Document:

exv10w1

 

Exhibit 10.1

NEWFIELD EXPLORATION COMPANY

FORM OF 2005 TSR

RESTRICTED STOCK AGREEMENT

     THIS
2005 TSR RESTRICTED STOCK AGREEMENT (this “Agreement”) is made as of _________  ___, 2005 and
is by and between Newfield Exploration Company (the “Company”) and ______________
(“Employee”).

     1. GRANT.

     (a) Restricted Shares. Pursuant to the Newfield Exploration Company 2004 Omnibus Stock Plan
(as amended, the “Plan”), ___shares of the Company’s common stock, par value $.01, will be
issued in Employee’s name subject to the Forfeiture Restrictions described in Section 2(a) below
(the “Restricted Shares”).

     (b) Plan Incorporated. Employee acknowledges receipt of a copy of the Plan and agrees that
the issuance of the Restricted Shares pursuant to this Agreement shall be subject to all of the
terms and provisions of the Plan (including any future amendments thereof), which terms and
provisions are incorporated herein for all purposes. Capitalized terms used but not defined in
this Agreement shall have the meanings ascribed to such terms in the Plan.

     2. RESTRICTIONS. Employee hereby accepts the Restricted Shares when issued and agrees
with respect thereto as follows:

     (a) Forfeiture Restrictions. Except as otherwise provided in Paragraphs V and IX of the Plan,
(i) the Restricted Shares shall not be sold, assigned, pledged, exchanged, hypothecated or
otherwise transferred or disposed of to the extent then subject to Forfeiture Restrictions, (ii)
if, prior to February 1, 2010, Employee’s employment with the Company and its subsidiaries is
terminated for any reason (including as described in the last sentence of Paragraph XI(b) of the
Plan) other than the death or permanent and total disability (within the meaning of section
22(e)(3) of the Code) (“Disability”) of Employee, Employee shall, for no consideration, forfeit to
the Company all Restricted Shares to the extent then subject to Forfeiture Restrictions and (iii)
Employee shall, for no consideration, forfeit to the Company all Restricted Shares to the extent
subject to Forfeiture Restrictions as of February 1, 2010. The prohibition against transfer and
the obligation to forfeit and surrender shares to the Company as provided in this Section 2(a) are
herein referred to as “Forfeiture Restrictions.” Forfeiture Restrictions shall be binding upon and
enforceable against any transferee of Restricted Shares.

     (b) Lapse of Forfeiture Restrictions—Death or Disability. If not previously forfeited,
Forfeiture Restrictions with respect to the Restricted Securities shall lapse upon the death or
Disability of Employee.

     (c) Lapse of Forfeiture Restrictions—Stockholder Return. If not previously forfeited,
Forfeiture Restrictions with respect to the Restricted Securities shall lapse in accordance with
the following schedule:

 

 

	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	Percentage of Restricted	 
	 	 	 	 	 	 	 	Shares Subject to	 
	 	 	 	 	 	 	 	Forfeiture Restrictions as	 
	 	 	 	 	 	 	 	to which Forfeiture	 
	 	Measurement period	 	 	TSR Rank	 	 	Restrictions Lapse	 
	 	36 Months Ending January 31, 2008	 	 	Top 7

Top 10

Top 15

Below 15
	 	 	100%

50%

331⁄3%

0%	 
	 	48 Months Ending January 31, 2009
	 	 	Top 7

Top 10

Top 15

Below 15
	 	 	100%

80%

50%

0%	 
	 	60 Months Ending January 31, 2010
	 	 	Top 7

Top 10

Top 15

Below 15
	 	 	100%

100%

50%

0%	 
	 

     (i) Forfeiture Restrictions shall lapse as of the February 1 immediately following the
last day of the applicable Measurement Period set forth in the schedule above with respect
to that percentage of the Restricted Shares that continue to be subject to Forfeiture
Restrictions corresponding to the highest TSR Rank (with Top 7 being the highest, Top 10
being the second highest, etc.) achieved for such Measurement Period as determined by the
Committee.

     (ii) “Initial Peer Group” means the following companies: Apache Corporation, Anadarko
Petroleum Corporation, Burlington Resources Inc., Chesapeake Energy Corporation, Cabot Oil &
Gas Corporation, Denbury Resources Inc., Devon Energy Corporation, Encana Corporation, EOG
Resources, Inc., Forest Oil Corporation, Kerr-McGee Corporation, Murphy Oil Corporation,
Nexen Inc., Noble Energy, Inc., Pioneer Natural Resources, Pogo Producing Company,
Southwestern Energy Company, Spinnaker Exploration Company, St. Mary Land & Exploration
Company, Stone Energy Corporation, Swift Energy Company, The Houston Exploration Company,
Talisman Energy Inc., Ultra Petroleum Corp., Vintage Petroleum, Inc., Western Gas Resources,
Inc. and XTO Energy Inc.

