Exhibit 10.5

Form of U.S. Performance-Based Restricted Stock Agreement (2014 Plan)

OM GROUP, INC.

PERFORMANCE-BASED RESTRICTED STOCK AGREEMENT

THIS PERFORMANCE-BASED RESTRICTED STOCK AGREEMENT (the “Agreement”), dated as of
             , 201    , is by and between OM GROUP, INC. (the “Company”) and
        (the “Participant”). All terms used in this Agreement with initial
capital letters and not otherwise defined in this Agreement that are defined in
the Company’s 2014 Equity and Incentive Compensation Plan (the “Plan”) shall
have the meanings assigned to them in the Plan.

WHEREAS, the Company maintains the Plan for the purpose of attracting and
retaining non-employee Directors, officers and other key executives and employee
of the Company and its Subsidiaries and to provide to such persons incentives
and rewards for performance;

WHEREAS, pursuant to the Plan, and subject to the terms and conditions thereof
and the terms and conditions hereinafter set forth, this Agreement evidences and
memorializes the Company’s grant to the Participant, effective as of         
    , 201    (the “Date of Grant”) of         performance-based shares of
Restricted Stock (the “Restricted Stock”). Subject to the achievement of the
Management Objectives described in Section 3 of this Agreement, the Participant
may earn between 0% and 100% of the Restricted Stock.

NOW, THEREFORE, the Company and the Participant agree as follows:

1. Restrictions on Transfer of Restricted Stock. Subject to Section 15 of the
Plan, the Participant shall not be entitled to sell, exchange, transfer, pledge,
hypothecate, assign or otherwise dispose of the Restricted Stock until such time
that such Restricted Stock has vested in accordance with this Agreement. Any
attempted sale, exchange, transfer, pledge, hypothecation, assignment or other
disposition of such Restricted Stock in violation of this Agreement shall be
void and of no effect and the Company shall have the right to disregard the same
on its books and records.

2. Evidence of Award. Following execution of this Agreement, the Company shall
cause the Restricted Stock to be represented either by a certificate issued in
the name of the Participant or by electronic direct registration, registered in
the name of the Participant. Such certificate or electronic registration shall
bear the following legend, together with any other legend deemed necessary or
desirable by the Company in order to comply with applicable laws or to ensure
the enforceability of the provisions of the Plan or this Agreement:

The sale or other transfer of the shares represented by this certificate is
subject to certain restrictions set forth in the Restricted Stock Agreement
between                     (the registered owner) and OM Group, Inc., dated as
of                     . A copy of such restrictions may be obtained from the
Secretary of OM Group, Inc.

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Any such stock certificate shall be held by the Company (or its designated
agent) on behalf of the Participant until such time as the Restricted Stock has
vested or is forfeited in accordance with this Agreement.

3. Rights Relating to Restricted Stock. The Restricted Stock shall constitute
issued and outstanding shares of Common Stock, and the Participant shall be
entitled to exercise voting rights pertaining to the Restricted Stock. In the
event dividends are paid by the Company with respect to its Common Stock prior
to such time as the Restricted Stock has vested in accordance with this
Agreement, such dividends shall be distributed to and held by the Company (or
its designated agent) in the same manner as the Restricted Stock and be either
distributed to the Participant upon vesting of the Restricted Stock or forfeited
in accordance with this Agreement. In the event that shares of Common Stock or
other securities are distributed to owners of outstanding Common Stock by reason
of a stock dividend, stock split, recapitalization or otherwise, such shares or
securities received by the Participant shall be encompassed within the term
“Restricted Stock” for purposes of this Agreement and the Participant shall
deliver to the Company all such shares or securities received, to be held by the
Company on behalf of the Participant subject to the same restrictions as the
Restricted Stock.

