Exhibit 10.5

WPX ENERGY, INC.

TIME-BASED RESTRICTED STOCK UNIT

INDUCEMENT AWARD AGREEMENT

THIS TIME-BASED RESTRICTED STOCK UNIT INDUCEMENT AWARD AGREEMENT and Appendices
A and B attached hereto (this “Agreement”), which contains the terms and
conditions for the Restricted Stock Units (“Restricted Stock Units” or “RSUs”),
is by and between WPX ENERGY, INC., a Delaware corporation (the “Company”) and
the individual identified on the last page hereof (the “Participant”).

1. Grant of RSUs. Subject to the terms and conditions of this Agreement, the
Company hereby grants an award (the “Award”) to the Participant of [•] RSUs
effective May 15, 2014 (the “Effective Date”). The Award gives the Participant
the opportunity to earn the right to receive the number of shares of the Common
Stock of the Company equal to the number of RSUs shown in the prior sentence,
subject to adjustment under the terms of this Agreement. These shares are
referred to in this Agreement as the “Shares.” Until the Participant both
becomes vested in the Shares under the terms of Paragraph 4 and is paid such
Shares under the terms of Paragraph 5, the Participant shall have no rights as a
stockholder of the Company with respect to the Shares.

2. Acceptance of Documents. The Participant acknowledges that he has received a
copy of, or has online access to, this Agreement and hereby automatically
accepts the RSUs subject to all the terms and provisions of this Agreement. The
Participant hereby further agrees that he has received a copy of, or has online
access to, the prospectus and hereby acknowledges his or her automatic
acceptance and receipt of such prospectus electronically.

3. Committee Decisions and Interpretations. The Participant hereby agrees to
accept as binding, conclusive and final all actions, decisions and/or
interpretations of the Committee, its delegates, or agents, upon any questions
or other matters arising under the Plan or this Agreement.

4. Vesting; Legally Binding Rights.

(a) Notwithstanding any other provision of this Agreement, the Participant shall
not be entitled to any payment of Shares under this Agreement unless and until
such Participant obtains a legally binding right to such Shares and satisfies
applicable vesting conditions for such payment.

(b) Except as otherwise provided in Subparagraphs 4(c) – 4(f) below, the
Participant shall vest in 100% of the Shares on the date that is one year after
the Effective Date (not including the Effective Date) (such anniversary of the
Effective Date, the “Maturity Date”), but only if the Participant remains an
active employee of the Company or any of its Affiliates through such Maturity
Date. For example, if the Effective Date of Participant’s award under this
Agreement is May 15, 2014, the Maturity Date will be May 15, 2015.

(c) If the Participant dies prior to the Maturity Date while an active employee
of the Company or any of its Affiliates, the Participant shall vest in all
unvested Shares at the time of such death.

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(d) If the Participant becomes Disabled prior to the Maturity Date while an
active employee of the Company or any of its Affiliates, the Participant shall
vest in all unvested Shares at the time the Participant becomes Disabled.

(e) If the Participant experiences a Separation from Service by the Company
without Cause or by the Executive for Good Reason prior to the Maturity Date,
the Participant shall vest in all unvested Shares upon such Separation from
Service.

(f) If the Participant experiences a Separation from Service by the Company for
Cause or by the Executive without Good Reason prior to the final Maturity Date,
the Participant shall forfeit all Shares at the time of such Separation from
Service.

5. Payment of Shares.

(a) The payment date for all Shares in which the Participant becomes vested
pursuant to Subparagraph 4(b) above shall be within the 30th day following the
Maturity Date.

(b) The payment date for all Shares in which the Participant becomes vested
pursuant to Subparagraph 4(c) above shall be within the 60th day following such
death.

(c) The payment date for all Shares in which the Participant becomes vested
pursuant to Subparagraph 4(d) above shall be within the 30th day after the
Participant becomes Disabled.

(d) The payment date for all Shares in which the Participant becomes vested
pursuant to Subparagraph 4(e) above shall be within the 30th day following such
Participant’s Separation from Service.

(e) Upon conversion of RSUs into Shares under this Agreement, such RSUs shall be
cancelled. Shares that become payable under this Agreement will be paid by the
Company by the delivery to the Participant, or the Participant’s beneficiary or
legal representative, of one or more certificates (or other indicia of
ownership) representing shares of Common Stock equal in number to the number of
Shares otherwise payable under this Agreement less the number of Shares having a
Fair Market Value, as of the date the withholding tax obligation arises, equal
to the minimum statutory withholding requirements. Notwithstanding the
foregoing, to the extent permitted by Section 409A of the Code and the guidance
issued by the Internal Revenue Service thereunder, if federal employment taxes
become due when the Participant becomes entitled to payment of Shares, the
number of Shares necessary to cover minimum statutory withholding requirements
may, in the discretion of the Company, be used to satisfy such requirements upon
such entitlement.

 

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6. Other Provisions.

