Exhibit 10.31

PLAINS EXPLORATION & PRODUCTION COMPANY

2006 INCENTIVE PLAN

RESTRICTED STOCK UNIT AGREEMENT

[Performance-Vested]

This Restricted Stock Unit Agreement (the “Agreement”), made as of the         
day of             , 20         (the “Grant Date”), by and between Plains
Exploration & Production Company (the “Company”), and «Fname» «Middle»«Dot»
«Lname» (the “Grantee”), evidences the grant by the Company of restricted stock
units (“Restricted Stock Units” or “Award”) to the Grantee on such date and the
Grantee’s acceptance of the Award in accordance with the provisions of the
Plains Exploration & Production Company 2006 Incentive Plan, as amended or
restated from time to time (the “Plan”). The Company and the Grantee agree as
follows:

1. Basis for Award. This Award is made in accordance with Article 5 of the Plan.
The Grantee hereby receives as of the date hereof an Award of Restricted Stock
Units pursuant to the terms of this Agreement (the “Grant”).

2. Restricted Stock Units Awarded.

(a) Effective          , 20        , the Company hereby awards to the Grantee,
in the aggregate, «Shares» Restricted Stock Units (the “Aggregate Target
Award”). The actual number of Restricted Stock Units earned by the Grantee may
be less than or greater than the Aggregate Target Award, as set forth in
Section 3.

(b) The Company shall in accordance with the Plan establish and maintain a
Restricted Stock Unit Account for the Grantee, and such account shall be
credited for the number of Restricted Stock Units granted to the Grantee. The
Restricted Stock Unit Account shall be credited for any securities or other
property (including regular cash dividends) distributed to the Company in
respect of its Shares (“Dividend Credits”) as if each Restricted Stock Unit were
one Share. Any Dividend Credits shall be subject to the same vesting schedule as
the Restricted Stock Units to which they relate.

(c) Until the Restricted Stock Units awarded to the Grantee shall have vested,
the Restricted Stock Units and any Dividend Credits thereon shall not be sold,
transferred, or otherwise disposed of and shall not be pledged or otherwise
hypothecated.

3. Vesting. Unless vested on an earlier date as set forth in Appendix I attached
hereto, the Restricted Stock Units covered by this Agreement and any Dividend
Credits thereon shall vest on each of the following dates with respect to a
certain percentage of the applicable Target Award based on the level of
achievement of the performance goal for the applicable performance period, as
set forth in such Appendix:

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(a) On          , 20         based on the level of achievement of the
performance goal for the performance period commencing on         , 20        
and ending on         , 20         (as set forth in such Appendix);

(b) On          , 20         based on the level of achievement of the
performance goal for the performance period commencing on         , 20        
and ending on         , 20         (as set forth in such Appendix); and

(c) On          , 20         based on the level of achievement of the
performance goal for the performance period commencing on         , 20        
and ending on         , 20         (as set forth in such Appendix);

provided that, Grantee is still employed by the Company (or any Parent or
Subsidiary) on such vesting date. Except as set forth in Appendix I, if the
Grantee ceases to be employed by the Company (or any Parent or Subsidiary) for
any reason at any time prior to vesting, the unvested Restricted Stock Units and
any Dividend Credits thereon shall automatically be forfeited upon such
cessation of employment.

4. Payment. Not later than 2 1/2 months after the vesting date, full payment of
any vested Restricted Stock Units shall be made in cash and any Dividend Credits
thereon shall be made in the form in which they were distributed.

5. Tax Withholding. The Grantee agrees that no later than the date as of which
the Restricted Stock Units and any Dividend Credits thereon vest, the Grantee
shall pay to the Company, by forfeiture of the cash payment the Grantee is
entitled to under this Agreement in an amount equal to the amount of the
Grantee’s tax withholding liability, any federal, state or local taxes of any
kind required by law to be withheld, if any, not to exceed the statutory
minimum, with respect to the Restricted Stock Units and Dividend Credits which
vest.

6. Nontransferability. Except as otherwise provided in the Plan, this Award is
not transferable.

7. No Right to Continued Employment. Nothing in this Agreement shall be deemed
by implication or otherwise to impose any limitation on the right of the Company
or any of its affiliates to terminate the Grantee’s employment at any time, in
absence of a specific written agreement to the contrary.

8. Representations and Warranties of Grantee. The Grantee represents and
warrants to the Company that:

(a) Agrees to Terms of the Plan. The Grantee has received a copy of the Plan and
has read and understands the terms of the Plan and this Agreement, and agrees to
be bound by their terms and conditions.

(b) Cooperation. The Grantee agrees to sign such additional documentation as may
reasonably be required from time to time by the Company.

 

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9. Adjustment Upon Changes in Capitalization. In the event of a change in
capitalization or certain other events, the Committee shall make appropriate
adjustments to the Award, including but not limited to the number and class of
shares on which the Restricted Stock Units are based, in accordance with the
provisions of Section 7 of the Plan. The Committee’s adjustment shall be
effective and final, binding and conclusive for all purposes of the Plan and
this Agreement.

10. Governing Law; Modification. This Agreement shall be governed by the laws of
the State of Delaware without regard to the conflict of law principles. Except
as otherwise provided in the Plan, the Agreement may not be modified except in
writing signed by both parties.

11. Defined Terms. Except as otherwise provided herein, or unless the context
clearly indicates otherwise, capitalized terms used but not defined herein have
the definitions as provided in the Plan. The terms and provisions of the Plan
are incorporated herein by reference, and the Grantee hereby acknowledges
receiving a copy of the Plan. In the event of a conflict or inconsistency
between the discretionary terms and provisions of the Plan and the provisions of
this Agreement, the Plan shall govern and control.

12. Miscellaneous. The masculine pronoun shall be deemed to include the
feminine, and the singular number shall be deemed to include the plural unless a
different meaning is plainly required by the context.

IN WITNESS WHEREOF, the parties hereto have signed this Agreement as of the date
first above written.

 

    PLAINS EXPLORATION & PRODUCTION COMPANY     By:           John F. Wombwell,
Executive Vice President      

 

 

 

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Appendix I

[Performance Goals for the [            ] Performance Periods]