respect of any Shares, unless and until the Grantee becomes the record holder of such Shares on the Company’s records.
11.    Conflicts with Plan, Correction of Errors, and Grantee’s Consent. In the event that any provision of this Agreement conflicts in any way with a provision of the Plan, such provisions shall be reconciled, or such discrepancy shall be resolved, by the Board in the exercise of its discretion. In the event that, due to administrative error, this Agreement does not accurately reflect the Performance Stock Units properly granted to the Grantee, the Board reserves the right to cancel any erroneous document and, if appropriate, to replace the cancelled document with a corrected document. All determinations and computations under this Agreement shall be made by the Board (or its authorized delegate or a duly authorize committee of the Board) in its discretion as exercised in good faith.
This Agreement and any award of Performance Stock Units or payment hereunder are intended to comply with or be exempt from Section 409A of the Internal Revenue Code and shall be interpreted accordingly. Accordingly, Grantee consents to such amendment of this Agreement as the Board may reasonably make in furtherance of such intention, and the Company shall promptly provide, or make available, to Grantee a copy of any such amendment.
12.    Miscellaneous.
(a)    No Fractional Shares. All provisions of this Agreement concern whole Shares. If the application of any provision hereunder would yield a fractional Share, such fractional Share shall be rounded down to the next whole Share if it is less than 0.5 and rounded up to the next whole Share if it is 0.5 or more.
(b)    Transferability of Performance Stock Units. The Performance Stock Units are transferable only to the extent permitted under the Plan at the time of transfer (i) by will or by the laws of descent and distribution, or (ii) by a domestic relations order in such form as is acceptable to the Company. No right or benefit hereunder shall in any manner be liable for or subject to any debts, contracts, liabilities, obligations or torts of the Grantee or any permitted transferee thereof.
(c)    Not an Employment Agreement. This Agreement is not an employment agreement, and no provision of this Agreement shall be construed or interpreted to create any Employment relationship between Grantee and the Company for any time period. The Employment of Grantee with the Company shall be subject to termination to the same extent as if this Agreement did not exist.
(d)    Notices. Any notice, instruction, authorization, request or demand required hereunder shall be in writing, and shall be delivered either by personal in-hand delivery, by telecopy or similar facsimile means, by certified or registered mail, return receipt requested, or by courier or delivery service, addressed to the Company at its then current main corporate address, and to Grantee at the address indicated on the Company’s records, or at such other address and number as a party has last previously designated by written notice given to the other party in the manner hereinabove set forth. Notices shall be deemed given when received, if sent by facsimile means (confirmation of such receipt by confirmed facsimile transmission being deemed receipt of communications sent by facsimile means); and when delivered and receipted for (or upon the date of attempted delivery where delivery is refused), if hand-delivered, sent by courier or delivery service, or sent by certified or registered mail, return receipt requested. 
(e)    Amendment, Termination and Waiver. This Agreement may be amended, modified, terminated or superseded only by written instrument executed by or on behalf of the Grantee and the Company (by action of the Board, its delegate or a duly authorized committee of the Board). Any waiver of the terms or conditions hereof shall be made only by a written instrument executed and delivered by the party waiving compliance. Any waiver granted by the Company shall be effective only if executed and delivered by a duly authorized executive officer of the Company other than Grantee. The failure of any party at any time or times to require performance of any provisions hereof shall in no manner affect the right to enforce the same. No waiver by any party of any term or condition herein, or the breach thereof, in one or more instances shall be deemed to be, or construed as, a further or continuing waiver of any such condition or breach or a waiver of any other condition or the breach of any other term or condition.
(f)    No Guarantee of Tax or Other Consequences. The Company makes no commitment or guarantee that any tax treatment will apply or be available to the Grantee or any other person. The Grantee has been advised, and provided with ample opportunity, to obtain independent legal and tax advice regarding this Agreement.
(g)    Governing Law and Severability. This Agreement shall be governed by the laws of the State of Texas without regard to its conflicts of law provisions, except as preempted by controlling federal law. The invalidity of any provision of this Agreement shall not affect any other provision hereof or of the Plan, which shall remain in full force and effect.
(h)    Successors and Assigns. This Agreement shall bind, be enforceable by, and inure to the benefit of, the Company and Grantee and any permitted successors and assigns under the Plan.
[Signature page follows.]