(a) The Participant understands and agrees that payments under this Agreement
shall not be used for, or in the determination of, any other payment or benefit
under any continuing agreement, plan, policy, practice, or arrangement providing
for the making of any payment or the provision of any benefits to or for the
Participant or the Participant’s beneficiaries or representatives, including,
without limitation, any employment agreement, any change of control severance
protection plan, or any employee benefit plan as defined in Section 3(3) of
ERISA, including, but not limited to qualified and non-qualified retirement
plans.

(b) The Participant agrees and understands that, subject to the limit expressed
in clause (iii) of the following sentence, upon payment of Shares under this
Agreement, stock certificates (or other indicia of ownership) issued may be held
as collateral for monies he/she owes to the Company or any of its Affiliates,
including but not limited to personal loan(s), Company credit card debt,
relocation repayment obligations, or benefits from any plan that provides for
pre-paid educational assistance. In addition, the Company may accelerate the
time or schedule of a payment of vested Shares, and/or deduct from any payment
of Shares to the Participant under this Agreement, or to his or her
beneficiaries in the case of the Participant’s death, that number of Shares
having a Fair Market Value at the date of such deduction to the amount of such
debt as satisfaction of any such debt, provided that (i) such debt is incurred
in the ordinary course of the employment relationship between the Company or any
of its Affiliates and the Participant, (ii) the aggregate amount of any such
debt-related collateral held or deduction made in any taxable year of the
Company with respect to the Participant does not exceed $5,000, and (iii) the
deduction of Shares is made at the same time and in the same amount as the debt
otherwise would have been due and collected from the Participant.

(c) Except as provided otherwise in Subparagraphs 4(c) through 4(i) above, in
the event that the Participant experiences a Separation from Service prior to
the Participant’s becoming vested in the Shares under this Agreement, RSUs
subject to this Agreement and any right to Shares issuable hereunder shall be
forfeited.

(d) RSUs, Shares, and the Participant’s interest in RSUs and Shares may not be
sold, assigned, transferred, pledged, or otherwise disposed of or encumbered at
any time prior to both (i) the Participant’s becoming vested in such Shares and
(ii) payment of such Shares under this Agreement.

(e) If the Participant at any time forfeits any or all of the RSUs pursuant to
this Agreement, the Participant agrees that all of the Participant’s rights to
and interest in such RSUs and in Shares issuable hereunder shall terminate upon
forfeiture without payment of consideration.

(f) The Committee shall determine whether an event has occurred resulting in the
forfeiture of the Shares, in accordance with this Agreement, and all
determinations of the Committee shall be final and conclusive.

 

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(g) With respect to the right to receive payment of the Shares under this
Agreement, nothing contained herein shall give the Participant any rights that
are greater than those of a general creditor of the Company.

(h) The obligations of the Company under this Agreement are unfunded and
unsecured. Each Participant shall have the status of a general creditor of the
Company with respect to amounts due, if any, under this Agreement.

(i) The parties to this Agreement intend that this Agreement meet the applicable
requirements of Section 409A of the Code and recognize that it may be necessary
to modify this Agreement and/or the Plan to reflect guidance under Section 409A
of the Code issued by the Internal Revenue Service. Participant agrees that the
Committee shall have sole discretion in determining (i) whether any such
modification is desirable or appropriate and (ii) the terms of any such
modification.

(j) The Participant hereby automatically becomes a party to this Agreement
whether or not he accepts the Award electronically or in writing in accordance
with procedures of the Committee, its delegates or agents.

(k) Nothing in this Agreement or the Plan shall interfere with or limit in any
way the right of the Company or an Affiliate to terminate the Participant’s
employment or service at any time, nor confer upon the Participant the right to
continue in the employ of the Company and/or Affiliate.

(l) The Participant hereby acknowledges that nothing in this Agreement shall be
construed as requiring the Committee to allow a domestic relations order with
respect to this Award.

7. Notices. All notices to the Company required hereunder shall be in writing
and delivered by hand or by mail, addressed to WPX Energy, Inc., One Williams
Center, Tulsa, Oklahoma 74172, Attention: Stock Administration Department.
Notices shall become effective upon their receipt by the Company if delivered in
the foregoing manner. To direct the sale of any Shares issued under this
Agreement, the Participant shall contact a dedicated Fidelity Stock Plan
Representative.

8. Tax Consultation. The Participant understands he will incur tax consequences
as a result of acquisition or disposition of the Shares. The Participant agrees
to consult with any tax consultants deemed advisable in connection with the
acquisition of the Shares and acknowledges that he is not relying, and will not
rely, on the Company for any tax advice.

 

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WPX ENERGY, INC.

 

By:    

William G. Lowrie

Chairman of the Board

Participant: Richard E. Muncrief

SSN:                             

 

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APPENDIX A

DEFINITIONS

“Affiliate” means all persons with whom the Company would be considered a single
employer under Section 414(b) of the Code and all persons with whom such person
would be considered a single employer under Section 414(c) of the Code.

