Business Context and Reporting Period
This Form 8-K Current Report was filed by Oil States International, Inc. on February 16, 2012. The filing discloses the Board of Directors' approval of deferred stock performance awards granted to certain named executive officers under the Company's 2001 Equity Participation Plan.
Key Financial Metrics
The filing text does not provide specific values for revenue, profit, cash flow, margins, debt, or liquidity. The document focuses exclusively on executive compensation arrangements and the performance metrics used to determine vesting.
Material Changes and Compensation Details
The primary material event is the grant of Performance Awards tied to the Company's Annual Return on Invested Capital (ROIC) over the performance period of January 1, 2012, through December 31, 2014. The vesting schedule is as follows:
- Entry Level: ROIC ≤ 6% results in 100% forfeiture.
- Target Level: ROIC = 9.5% results in 100% vesting.
- Over-Achieve Level: ROIC ≥ 13% results in 200% vesting.
- Interpolation: Vesting is proportionate between the Entry/Target levels and Target/Over-Achieve levels.
Specific grants awarded at the Target Level include:
| Recipient | Title | Target Level Awards |
|---|---|---|
| Cindy Taylor | President and CEO | 31,125 (Includes 23,625 special retention award) |
| Bradley Dodson | SVP, CFO and Treasurer | 5,000 |
| Christopher Cragg | SVP, Operations | 2,500 |
| Charles Moses | SVP, Offshore Products | 2,500 |
Outlook, Risks, and Contingencies
Vesting Conditions: Awards vest on the third anniversary of the grant date, contingent on continuous employment and ROIC achievement. Accelerated vesting occurs upon Change of Control, Disability, or Death, subject to specific proration rules depending on the timing of the event relative to the grant date.
Forfeiture Risk: If a recipient terminates employment prior to the third anniversary and none of the special conditions (Change of Control, Disability, Death, or retirement after age 65) apply, the awards are forfeited in full.
Shareholder Rights: Recipients do not have voting rights or dividend privileges until shares are delivered following vesting.
Investor Verification Checklist
- Verify the Company's actual ROIC performance for the 2012-2014 period to determine final vesting amounts.
- Review the attached Exhibit 10.1 (Form of Deferred Performance Award Agreement) for detailed definitions of "Change of Control" and "Disability."
- Monitor future filings for any amendments to the performance targets or the 2001 Equity Participation Plan.
- Confirm the impact of the special retention award granted to the CEO on total executive compensation expenses.