     (iii) “Qualified Peer Group” means (A) the Dow Jones Industrial Average Index, (B) the
S&P 500 Index and (C) each company included in the Initial Peer Group that has had its
primary common equity security listed or traded on a national securities exchange or the
Nasdaq National Market (or any successor thereto) throughout the relevant Measurement
Period.

     (iv) “TSR Rank” means the Company’s rank from one to one plus the total number of
companies and indices comprising the Qualified Peer Group for the relevant Measurement
Period with the Company, each such other company and each such index together ranked from
best to worst based on the Total Stockholder Return of the Company, each such other company
and each such index for such Measurement Period.

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     (v) “Total Stockholder Return” for a particular Measurement Period means the rate of
return (expressed as a percentage) achieved with respect to the common stock of the Company,
the common stock of each company in the Qualified Peer Group and each index included in the
Qualified Peer Group for such Measurement Period if (A) $100 were invested in the common
stock of each such company or such index at the beginning of such Measurement Period based
on the closing price of such common stock or such index on January 31, 2005, (B) all
dividends declared with respect to a particular common stock during such Measurement Period
are reinvested in such common stock as of the payment date for such dividends (using the
closing price of such common stock on such payment date) and (C) the valuation of such
common stock or such index at the end of such Measurement Period is based on the average
closing price for the last ten trading days occurring on or before the last January 31 of
such Measurement Period.

     (d) Certificates. A certificate evidencing the Restricted Shares will be issued by the
Company in Employee’s name, pursuant to which Employee shall have voting rights and receive
dividends. The certificate may bear a legend reciting or incorporating Forfeiture Restrictions and
any other legends the Company believes are appropriate, and the Company may cause the certificate
to be delivered upon issuance to the Secretary of the Company (or such other person as may be
designated by the Committee) as a depositary for safekeeping until Forfeiture Restrictions lapse or
forfeiture occurs pursuant to the terms of the Plan and this Agreement. At the Company’s request,
Employee shall execute and deliver a stock power, in blank, with respect to the Restricted Shares,
and the Company may exercise such stock power in the event of forfeiture. Upon the lapse of
Forfeiture Restrictions without forfeiture, the Company will cause a new certificate or
certificates to be issued without legend in the name of Employee.

     3. COMMUNITY INTEREST OF SPOUSE. The community interest, if any, of any spouse of
Employee in any of the Restricted Shares shall be subject to all of the terms, conditions and
restrictions of this Agreement and the Plan, and shall be forfeited and surrendered to the Company
upon the occurrence of any of the events requiring Employee’s interest in such Restricted Shares to
be so forfeited and surrendered pursuant to this Agreement.

     4. TAX ELECTION. If Employee makes the election authorized by section 83(b) of the
Internal Revenue Code of 1986, as amended, Employee shall submit to the Company a copy of the
statement filed by Employee to make such election.

     5. BINDING EFFECT. This Agreement shall be binding upon and inure to the benefit of
any successors to the Company and all persons lawfully claiming under Employee.

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     IN WITNESS WHEREOF, the Company has caused this Agreement to be duly executed by an authorized
officer and Employee has executed this Agreement, all as of the date first above written.

	 	 	 	 	 
	 
	 	NEWFIELD EXPLORATION COMPANY
	 
	 	 	 	 
	

	 	By:	 	 
	

	 	 	 	 
	

	 	 	 	David A. Trice
	

	 	 	 	President and Chief Executive Officer
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 
	 
	 	[Employee]

4exv10w3

 

Exhibit 10.3 — Form of Employee Deferred Performance Unit Award Letter

«FirstLast»

(address)

Dear «Fname»:

TODCO (the “Company”) hereby grants to you effective as of February 7, 2005 (the “Grant Date”)
Deferred Performance Units representing the opportunity to receive up to a maximum of ___
shares of TODCO Common Stock (“Common Stock”) in accordance with the TODCO Long-Term Incentive
Plan (the “Plan”). The exact amount of your award will be determined as of December 31, 2007.
Please refer to the attached Appendix A, Terms and Conditions of Employee Deferred Performance Unit
Award, for further details.

Shares of Common Stock earned (if any) will vest on the Determination Date.