“Disabled” means a Participant qualifies for long-term disability benefits under
the Company’s long-term disability plan, or if the Company does not sponsor such
a disability plan, the Participant qualifies for Social Security Disability
Insurance under Title II of the Social Security Act. Notwithstanding the
forgoing, all determinations of whether a Participant is Disabled shall be made
in accordance with Section 409A of the Internal Revenue Code of 1986, as
amended, and the guidance thereunder.

“Retirement” means a Separation from Service (other than for Cause) after
attaining age fifty-five (55) and completing at least five (5) years of
continuous service.

“Separation from Service” means a Participant’s termination or deemed
termination from employment with the Company and its Affiliates. For purposes of
determining whether a Separation from Service has occurred, the employment
relationship is treated as continuing intact while the Participant is on
military leave, sick leave, or other bona fide leave of absence if the period of
such leave does not exceed six months, or if longer, so long as the Participant
retains a right to reemployment with his or her employer under an applicable
statute or by contract. For this purpose, a leave of absence constitutes a bona
fide leave of absence only if there is a reasonable expectation that the
Participant will return to perform services for his or her employer. If the
period of leave exceeds six months and the Participant does not retain a right
to reemployment under an applicable statute or by contract, the employment
relationship will be deemed to terminate on the first date immediately following
such six month period.

Notwithstanding the foregoing, if a leave of absence is due to any medically
determinable physical or mental impairment that can be expected to last for a
continuous period of more than six months but less than 12 months, and such
impairment causes the Participant to be unable to perform the duties of the
Participant’s position of employment or any substantially similar position of
employment, a period equal to such Participant’s leave of absence will be
substituted for such six-month period, so long as that period is less than 12
months. If such an absence exceeds 12 months, then the Participant will be
considered Disabled and Section 4(d) will govern.

A Separation from Service occurs at the date as of which the facts and
circumstances indicate either that, after such date: (A) the Participant and the
Company reasonably anticipate the Participant will perform no further services
for the Company and its Affiliates (whether as an employee or an independent
contractor) or (B) that the level of bona fide services the Participant will
perform for the Company and its Affiliates (whether as an employee or
independent contractor) will permanently decrease to no more than 20% of the
average level of bona fide services performed over the immediately preceding
36-month period or, if the Participant has been providing services to the
Company and its Affiliates for less than 36 months, the full period over which
the Participant has rendered services, whether as an employee or independent
contractor. The determination of whether a Separation from Service has occurred
shall be governed by the provisions of Treasury Regulation § 1.409A-1, as
amended, taking into account the objective facts and circumstances with respect
to the level of bona fide services performed by the Participant after a certain
date.

 

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APPENDIX B

WPX ENERGY, Inc.

Inducement Award – Richard E. Muncrief

(Effective as of May 15, 2014)

Article 1.—Effective Date, History, Objectives, and Duration

1.1 Effective Date. In connection with WPX Energy, Inc. (the “Company”) agreeing
to employ Richard E. Muncrief (“Grantee”) as its President and Chief Executive
Officer effective as of May 15, 2014, the Company is agreeing to award Grantee
time-vesting and performance-vesting restricted stock units of the Company which
are intended to be “inducement awards” (in accordance with New York Stock
Exchange rules) (the “Inducement Award”), subject to the terms and conditions of
the applicable award agreement and this Appendix A (the “Inducement Award
Agreement”). Inducement Awards are not granted pursuant to the WPX Energy, Inc.
2013 Incentive Plan (the “Plan”). Inducement Awards are granted effective as of,
and contingent upon, Grantee commencing employment with the Company in such
capacity (the “Effective Date”).

Article 2.—Definitions

The following terms shall have the meanings set forth below:

2.1 “Affiliate” means any Person that directly or indirectly, through one or
more intermediaries, controls, or is controlled by or is under common control
with the Company.

2.2 “Board” has the meaning set forth in Section 1.3.

2.3 “Committee” and “Management Committee” have the respective meanings set
forth in Article 3.

2.4 “Common Stock” means the common stock, $1.00 par value, of the Company.

2.5 “Exchange Act” means the Securities Exchange Act of 1934, as amended from
time to time. References to a particular section of the Exchange Act include
references to successor provisions.

2.6 “Fair Market Value” means (a) with respect to any property other than
Shares, the fair market value of such property determined by such methods or
procedures as shall be established from time to time by the Committee, and
(b) with respect to Shares, unless otherwise determined in the good faith
discretion of the Committee, as of any date: (i) the closing price on the date
of determination reported in The Wall Street Journal (or an equivalent alternate
or successor) (or, if no sale of Shares was reported for such date, on the most
recent trading day prior to such date on which a sale of Shares was reported);
(ii) if the Shares are not listed on the New York Stock Exchange, the closing
price of the Shares on such other national exchange on

 

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which the Shares are principally traded or as reported by the Nasdaq Global
Select or Global Market System, or similar securities market, or if no such
quotations are available, the average of the high bid and low asked quotations
in the over-the-counter market as reported by the Nasdaq Capital Market or
similar securities market; or (iii) in the event that there shall be no public
market for the Shares, the fair market value of the Shares as determined (which
determination shall be conclusive) in good faith by the Committee.

