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8-K - FORM 8-K - NEWPARK RESOURCES INC | c18779e8vk.htm |
EX-10.2 - EXHIBIT 10.2 - NEWPARK RESOURCES INC | c18779exv10w2.htm |
Exhibit 10.1
NEWPARK RESOURCES, INC.
2003 LONG TERM INCENTIVE PLAN
Amended and Restated Effective March 8, 2011
Amended and Restated Effective March 8, 2011
1. PURPOSE.
The Newpark Resources, Inc. 2003 Long Term Incentive Plan (the Plan) is intended (i) to
increase the value of the stockholders investment in Newpark Resources, Inc. (Newpark) by
improving Newparks performance and profitability; and (ii) to retain, attract and motivate
management employees, executive officers and other corporate and divisional officers (all of who
are sometimes collectively referred to herein as Employees) of high caliber and potential by
providing them with incentives for outstanding performance. The Plan provides for the award of
long-term incentives to those Employees who make substantial contributions to Newpark by their
loyalty, industry and invention. Unless the context indicates otherwise, references to Newpark
herein shall be deemed to include reference to the subsidiary of Newpark that actually employs the
affected Employee.
2. SHARES SUBJECT TO THE PLAN.
The maximum number of shares of Common Stock of Newpark (the Stock) that may be issued
pursuant to the Plan shall be 1,000,000, subject to adjustment pursuant to the provisions of
Section 7. For purposes of this Section 2, the following shares of Stock shall not be considered to
have been issued under the Plan; (i) shares of Stock remaining under an Award (as herein defined)
of Deferred Stock (as herein defined) which terminates without having been fully vested and (ii)
shares of Stock that have been forfeited in accordance with the terms of the applicable Award.
3. ADMINISTRATION.
3.1 The Plan shall be administered by the Compensation Committee (the Committee) of the
Board of Directors of Newpark (the Board). Each member of the Committee shall be (a) a
Non-Employee Director as that term is defined in Rule 16b-3 promulgated by the Securities and
Exchange Commission pursuant to the Securities and Exchange Act of 1934 (the Exchange Act), (b)
an independent director as defined under the rules of the New York Stock Exchange, as they may be
amended from time to time, except as may otherwise be permitted by such rules, and (c) an outside
director under Regulation Section 1.162-27 promulgated under Section 162(m) of the Internal
Revenue Code of 1986, as amended (the Code), but no action of the Committee shall be invalid if
this requirement is not met. The Committee shall select one of its members as Chairman and shall
act by vote of a majority of a quorum or by unanimous written consent. A majority of its members
shall constitute a quorum. The Committee shall be governed by the provisions of Newparks By-Laws
and of Delaware law applicable to the Board, except as otherwise provided herein or determined by
the Board.
3.2 The Committee shall have full power, discretion and authority to administer, interpret and
construe the Plan and any award or agreement made pursuant to the Plan, and to prescribe and
rescind rules, regulations and policies for administration of the Plan. The
Committees actions, interpretations and constructions with regard to the Plan shall be final,
conclusive and binding on all persons for all purposes.
3.3 No member of the Committee or the Board shall be liable for any action or determination
made in good faith with respect to the Plan or any award pursuant to it. Newpark shall indemnify
and hold harmless each member of the Committee and the Board, and the estate and heirs of each such
member, against all claims, liabilities, expenses, penalties, damages or other pecuniary losses,
including legal fees, which such Committee member or Board member or his or her estate or heirs may
suffer as a result of any act or omission to act in connection with the Plan, to the extent that
insurance, if any, does not cover the payment of such items.
4. ELIGIBILITY.
Key Employees of Newpark and its subsidiaries shall be eligible to be granted awards under the
Plan. In determining which key Employees to designate as participants, the Committee shall
consider those Employees of Newpark and its subsidiaries whose responsibilities and decisions, in
the judgment of the Committee, materially affect the growth, performance or profitability of
Newpark. An Employee shall become a participant in the Plan (a Participant) upon designation as
a Participant by the Committee, in its sole discretion.
