EX-10.6


 Exhibit 10.6 

WARREN RESOURCES, INC. 

2016 EQUITY INCENTIVE PLAN 

NOTICE OF STOCK OPTION AWARD 
 Subject to
the terms and conditions of this Notice of Stock Option Award (this “Notice”), the Stock Option Award Agreement attached hereto (the “Award Agreement”), and the Warren Resources, Inc. 2016 Equity
Incentive Plan (the “Plan”), the below individual (the “Participant”) is hereby granted an option (the “Option”) to purchase the below number of Shares of common stock in
Warren Resources, Inc., a Delaware corporation (the “Company”). Unless otherwise specifically indicated, all terms used in this Notice shall have the meaning as set forth in the Award Agreement or the Plan. 

Identifying Information: 
  

							
	Participant Name:	 	  
	  	Date of Grant:	  	  

	and Address:	 	  
	  	Vesting Commencement Date:	  	  

		 	  
	  	Exercise Price per Share:	  	  

				
	Type of Option:	 	   ☐ Nonstatutory Stock Option

  ☐ Incentive Stock Option
	  	 Total Number of Shares

(“Optioned Shares”):
	  	  

	Expiration Date:	 	  [Insert 10 years from Date of Grant]	  		  	
		 	  
	  		  	

 Vesting Schedule: 

Subject to the Participant’s continuous status as a Service Provider, the Optioned Shares shall vest over a [___]-year period in accordance with the
following vesting schedule (the “Vesting Schedule”): 
  

			
	Vesting Date	  	Nonforfeitable Percentage
	1st anniversary of the Vesting Commencement Date	  	25% shall vest, combined total of 25% vested
	2nd anniversary of the Vesting Commencement Date	  	25% shall vest, combined total of 50% vested
	3rd anniversary of the Vesting Commencement Date	  	25% shall vest, combined total of 75% vested
	4th anniversary of the Vesting Commencement Date	  	25% shall vest, combined total of 100% vested

 Notwithstanding the foregoing, the Optioned Shares shall automatically become fully vested upon the earlier of: (i) the
Participant’s Disability, (ii) the Participant’s death, (iii) the Participant terminating his or her Service Provider status for Good Reason (as such term is defined in Participant’s employment agreement), (iv) the Company terminating
the Participant’s Service Provider status without Cause, (v) the Participant’s Retirement, and (vi) immediately prior to the closing of a Change in Control of the Company. 

Maximum Exercise Period: 
 Pursuant to Section 4 of the
Award Agreement and Section 7(d) of the Plan, the post-termination exercise period shall be: 
  

			
	Event Triggering Termination of Option	  	 Max Time to Exercise

Following Triggering Event

	Termination of Service Provider status (except as provided below)	  	30 days
	Termination of Service Provider status due to Disability	  	12 months
	Termination of Service Provider status due to death	  	12 months

 [SIGNATURES ON NEXT PAGE] 






 By the Participant’s signature and the signature of the Company’s representative below, the Participant
and Company agree that the Option granted herein is governed by the terms and conditions of this Notice, the Award Agreement and the Plan. 
  

			
	WARREN RESOURCES, INC.
		
	By:	 	  

	Its:	 	  

	Dated:	 	  



 PARTICIPANT REPRESENTATION 

The Participant has reviewed this Notice, the Award Agreement and the Plan in their entirety, has had an opportunity to have such reviewed by
his or her legal and tax advisers, and hereby attests that he or she is relying solely on such advisors and not on any statements or representations of the Company or any of its agents or affiliates. The Participant represents to the Company
that he or she is familiar with the terms of this Notice, the Award Agreement and the Plan, and hereby accepts the Option subject to all of its terms. The Participant hereby agrees that all questions of interpretation and administration
relating to this Notice, the Award Agreement and the Plan shall be solely resolved by the Committee. 
 This Notice may be executed by the
Participant and the Company by means of electronic or digital signatures, which shall have the same force and effect as manual signatures. The Participant agrees that clicking “I Accept” in connection with or response to any
electronic communication or other medium has the effect of affixing the Participant’s electronic signature to this Notice. 
  