2.7 “Grant Date” means the date on which an Inducement Award is granted or, in
the case of a grant to an Eligible Person, such later date as specified in
advance by the Committee.

2.8 “Grantee” means Richard E. Muncrief.

2.9 “including” or “includes” means “including, without limitation,” or
“includes, without limitation,” respectively.

2.10 “Person” means any individual, sole proprietorship, partnership, joint
venture, limited liability company, trust, unincorporated organization,
association, corporation, institution, public benefit corporation, entity or
government instrumentality, division, agency, body or department.

2.11 “Restricted Stock Unit” means a right, granted in accordance the Inducement
Award Agreement, to receive a Share or cash payment equal to the value thereof.

2.12 “Retirement” shall have the meaning ascribed to such term in the Company’s
governing tax-qualified retirement plan applicable to the Grantee, or if no such
plan is applicable to the Grantee, in the good faith determination of the
Committee.

2.13 “Rule 16b-3” means Rule 16b-3 promulgated by the SEC under the Exchange
Act, as amended from time to time, together with any successor rule.

2.14 “SEC” means the United States Securities and Exchange Commission, or any
successor thereto.

2.15 “Section 16 Non-Management Director” means a Non-Management Director who
satisfies the requirements to qualify as a “non-employee director” under Rule
16b-3.

2.16 “Section 16 Person” means a person who is subject to potential liability
under Section 16(b) of the Exchange Act with respect to transactions involving
equity securities of the Company.

2.17 “Securities Act” means the Securities Act of 1933, as amended from time to
time. References to a particular section of the Securities Act include
references to successor provisions.

2.18 “Share” means a share of Common Stock, and such other securities of the
Company as may be substituted or resubstituted for Shares pursuant to
Section 4.2 hereof.

 

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Article 3.—Administration

3.1 Committee.

(a) Subject to Article 8 and Section 3.2, the Inducement Award Agreement shall
be administered by a committee (the “Committee”). Except to the extent the Board
reserves administrative powers to itself or appoints a different committee to
administer the Inducement Award Agreement, the Committee shall be the
Compensation Committee of the Board. In addition, to the extent the Board
considers it desirable to comply with Rule 16b-3, the Committee shall consist of
two or more directors of the Company, all of whom qualify as “outside directors”
within the meaning of Section 16 Non-Management Directors (the “Independent
Committee”). The number of members of the Committee shall from time to time be
increased or decreased, and shall be subject to such conditions, in each case as
the Board deems appropriate to permit transactions in Shares pursuant to the
Inducement Award to satisfy such conditions of Rule 16b-3 as then in effect.

(b) The Board or the Compensation Committee may, by resolution, appoint and
delegate to another committee of one or more officers of the Company (other than
the Grantee) (a “Management Committee”) any or all of the authority of the Board
or the Committee, as applicable, with respect to Inducement Awards. Any
delegation of authority pursuant to this Section 3.1(b) shall comply with the
requirements of applicable law, including Section 157(c) of the General
Corporation Law of the State of Delaware to the extent applicable.

(c) Unless the context requires otherwise, any references herein to “Committee”
include references to the Board, the Compensation Committee of the Board, the
Management Committee, or the Independent Committee (if distinct from any of the
foregoing, as applicable. For avoidance of doubt, notwithstanding any provision
of the Inducement Award to the contrary, any action taken by the Compensation
Committee of the Board shall be treated as a valid action of the Committee,
except as limited by the terms of the Board’s delegation of authority to the
Compensation Committee of the Board or in the event that such action would
violate applicable law.

3.2 Powers of Committee. Subject to and consistent with the provisions of the
Inducement Award Agreement, the Committee has full and final authority and sole
discretion to construe and interpret the Inducement Award Agreement and to make
all determinations, including factual determinations, necessary or advisable for
the administration of the Inducement Award Agreement, including:

(a) to determine whether any performance or vesting conditions have been
satisfied;

(b) to determine whether, to what extent and under what circumstances an
Inducement Award may be settled in cash or Shares, or an Inducement Award may be
accelerated, vested, canceled, forfeited or surrendered or any terms of the
Inducement Award may be waived, and to accelerate the exercisability of, and to
accelerate or waive any or all of the terms and conditions applicable to any
Inducement Award for any reason and at any time;

 

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(c) to offer to exchange or buy out any previously granted Inducement Award for
a payment in cash or Shares;

(d) to make, amend, suspend, waive and rescind rules and regulations relating to
the Inducement Award Agreements;

(e) to appoint such agents as the Committee may deem necessary or advisable to
administer the Inducement Award Agreements;

(f) with the consent of the Grantee, to amend any such Inducement Award at any
time, among other things, to permit transfers of such Inducement Award to the
extent permitted by the Inducement Award; provided that the consent of the
Grantee shall not be required for any amendment (i) which does not materially
adversely affect the rights of the Grantee, or (ii) which is necessary or
advisable (as determined by the Committee) to carry out the purpose of the
Inducement Award as a result of any new applicable law or change in an existing
applicable law, or (iii) to the extent the Inducement Award specifically permits
amendment without consent, or (iv) provided for or specifically contemplated in
the Inducement Award;