IN WITNESS WHEREOF, this Agreement is hereby approved and executed as of the date first written above.

	
		
	RANGER ENERGY SERVICES, INC.
	 

	 
	 

	 
	 

	_________________________________
	_________________________

	Name:
	Date of Signature

	Title:
	 

	 
	 

	

	 

	 
	 

	_________________________________
	_________________________

	Name:
	Date of Signature

EXHIBIT A
Performance Criterion and Peer Companies 
1.     RTSR.  RTSR is the Performance Criterion applicable to 50% of the Performance Stock Units and is determined by dividing (1) the sum of (a) the cumulative amount of the dividends of the Company or the Peer Company, as applicable, for the applicable period assuming same-day reinvestment into the corporation’s common stock on the ex-dividend date and (b) the share price of such corporation at the end of the applicable period minus the share price at the beginning of the applicable period, by (2) the share price at the beginning of the applicable period. The RTSR for each Peer Company in the Peer Group will be calculated over the applicable period, and then compared with the identical calculation for the Company. The Company’s RTSR is a Performance Criterion that is compared to each Peer Company’s RTSR for the applicable period.
2.    Absolute TSR. Absolute TSR is the Performance Criterion applicable to the balance of the Performance Stock Units, and is determined by subtracting the Base Price of $7.80 per share from the closing price on the last day of trading during the applicable period.  This difference will then be divided by the Base Price of $7.80 per share and multiplied by 100 to determine the Absolute TSR as a percent of growth in the stock price over the applicable period.  The Company’s Absolute TSR is a Performance Criterion that will not be compared to similar Peer Company performance over the applicable period.  
3.     Peer Companies and Peer Group.  The following Peer Companies comprise the Peer Group to which the Company’s RTSR performance will be compared for the Performance Period:

1.    TUSK        Mammoth Energy Services, Inc.
2.    WTTR        Select Energy Services, Inc. 
3.    BAS        Basic Energy Services, Inc.
4.    NINE        Nine Energy Services, Inc. 
5.    PES        Pioneer Energy Services Corp.
6.    KEG        Key Energy Services, Inc.
7.    PKD        Parker Drilling Company
8.    FTK        Flotek Industries, Inc.
9.    ICD        Independence Contract Drilling, Inc.

Should any Peer Company listed above become disqualified during the Performance Period under Section 3(d) of the Agreement, then the Board will replace such disqualified Peer Company with any one of the following Alternate Bench Peer Companies:
            
		
	1.
	PTEN           Patterson-UTI Energy, Inc.

		
	2.
	ESV        Ensco plc

		
	3.
	PD        Precision Drilling Corporation

		
	4.
	RDC        Rowan Companies plc

		
	5.
	FET        Forum Energy Technologies, Inc.

		
	6.
	HLX        Helix Energy Solutions Group, Inc.

1Exhibit

2019 PERFORMANCE RESTRICTED STOCK UNITS
GRANT AGREEMENT 

To:  _________________

By accepting your grant online through the Schwab Equity Award Center, you agree that these incentives are granted under and governed by the terms and conditions of the 2010 Long-Term Incentive Plan of BWX Technologies, Inc. (as amended and restated to date, the “Plan”), and this 2019 Performance Restricted Stock Units Grant Agreement, which is included in the online acceptance process.  A copy of the Plan and the Prospectus relating to the stock issued under the Plan can be found at http://equityawardcenter.schwab.com under the “At a Glance/My Company Info” tab in your Schwab account.  The Plan and Prospectus are incorporated by reference and made a part of the terms and conditions of your award.  If you would like to receive a copy of either the Plan or Prospectus, please contact Kathy Peres at 980-625-4194 or kaperes@bwxt.com.

******************************************************************************

Effective __________, 2019 (the “Date of Grant”), the Compensation Committee of the Board of Directors (the “Committee”) of BWX Technologies, Inc. (“BWXT”) awarded you a grant of performance-based Restricted Stock Units (“Performance RSUs”) under the Plan.  The provisions of the Plan are incorporated herein by reference and capitalized terms used but not otherwise defined in this Agreement have the meanings given them in the Plan.  For the avoidance of doubt, the Performance RSUs are not intended to be a Performance-Based Award under the Plan.