5. GRANTS OF AWARDS AND AWARD AGREEMENTS.
5.1 Subject to the provisions of the Plan, the Committee shall (i) grant awards pursuant to
the Plan, (ii) determine the number of shares of Common Stock subject to each award, (iii)
determine the terms and conditions (which need not be identical) of each award, (iv) establish and
modify performance criteria for awards, and (v) make all of the determinations necessary or
advisable with respect to Awards under the Plan.
5.2 Each Award under the Plan shall consist of (i) Stock equivalents (Deferred Stock) that
vest and become payable in Stock upon the meeting of performance criteria over a three-year
performance period, as established by the Committee or (ii) shares of restricted Stock (Restricted
Stock) that are subject to forfeiture and vesting restrictions, restrictions on transferability
and other restrictions as established by the Committee. The Committee may grant awards of Deferred
Stock and awards of Restricted Stock (Awards) in such amounts, at such times, and to such
Employees as the Committee, in its discretion, may determine; provided, however, that, subject to
adjustment as provided in Section 7, the maximum number of shares of Stock which may be granted to
any one Employee during any one calendar year shall be 50,000. Each Award granted under the Plan
shall be evidenced by a written agreement (a Deferred Stock Agreement in the case of an Award of
Deferred Stock and a Restricted Stock Agreement in the case of an Award of Restricted Stock;
either one, an Award Agreement), in a form approved by the Committee and executed by Newpark and
the Participant to whom the Award is granted. The Award Agreement shall set forth conditions and
requirements for vesting, as well as those that will result in forfeiture. Awards shall be
conditioned upon the prompt and timely execution of the Award Agreement by the Participant and
Newpark.
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5.3 Except as otherwise determined by the Committee or provided in the Award Agreement, any
Award that is unvested at the time a Participants employment by Newpark and
its subsidiaries terminates for any reason or by any means shall be forfeited. In the case of
a Restricted Stock Award that is forfeited, all shares of Restricted Stock subject to that Award
shall be returned to Newpark and shall be available for issuance under the Plan. In the case of an
Award of Deferred Stock, any shares of Stock which are not issued under such Award at the time the
Award terminates shall be available for issuance under the Plan. The Committee may provide for
accelerated vesting upon the occurrence of a Change of Control or such other events as the
Committee shall determine, or upon a Participants death, disability, retirement at or after normal
retirement age or the termination of the Participations employment with Newpark by Newpark without
Cause. No Award that is intended to qualify as performance-based Compensation under Code Section
162(m) shall provide or allow for vesting other than by the timely satisfaction of the
pre-determined performance goals and other criteria, or if so specified by the Committee, upon
death, disability or a Change of Control.
For purposes of this Section 5.3, Cause shall mean: the conviction of Participant for a
felony or other crime involving fraud and/or moral turpitude;
(a) dishonesty, willful misconduct or material neglect, which neglect causes material
harm to Newpark, of Participant with respect to Newpark or any of its subsidiaries;
(b) any intentional act on the part of Participant that causes material damage to
Newpark and/or its subsidiaries reputation;
(c) appropriation (or an overt act attempting appropriation) of a material business
opportunity of Newpark or its subsidiaries by Participant;
(d) misappropriation (or an overt act attempting misappropriation) of any funds of
Newpark or its subsidiaries by Participant;
(e) the failure of Participant to follow the reasonable and lawful written instructions
or policy of Newpark with respect to the services to be rendered and the manner of rendering
such services by Participant, provided Participant has been given reasonable written notice
thereof and opportunity to cure and no cure has been effected within a reasonable time after
such notice; or
(f) the failure of Participant to perform or observe any of the material terms or
conditions of Participants employment other than by reason of illness, injury or
incapacity, provided Participant has been given reasonable written notice thereof and
opportunity to cure and no cure has been effected within a reasonable time after such
notice.