(g) to cancel, with the consent of the Grantee, outstanding Inducement Awards
and to grant new Inducement Awards in substitution therefor;

(h) to make such adjustments or modifications to Inducement Awards are advisable
to fulfill the purposes of the Inducement Award (including to comply with local
law);

(i) to impose such additional terms and conditions upon the grant, exercise or
retention of Inducement Awards as the Committee may, before or concurrently with
the grant thereof, deem appropriate, including, as applicable, limiting the
percentage of Inducement Awards which may from time to time be exercised by the
Grantee;

(j) to make adjustments in the terms and conditions of, and the criteria in,
Inducement Awards in recognition of unusual or nonrecurring events (including
events described in Section 4.1) affecting the Company or an Affiliate or the
financial statements of the Company or an Affiliate, or in response to changes
in applicable laws, regulations or accounting principles;

(k) to correct any defect or supply any omission or reconcile any inconsistency,
and to construe and interpret Inducement Award Agreement, the rules and
regulations, and any other instrument entered into or relating to an Inducement
Award; and

(l) to take any other action with respect to any matters relating to the
Inducement Award Agreement and to make all other decisions and determinations as
may be required under the terms of the Inducement Award Agreement or as the
Committee may deem necessary or advisable for the administration of the
Inducement Award Agreement.

Any action of the Committee with respect to the Inducement Award Agreement shall
be final, conclusive and binding on all persons, including the Company, its
Affiliates, the Grantee, any person claiming any rights under the Inducement
Award from or through the Grantee, and stockholders, except to the extent the
Committee may subsequently modify, or take further

 

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action not consistent with, its prior action. If not specified in the Inducement
Award Agreement, the time at which the Committee must or may make any
determination shall be determined by the Committee, and any such determination
may thereafter be modified by the Committee. The express grant of any specific
power to the Committee, and the taking of any action by the Committee, shall not
be construed as limiting any power or authority of the Committee.

Article 4.—Adjustments

4.1 Adjustments in Authorized Shares and Inducement Awards. In the event of any
dividend or other distribution (whether in the form of cash, Shares, or other
property, but excluding regular, quarterly cash dividends), recapitalization,
forward or reverse stock split, subdivision, consolidation or reduction of
capital, reorganization, merger, consolidation, scheme of arrangement, split-up,
spin-off or combination involving the Company or repurchase or exchange of
Shares or other securities of the Company or other rights to purchase Shares or
other securities of the Company, or other similar corporate transaction or event
that affects the Shares, provided that any such transaction or event referred to
heretofore does not involve the receipt of consideration by the Company, then
the Committee shall, in such manner as it deems equitable in order to prevent
dilution or enlargement of the benefits or potential benefits intended to be
made available under the Inducement Award Agreement, adjust (a) the number and
type of Shares (or other securities or property) with respect to which
Inducement Awards may be granted, (b) the number and type of Shares (or other
securities or property) subject to outstanding Inducement Awards, (c) the number
of Shares with respect to which Inducement Awards may be granted to the Grantee,
and (d) the number and type of Shares (or other securities or property) as to
which Inducement Awards may be settled; provided, that the number of Shares
subject to any Inducement Award denominated in Shares shall always be a whole
number.

Article 5.—General Conditions of Inducement Awards

5.1 General Terms and Termination of Affiliation. The Committee may impose on
any Inducement Award or the exercise or settlement thereof, at the Grant Date
or, subject to the provisions of Section 8.1, thereafter, such additional terms
and conditions not inconsistent with the provisions of the Inducement Award as
the Committee shall determine, including terms requiring forfeiture,
acceleration or pro-rata acceleration of Inducement Awards. Except as may be
required under the Delaware General Corporation Law, Inducement Awards may be
granted for no consideration other than prior and future services.

5.2 Nontransferability of Inducement Awards.

(a) Each Inducement Award and each right under any Inducement Award shall be
exercisable only by the Grantee during the Grantee’s lifetime, or, if
permissible under applicable law, by the Grantee’s guardian or legal
representative.

(b) No Inducement Award (prior to the time, if applicable, Shares are delivered
in respect of such Inducement Award), and no right under any Inducement Award,
may be assigned, alienated, pledged, attached, sold or otherwise transferred or
encumbered by the Grantee other than by will or by the laws of descent and
distribution, and any such purported assignment, alienation, pledge, attachment,
sale, transfer or encumbrance shall be void and unenforceable against the
Company and any Affiliate; provided that the designation of a beneficiary shall
not constitute an assignment, alienation, pledge, attachment, sale, transfer or
encumbrance.