			
	PARTICIPANT:
	  

	Signature	 	
	
	  

	Print Name	 	
	
	Dated:                                   
                                        




  
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 WARREN RESOURCES, INC. 

2016 EQUITY INCENTIVE PLAN 

STOCK OPTION AWARD AGREEMENT 
 Subject to
the terms and conditions of the Notice of Stock Option Award (the “Notice”), this Stock Option Award Agreement (this “Award Agreement”) and the 2016 Equity Incentive Plan (the
“Plan”), Warren Resources, Inc., a Delaware corporation (the “Company”) hereby grants the individual set forth in the Notice (the “Participant”) an option (the
“Option”) to purchase shares of the Company’s common stock. Unless otherwise specifically indicated, all terms used in this Award Agreement shall have the meaning as set forth in the Notice or the Plan. 

1. Grant of the Option. The principal features of the Option, including the number of Optioned Shares subject to the Option, are
set forth in the Notice. 
 2. Vesting Schedule. Subject to the Participant’s continuous service as a Service Provider, the
Optioned Shares shall vest in accordance with the Vesting Schedule provided in the Notice. 
 3. Risk of Forfeiture. The
Optioned Shares shall be subject to a risk of forfeiture until such time the risk of forfeiture lapses in accordance with the Vesting Schedule. All or any portion of the Optioned Shares subject to a risk of forfeiture shall automatically be
forfeited and immediately returned to the Company if Participant’s continuous status as a Service Provider is interrupted or terminated for any reason other than as permitted under the Plan. The Company shall implement any forfeiture under
this Section 3 in a unilateral manner, without Participant’s consent, and with no payment to Participant, cash or otherwise, for the forfeited Optioned Shares. 

4. Exercise of Option. 

(a) Right to Exercise. The Optioned Shares shall be exercisable during its term cumulatively according to the Vesting Schedule set
forth above and the applicable provisions of the Plan; however, the Optioned Shares shall not be exercised for a fraction of a Share. Additionally, and notwithstanding anything in the Notice, this Award Agreement, the Plan or any other
agreement to the contrary, the Participant’s right to exercise vested Optioned Shares shall automatically expire, and the vested Optioned Shares shall automatically terminate, upon the end of the period (the “Maximum Exercise
Period”) prescribed in the Notice following the earliest of these events: (i) the termination of the status of the Participant as a Service Provider (except as provided below); (ii) the termination of the status of the
Participant as a Service Provider due to Disability; and (iii) the termination of the status of the Participant as a Service Provider due to death. As provided under the Plan, and notwithstanding anything to the contrary, all Optioned
Shares shall automatically expire and terminate upon the Expiration Date (as set forth in the Notice) to the extent not then exercised. Thereafter, no vested Optioned Shares may be exercised. 

(b) Method of Exercise. The Option shall be exercisable to the extent then vested by delivery of a written exercise notice in a
form acceptable to the Committee 

  
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(the “Exercise Notice”), which shall state the election to exercise the Option, the number of Shares with respect to which the Option is being exercised, and such
other representations and agreements as may be required by the Company. The Exercise Notice shall be signed by the Participant (or by the Participant’s beneficiary or other person entitled to exercise the Option in the event of the
Participant’s death under the Plan) and shall be delivered in person or by certified mail to the Secretary of the Company. The Exercise Notice shall be accompanied by payment of the aggregate Exercise Price as to all Shares
exercised. The Option shall be deemed to be exercised as of the date (the “Exercise Date”): (i) the date the Company receives (as determined by the Committee in its sole, but reasonable, discretion) the fully executed
Exercise Notice accompanied by payment of the aggregate Exercise Price, and (ii) all other applicable terms and conditions of the Award Agreement are satisfied in the sole discretion of the Committee. 

