Document:

EXHIBIT 10.4

 

SM ENERGY COMPANY

 

PERFORMANCE SHARE AND RESTRICTED STOCK UNIT AWARD NOTICE

 

[Date](1)

 

[Name and Address]

 

Dear
[Name]:

 

Pursuant
to the SM Energy Company long term incentive program (“LTIP”) under the Company’s
Equity Incentive Compensation Plan, as amended (the “Plan”), you have been
awarded [Number]  performance shares (the
“Performance Shares”) and [Number] restricted stock units (the “Units”).  The Performance Shares represent the right to
receive, upon payment of the Performance Shares after the completion of the
Performance Period set forth below, a number of shares of the Company’s common
stock that will be calculated as set forth in the Performance Share and
Restricted Stock Unit Award Agreement (the “Agreement”), which Agreement will
set forth terms and conditions for the Performance Shares and the Units and
will be separately delivered to you, based on the Company’s performance for the
Performance Period and the extent to which the Performance Shares are
vested.  That number of shares relating
to the Performance Shares may be from zero (0) to two (2.0) times the number of
Performance Shares awarded.  Each Unit
represents the right to receive one share of the Company’s common stock to be
delivered upon settlement of the vested Units as set forth in the
Agreement.  The Performance Shares and
the Units are subject to all of the terms and conditions of the Plan and the
Agreement, which are both incorporated herein in their entirety.

 

	
  Awarded To:

  	
   

  	
  [Name]

  
	
  Award Date:

  	
   

  	
  [Award
  Date]

  
	
   

  	
   

  	
   

  
	
  PERFORMANCE
  SHARES:

  	
   

  	
   

  
	
  Number of Performance Shares:

  	
   

  	
  [Number]

  
	
  Performance Period:

  	
   

  	
  The
  three-year period beginning on [Date], and ending on [Date]

  
	
  PSA Vesting Schedule:

  	
   

  	
  The
  Performance Shares will vest as follows (provided that on such vesting date
  you are then employed by the Company or a subsidiary): 

  1/7th (approximately 14.3%) on [Vesting Date] 

  

 

(1)                                  Items in brackets are
features that may vary among individual awards.

 

 

	
   

  	
   

  	
  2/7ths (approximately 28.6%) on [Vesting Date] 

  4/7ths (approximately 57.1%) on [Vesting Date] 

  In
  addition, the Performance Shares may become fully vested or be forfeited
  under certain circumstances specified in the Agreement.

  
	
  PSA Payment Date:

  	
   

  	
  [Settlement
  Date]

  
	
   

  	
   

  	
   

  
	
  UNITS:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Number of Units:

  	
   

  	
  [Number]

  
	
  RSU Vesting Schedule:

  	
   

  	
  The
  Units will vest as follows (provided that on such vesting date you are then
  employed by the Company or a subsidiary): 

  1/7th (approximately 14.3%) on [Vesting Date] 

  2/7ths (approximately 28.6%) on [Vesting Date] 

  4/7ths (approximately 57.1%) on [Vesting Date] 

  In
  addition, the Units may become fully vested or be forfeited under certain
  circumstances specified in the Agreement.

  
	
  RSU Settlement Dates:

  	
   

  	
  For
  each vested portion of the Units, the RSU Settlement Date will be the same
  date as the vesting date.

  

 

*     *    
*     *     *

 

[Signature page follows]

 

2

 

By
your signature below, you hereby acknowledge receipt of the Performance Shares
and Units awarded on the date shown above, which have been awarded to you under
the terms and conditions of the Plan and the Agreement.  You further acknowledge receipt either
directly or electronically of a copy of the Plan, a prospectus for the Plan,
and the Agreement, and agree to conform to all of the terms and conditions of
the Performance Shares, the Units, the Plan, and the Agreement.

 

Execution
of a written instrument for purposes of this award may be evidenced by any
appropriate form of electronic signature or affirmative email or other
electronic response attached to or logically associated with such written
instrument, which is executed or adopted by a party with an indication of the
intention by such party to execute or adopt such instrument for purposes of
execution thereof.

 

 

COMPANY:

 

SM
ENERGY COMPANY,

a
Delaware corporation

 

 

	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Printed
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date
  Signed:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
  PARTICIPANT:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Signature:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Printed
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date
  Signed:EXHIBIT 10.5

 

SM ENERGY COMPANY

 

NON-EMPLOYEE DIRECTOR
RESTRICTED STOCK AWARD AGREEMENT

 

THIS
NON-EMPLOYEE DIRECTOR RESTRICTED STOCK AWARD AGREEMENT, hereinafter referred to
as the “Agreement,” is made effective as of the Award Date set forth in the
attached Non-Employee Director Restricted Stock Award Notice (the “Award Notice”),
by and between SM ENERGY COMPANY, a Delaware corporation (the “Company”), and
the undersigned person, who is a non-employee member of the Company’s Board of
Directors (the “Board”) as of the Award Date, to whom restricted stock has been
awarded as set forth in the Award Notice (the “Director”).