 

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(c) Notwithstanding subsections (a) and (b) above, to the extent provided in the
Inducement Award Agreement, such Restricted Stock Units may be transferred to
one or more trusts or persons during the lifetime of the Grantee in connection
with the Grantee’s estate planning or wealth transfer planning, and may be
exercised by such transferee in accordance with the terms of such Inducement
Award. If so determined by the Committee, the Grantee may, in the manner
established by the Committee, designate a beneficiary or beneficiaries to
exercise the rights of the Grantee, and to receive any distribution with respect
to any Inducement Award upon the death of the Grantee. A transferee,
beneficiary, guardian, legal representative or other person claiming any rights
under the Inducement Award Agreement from or through the Grantee shall be
subject to and consistent with the provisions of the Inducement Award Agreement,
except to the extent the any additional restrictions or limitations are deemed
necessary or appropriate by the Committee.

(d) Nothing herein shall be construed as requiring the Committee to honor a
domestic relations order except as required under the respective Inducement
Award Agreement or to the extent required under applicable law.

5.3 Cancellation and Rescission of Inducement Awards. Unless the Inducement
Award Agreement specifies otherwise, the Committee may cancel, rescind, suspend,
withhold, or otherwise limit or restrict any unexercised Inducement Award at any
time if the Grantee is not in compliance with all applicable provisions of the
Inducement Award Agreement.

5.4 Compliance with Rule 16b-3.

(a) Reformation to Comply with Exchange Act Rules. To the extent the Committee
determines that a grant or other transaction by a Section 16 Person should
comply with applicable provisions of Rule 16b-3 (except for transactions
exempted under alternative Exchange Act rules), the Committee shall take such
actions as necessary to make such grant or other transaction so comply, and if
any provision of any Inducement Award Agreement does not comply with the
requirements of Rule 16b-3 as then applicable to any such grant or transaction,
such provision will be construed or deemed amended, if the Committee so
determines, to the extent necessary to conform to the then applicable
requirements of Rule 16b-3 without the consent of or notice to the affected
Section 16 Person.

(b) Rule 16b-3 Administration. Any function relating to a Section 16 Person
shall be performed solely by the Committee or the Board if necessary to ensure
compliance with applicable requirements of Rule 16b-3, to the extent the
Committee determines that such compliance is desired. Each member of the
Committee or person acting on behalf of the Committee shall be entitled to, in
good faith, rely or act upon any report or other information furnished to him by
any officer, manager or other employee of the Company or any Affiliate, the
Company’s independent certified public accountants or any executive compensation
consultant or attorney or other professional retained by the Company to assist
in the administration of the Inducement Award Agreement.

 

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5.5 Deferral of Inducement Award Payouts. The Committee may permit or require
the Grantee to defer receipt of the payment of cash or the delivery of Shares
that would otherwise be due by virtue of the lapse or waiver of restrictions for
Restricted Stock Units. The Committee may also require such a deferral of
receipt in order to avoid non-deductibility of any amounts associated with such
Inducement Award or to comply with the requirements of applicable law. If any
such deferral is required or permitted, the Committee shall, in its sole
discretion, establish rules and procedures for such payment deferrals. Except as
otherwise provided in an Inducement Award Agreement or this Section 5.5, any
payment of any Shares that are subject to such deferral shall be made or
delivered to the Grantee upon the Grantee’s termination of employment.
Notwithstanding anything herein to the contrary, in no event will any deferral
or payment of a deferred number of Shares or any other payment with respect to
any Inducement Award be allowed if the Committee determines, in its sole
discretion, that the deferral would result in the imposition of the additional
tax under Section 409A(a)(1)(B) of the Code.

Article 6.—Restricted Stock Units

6.1 Delivery and Limitations. Delivery of Shares will occur upon the terms and
conditions of the Inducement Award Agreement. In addition, an Inducement Award
shall be subject to such additional limitations as the Committee may impose. The
Grantee will have no voting rights and will have no rights to receive dividends
or dividend equivalents in respect of his Restricted Stock Units.

Article 7.—Change in Control

7.1 Acceleration of Exercisability and Lapse of Restrictions. If, upon or within
two (2) years following a Change in Control, the Grantee has a termination of
employment with the Company and its Affiliates (excluding any transfer to the
Company or its Affiliates) voluntarily for Good Reason, or involuntarily (other
than due to Cause, death, Disability, or Retirement), all restrictions or
limitations on any outstanding Inducement Awards shall lapse and all performance
criteria and other conditions to payment of Inducement Awards shall be deemed to
be achieved or fulfilled (at the target level, to the extent applicable).

7.2 Definitions. For purposes of this Article 7, the following terms shall have
the meanings as set forth in Section 5.9 of the Employment Agreement by and
between the Company and the Grantee, entered into as of April 29, 2014: “Cause”,
“Change in Control” and “Good Reason”.

Article 8.—Amendment, Modification, and Termination

8.1 Inducement Awards Previously Granted. Except as otherwise specifically
permitted in Inducement Award Agreement, no termination, amendment, or
modification of the Inducement Award Agreement shall adversely affect in any
material way any Inducement Award previously granted under the Inducement Award
Agreement, without the written consent of the Grantee of such Inducement Award.