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Subject to Section 11.1, below, a Change of Control shall be deemed to occur if: (i) a
Takeover Transaction (as defined below) occurs; or (ii) any election of directors of Newpark
takes place (whether by the directors then in office or by the stockholders at a meeting or by
written consent) and a majority of the directors in the office following such election are
individuals who were not nominated by a vote of two-thirds of the members of the Board of Directors
or its nominating committee immediately preceding such election; or (iii) Newpark effectuates a
complete liquidation or a sale or disposition of all or substantially
all of its assets. A Takeover Transaction shall mean (i) a merger or consolidation of Newpark with, or an
acquisition of Newpark or all or substantially all of its assets by, any other corporation or
entity, other than a merger, consolidation or acquisition in which the individuals who were members
of the Board of Directors of Newpark immediately prior to such transaction continue to constitute a
majority of the Board of Directors or other governing body of the surviving corporation or entity
(or, in the case of an acquisition involving a holding company, constitute a majority of the Board
of Directors or other governing body of the holding company) for a period of not less than twelve
(12) months following the closing of such transaction, or (ii) one or more occurrences or events as
a result of which any person (as such term is used in Sections 13(d) and 14(d)(2) of the Exchange
Act) becomes the beneficial owner (as such term is defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of thirty percent (30%) or more of the combined voting power of Newparks
then outstanding securities.
5.4 The Committee may modify or amend any Award under the Plan or waive any restrictions or
conditions applicable to such Awards but only to the extent not inconsistent with the terms of the
Plan. Notwithstanding the foregoing, the Committee may not undertake any modifications, amendments
or waivers if the effect thereof materially adversely affects the rights of any Participant without
his or her consent.
6. TERMS AND CONDITIONS OF AWARDS.
6.1 Shares of Stock underlying a Deferred Stock Award will not be issued until the Deferred
Stock Award has vested pursuant to a vesting schedule and/or performance criteria set by the
Committee and the Committee has determined that the relevant schedule has been met and/or the
performance criteria achieved. Unless otherwise provided by the Committee, a Participant shall have
no rights as a stockholder of Newpark with respect to such Deferred Stock until such time as the
Award has vested and the Stock underlying the Award has been issued. The shares of Stock
underlying a Deferred Stock Award that become vested shall be issued to the Participant within ten
(10) days of the Committees determination that vesting has occurred, and in all cases, by no later
than two and one-half (21/2) calendar months after the end of the year in which the requirements for
vesting were satisfied.
6.2 At the time of grant of each Restricted Stock Award, the Committee shall determine the
performance and vesting requirements, conditions of, and forfeiture restrictions on transferability
and other restrictions (including, without limitation, limitations on the right to vote Restricted
Stock or the right to receive dividends on Restricted Stock) that will apply to the Award. These
restrictions may lapse separately or in combination at such times, under such circumstances
(including based on achievement of performance criteria or future service requirements or both), in
such installments or otherwise, as the Committee may determine in its discretion.
Restricted Stock granted under the Plan may be evidenced in such manner as the Committee shall
determine. If certificates representing Restricted Stock are registered in the name of the
Participant, the Committee may require that such certificates bear an appropriate legend referring
to the terms, conditions and restrictions applicable to such Restricted Stock, that Newpark retain
physical possession of the certificates, and that the Participant deliver a stock power to Newpark,
endorsed in blank, relating to the Restricted Stock.
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Unless otherwise set forth in the Award Agreement, (a) any regular cash dividends declared and
paid with respect to shares of Restricted Stock shall be paid to the Participant at the same time
they are paid to all other stockholders of Newpark, and (b) shares of Stock distributed in
connection with a stock split or stock dividend, and any other cash or property (including
securities of Newpark or other issuers) distributed as a dividend (other than regular cash
dividends), shall be subject to restrictions and forfeiture conditions to the same extent as the
Restricted Stock with respect to which such shares, cash or other property have been distributed,
and all references to Restricted Stock in the Plan or the applicable Award Agreement shall be
deemed to include such shares, cash or other property.
Unless otherwise set forth in the Award Agreement, all voting rights appurtenant to the shares
of Restricted Stock shall be exercised by the Participant.