 

Pursuant
to the terms of the Company’s Equity Incentive Compensation Plan, as amended
(the “Plan”), the attached Award Notice and this Agreement, as of the Award
Date the Company has made an Award (the “Award”) to the Director of [Number](1) shares of common stock of
the Company (the “Stock”) delivered on the Award Date as set forth in the Award
Notice, subject to the terms and conditions set forth in the Plan, this
Agreement and the Award Notice. 
Capitalized terms used but not defined in this Agreement shall have the
meanings given to them in the Plan or in the Award Notice.

 

1. Earning and Vesting of Shares.

 

(a) Subject to the provisions contained
herein, the Stock shall be earned over the Earning Period set forth in the
Award Notice, which shall correspond to the fiscal year of Board service by the
Director following the Award Date, provided that earning shall cease when the
Director is no longer a member of the Board. 
The Stock shall become completely vested upon completion of the Earning
Period through Board service by the Director. 
Notwithstanding any other provisions of this Section 1(a), if the
Director resigns from the Board prior to the completion of the Earning Period,
but after the Director has completed at least five years of service to the
Company as a Non-Employee Director, the Stock shall be deemed to be fully
earned and vested upon such resignation.

 

(b) Irrespective of
the other provisions of this Section 1, as set forth in Article III of the
Plan, the Board’s Compensation Committee (the “Compensation Committee”) is
authorized to administer the Plan, and in its discretion may accelerate the
earning and vesting period of the Stock within the current Earning Period;
provided, however, that any such acceleration shall occur only if in compliance
with any applicable provisions of Section 409A of the Internal Revenue Code of
1986, as amended (the “Code”), and the regulations thereunder.

 

(1)  Items in
brackets are features that may vary among individual awards.

 

 

2. Transfer Restrictions.

 

(a) The shares of Stock issued under the Plan and
which are subject to the terms and conditions set forth in this Agreement have
been registered under the Securities Act of 1933, as amended (the “Securities
Act”).  However, since the Director is
considered to be an “affiliate” of the Company for securities law purposes, the
shares of Stock will be subject to restrictions on transferability and sale and
may not be offered for sale, sold or otherwise transferred except pursuant to
an effective registration statement under the Securities Act for the resale of
the Stock or pursuant to an exemption from registration under the Securities
Act, the availability of which is to be established to the satisfaction of the
Company.

 

(b) In addition, the shares of Stock shall be
subject to a Holding Period of one year following the expiration of the Earning
Period set forth in the Award Notice. 
During such Holding Period the shares of Stock may not be offered for
sale, sold or otherwise transferred by the Director, other than (i) to the
person or persons to whom the Director’s rights under such shares pass by will
or the laws of descent and distribution, (ii) to the spouse or the descendants
of the Director or to trusts for such persons to whom or which the Director may
transfer such shares by gift, (iii) to the legal representative of any of the
foregoing, or (iv) pursuant to a qualified domestic relations order as defined
under Section 414(p) of the Code or a similar order or agreement pursuant to
state domestic relations law (including a community property law) relating to
the provision of child support, alimony payments, or marital property rights to
a spouse, former spouse, child, or other dependent of the Director.  Any such transfer shall be made only in
compliance with the Securities Act and the requirements therefor as set forth
by the Company.  Any attempted transfer
in contravention of the foregoing provisions shall be null and void and of no
effect.  Any permitted transferee under
the foregoing provisions shall be subject to the remainder of the Holding
Period for the Stock.

 

(c) Any certificates for shares of Stock issued
under this Agreement shall bear a restrictive legend consistent with the
foregoing, and any book-entry accounts credited with shares of Stock issued
under this Agreement shall be subject to stop-transfer orders with respect to
such shares consistent with the foregoing.

 

3. Notices.  Any notice relating to this Agreement shall
be in writing and delivered in person or by mail, fax, or email transmission to
the address or addresses on file with the Company.  Any notice to the Company shall be addressed
to it at its principal office, and be specifically directed to the attention of
the Secretary.  Anyone to whom a notice
may be given under this Agreement may designate a new address by notice to that
effect.

 

4. Benefits of Agreement.  This Agreement shall inure to the benefit of
and be binding upon each successor of the Company and the Director’s heirs,
legal representatives and permitted transferees.  This Agreement shall be the sole and
exclusive source of any and all rights which the Director and the Director’s
heirs, legal representatives and permitted transferees may have with respect to
the Plan and the Stock.

 

5. Resolution of Disputes.  Any dispute or disagreement which arises
under, or as a result of, or in any way relates to, the interpretation,
construction or applicability of this 

 

2

 

Agreement shall be resolved as determined by the
Compensation Committee.  Any
determination made hereunder shall be final, binding and conclusive for all
purposes.