 

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Article 9.—Withholding

9.1 Mandatory Tax Withholding. Whenever, under the Inducement Award Agreement,
(i) Shares are to be delivered upon payment of an Inducement Award, (ii) a cash
payment is made for any Inducement Award, or (iii) any other payment event
occurs with respect to rights and benefits hereunder, the Company or any
Affiliate shall be entitled to require (A) that the Grantee remit an amount in
cash, or in the Company’s discretion, in Shares, valued at their Fair Market
Value on the date the withholding obligation arises, sufficient to satisfy all
of the employer’s federal, state, and local tax withholding requirements related
thereto but no more than the minimum amount necessary to satisfy such amounts
(“Required Withholding”), (B) the withholding of such Required Withholding from
compensation otherwise due to the Grantee or from any Shares valued at their
Fair Market Value at the date the withholding obligation arises, or from any
other payment due to the Grantee under the Inducement Award or otherwise or
(C) any combination of the foregoing.

Article 10.—Additional Provisions

10.1 Successors. All obligations of the Company under the Inducement Award
Agreement with respect to Inducement Awards granted hereunder shall be binding
on any successor to the Company, whether the existence of such successor is the
result of a direct or indirect purchase, merger, consolidation, or otherwise of
all or substantially all of the business and/or assets of the Company.

10.2 Severability. If any part of the Inducement Award Agreement is declared by
any court or governmental authority to be unlawful or invalid, such unlawfulness
or invalidity shall not invalidate any other part of the Inducement Award
Agreement. Any Section or part of a Section so declared to be unlawful or
invalid shall, if possible, be construed in a manner which will give effect to
the terms of such Section or part of a Section to the fullest extent possible
while remaining lawful and valid.

10.3 Requirements of Law. The granting of Inducement Awards and the delivery of
Shares under the Inducement Award Agreement shall be subject to all applicable
laws, rules, and regulations, and to such approvals by any governmental agencies
or securities exchanges as may be required. Notwithstanding any provision of the
Inducement Award Agreement, the Grantee shall not be entitled to exercise, or
receive benefits under, any Inducement Award, and the Company (and any
Affiliate) shall not be obligated to deliver any Shares or deliver benefits to
the Grantee, if such exercise or delivery would constitute a violation by the
Grantee or the Company of any applicable law or regulation.

10.4 Securities Law Compliance.

(a) If the Committee deems it necessary to comply with any applicable securities
law, or the requirements of any securities exchange or other form of securities
market upon which Shares may be listed, the Committee may impose any restriction
on Shares acquired pursuant to Inducement Awards under the Inducement Award
Agreement as it may deem advisable. All certificates for Shares delivered under
the Inducement Award Agreement pursuant to any Inducement Award or the exercise
thereof shall be subject to such stop transfer

 

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orders and other restrictions as the Committee may deem advisable under the
rules, regulations and other requirements of the SEC, any securities exchange or
other form of securities market upon which Shares are then listed, any
applicable securities law, and the Committee may cause a legend or legends to be
put on any such certificates to make appropriate reference to such restrictions.
If so requested by the Company, the Grantee shall make a written representation
to the Company that he will not sell or offer to sell any Shares unless a
registration statement shall be in effect with respect to such Shares under the
Securities Act of 1933, as amended, and any applicable state or foreign
securities law or unless he shall have furnished an opinion to the Company, in
form and substance satisfactory to the Company, that such registration is not
required.

(b) If the Committee determines that the exercise, nonforfeitability of, or
delivery of benefits pursuant to, any Inducement Award would violate any
applicable provision of securities laws or the listing requirements of any
securities exchange or other form of securities market on which are listed any
of the Company’s equity securities, then the Committee may postpone any such
exercise, nonforfeitability or delivery, as applicable, but the Company shall
use all reasonable efforts to cause such exercise, nonforfeitability or delivery
to comply with all such provisions at the earliest practicable date.

10.5 No Rights as a Stockholder. No Grantee shall have any rights as a
stockholder of the Company with respect to the Shares which may be deliverable
upon payment of such Inducement Award until such Shares have been delivered to
him.

10.6 Nature of Payments. Unless specified in the Inducement Award Agreement or
otherwise determined by the Company, Inducement Awards shall be special
incentive payments to the Grantee and shall not be taken into account in
computing the amount of salary or compensation of the Grantee for purposes of
determining any pension, retirement, death or other benefit under (a) any
pension, retirement, profit-sharing, bonus, insurance or other employee benefit
plan of the Company or any Affiliate, except as such plan shall otherwise
expressly provide, or (b) any agreement between (i) the Company or any Affiliate
and (ii) the Grantee, except as such agreement shall otherwise expressly
provide.

10.7 Governing Law. The Inducement Award Agreement shall be construed in
accordance with and governed by the laws of the State of Delaware, other than
its laws respecting choice of law.