(c) Approval by Stockholders and Compliance Restrictions on Exercise. Notwithstanding any other provision of this Award Agreement
to the contrary, no portion of the Option shall be exercisable at any time prior to the approval of the Plan by the stockholders of the Company. No Shares shall be issued pursuant to the exercise of an Option unless the issuance and exercise,
including the form of consideration used to pay the Exercise Price, comply with Applicable Laws. 
 (d) Issuance of
Shares. After receiving the Exercise Notice, the Company shall cause to be issued a certificate or certificates (or electronic equivalent) for the Shares as to which the Option has been exercised, registered in the name of the person
exercising this Option (or in the names of such person and his or her spouse as community property or as joint tenants with right of survivorship), provided that the Participant has executed a joinder to the Stockholders Agreement (if not
already a party to the Stockholders Agreement) to become effective upon the delivery of Shares. The Company shall cause the certificate or certificates to be deposited in escrow or delivered to or upon the order of the person exercising the
Option.
 5. Method of Payment. Payment of the aggregate Exercise Price shall be by any of the following forms of consideration,
or a combination thereof, at the election of the Participant: 
 (a) cash or check; 

(b) if approved by the Committee (in its sole discretion), consideration received by the Company under a formal cashless exercise program
adopted by the Company in connection with the Plan or a net exercise feature; or 
 (c) if approved by the Committee (in its sole
discretion), surrender of other Shares which, if accepted by the Company, would not subject the Company to adverse accounting as determined by the Committee. 

6. Non-Transferability of Option. The Option and the rights and privileges conferred hereby shall not be sold, transferred by
gift, pledged, hypothecated, or otherwise transferred or disposed of (whether by operation of law or otherwise) in any manner otherwise than by will or by the laws of descent or distribution, shall not be subject to sale under execution, attachment,
levy or similar process and may be exercised during the lifetime of the Participant only by the Participant. The terms of the Notice, this Award Agreement and the Plan shall be binding upon the executors, administrators, heirs, successors and
assigns of the Participant. 

  
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 7. Term of Option. The Option shall in any event expire on the Expiration Date set
forth in the Notice, and may be exercised prior to the Expiration Date only in accordance with the Plan and the terms of this Award Agreement. 

8. Tax. The Participant hereby acknowledges and understands that he or she may suffer adverse tax consequences as a result of the
Participant’s exercise of the Option or disposition of the Optioned Shares. 
 (a) Representations. The Participant has
reviewed with his or her own tax advisors the tax consequences of this Award Agreement and the Optioned Shares granted hereunder, including any U.S. federal, state and local tax laws, and any other applicable taxing jurisdiction. The
Participant is relying solely on such advisors and not on any statements or representations of the Company or any of its agents. The Participant hereby acknowledges and understands that he or she (and not the Company) shall be responsible for
his or her own tax liability that may arise as a result of his or her receiving this Award Agreement and the Optioned Shares granted hereunder. 

(b) Payment of Withholding Taxes. The Participant shall make appropriate arrangements with the Company for the satisfaction of all
U.S. federal, state, local and non-U.S. income and employment tax withholding requirements applicable to the Option exercise. The Committee shall have the sole authority to determine whether a “net withholding” may be permitted or is
required for purposes of the Participant satisfying his or her obligations under this Section 8(b); provided that no Shares shall be withheld with a value exceeding the maximum individual statutory tax rate for each applicable tax jurisdiction. The
Participant hereby acknowledges his or her understanding that the Company’s obligations under this Award Agreement are fully contingent on the Participant first satisfying this Section 8(b). Therefore, a failure of the Participant to
reasonably satisfy this Section 8 in accordance with the Committee’s sole and absolute discretion shall result in the automatic termination and expiration of this Award Agreement and the Company’s obligations hereunder. The Participant
hereby agrees that a breach of this Section 8 shall be deemed to be a material breach of this Award Agreement. 
 (c) Notice of
Disqualifying Disposition of Shares. If the Option granted to the Participant herein is designated as an Incentive Stock Option, and if the Participant sells or otherwise disposes of any of the Shares acquired pursuant to the Incentive
Stock Option on or before the later of: (i) the date two years after the Date of Grant and (ii) the date one year after the date of exercise, the Participant shall immediately notify the Company in writing of such disposition. The Participant
hereby acknowledges and agrees that the Participant may be subject to income tax withholding by the Company on the compensation income recognized by the Participant in connection with the exercise of the Option. 