4. Vesting of Restricted Stock.

4.1 Normal Vesting. Subject to Sections 4.2 through 4.5 of this Agreement, the
Restricted Stock will vest (meaning that the restrictions set forth in this
Agreement shall no longer be applicable and the Restricted Stock shall no longer
be subject to forfeiture as provided in this Agreement) based on the relative
achievement of the Management Objective(s) approved by the Committee on the Date
of Grant (the “Performance Targets”) for the performance period from January 1,
20    through December 31, 20    (the “Performance Period”) as follows:

(a) The applicable percentage of the Restricted Stock that shall be earned by
the Participant for the Performance Period shall be determined by reference to
the Performance Matrix for the Performance Period approved by the Committee on
the Date of Grant and communicated to the Participant in writing (the
“Performance Matrix”) if the Participant remains continuously employed by either
the Company or any Subsidiary until the end of the Performance Period. For
purposes of this Agreement, the continuous employment of the Participant with
the Company or any Subsidiary will not be deemed to have been interrupted, and
the Participant shall not be deemed to have ceased to be an employee of the
Company or any Subsidiary, by reason of the transfer of the Participant’s
employment among the Company and its Subsidiaries;

(b) In the event that achievement with respect to one of the Performance Targets
is between the performance levels specified in the Performance Matrix, the
applicable percentage of the Restricted Stock that shall be earned by the
Participant for the Performance Period for that particular Performance Target
shall be determined by the Committee using straight-line mathematical
interpolation;

 

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(c) To the extent the Performance Targets are not achieved by the end of the
Performance Period, then the Restricted Stock evidenced by this Agreement will
be forfeited without compensation or other consideration. The vesting of the
Restricted Stock pursuant to this Section 4.1 shall be contingent upon a
determination of the Committee that the Performance Metrics have been satisfied;
and

(d) In the absence of a prior forfeiture of the Restricted Stock pursuant to
this Agreement, as promptly as practicable after the Restricted Stock vests and
compliance with Section 6 of this Agreement, the Company shall, if applicable,
cause a new certificate or certificates to be issued in the name of the
Participant, or the Participant’s designee, in exchange for the certificate for
the Restricted Stock that is described in Section 3 of this Agreement. Such new
certificate shall not contain the legend set forth in Section 3 of this
Agreement but may contain any other legend the Company believes is appropriate
in order to comply with applicable securities law requirements.

4.2 Pro-Rata Vesting Due to Death or Becoming Disabled. If, prior to the end of
the Performance Period, the Participant dies or becomes Disabled while in the
employ of the Company or any Subsidiary, then, to the extent that the Restricted
Stock has not previously been forfeited, a pro-rata number of shares of
Restricted Stock shall remain eligible for vesting after the end of the
Performance Period, with such pro-rata number of shares of Restricted Stock
being determined by multiplying (a) the number of shares of Restricted Stock in
which the Participant would have vested in accordance with the terms and
conditions of Section 4.1 if the Participant had remained in the continuous
employment of the Company or any Subsidiary from the Date of Grant until the end
of the Performance Period (or the occurrence of a Change in Control to the
extent a Replacement Award is not provided) by (b) a fraction (i) the numerator
of which is the total number of calendar days in the period commencing with the
start of the Performance Period and ending on the date of such death or the date
on which the Participant became Disabled and (ii) the denominator of which is
the number of days in the Performance Period, with any fractional share rounded
down to the nearest whole number. The balance of the Restricted Stock evidenced
by this Agreement and not subject to pro-rata eligibility for vesting under this
Section 4.2 shall be immediately forfeited without compensation or other
consideration. For purposes of this Agreement, the Participant shall be
considered to have become “Disabled” if the Participant has qualified for a
long-term disability benefit under a disability plan or program of the Company
or, in the absence of a disability plan or program of the Company, under a
government-sponsored disability program, and is “disabled” within the meaning of
Section 409A(a)(2)(C) of the Code.

4.3 Pro-Rata Vesting Due to Retirement. If the Participant ceases to be employed
by the Company or any Subsidiary prior to the end of the Performance Period due
to the Participant’s retirement in accordance with any retirement plan or policy
of the Company or any Subsidiary (“Retirement”), then, to the extent that the
Restricted Stock

 

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has not previously been forfeited, a pro-rata number of shares of Restricted
Stock shall remain eligible for vesting after the end of the Performance Period,
with such pro-rata number of shares of Restricted Stock being determined by
multiplying (a) the number of shares of Restricted Stock in which the
Participant would have vested in accordance with the terms and conditions of
Section 4.1 if the Participant had remained in the continuous employment of the
Company or any Subsidiary from the Date of Grant until the end of the
Performance Period (or the occurrence of a Change in Control to the extent a
Replacement Award is not provided) by (b) a fraction (i) the numerator of which
is the total number of calendar days in the period commencing with the start of
the Performance Period and ending on the date of such Retirement and (ii) the
denominator of which is the number of days in the Performance Period, with any
fractional share rounded down to the nearest whole number. The balance of the
Restricted Stock evidenced by this Agreement and not subject to pro-rata
eligibility for Vesting under this Section 4.3 shall be immediately forfeited
without compensation or other consideration.