Any reference or definition contained in this Agreement shall, except as otherwise specified, be construed in accordance with the terms and conditions of the Plan and all determinations and interpretations made by the Committee with regard to any question arising hereunder or under the Plan shall be binding and conclusive on you and your legal representatives and beneficiaries.  The term “BWXT” as used in this Agreement with reference to employment shall include subsidiaries of BWXT (including unconsolidated joint ventures).  Whenever the words “you” or “your” are used in any provision of this Agreement under circumstances where the provision should logically be construed to apply to the beneficiary, estate, or personal representative, to whom any rights under this Agreement may be transferred by will or by the laws of descent and distribution, it shall be deemed to include such person.
 
Performance RSUs

1.     Performance RSU Award.  You have been awarded ________ performance-based restricted stock units (the “Initial Performance RSUs”).  These Performance RSUs represent a right to receive Shares, calculated as described below, provided (and to the extent that) the applicable performance measures and vesting requirements set forth in this Agreement have been satisfied.  No Shares are awarded or issued to you on the Date of Grant.

2.     Vesting Requirements.  Subject to Section 3 of this Agreement (the “Forfeiture of Performance RSUs” provision), Performance RSUs will become vested under one of the following circumstances, to the extent the Performance RSUs have not previously vested or become forfeited:

		
	·  
	a percentage of the Initial Performance RSUs shall become vested on the third anniversary of the Date of Grant, provided you are still employed by BWXT (with the number in which you vest 

determined as described in Section 4 of this Agreement (the “Number of Performance RSUs” provision));
		
	·  
	if you terminate employment on or after the first anniversary of the Date of Grant but prior to the third anniversary of the Date of Grant due to Retirement or an involuntary termination by BWXT without Cause (in each case as defined below), you will be eligible to vest in a number of Performance RSUs equal to the product of (a) the number of Performance RSUs that would have vested if you would have remained in the continuous employ of BWXT until the third anniversary of the Date of Grant or the occurrence of a Change in Control (whichever occurs first) multiplied by (b) a fraction, the numerator of which is the number of calendar days you are employed by BWXT during the Performance Period, and the denominator of which is the total number of calendar days in the Performance Period;

		
	·  
	100% of the Initial Performance RSUs shall become vested prior to the third anniversary of the Date of Grant on the earliest to occur of: (a) the date of termination of your employment from BWXT due to death, (b) your Disability, or (c) the date of a Change in Control; and

		
	·  
	the Committee may provide for additional vesting under other circumstances, in its sole discretion.

For purposes of this Agreement, “Retirement” means voluntary termination of employment with BWXT after attaining (i) at least 60 years of age and (ii) at least [5] [10] years of service with BWXT (with years of service calculated by reference from your “adjusted service date,” as determined by the Company).

For purposes of this Agreement, “Cause” means that (a) you are convicted of (i) a felony or (ii) a misdemeanor involving fraud, dishonesty or moral turpitude, or (b) you engage in conduct that adversely affects or may reasonably be expected to adversely affect the business reputation or economic interests of BWXT, as determined in the sole judgment of the Committee.

3.     Forfeiture of Performance RSUs.  Except in connection with a “Retirement” or a termination without Cause as described in Section 2 above, Performance RSUs which are not or do not become vested upon your termination of employment for any reason shall, coincident therewith, be forfeited and be of no force and effect.

4.     Number of Performance RSUs.  Except as otherwise provided in this Agreement and subject to adjustments permitted by the Plan, the number of Performance RSUs in which you will vest under this Agreement, if any, will be determined by multiplying (a) the sum of (i) 0.5 times the vested percentage applicable to Return on Invested Capital (“ROIC”) plus (ii) 0.5 times the vested percentage applicable to diluted Earnings Per Share (“EPS”) by (b) the number of Initial Performance RSUs.  The maximum number of Performance RSUs in which you can vest is 200% of your Initial Performance RSUs and the minimum number of Performance RSUs in which you can vest is 0% of your Initial Performance RSUs.

The vested percentage applicable to ROIC and EPS will each be determined over the Performance Period as set forth on Schedule 1 attached hereto and incorporated by reference herein.  For purposes of this Agreement, the “Performance Period” means the period beginning on January 1, 2019 and ending on December 31, 2021.   