10.8 Share Certificates. Any certificates for Shares delivered under the terms
of the Inducement Award Agreement shall be subject to such stop-transfer orders
and other restrictions as the Committee may deem advisable under federal or
state securities laws, rules and regulations thereunder, and the rules of any
foreign securities laws, rules and regulations thereunder, and the rules of any
national securities exchange or other form of securities market on which Shares
are listed or quoted. The Committee may cause a legend or legends to be placed
on any such certificates to make appropriate reference to such restrictions or
any other restrictions or limitations that may be applicable to Shares. In
addition, during any period in which Inducement Awards or Shares are subject to
restrictions or limitations under the terms of the Inducement Award Agreement or
any Inducement Award Agreement, or during any period during which delivery or
receipt of an Inducement Award or Shares has been deferred by the

 

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Committee or the Grantee, the Committee may require the Grantee to enter into an
agreement providing that certificates representing Shares deliverable or
delivered pursuant to an Inducement Award shall remain in the physical custody
of the Company or such other person as the Committee may designate.

10.9 Unfunded Status of Inducement Awards; Creation of Trusts. The Inducement
Award Agreement is intended to constitute an “unfunded” plan for incentive and
deferred compensation. With respect to any payments not yet made to the Grantee
pursuant to an Inducement Award, nothing contained in the Inducement Award
Agreement or any Inducement Award Agreement shall give the Grantee any rights
that are greater than those of a general creditor of the Company; provided that
the Committee may authorize the creation of trusts or make other arrangements to
meet the Company’s obligations under the Inducement Award Agreement to deliver
cash, Shares or other property pursuant to any Inducement Award which trusts or
other arrangements shall be consistent with the “unfunded” status of the
Inducement Award Agreement unless the Committee otherwise determines.

10.10 Employment. Nothing in the Inducement Award Agreement or an Inducement
Award Agreement shall interfere with or limit in any way the right of the
Company or any Affiliate to terminate the Grantee’s employment at any time, for
any reason or no reason, or shall confer upon the Grantee the right to continue
in the employ or as an officer of the Company or any Affiliate.

10.11 Military Service. Inducement Awards shall be administered in accordance
with Section 414(u) of the Code and the Uniformed Services Employment and
Reemployment Rights Act of 1994 to the extent required by law or as determined
by the Committee.

10.12 Construction; Gender and Number. The following rules of construction will
apply to the Inducement Award Agreement: (a) the word “or” is disjunctive but
not necessarily exclusive, and (b) words in the singular include the plural,
words in the plural include the singular, and words in the neuter gender include
the masculine and feminine genders and words in the masculine or feminine gender
include the other neuter genders.

10.13 Headings. The headings of articles and sections are included solely for
convenience of reference, and if there is any conflict between such headings and
the text of this Plan, the text shall control.

10.14 Obligations. Unless otherwise specified in the Inducement Award Agreement,
the obligation to deliver, pay or transfer any amount of money or other property
pursuant to Inducement Awards under this Plan shall be the sole obligation of
the Grantee’s employer; provided that the obligation to deliver or transfer any
Shares pursuant to Inducement Awards under this Plan shall be the sole
obligation of the Company.

10.15 Code Section 409A Compliance. The Board intends that any Inducement Awards
under the Inducement Award Agreement shall be administered, interpreted, and
construed in a manner intended to comply with Section 409A of the Internal
Revenue Code of 1986, as amended (“Code”), the regulations issued thereunder or
any exceptions thereto (or disregarded to the extent such provisions cannot be
so administered, interpreted, or construed). If the

 

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Committee determines that an Inducement Award, Inducement Award Agreement,
payment, distribution, deferral election, transaction or any other action or
arrangement contemplated by the provisions of the Inducement Award Agreement
would, if undertaken, cause the Grantee to become subject to additional taxes
pursuant to Section 409A, unless the Committee expressly determines otherwise,
such grant of Inducement Award, payment, distribution, deferral election,
transaction or other action or arrangement shall not be undertaken and the
related provisions of the Inducement Award Agreement and/or Inducement Award
Agreement will be amended or deemed modified in as close a manner as possible to
give effect to the original terms of the Inducement Award, or, only if necessary
because a modification or deemed modification would not be reasonably effective
in avoiding the additional income tax under Section 409A(a)(1)(B) of the Code,
rescinded in order to comply with the requirements of Section 409A to the extent
determined by the Committee without the consent of or notice to the Grantee.
Notwithstanding the foregoing, with respect to any Inducement Award intended by
the Committee to be exempt from the requirements of Section 409A which is to be
paid out when vested, such payment shall be made as soon as administratively
feasible after the Inducement Award becomes vested, but in no event shall such
payment be made later than 2-1/2 months after the end of the calendar year in
which the Inducement Award became vested unless (a) deferred pursuant to
Section 5.5 otherwise permitted under the exemption provisions of Section 409A.

10.16 Recoupment. In the event that financial results of the Company are
significantly restated due to fraud or intentional misconduct, the Board will
review any performance-based incentive payments paid to executive officers, who
are found by the Board to be personally responsible for the fraud or intentional
misconduct that caused the need for the restatement and will, to the extent
permitted by applicable law, seek recoupment from all executive officers of any
amounts paid in excess of the amounts that would have been paid based on the
restated financial results.

 

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