 

  4.4 Accelerated Vesting in Connection with a Change in Control.

(a) Upon a Change in Control occurring after the Date of Grant but prior to the
end of the Performance Period, if the Participant has been continuously employed
by either the Company or any Subsidiary between the Date of Grant and the date
of such Change in Control, to the extent that the Restricted Stock has not
previously been forfeited, the Restricted Stock shall vest in full at the target
level (50% of the Restricted Stock), except to the extent that a Replacement
Award is provided to the Participant to replace, continue or adjust the
outstanding Restricted Stock (the “Replaced Award”). If the Participant is
provided with a Replacement Award in connection with the Change in Control, then
if, upon or after receiving the Replacement Award, the Participant’s employment
with the Company or any Subsidiary (or any of their successors after the Change
in Control) (as applicable, the “Successor”) is terminated by the Participant
for Good Reason or by the Successor other than for Cause (excluding, for the
avoidance of doubt, termination due to the Participant’s death, Disability,
retirement or voluntary resignation), in each case within a period of two years
after the Change in Control but prior to the end of the Performance Period, to
the extent that the Replacement Award has not previously been forfeited, (i) the
Replacement Award will vest in full at the target level (50% of the Restricted
Stock).

(b) For purposes of this Agreement, a “Replacement Award” means an award (i) of
the same type (i.e., performance-based restricted stock) as the Replaced Award,
(ii) that has a value at least equal to the value of the Replaced Award,
(iii) that relates to publicly traded equity securities of the Successor in the
Change in Control (or another entity that is affiliated with the Successor
following the Change in Control), (iv) the tax consequences of which for such
Participant under the Code, if the Participant is subject to U.S. federal income
tax under the Code, are not less favorable to the Participant than the tax
consequences of the

 

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Replaced Award, and (v) the other terms and conditions of which are not less
favorable to the Participant than the terms and conditions of the Replaced Award
(including the provisions that would apply in the event of a subsequent change
in control). A Replacement Award may be granted only to the extent it does not
result in the Replaced Award or Replacement Award failing to comply with or
ceasing to be exempt from Section 409A of the Code, if applicable. Without
limiting the generality of the foregoing, the Replacement Award may take the
form of a continuation of the Replaced Award if the requirements of the
preceding two sentences are satisfied. The determination of whether the
conditions of this Section 4.4(b) are satisfied will be made in good faith by
the Committee, as constituted immediately before the Change in Control, in its
sole discretion.

(c) For purposes of this Agreement, “Cause” has the meaning set forth in the
Participant’s employment, change in control, or severance agreement, as
applicable (in that order), or otherwise means: (i) the Participant’s gross
negligence or serious misconduct (including, without limitation, any criminal,
fraudulent or dishonest conduct) that is or may be injurious to the Successor;
or (ii) the Participant being convicted of, or entering a plea of nolo
contendere to, any crime that constitutes a felony or involves moral turpitude;
or (iii) the Participant’s breach of a written agreement between the Participant
and the Successor; or (iv) the Participant’s willful and continued failure to
perform the Participant’s duties on behalf of the Successor; or (v) the
Participant’s material breach of a written policy of the Successor.