5.     Settlement of Performance RSUs.  You (or your beneficiary, if applicable) will receive one Share for each Performance RSU that vests under this Agreement.  If you have made a permitted deferral election with respect to the Performance RSUs, then, subject to compliance with Section 409A of the Code (to the extent applicable), vested Performance RSUs shall be paid to you in accordance with such deferral election.  If you have not made a permitted deferral election with respect to the Performance RSUs, vested Performance RSUs 

shall be paid to you as soon as administratively practicable after the Performance RSUs vest, but in no event later than the earlier of (a) March 15 following the end of the calendar year in which the Performance RSUs vest and (b) March 15, 2022 (and in all events within the short-term deferral period for purposes of Section 409A of the Code). 

6.     Dividend, Voting Rights and Other Rights.  You shall have no rights of ownership in the Shares underlying the Performance RSUs and shall have no right to vote such Shares until the date on which the Shares are transferred to you pursuant hereto.  From and after the Date of Grant and until the earlier of (a) the time when the Performance RSUs become vested and are paid in accordance with Section 5 hereof or (b) the time when your right to receive Shares in payment of the Performance RSUs is forfeited in accordance with Section 3 hereof, on the date that BWX Technologies, Inc. pays a cash dividend (if any) to holders of Shares generally, you shall be credited with cash per Performance RSU equal to the amount of such dividend.  Any amounts credited pursuant to the immediately preceding sentence shall be subject to the same applicable terms and conditions (including vesting, payment and forfeitability) as apply to the Performance RSUs based on which the dividend equivalents were credited, and such amounts shall be paid in cash at the same time as the Performance RSUs to which they relate.   
Taxes

7.     Liability for Tax-Related Items.  Regardless of any action BWXT or your employer (the “Employer”) takes with respect to any or all income tax, social insurance, payroll tax, or other tax-related withholding (“Tax-Related Items”), you acknowledge and agree that the ultimate liability for all Tax-Related Items legally due by you is and remains your responsibility and that BWXT and/or the Employer (i) make no representations nor undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of this grant of Performance RSUs, including the grant and vesting of Performance RSUs, subsequent delivery of Shares or the subsequent sale of any Shares acquired pursuant to such Performance RSUs and receipt of any dividend equivalent payments (if any) and (ii) do not commit to structure the terms or any aspect of this grant of Performance RSUs to reduce or eliminate your liability for Tax-Related Items.  Prior to the taxable or tax withholding event, as applicable, you shall pay, or make adequate arrangements satisfactory to BWXT or to the Employer to satisfy all Tax-Related Items.  In this regard, you authorize BWXT or Employer to withhold all applicable Tax-Related Items legally payable by you, and unless determined otherwise by the Committee, BWXT or Employer will withhold a number of Shares otherwise deliverable equal to the minimum statutory withholding amount to satisfy such liability.  If the obligation for Tax-Related Items is satisfied by withholding a number of Shares as described herein, you understand that you will be deemed to have been issued the full number of Shares subject to the settled Performance RSUs, notwithstanding that a number of Shares are held back solely for the purpose of paying the Tax-Related Items due as a result of the settlement of the Performance RSUs.

Transferability

8.     Non-Transferability.  Performance RSUs granted hereunder are non-transferable other than by will or by the laws of descent and distribution or pursuant to a qualified domestic relations order.

Clawback Provisions

9.     Recovery of Performance RSUs.  In the event that BWXT is required to prepare an accounting restatement due to the material noncompliance of BWXT with any financial reporting requirement under the U.S. federal securities laws as a result of fraud (a “Restatement”) and the Board reasonably determines that you knowingly engaged in the fraud, BWXT will have the right to recover the Performance RSUs granted during the three-year period preceding the date on which the Board or BWXT, as applicable, determines it is required to prepare the Restatement (the “Three-Year Period”), or vested in whole or in part during the 

Three-Year Period, to the extent of any excess of what would have been granted to or would have vested for you under the Restatement.