Your Deferred Performance Units are subject to the terms and conditions set forth in the enclosed
Plan, the Prospectus for the Plan, any additional terms and conditions set forth in the attached
Appendix A and any rules and regulations adopted by the Executive Compensation Committee of the
Board of Directors in accordance with the terms of the plan.

This award letter and the attachments contain the formal terms and conditions of your award and
accordingly should be retained in your files for future reference.

Congratulations on your award.

Very truly yours,

Jan Rask

Enclosures

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Appendix A

To Award Letter

Terms and Conditions of

Employee Deferred Performance Unit Award

February 7, 2005

The Deferred Performance Unit award by TODCO (the “Company”) to you effective as of the Grant Date
provides for the opportunity for you to receive, if certain conditions are met, shares of TODCO
Common Stock (“Common Stock”) subject to the terms and conditions set forth in the TODCO Long-Term
Incentive Plan (the “Plan”), the enclosed Prospectus for the Plan, any rules and regulations
adopted by the Executive Compensation Committee of the Board of Directors (the “Committee”), and
any additional terms and conditions set forth in this Appendix A all of which forms a part of the
attached award letter to you (“Award Letter”). Any terms used and not defined in the Award Letter
have the meanings set forth in the Plan. In the event there is an inconsistency between the terms
of the Plan and the Award Letter, the terms of the Plan will prevail.

1. Determination of Earned Shares

     (a)      Earned Shares

The exact number of shares of Common Stock that will actually be earned by and
granted to you (the “Earned Shares”) out of the total maximum number of Deferred
Performance Units awarded to you in the Award Letter will be based upon the level
of achievement by the Company of the performance standard described below over the
three-year period commencing January 1, 2005 (the “Performance Cycle”). The
determination by the Committee with respect to the achievement of such performance
standards will be made in the first quarter of 2008 after all necessary Company and
peer information is available. The specific date on which such determination is
formally made and approved by the Committee is referred to as the “Determination
Date”. After the Determination Date, the Company will notify you of the number of
Earned Shares, if any, to be actually granted to you. All payments shall be made no
later than February 28, 2008.

The calculation of Earned Shares shall be based on the Company’s Total Shareholder
Return ranking compared to a defined peer group at the end of the Performance Cycle
as determined by the Committee in its sole discretion. Total Shareholder Return is
defined for a given company as the change in share price plus cumulative dividends
paid, assuming dividend reinvestment during the Performance Cycle, over share price
at the beginning of the Performance Cycle of the applicable Company. Earned Shares
will be calculated by multiplying the maximum number of deferred performance units
granted by the following percentages for the percentile rank achieved. For Total
Shareholder Return performance between the percentile ranks noted below, linear
interpolation will be used to calculate the exact number of Earned Shares:

9

 

	 	 	 	 	 
	Percentile	 	 	 
	Rank	 	Percentage	 
	100th
	 	 	100	%
	92
	 	 	91.67	 
	84
	 	 	83.33	 
	75
	 	 	75.00	 
	68
	 	 	66.67	 
	62
	 	 	58.33	 
	56
	 	 	50.00	 
	50
	 	 	40.00	 
	44
	 	 	30.00	 
	38
	 	 	20.00	 
	32
	 	 	10.00	 
	25th or lower
	 	ZERO

	 	   	The Company’s defined “Peer Group” shall consist of TODCO and the following
companies: Cal Dive International, Ensco International, Global Industries, Grant
Prideco, Grey Wolf, Helmerich & Payne, Key Energy Services, Maverick Tube, Newpark
Resources, Parker Drilling, Patterson — UTI Energy, Pride International, Rowan
Companies Inc., Tidewater Inc., Varco International Inc.
	 
	 	(b)  	Committee Determinations
	 
	 	   	In accordance with the provisions of the Plan, the Committee shall have the
exclusive authority to make all determinations hereunder, including but not limited
to the ranking of TODCO and its Peer Group. Without limiting the foregoing, the
Committee shall have absolute discretion to determine the number of Earned Shares
to which you are entitled, if any, including without limitation such adjustments as
may be necessary in the opinion of the Committee to account for changes since the
date of the Award Letter. Notwithstanding the foregoing, the Committee shall be
precluded from increasing the amount that would otherwise be obtainable upon the
achievement of the performance goals described in Section 1(a) above to the extent
prescribed by Section 162(m) of the Internal revenue Code of 1986 as amended (the
“Code”) and the applicable regulations rulings and notices thereunder. The
Committee’s determination shall be final, conclusive and binding upon you. You
shall not have any right or claim with respect to any shares other than Earned
Shares to which you become entitled in accordance herewith.
	 