9. Adjustment of Shares. In the event of any transaction described in Section 15(a) of the Plan, the terms of the Option
(including, without limitation, the number and kind of the Optioned Shares and the Exercise Price) may be adjusted as set forth therein. This Award Agreement shall in no way affect the right of the Company to adjust, reclassify, reorganize or
otherwise change its capital or business structure or to merge, consolidate, dissolve, liquidate or sell or transfer any part of its business or assets. 

  
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 10. Legality of Initial Issuance. No Shares shall be issued upon the exercise of the
Option unless and until the Committee has determined that: (i) the Company and the Participant have taken all actions required to register the Shares under the Securities Act or to perfect an exemption from the registration requirements thereof, if
applicable; (ii) all applicable listing requirements of any stock exchange or other securities market on which the Shares are listed has been satisfied; and (iii) any other applicable provision of state or U.S. federal law or other Applicable Laws
has been satisfied. 
 11. No Registration Rights. The Company may, but shall not be obligated to, register or qualify the sale
of Shares under the Securities Act or any other Applicable Laws. The Company shall not be obligated to take any affirmative action in order to cause the sale of Shares under this Award Agreement to comply with any law. 

12. Restrictions. Regardless of whether the offering and sale of Shares under the Plan have been registered under the Securities
Act or have been registered or qualified under the securities laws of any state, the Company at its discretion may impose restrictions upon the sale, pledge or other transfer of the Shares (including the placement of appropriate legends on share
certificates or the imposition of stop-transfer instructions) if, in the judgment of the Company, such restrictions are necessary or desirable in order to achieve compliance with Applicable Laws. 

13. Notice. Any notice required by the terms of this Award Agreement shall be given in writing and shall be deemed effective upon
personal delivery or upon deposit with the United States Postal Service, by registered or certified mail, with postage and fees prepaid. Notice shall be addressed to the Company at its principal executive office and to the Participant at the
address that he or she most recently provided to the Company. 
 14. Successors and Assigns. Except as provided herein to the
contrary, this Award Agreement shall be binding upon and inure to the benefit of the parties to this Award Agreement, their respective successors and permitted assigns. 

15. No Assignment. Except as otherwise provided in this Award Agreement, the Participant shall not assign any of his or her rights
under this Award Agreement without the prior written consent of the Company, which consent may be withheld in its sole discretion. The Company shall be permitted to assign its rights or obligations under this Award Agreement, but no such
assignment shall release the Company of its obligations hereunder. 
 16. Construction; Severability. The captions used in this
Award Agreement are inserted for convenience and shall not be deemed to be a part of the Option for construction or interpretation. Except where otherwise indicated by the context, the singular shall include the plural and the plural shall
include the singular. Use of the term “or” is not intended to be exclusive, unless the context clearly requires otherwise. The validity, legality or enforceability of the remainder of this Award Agreement shall not be affected
even if one or more of the provisions of this Award Agreement shall be held to be invalid, illegal or unenforceable in any respect. 

  
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 17. Administration and Interpretation. Any determination by the Committee in
connection with any question or issue arising under the Notice, the Plan or this Award Agreement shall be final, conclusive, and binding on the Participant, the Company, and all other persons. 

18. Spousal Consent. To the extent Participant is married, Participant agrees to (i) provide Participant’s spouse with a
copy of this Award Agreement prior to its execution by Participant and (ii) obtain such spouse’s consent to this Award Agreement as evidenced by such spouse’s execution of the Spousal Consent attached hereto as Exhibit A (Spousal
Consent). 
 19. Venue. The Company, the Participant and the Participant’s assignees agree that any suit, action or
proceeding arising out of or related to the Notice, this Award Agreement or the Plan shall be brought in the United States District Court for the Southern District of Texas (or should such court lack jurisdiction to hear such action, suit or
proceeding, in a state court in Harris County) and that all parties shall submit to the jurisdiction of such court. The parties irrevocably waive, to the fullest extent permitted by law, any objection the party may have to the laying of venue
for any such suit, action or proceeding brought in such court. If any one or more provisions of this Section 19 shall for any reason be held invalid or unenforceable, it is the specific intent of the parties that such provisions shall be
modified to the minimum extent necessary to make it or its application valid and enforceable. 
 20. Counterparts. This Award
Agreement may be executed in any number of counterparts, any of which may be executed and transmitted by facsimile, and each of which shall be deemed to be an original, but all of which together shall be deemed to be one and the same instrument.