10.    Recovery Process.  In the event a Restatement is required, the Board, based upon a recommendation by the Committee, will (a) review the Performance RSUs either granted or vested in whole or in part during the Three-Year Period and (b) in accordance with the provisions of this Agreement and the Plan, will take reasonable action to seek recovery of the amount of such Performance RSUs in excess of what would have been granted to or would have vested for you under the Restatement (but in no event more than the total amount of such Performance RSUs), as such excess amount is reasonably determined by the Board in its sole discretion, in compliance with Section 409A of the Code.  There shall be no duplication of recovery under Article 19 of the Plan and any of 15 U.S.C. Section 7243 (Section 304 of The Sarbanes-Oxley Act of 2002) and Section 10D of the Exchange Act.  Notwithstanding anything in this Agreement to the contrary, you acknowledge and agree that this Agreement and the award described herein (and any settlement thereof) are subject to the terms and conditions of the Company’s clawback policy (if any) as may be in effect from time to time specifically to implement Section 10D of the Exchange Act, and any applicable rules or regulations promulgated thereunder (including applicable rules and regulations of any national securities exchange on which the Shares may be traded) (the “Compensation Recovery Policy”), and that Sections 9 and 10 of this Agreement shall be deemed superseded by and subject to the terms and conditions of the Compensation Recovery Policy from and after the effective date thereof. 

Other Information

11.    No Guarantee of Continued Service.  Neither the action of BWXT in establishing the Plan, nor any action taken by it, by the Committee or by your employer, nor any provision of the Plan or this Agreement shall be construed as conferring upon you the right to be retained in the employ of BWXT or any of its subsidiaries or affiliates.

12.    Adjustments.  The Performance RSUs evidenced by this Agreement are subject to adjustment as provided in Sections 4.3 and 15.2 of the Plan.

13.    Compliance with Section 409A of the Code.  To the extent applicable, it is intended that this Agreement and the Plan comply with the provisions of Section 409A of the Code.  This Agreement and the Plan shall be administered in a manner consistent with this intent, and any provision that would cause this Agreement or the Plan to fail to satisfy Section 409A of the Code shall have no force or effect until amended to comply with Section 409A of the Code (which amendment may be retroactive to the extent permitted by Section 409A of the Code and may be made by BWXT without your consent).  Any reference in this Agreement to Section 409A of the Code will also include any proposed, temporary or final regulations, or any other guidance, promulgated with respect to such Section by the U.S. Department of the Treasury or the Internal Revenue Service.

14.    Electronic Delivery.  BWXT may, in its sole discretion, deliver any documents related to the Performance RSUs and your participation in the Plan, or future awards that may be granted under the Plan, by electronic means or request your consent to participate in the Plan by electronic means.  You hereby consent to receive such documents by electronic delivery and, if requested, agree to participate in the Plan through an on-line or electronic system established and maintained by BWXT or another third party designated by BWXT.

15.    Severability.  In the event that one or more of the provisions of this Agreement shall be invalidated for any reason by a court of competent jurisdiction, any provision so invalidated shall be deemed to be 

separable from the other provisions hereof, and the remaining provisions hereof shall continue to be valid and fully enforceable.

16.    Successors and Assigns.  Without limiting Section 8 hereof, the provisions of this Agreement shall inure to the benefit of, and be binding upon, your successors, administrators, heirs, legal representatives and assigns, and the successors and assigns of the Company.
 
17.    Acknowledgement.  You acknowledge that you (a) have received a copy of the Plan, (b) have had an opportunity to review the terms of this Agreement and the Plan, (c) understand the terms and conditions of this Agreement and the Plan and (d) agree to such terms and conditions.

18.    Country-Specific Special Terms and Conditions.  Notwithstanding any provisions in this Agreement, the Performance RSUs shall also be subject to the special terms and conditions set forth in Appendix A to this Agreement for your country of residence.  Moreover, if you relocate to one of the countries included on Appendix A, the special terms and conditions for such country will apply to you, to the extent BWXT determines that the application of such terms and conditions are necessary or advisable in order to comply with local law or facilitate the administration of the Plan.  Appendix A constitutes part of this Agreement.

19.    Notice to Governmental Authority.  Notwithstanding anything in this Agreement to the contrary, nothing in this Agreement prevents you from providing, without prior notice to BWXT, information to governmental authorities regarding possible legal violations or otherwise testifying or participating in any investigation or proceeding by any governmental authorities regarding possible legal violations, and for purpose of clarity you are not prohibited from providing information voluntarily to the Securities and Exchange Commission pursuant to Section 21F of the 1934 Act.