(d) For purposes of this Agreement, “Good Reason” means: (i) a material change
in the geographic location at which the Participant must perform the
Participant’s services (which shall in no event include a relocation of the
Participant’s current principal place of business to a location less than 50
miles away) from the geographic location immediately prior to the Change of
Control; (ii) a material diminution in the Participant’s base compensation from
the level immediately prior to the Change of Control; or (iii) a material
diminution in the Participant’s authority, duties, or responsibilities from the
level immediately prior to the Change of Control; provided, however, that no
termination shall be deemed to be for Good Reason unless (x) the Participant
provides the Successor with written notice setting forth the specific facts or
circumstances constituting Good Reason within ninety (90) days after the initial
existence of the occurrence of such facts or circumstances, (y) the Successor
has failed to cure such facts or circumstances within thirty (30) days of its
receipt of such written notice, and (z) the effective date of the termination
for Good Reason occurs no later than one hundred fifty (150) days after the
initial existence of the facts or circumstances constituting Good Reason.

 

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(e) If a Replacement Award is provided, notwithstanding anything in this
Agreement or the Plan to the contrary, any outstanding Restricted Stock that at
the time of the Change in Control are not subject to a “substantial risk of
forfeiture” (within the meaning of Section 409A of the Code) will be deemed to
be vested at the time of such Change in Control.

4.5 Forfeiture Upon Other Terminations of Employment. Any Restricted Stock that
has not vested pursuant to Section 4 of this Agreement on or prior to the end of
the Performance Period will be forfeited automatically and without further
notice on such date without compensation or any other consideration (or earlier
if, and on such date that, the Participant ceases to be an employee of the
Company or any Subsidiary prior to the end of the Performance Period for any
reason other than as described in Sections 4.2 through 4.4 of this Agreement).
For purposes of this Section 4, the Participant shall have ceased to be employed
by the Company or any Subsidiary when the Participant no longer has the right or
obligation to perform services in such capacity, notwithstanding the
continuation of any employment agreement for any other purpose or the
continuation of compensation or benefits under any such employment agreement or
otherwise.

5. Tax Withholding. Subject to Section 16 of the Plan, to the extent that the
Company is required to withhold federal, state, local or foreign taxes in
connection with any payment made or benefit realized by the Participant or other
person under the Restricted Stock, and the amounts available to the Company for
such withholding are insufficient, it will be a condition to the receipt of such
payment or the realization of such benefit that the Participant or such other
person make arrangements satisfactory to the Company for payment of the balance
of such taxes required to be withheld, which arrangements (in the discretion of
the Committee) may include relinquishment of a portion of such benefit. If the
Participant fails to make arrangements for the payment of such tax, then, unless
otherwise determined by the Committee, the Company will withhold shares of
Common Stock having a value equal to the amount required to be withheld from the
Restricted Stock vesting. Notwithstanding the foregoing, the Participant may
elect, unless otherwise determined by the Committee, to satisfy the obligation,
in whole or in part, by having withheld, from the shares required to be
delivered to the Participant, shares of Common Stock having a value equal to the
amount required to be withheld, or by delivering to the Company other shares of
Common Stock held by the Participant. The shares used for tax withholding will
be valued at an amount equal to the market value of such Common Stock on the
date the benefit is to be included in Participant’s income. In no event will the
market value of the Common Stock to be withheld and delivered pursuant to this
Section 5 to satisfy applicable withholding taxes in connection with the benefit
exceed the minimum amount of taxes required to be withheld.

6. Adjustments. The Committee shall make or provide for such adjustments in the
number of shares of Common Stock covered by the Restricted Stock and in the kind
of shares covered by the Restricted Stock as the Committee, in its sole
discretion, exercised in good faith, may determine is equitably required to
prevent dilution or enlargement of the rights of the Participant that otherwise
would result from (a) any stock dividend, stock split, combination of shares,
recapitalization or other change in the capital structure of the Company,
(b) any merger, consolidation, spin-off, split-off, spin-out, split-up,
reorganization, partial or complete liquidation or other distribution of assets,
issuance of rights or warrants to purchase securities, or

 

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(c) any other corporate transaction or event having an effect similar to any of
the foregoing. Moreover, in the event of any such transaction or event or in the
event of a Change in Control, the Committee, in its discretion, shall provide in
substitution for the Restricted Stock such alternative consideration (including
cash), if any, as it, in good faith, may determine to be equitable in the
circumstances and may require in connection therewith the surrender of the
Restricted Stock in a manner that complies with Section 409A of the Code. Any
action taken by the Committee pursuant to this Section 6 will only be taken to
the extent it does not result in the Restricted Stock failing to comply with or
ceasing to be exempt from Section 409A of the Code.