Upon satisfaction of the terms and conditions specified in the Restricted Stock Agreement, (a)
the Participant shall be entitled to have the legend referred to above removed from his or her
shares, and (b) if Newpark has retained possession of the certificates representing the shares of
Restricted Stock, Newpark shall promptly deliver such certificates to the Participant. If the terms
and conditions specified in the Restricted Stock Agreement have not been satisfied, the Restricted
Stock subject to the Award shall be forfeited and reacquired by Newpark or shall be subject to a
repurchase option in favor of Newpark, as may be specified in the Restricted Stock Agreement.
6.3 The Committee may designate whether any Award is intended to be performance-based
compensation as that term is used in Section 162(m) of the Code. Any such Awards designated as
intended to be performance-based compensation shall be conditioned on the achievement of one or
more performance measures, to the extent required by Code Section 162(m). The performance measures
that may be used by the Committee for Awards shall be based on any one or more of the following, as
selected by the Committee:
(a) Total stockholder return of Newpark compared to that of the PHLX Oil Service Sector
industry group, or such other peer group selected by the Committee in its discretion from
time to time (the Peer Group);
(b) Newparks return on equity compared to that of the Peer Group;
(c) Growth in Newparks earnings per share (EPS);
(d) Profits and/or return on capital within a specified business unit of Newpark; and
(e) The OSHA reportable incident rate within a specified business unit of Newpark.
For Awards intended to be performance-based compensation under Code Section 162(m), the
grant of the Awards and the establishment of performance measures shall be made during the period
required under Code Section 162(m).
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6.4 No right or interest of a Participant in an Award or the Stock underlying an unvested
Award may be transferred, pledged, encumbered, or hypothecated to or in favor of any party other
than Newpark or an affiliate of Newpark, or shall be subject to any lien, obligation, or liability
of such Participant to any other party other than Newpark or an affiliate of Newpark. No unvested
Deferred Stock Award or Restricted Stock Award shall be assignable or transferable by a Participant
other than by will or the laws of descent and distribution or pursuant to a domestic relations
order that would satisfy Section 414(p)(1)(A) of the Code if such Section applied to an Award under
the Plan; provided, however, that the Committee may (but need not) permit other transfers where the
Committee concludes that such transferability does not result in accelerated taxation and is
otherwise appropriate and desirable, taking into account any factors deemed relevant, including
without limitation, state or federal tax or securities laws applicable to transferable Awards.
7. ADJUSTMENTS.
In the event of any subdivision or consolidation of outstanding Stock or declaration of a
dividend payable in Stock or capital reorganization or reclassification or other transaction
involving an increase or reduction in the number of outstanding shares of Stock, the Committee may
adjust proportionally the number of shares of Stock reserved under this Plan, the maximum number of
shares of Stock that may be subject to Awards granted to any one individual during a calendar year,
and the number of shares of Stock covered by outstanding Awards denominated in Stock. In the event
of any consolidation or merger of Newpark with another corporation or entity or the adoption by
Newpark of a plan of exchange affecting the Stock or any distribution to holders of Stock of
securities or property (other than normal cash dividends or dividends payable in Stock), the
Committee shall make such adjustments or other provisions as it may deem equitable, including
adjustments to avoid fractional shares, to give proper effect to such event.
8. WITHHOLDING TAXES.
Newpark shall have the right, at the time of a Participants taxation, to make adequate
provision for any federal, state, local or foreign taxes which it believes are or may be required
by law to be withheld with respect to an Award under the Plan (Tax Liability), to ensure the
payment of any such Tax Liability. Newpark may provide for the payment of any Tax Liability by any
of the following means or a combination of such means, as determined by the Committee in its sole
and absolute discretion in the particular case: (i) by requiring the Participant to tender a cash
payment to Newpark, (ii) by withholding from the Participants cash compensation, (iii) by
withholding shares from the shares of Common Stock issued under the Deferred Stock Award or become
vested in the case of Restricted Stock Awards, in each case, valued as of the date the shares are
withheld, or (iv) by any other method deemed appropriate by the Committee.
9. AMENDMENT AND TERMINATION.
The Board may at any time suspend, amend or terminate the Plan. No such action shall adversely
affect any outstanding Award Agreement without the Participants written consent. No amendment or
modification of the Plan may be adopted, except by stockholder approval, which would (a) materially
increase the benefits accruing to Participants under the Plan, (b) materially increase the number
of securities which may be issued under this Plan (except for adjustments
pursuant to Section 7) or (c) materially modify the requirements as to eligibility for
participation in the Plan.