Schedule 1

Calculating ROIC and EPS

Except as otherwise described below, the component values used to calculate ROIC and EPS will be determined in accordance with U.S. generally accepted accounting principles excluding (1) expenses associated with the acquisition or disposition of any asset, (2) expenses associated with company restructuring activity, (3) any pension accounting mark-to-market losses, (4) acquisition related amortization resulting from an acquisition that occurs during the Performance Period, (5) losses from divestitures, (6) impairments of tangible and intangible assets,  (7) losses in respect of legal proceedings and dispute resolutions, and (8) losses from tax valuation allowances.  The performance goals or the component values will also be adjusted to reflect the negative effects from applicable changes in accounting standards / policies or tax regulations after the date of this meeting.  No adjustment herein shall limit any discretion provided by the Plan to increase or reduce the amount of a Participant’s Final Award as computed hereunder. 

Return on Invested Capital (ROIC)

The vested percentage applicable to ROIC will be determined based on BWXT’s average annual ROIC (as calculated below) (“Average ROIC”) for the Performance Period in accordance with the following schedule:

Average ROIC        ROIC Vested Percentage

       xx.x%                 50%
       xx.x%               100%
       xx.x%               200%

Vested percentages between the amounts shown will be calculated by linear interpolation.  The vested percentage applicable to ROIC will be 0% if the Average ROIC for the Performance Period is below xx.x%.  In no event will the vested percentage applicable to ROIC be greater than 200%.

ROIC will be calculated quarterly and the ROIC for any calendar year during the Performance Period will equal the sum of the four applicable quarterly ROIC calculations.  Average ROIC will equal the sum of the three annual ROIC calculations during the Performance Period divided by three.

For purposes of this Agreement, the term “ROIC” is a ratio measure of BWXT’s net income in relation to BWXT’s invested capital, using the formula set forth below.  For purposes of determining ROIC, net income is pre-tax income less tax expense calculated in accordance with U.S. generally accepted accounting principles.    Invested capital is BWXT’s total assets less current liabilities.  Current liabilities include any liabilities that are due within one calendar year and will be defined based on BWXT’s consolidated balance sheet applicable to the applicable period.    

	
			
	Net Income
	=
	Pre-tax Income - Tax Expense

	Invested Capital
	Total Assets - Current Liabilities

Diluted Earnings Per Share (EPS)

The vested percentage applicable to EPS will be determined based on BWXT’s cumulative EPS (as calculated below) (“Cumulative EPS”) for the Performance Period in accordance with the following schedule:

Cumulative EPS        EPS Vested Percentage

      $xx.x                             50%
      $xx.x                   100%
      $xx.x                   200%

Vested percentages between the amounts shown will be calculated by linear interpolation.  The vested percentage applicable to EPS will be 0% if the Cumulative EPS for the Performance Period is below $xx.x.  In no event will the vested percentage applicable to EPS be greater than 200%. 

EPS will be calculated for each calendar year during the Performance Period and Cumulative EPS for the Performance Period will equal the sum of the three applicable annual EPS calculations.

For purposes of this Agreement, the term “EPS” means BWXT’s net income attributable to stockholders of common stock for the applicable period divided by BWXT’s weighted average diluted shares outstanding for the applicable period.  For purposes of determining EPS, net income attributable to stockholders of common stock is defined as “Net Income Attributable to BWX Technologies, Inc.” on BWXT’s Consolidated Statement of Income.  Diluted shares outstanding will include all basic shares outstanding and any other dilutive securities for the period.  If any securities are dilutive, the impact on the number of outstanding shares will be included in the denominator and the related income statement impact of the security will be removed from the numerator. 

	
			
	Diluted EPS
	=
	Net Income to Common Shareholders + Net Income Impact of Dilutive Securities

	WACSO assuming all Dilutive Securities are converted to Common Stock

WACSO represents weighted average common stock outstanding.

APPENDIX A
COUNTRY-SPECIFIC SPECIAL TERMS AND CONDITIONS 

This Appendix A, which is part of the BWXT 2019 Performance Restricted Stock Units Grant Agreement (the “Agreement”), contains additional terms and conditions of the Agreement that will apply to you if you reside in one of the countries listed below.  It also includes information about certain other issues of which you should be aware with respect to your participation in the Plan.  Such information is based on securities, exchange control, and other laws in effect in the respective countries as of February 2019.  Capitalized terms used but not defined herein shall have the same meanings assigned to them in the Plan and/or the Agreement. By accepting the Performance RSUs, you agree to be bound by the terms and conditions contained in the paragraphs below in addition to the terms of the Plan, the Agreement, and the terms of any other document that may apply to you and your Performance RSUs.  