	 	(c)  	You will not be required to pay any purchase price for the Earned Shares;
however tax withholding is required pursuant to Section 8.

	2.  	Vesting

	 	(a)  	Unless vested on an earlier date as provided in this Appendix A, the Earned
Shares will vest on the Determination Date.

	 	(b)  	As described in Section 7 below, in the event of a Change of Control a
portion of your Deferred Performance Units may become Earned Shares and vest prior to
the Determination Date.

	3.  	Restrictions
	 
	   	Until and unless Earned Shares become vested, you do not own any of the Common Stock
potentially subject to this Deferred Performance Unit award and may not attempt to sell,
transfer, assign or pledge any such Common Stock. Your Earned Shares, if any, will be
registered in your name as of the Determination Date. The Deferred Performance Unit grant
shall be accounted for by the Company on your behalf on a ledger pursuant to Section 3.2(c)
of the Plan until the number of Earned Shares is determined and may not be transferred,
sold, assigned or pledged in any manner prior to vesting. Promptly after the Earned Shares
vest, the net shares (total vested Earned Shares minus any Earned Shares retained to
satisfy the tax withholding obligation of the Company, as described in Section 8 if
applicable), will be delivered in street name to your brokerage account (or, in the event
of your death, to a brokerage account in the name of your

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beneficiary under the Plan) or, at the Company’s option, a certificate for such shares will
be delivered to you. There may be some delay between the date of vesting and the date your shares become available to you due to administrative reasons.

4.       Dividends and Voting

After the Determination Date, all cash dividends (if any) that become payable with respect
to your Earned Shares after the Determination Date, if any, will be paid directly to you at
the same time dividends are paid with respect to all other Common Stock of the Company.
Also, after the Determination Date, you will have the right to vote your Earned Shares.

5.      Termination of Employment

If your employment is terminated prior to the Determination Date due to death, disability,
retirement (as defined below) or at the convenience of the Company (as determined by the
Committee), you will be entitled to receive Earned Shares representing a Pro Rata share of
your Deferred Performance Unit award on the Determination Date. The calculation of your
Pro-Rata Share is determined by multiplying the number of Earned Shares calculated as of
the Determination Date which would have otherwise been earned had your employment not been
terminated, by a fraction, the numerator of which is the number of calendar days you were
employed during the Performance Cycle after the Grant Date and the denominator of which is
the total number of calendar days in the Performance Cycle after the Grant Date. Retirement
is defined for the purpose of this section of Appendix A as meeting the “Rule of 70”, which
requires a minimum age of 55, combined with years of service to total 70 or more. If you
retire after the age of 55, yet your age and years of service do not lead to a combined 70,
you will not be entitled to any Earned Shares. “Disability” shall mean you are 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 last a continuous period
of not less than twelve months or by reason of either of the foregoing you are receiving
income replacement benefits for a period of not less than three months under an accident
and health plan covering employees of the Company. Except as provided under Section 7,
“Change in Control”, if your employment is terminated for any reason other than death,
disability, termination for the convenience of the Company or retirement (as defined
herein), you will not be entitled to any Earned Shares. The Committee shall have absolute
discretion to determine the date and circumstances of termination of your employment,
including without limitation whether as a result of death, disability, convenience of the
Company, retirement or any other reason, and its determination shall be final, conclusive
and binding upon you.

6.       Beneficiary

You may designate a beneficiary to receive any Earned Shares that become due to you after
your death, and may change your beneficiary from time to time. Beneficiary designations
should be filed with the Administrator of the Long-Term Incentive Plan. If you fail to
designate a beneficiary, Earned Shares due to you under the Plan will be issued to the
executor or administrator of your estate in the event of your death.

7.       Change of Control

	 	(a)       	Acceleration of Vesting

If you are employed by the Company on the date of a Change of Control of the
Company and the Determination Date has not occurred, you will be entitled to
receive Earned Shares representing 50% of your Deferred Performance Units. For the
purposes of this award letter the definition of Change in Control shall have the
meaning assigned such term under Code Section 409A and the regulations and notices
thereunder to the extent

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	 	   	such definition is more restrictive than definition in the Plan. Otherwise Change
of Control shall have the meaning set forth in the Plan.