 22. Entire Agreement; Governing Law; and Amendments. The provisions of the Plan and the Notice are incorporated herein
by reference. The Plan, the Notice and this Award Agreement constitute the entire agreement of the parties with respect to the subject matter hereof and supersede in their entirety all prior undertakings and agreements of the Company and the
Participant with respect to the subject matter hereof, and may not be modified adversely to the Participant’s interest except by means of a writing signed by the Company and the Participant. This Award Agreement is governed by the laws of
the State of Texas applicable to contracts executed in and to be performed in that State. 
 23. Waiver. Failure to insist upon
strict compliance with any of the terms, covenants, or conditions hereof will not be deemed to be a waiver of such term, covenant, or condition, nor will any waiver or relinquishment of, or failure to insist upon strict compliance with, any right or
power hereunder at any one or more times be deemed to be a waiver or relinquishment of such right or power at any other time or times. 

24. No Guarantee of Continued Service. THE PARTICIPANT ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES PURSUANT TO THE VESTING
SCHEDULE HEREOF IS EARNED ONLY BY CONTINUING AS A SERVICE PROVIDER AT THE WILL OF THE COMPANY (NOT THROUGH THE ACT OF BEING HIRED, 

  
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BEING GRANTED THE OPTION OR ACQUIRING SHARES HEREUNDER). THE PARTICIPANT FURTHER ACKNOWLEDGES AND AGREES THAT THIS AWARD AGREEMENT, THE OPTION GRANTED HEREUNDER, THE TRANSACTIONS
CONTEMPLATED HEREUNDER AND THE VESTING SCHEDULE SET FORTH HEREIN DO NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS A SERVICE PROVIDER FOR THE VESTING PERIOD, FOR ANY PERIOD, OR AT ALL, AND SHALL NOT INTERFERE IN ANY WAY WITH
THE PARTICIPANT’S RIGHT OR THE COMPANY’S/AFFILIATE’S RIGHT TO TERMINATE THE PARTICIPANT’S RELATIONSHIP AS A SERVICE PROVIDER AT ANY TIME, WITH OR WITHOUT CAUSE. 

*     *     *     *     * 

  
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 EXHIBIT A 

WARREN RESOURCES, INC. 

2016 EQUITY INCENTIVE PLAN 

STOCK OPTION AWARD AGREEMENT 

SPOUSAL CONSENT 
 I, the
undersigned, hereby certify that: 
 1. I am the spouse of
                                         
               . 
 2. Each of the undersigned and the
undersigned’s spouse is a resident of
                                        .

 3. I have read the Warren Resources, Inc. 2016 Equity Incentive Plan and the Stock Option Award Agreement (the “Award
Agreement”), by and between Warren Resources, Inc., a Delaware corporation (the “Company”), and my spouse. I have had the opportunity to consult independent legal counsel regarding the contents of the Plan
and Agreement. 
 4. I understand the terms and conditions of the Award Agreement and the Plan. 

5. I hereby consent to the terms of the Agreement and the Plan and to their application to and binding effect upon any community property or
other interest I may have in the Option (it being understood that this Spousal Consent shall in no way be construed to create any such interest). I agree that I will take no action at any time to hinder the operation of the transactions
contemplated in and by the Agreement and the Plan. 
 IN WITNESS WHEREOF, this Spousal Consent has been executed as of
                        , 2016. 

 

			
	 Name:
	 	  

		 	 Signature

		 	  

		 	 Print Name