In addition, the information contained herein is general in nature and may not apply to your particular situation, and BWXT is not in a position to assure you of a particular result.  Accordingly, you are advised to seek appropriate professional advice as to how the relevant laws in your country may apply to your situation.

Finally, if you are a citizen or resident of a country other than the one in which you are currently working, transferred employment after the Performance RSUs were granted to you, or are considered a resident of another country for local law purposes, the information contained herein may not apply.

COUNTRIES COVERED BY THIS APPENDIX A:
Canada.

---------------------------------------------------------------------------------------------------------------------

CANADA

Terms and Conditions 

		
	1. 
	Nature of Grant.  In accepting the grant of Performance RSUs, you acknowledge that:

		
	·  
	the Plan is established voluntarily by BWXT, is discretionary in nature and may be modified, amended, suspended or terminated by BWXT at any time;

		
	·  
	the grant of the Performance RSUs is voluntary and occasional and does not create any contractual or other right to receive future grants of Performance RSUs, or benefits in lieu of Performance RSUs, even if Performance RSUs have been granted repeatedly in the past;

		
	·  
	all decisions with respect to future Performance RSUs grants, if any, will be at the sole discretion of BWXT;

		
	·  
	you are voluntarily participating in the Plan;

		
	·  
	the Performance RSUs and the Shares subject to the Performance RSUs are an extraordinary item that does not constitute compensation of any kind for services of any kind rendered to BWXT or the Employer, and which is outside the scope of your employment contract, if any;

		
	·  
	the Performance RSUs and the Shares subject to the Performance RSUs are not intended to replace any pension rights or compensation;

		
	·  
	the Performance RSUs and the Shares subject to the Performance RSUs are not part of normal or expected compensation or salary for any purposes, including, but not limited to, calculating any severance, resignation, termination, redundancy, dismissal, end of service payments, bonuses, long-service awards, pension or retirement or welfare benefits or similar payments and in no event should be considered as compensation for, or relating in any way to, past services for BWXT, the Employer, or any Subsidiary;

		
	·  
	the Performance RSUs and your participation in the Plan will not be interpreted to form an employment contract or relationship with BWXT or any Subsidiary;

		
	·  
	the future value of the underlying Shares is unknown and cannot be predicted with certainty;

		
	·  
	in consideration of the grant of the Performance RSUs, no claim or entitlement to compensation or damages shall arise from forfeiture of the Performance RSUs resulting from termination of your service with BWXT or the Employer (for any reason whatsoever and whether or not in breach of local labor laws) and you irrevocably release BWXT and the Employer from any such claim that may arise; if, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen, you shall be deemed irrevocably to have waive any entitlement to pursue such claim;

		
	·  
	in the event of termination of your service with BWXT (whether or not in breach of local labor laws), your right to vest in the Performance RSUs under the Plan, if any, will terminate effective as of the date that you are no longer actively providing services and will not be extended by any notice period mandated under local law (e.g., active service would not include a period of “garden leave” or similar period pursuant to local law); you hereby waive and release any claims you may have against BWXT, its subsidiaries, affiliates, employees, officers and directors for the termination of any such right to vest during such notice period; the Board/Committee shall have the exclusive discretion to determine when you are no longer actively providing services for purposes of the Performance RSUs; notwithstanding the foregoing, if your service terminates due to certain termination events as described in this Agreement, the Performance RSUs will be fully vested as of the date of death; and

		
	·  
	the Performance RSUs and the benefits under the Plan, if any, will not automatically transfer to another company in the case of a merger, take-over or transfer of liability.

		
	2. 
	Data Privacy.  You hereby explicitly and unambiguously consent to the collection, use and transfer, in electronic or other form, of your personal data as described in this Agreement and any other award materials by and among, as applicable, the Employer, BWXT, and its Subsidiaries for the exclusive purpose of implementing, administering and managing your participation in the Plan.

You understand that BWXT and the Employer may hold certain personal information about you, including but not limited to, your name, home address, email address and telephone number, date of birth, social insurance number, passport number or other identification number, salary, nationality, job title, any Shares or directorships held in BWXT, details of all awards or any other entitlement to Shares granted, canceled, purchased, exercised, vested, unvested or outstanding in your favor, for the exclusive purpose of implementing, administering and managing the Plan (“Data”). 