	 	(b)  	Section 280G Limitation

Notwithstanding anything in the Award Letter and this Appendix A to the contrary,
if all or any portion of the benefits provided hereunder, either alone or together
with other payments and benefits received or to be received from the Company or any
affiliate or successor, would constitute a “parachute payment”, as such term is
defined in Section 280G(b)(2) of the U.S. Internal Revenue Code of 1986 (the
“Code”), and the amount of the parachute payment, reduced by all U.S. federal,
state and local taxes applicable thereto, including the excise tax imposed pursuant
to Code Section 4999, is less than the amount you would receive if you were paid
three times your “base amount,” as defined in Code Section 280G(b)(3), less one
dollar, reduced by all U.S. federal, state and local taxes applicable thereto, then
the aggregate of the amounts constituting the parachute payment shall be reduced to
an amount that will equal three times your base amount less one dollar, and, to the
extent necessary, the award or vesting of Earned Shares shall be reduced by the
Committee in order that this limitation not be exceeded; provided, however, that
this Section 7(b) shall be superceded in its entirety by (i) any contrary treatment
of parachute payments to which you have agreed in writing prior to the Change of
Control pursuant to any other plan, program or agreement, or (ii) any more
favorable treatment of the excise tax on parachute payments extended to you by the
Company or its affiliates pursuant to any other plan, program or agreement.

8.       Income Tax Withholding

	 	(a)  	You should consult the Long-Term Incentive Plan Prospectus for a general
summary of the U.S. federal income tax consequences to you from the Contingent Shares
based on currently applicable provisions of the Code and related regulations. The
summary does not discuss state and local tax laws or the laws of any other
jurisdiction, which may differ from U.S. federal tax law. For these reasons, you are
urged to consult your own tax advisor regarding the application of the tax laws to
your particular situation.

	 	(b)  	The grant under the Award Letter and this Appendix A is subject to your
making of arrangements satisfactory to the Company to satisfy any applicable U.S.
federal, state or local withholding tax liability arising from the vesting of the
Earned Shares. You can either make a cash payment to the Company of the required
amount or at the discretion of the Committee you can elect to satisfy your withholding
obligation by having the Company retain Common Stock having a value approximately
equal to the amount of your withholding obligation from the Earned Shares otherwise
deliverable to you upon the vesting of such shares. You may not elect for such
withholding to be greater than the minimum statutory withholding tax liability arising
from the vesting of the Earned Shares. If you fail to satisfy your withholding
obligation in a time and manner satisfactory to the Company, no shares will be issued
to you or the Company at its discretion shall have the right to withhold the required
amount from your salary or other amounts payable to you. Further, any dividends on the
Earned Shares paid to you pursuant to Section 4 above prior to their vesting will
generally be subject to federal, state and local tax withholding, as appropriate, as
additional compensation.

12

 

	 	(c)       	In addition, you must make arrangements satisfactory to the Company to satisfy
any applicable withholding tax liability imposed under the laws of any other
jurisdiction arising from the award hereunder. You may not elect to have the
Company withhold Earned Shares having a value in excess of the minimum statutory
withholding tax liability. If you fail to satisfy such withholding obligation in a
time and manner satisfactory to the Company, no shares will be issued to you or the
Company shall have the right to withhold the required amount from your salary or
other amounts payable to you.

9.      Restrictions on Resale

Other than the restrictions referenced in paragraph 3, there are no restrictions imposed by
the Plan on the resale of Earned Shares acquired under the Plan. However, under the
provisions of the Securities Act of 1933 (the “Securities Act”) and the rules and
regulations of the Securities and Exchange Commission (the “SEC”), resales of shares
acquired under the Plan by certain officers and directors of the Company who may be deemed
to be “affiliates” of the Company must be made pursuant to an appropriate effective
registration statement filed with the SEC, pursuant to the provisions of Rule 144 issued
under the Securities Act, or pursuant to another exemption from registration provided in
the Securities Act. At the present time, the Company does not have a currently effective
registration statement pursuant to which such resales may be made by affiliates. These
restrictions do not apply to persons who are not affiliates of the Company; provided,
however, that all employees are subject to the Company’s policies against insider trading,
and restrictions on resale may be imposed by the Company from time-to-time as may be
necessary under applicable law.

10.       Effect on Other Benefits

Income recognized by you as a result of the grant or vesting of Earned Shares or dividends
on your Earned Shares will not be included in the formula for calculating benefits under
any of the Company’s retirement and disability plans or any other benefit plans.

11.      Compliance With Laws

This Award Letter, the deferred Performance Units and any Earned Shares issued hereunder
shall be subject to all applicable federal and state laws and the rules of the exchange on
which shares of the Company’s common stock are traded.

If you have any questions regarding your contingent award or would like to obtain additional
information about the Plan or the Committee, please contact the Company’s General Counsel. Your
Award Letter and this Appendix A contain the formal terms and conditions of your award and
accordingly should be retained in your files for future reference.

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