7. Special Incentive Compensation. The Participant agrees that the award of the
Restricted Stock is special incentive compensation and that it, any dividend
equivalents paid thereon (even if treated as compensation for tax purposes) and
any other property received on account of such Restricted Stock will not be
taken into account as “salary” or “compensation” or “bonus” in determining the
amount of any payment under any pension, retirement or profit-sharing plan of
the Company or any life insurance, disability or other benefit plan of the
Company.

8. Relationship to the Plan. This Agreement is subject to the terms of the Plan
and any related administrative policies or procedures adopted by the Company. If
there is any inconsistency between this Agreement and the Plan or any such
administrative policies or procedures, the Plan and the policies or procedures,
in that order, shall govern (except that, with respect to Section 4.4 of this
Agreement, the terms of this Agreement shall govern in the case of an
inconsistency between Section 4.4 of this Agreement and the Plan).

9. No Effect on Employment Relationship. This Agreement is not intended to have
any effect upon the Participant’s employment relationship with the Company or
any Subsidiary. Nothing in this Agreement shall interfere with or affect the
rights of the Company or the Participant under any employment agreement or
confer upon the Participant any right to continued employment with the Company
or any Subsidiary.

10. Forfeiture upon Termination due to Violation of the Code of Conduct and
Ethics. Notwithstanding any other provisions of this Agreement, if the
Participant’s employment with the Company or any Subsidiary is terminated on
account of a violation of the Company’s Code of Conduct and Ethics, the
Restricted Stock will be forfeited upon such termination.

11. Binding Effect. Subject to the provisions of the Plan, this Agreement shall
inure to the benefit of and be binding upon the Participant and the Company and
their respective heirs, legal representatives, successors and assigns.

12. Amendments. Any amendment to the Plan shall be deemed to be an amendment to
this Agreement to the extent that the amendment is applicable hereto; provided,
however, that no amendment shall adversely affect the rights of the Participant
under this Agreement without the Participant’s consent (provided, however, that
the Participant’s consent shall not be required to an amendment that is deemed
necessary by the Company to ensure compliance with Section 409A of the Code). No
amendment, modification, waiver or release of or under this Agreement will be
effective unless evidenced by an instrument in writing signed by each of the
Company and the Participant.

 

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13. Compliance with Law. The Company shall make reasonable efforts to comply
with all applicable federal and state securities laws; provided, however,
notwithstanding any other provision of this Agreement, the Company shall not be
obligated to issue any Common Stock pursuant to this Agreement if the issuance
thereof would result in a violation of any such law.

14. Compliance with Section 409A of the Code. To the extent applicable, it is
intended that this Agreement and the Plan comply with the provisions of
Section 409A of the Code, so that the income inclusion provisions of
Section 409A(a)(1) of the Code do not apply to the Participant. This Agreement
and the Plan shall be interpreted in a manner consistent with this intent.
Reference to Section 409A of the Code is to Section 409A of the Internal Revenue
Code of 1986, as amended, and will also include any proposed, temporary or final
regulations, or any other guidance promulgated with respect to such Section by
the U.S. Department of the Treasury or the Internal Revenue Service.

15. Severability. If any provision of this Agreement or the application of any
provision hereof to any person or circumstances is held invalid, unenforceable
or otherwise illegal, the remainder of this Agreement and the application of
such provision to any other person or circumstances shall not be affected, and
the provisions so held to be invalid, unenforceable or otherwise illegal shall
be reformed to the extent (and only to the extent) necessary to make it
enforceable, valid and legal.

16. Electronic Delivery. The Company may, in its sole discretion, deliver any
documents related to the Restricted Stock and the Participant’s participation in
the Plan, or future awards that may be granted under the Plan, by electronic
means or to request the Participant’s consent to participate in the Plan by
electronic means. The Participant hereby consents to receive such documents by
electronic delivery and, if requested, agrees to participate in the Plan through
an on-line or electronic system established and maintained by the Company or
another third party designated by the Company.

[SIGNATURES ON NEXT PAGE]

 

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

 

PARTICIPANT     OM GROUP, INC. By:  

 

    By:  

 

  [NAME]       [NAME]       Title:   [TITLE]

 

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