You understand that Data will be transferred to any third parties assisting BWXT with the implementation, administration and management of the Plan.  You understand that the recipients of the Data may be located in the United States or elsewhere, and that the recipients’ country (e.g., the United States) may have different data privacy laws and protections than your country.  You 

understand that you may request a list with the names and addresses of any potential recipients of the Data by contacting your local human resources representative.  You authorize BWXT and any other possible recipients which may assist BWXT (presently or in the future) with implementing, administering and managing the Plan to receive, possess, use, retain and transfer the Data, in electronic or other form, for the sole purpose of implementing, administering and managing your participation in the Plan.  You understand that Data will be held only as long as is necessary to implement, administer and manage your participation in the Plan.  You understand that you may, at any time, view Data, request additional information about the storage and processing of Data, require any necessary amendments to Data or refuse or withdraw the consents herein, in any case without cost, by contacting in writing your local human resources representative.  You understand, however, that refusing or withdrawing your consent may affect your ability to participate in the Plan.  For more information on the consequences of your refusal to consent or withdrawal of consent, you understand that you may contact your local human resources representative.

		
	3.
	Settlement of Performance RSUs.  Section 5 of the Agreement (the “Settlement of Performance RSUs” provision) is hereby amended in its entirety to read as follows:

“Settlement of Performance RSUs.  You (or your beneficiary, if applicable) will receive one Share for each Performance RSU that vests under this Agreement. Such Shares shall be distributed to you as soon as administratively practicable after the Performance RSUs vest, but in no event later than March 15 following the end of the calendar year in which the Performance RSUs vest or, if earlier, at the latest by December 31 of the third year following the end of the year in which the Date of Grant occurred.

4.    Language Consent.  The following provision will apply to residents of Quebec:
The parties acknowledge that it is their express wish that this Agreement, as well as all documents, notices, and legal proceedings entered into, given or instituted pursuant hereto or relating directly or indirectly hereto, be drawn up in English.

Les parties reconnaissent avoir exigé la rédaction en anglais de cette convention, ainsi que de tous documents, avis et procédures judiciaires, exécutés, donnés ou intentés en vertu de, ou liés directement ou indirectement à la présente convention.

		
	5.
	Dividend Equivalents Settled in Shares Only.  Notwithstanding anything to the contrary in the Plan and/or this Agreement, any vested dividend equivalents will be settled in Shares.

		
	6.
	Performance RSUs Settled in Shares Only.  Notwithstanding anything to the contrary in the Plan and/or this Agreement, any Performance RSUs granted to you shall be paid in Shares only and do not provide any right to receive a cash payment.

		
	7.
	Form of Payment.  Due to legal restrictions in Canada and notwithstanding any language to the contrary in the Plan, you are prohibited from surrendering Shares that you already own or from attesting to the ownership of Shares to pay any tax withholding in connection with Performance RSUs granted to you. 

Notifications 

		
	1.
	Additional Restrictions on Resale.  In addition to the restrictions on resale and transfer noted in Plan materials, securities purchased under the Plan may be subject to certain restrictions on resale imposed by Canadian provincial securities laws.  You are encouraged to seek legal advice prior to any resale of such securities.  In general, participants resident in Canada may resell their securities in transactions carried out on exchanges outside of Canada and, in particular, you are generally permitted to sell Shares acquired pursuant to the Plan through the designated broker appointed under the Plan, if any, provided that BWXT is a foreign issuer that is not public in Canada and the sale of the Shares acquired pursuant to the Plan takes place: (i) through an exchange, or a market, outside of Canada on the distribution date; or (ii) to a person or company outside of Canada.  For purposes hereof, a foreign issuer is an issuer that: (a) is not incorporated or existing pursuant to the laws of Canada or any jurisdiction of Canada; (b) does not have its head office in Canada; and (c) does not have a majority of its executive officers or directors ordinarily resident in Canada.  

		
	2.
	Tax Reporting.  The Tax Act and the regulations thereunder require a Canadian resident individual (among others) to file an information return disclosing prescribed information where, at any time in a tax year, the total cost amount of such individual’s “specified foreign property” (which includes shares, options, restricted stock units, and performance-based restricted stock units) exceeds Cdn.$100,000.  You should consult your own tax advisor regarding this reporting requirement.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00295-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00295-of-00352.parquet"}]]