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10. MISCELLANEOUS.
10.1 Nothing in this Plan or any Award granted hereunder shall confer upon any employee any
right to continue in the employ of Newpark or interfere in any way with the right of Newpark to
terminate his or her employment at any time.
10.2 Except as may be required under the terms of any employee benefit plan subject to the
Employee Retirement Incentive Security Act of 1974, as amended, or applicable law, no Award granted
under the Plan shall be deemed salary or compensation for the purpose of computing benefits under
any employee benefit plan or other arrangement of Newpark for the benefit of its employees.
10.3 The Plan and the grant of Awards under it shall be subject to all applicable federal and
state laws, rules and regulations and to such approvals by any governmental or regulatory agency as
may be required.
10.4 The Plan shall be construed in accordance with and governed by the laws of the State of
Delaware.
10.5 Subject to the provisions of Section 6, each Award Agreement shall inure to the benefit
of the Participant and the Participants heirs, representatives and successors and shall be binding
on Newpark and each successor (direct or indirect, whether by purchase, merger, consolidation or
otherwise).
10.6 No Stock issued under the Plan may be resold unless and until any applicable registration
or qualification requirements of federal and state securities laws and all other requirements of
law or any regulatory bodies having jurisdiction over such resale have been fully complied with.
Newpark shall have no obligation to file any Registration Statement covering resales of the Stock.
11. CODE SECTION 409A.
11.1 In the case of Deferred Stock Awards: (i) the term Change of Control herein shall mean,
but only with respect to the income so affected, a transaction, circumstance or event that
constitutes a Change of Control (as defined above) and that also constitutes a change in control
event within the meaning of Treas. Reg. §1.409A-3(i)(5); (ii) references to the disability of a
Participant shall mean (a) the inability of the Participant 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 twelve
months or (b) the receipt of income replacements by the Participant, 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 twelve (12) months, for a period of not
less than three months under the Newpark accident and health plan; and (iii) references to the
termination of a Participants employment, where vesting will or could result from such
termination, shall mean a termination of such employment without Cause that results from death
or disability or that constitutes an involuntary separation from service within the meaning
of Treas. Reg. §1.409A-1(n).
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11.2 In the event that a specified employee (as defined under Code Section 409A) becomes
entitled to shares of Common Stock under a Deferred Stock Award on account of a termination of
employment, such Common Stock shall not be transferred until the first day of the seventh calendar
month after the date of the Participants separation from service within the meaning of Code
Section 409A.
11.3 No Award shall contain or reflect, or be amended, affected or supplemented by any other
agreement (including, but not limited to, employment agreements, other plans or arrangements of
deferred compensation) so as to contain, include or be subject to a deferral feature or an
additional deferral feature within the meaning and usage of those terms under Code Section 409A.
11.4 Certain items of compensation paid pursuant to this Plan are or may be subject to Code
Section 409A of the Code. In such instances, this Plan is intended to comply and shall be
administered in a manner that is intended to comply with Code Section 409A and shall be construed
and interpreted in accordance with such intent.
12. MISCONDUCT OF A PARTICIPANT.
Notwithstanding any other provision of the Plan, if a Participant commits fraud or dishonesty
toward Newpark, wrongfully uses or discloses any trade secret, confidential data or other
information proprietary to Newpark or intentionally takes any other action materially inimical to
the best interests of Newpark, as determined by the Committee in its sole and absolute discretion,
such Participant shall forfeit all rights under every unvested Award.
13. STOCKHOLDER APPROVAL AND TERM OF PLAN.
The effective date of the Plan shall be March 12, 2003, subject to approval by the
stockholders of Newpark on or before December 31, 2003. If stockholder is not timely obtained, all
Awards made under the Plan shall be null and void and all shares of Stock issued thereunder, and
any dividends and other distributions declared or paid thereon, shall be forfeited to Newpark
without any payment with respect thereto. No Awards may be granted under the Plan after March 12,
2013.
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