 

6. Controlling Documents.  The provisions of the Plan are hereby
incorporated into this Agreement by reference. 
In the event of any inconsistency between this Agreement and the Plan,
the Plan shall control.

 

7. Amendments.  This Agreement may be amended only by a
written instrument executed by both the Company and the Director.

 

8. Compliance with Section 409A
of the Code. 
Notwithstanding any provision in this Agreement to the contrary, to the
extent that this Agreement constitutes a nonqualified deferred compensation
plan or arrangement to which Section 409A of the Code applies, the
administration of this Award (including the time and manner of payments under
the Award and this Agreement) shall comply with Section 409A of the Code.

 

9. Electronic Delivery of
Documents.  The Company
may, in its sole discretion, deliver any documents related to this Award, or
any future awards that may be granted under the Plan, by electronic means, or
request the Director’s consent to participate in the Plan or other
authorizations from the Director in connection therewith by electronic
means.  The Director hereby consents to
receive such documents by electronic delivery and, if requested, to participate
in the Plan through an on-line or electronic system established and maintained
by the Company or another third party designated by the Company.

 

10. Execution and Counterparts.  This Agreement may be executed in
counterparts and signature pages may be delivered by email or fax
transmission.  Execution of a written
instrument for this Agreement may be evidenced by any appropriate form of
electronic signature or affirmative email or other electronic response attached
to or logically associated with such written instrument, which is executed or
adopted by a party with an indication of the intention by such party to execute
or adopt such instrument for purposes of execution thereof.

 

*     *     *    
*     *

 

[Signature page follows]

 

3

 

IN
WITNESS WHEREOF, the Company and the Director have caused this NON-EMPLOYEE DIRECTOR
RESTRICTED STOCK AWARD AGREEMENT to be entered into effective as of the Award
Date.

 

	
   

  	
   

  	
   

  	
  COMPANY:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  SM
  ENERGY COMPANY,

  
	
   

  	
   

  	
   

  	
  a
  Delaware corporation

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  Printed
  Name:

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  	
  Date
  Signed:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  DIRECTOR:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Printed
  Name:

  	
   

  
	
   

  	
   

  	
   

  	
  Date
  Signed:

  	
   

  

 

Attachment:  Non-Employee Director Restricted Stock Award
Notice

 

4

 

SM ENERGY COMPANY

 

NON-EMPLOYEE DIRECTOR RESTRICTED STOCK AWARD NOTICE

 

Effective as of [Date]

 

Dear
[Name]:

 

Pursuant
to the terms and conditions of the Company’s Equity Incentive Compensation
Plan, as amended (the “Plan”), you have been awarded [Number] shares of common
stock of the Company delivered upon the Award Date set forth below.  The Stock is subject to all of the terms and
conditions of the Plan and the attached Non-Employee Director Restricted Stock
Award Agreement (the “Award Agreement”), which are both incorporated herein in
their entirety.

 

	
  Awarded To:

  	
   

  	
  [Name]

  
	
   

  	
   

  	
   

  
	
  Award Date:

  	
   

  	
  [Award Date]

  
	
   

  	
   

  	
   

  
	
  Shares Awarded:

  	
   

  	
  [Number]

  
	
   

  	
   

  	
   

  
	
  Earning Period:

  	
   

  	
  The
  annual Board of Directors service period beginning with your election as a
  Board member on [Date] and ending with the election of Directors at the
  Company’s [Year] annual stockholders meeting, which is currently scheduled to
  occur on or about [date]. 

  
	
   

  	
   

  	
   

  
	
  Holding Period:

  	
   

  	
  One
  year following the expiration of the Earning Period.

  

 

*     *     *    
*     *

 

[Signature page follows]

 

5

 

By
your signature below, you hereby acknowledge receipt of the Stock awarded on
the date shown above, which has been awarded to you under the terms and
conditions of the Plan and the attached Award Agreement.  You further acknowledge receipt either
directly or electronically of a copy of the Plan, a prospectus for the Plan,
and the Award Agreement, and agree to conform to all of the terms and
conditions of the Plan and the Award Agreement.

 

Execution
of a written instrument for purposes of this award may be evidenced by any
appropriate form of electronic signature or affirmative email or other
electronic response attached to or logically associated with such written
instrument, which is executed or adopted by a party with an indication of the
intention by such party to execute or adopt such instrument for purposes of
execution thereof.

 

	
  COMPANY:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  SM ENERGY COMPANY,

  	
   

  	
   

  
	
  a Delaware corporation

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  Date
  Signed:

  	
   

  
	
  Printed
  Name:

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  DIRECTOR:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Signature:

  	
   

  	
   

  	
  Date
  Signed:

  	
   

  
	
  Printed
  Name:

  	
   

  	
   

  	
   

  

 

Attachment:  Non-Employee Director Restricted Stock Award
Agreement

 

6

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