Document:

EX-10.6

 Exhibit 10.6 
  

 
 ENCANA CORPORATION 

EMPLOYEE STOCK OPTION PLAN 

Reflective with amendments made as of April 27, 2005, 

as of April 25, 2007, as of April 22, 2008, as of October 22, 2008, 

as of November 30, 2009, as of July 20, 2010, as of February 24, 2015 and as of February 22, 2016. 

 TABLE OF CONTENTS 

 

							
	 Section
	 	 	  	Page	 
			
	1.	 	 PURPOSES OF THE PLAN
	  	 	1	  
			
	2.	 	 ADMINISTRATION
	  	 	1	  
			
	3.	 	 SHARES
	  	 	1	  
			
	4.	 	 GRANT OF OPTIONS AND STOCK APPRECIATION RIGHTS
	  	 	1	  
			
	5.	 	 GRANT PRICE
	  	 	2	  
			
	6.	 	 OPTION PERIOD
	  	 	2	  
			
	7.	 	 EXERCISE OF OPTIONS AND STOCK APPRECIATION RIGHTS
	  	 	3	  
			
	8.	 	 NON-ASSIGNABILITY
	  	 	3	  
			
	9.	 	 EFFECTS OF ALTERATION OF SHARE CAPITAL
	  	 	3	  
			
	10.	 	 EFFECTIVE DATE OF THE PLAN
	  	 	3	  
			
	11.	 	 AMENDMENT OR TERMINATION OF PLAN
	  	 	3	  
			
	12.	 	 ENCANA REPLACEMENT STOCK OPTIONS
	  	 	4	  
			
	13.	 	 FORMER CANADIAN PACIFIC LIMITED OPTIONHOLDERS
	  	 	4	  
			
	14.	 	 BLACKOUT PERIOD
	  	 	5	  

 ENCANA CORPORATION 

EMPLOYEE STOCK OPTION PLAN 

(Reflective with amendments made as of April 27, 2005, 

as of April 25, 2007, as of April 22, 2008, as of October 22, 2008, 

as of November 30, 2009, as of July 20, 2010, as of February 24, 2015, 

and as of February 22, 2016) 
  

	1.	PURPOSES OF THE PLAN 

 The principal purposes of the Employee Stock Option Plan (the “Plan”) of
Encana Corporation (the “Company”) and its subsidiaries are: 
  

	(a)	to promote a proprietary interest in the Company among employees; 

  

	(b)	to attract and retain qualified employees the Company requires; 

  

	(c)	to provide a long-term incentive element in overall compensation of employees; and 

  

	(d)	to promote an alignment of interests between employees and shareholders of the Company. 

  

	2.	ADMINISTRATION 

 The Plan shall be administered by such committee of the Board of Directors of the
Company as is designated from time to time by the Board (the “Committee”). The Committee shall have full and complete authority to interpret the Plan and to prescribe such rules and regulations and make such other determinations as it
deems necessary or desirable for the administration of the Plan. 
  

	3.	SHARES 

 The shares that may be issued pursuant to the exercise of options under the Plan are common
shares of the Company (“Shares”). The maximum number of Shares that may be issued pursuant to the exercise of options granted under the Plan is 107,800,000. 
  

	4.	GRANT OF OPTIONS AND TANDEM STOCK APPRECIATION RIGHTS 

 The Committee may from time to time designate
officers and other employees who, in the opinion of the Committee, are eligible employees of the Company or its subsidiaries to whom options to purchase Shares shall be granted. The Committee shall determine the effective date of any such grant
(“Grant Date”), the number or grant date expected value of Shares to be optioned to such employees and all other terms, conditions and limitations of the grant of the options, subject always to the provisions of this Plan and any
corresponding option grant agreements (“Options”). Where the Committee determines to grant any Options on a date which is within a trading blackout period imposed by the Company under the Company’s Securities Trading and Insider
Reporting Policy (as amended, supplemented or replaced by the Company from time to time) (a “Blackout Period”) or where, for any reason: (i) a grant of Options occurs on a day that is within a Blackout Period; or (ii) the Market
Value of the grant of Options would be calculated using a trading day that is within a Blackout Period, then the Grant Date shall be no earlier than the sixth trading day immediately following the end of such Blackout Period, or such later date as
may be necessary pursuant to Section 5 hereof, to permit the Market Value to be determined based on trading days which occur immediately following the end of any such Blackout Period. 

			
	Encana Corporation	  	Page 2
	Employee Stock Option Plan	  	
	(With amendments as of February 22, 2016)	  	

  

 At the discretion of the Committee, an Option to purchase Shares may have associated with it a tandem stock
appreciation right (“TSAR”) in respect of each Share covered by such Option. Each TSAR shall entitle the optionee to surrender to the Company, unexercised, the right to exercise their Option to purchase a specified number of Shares and to
receive in exchange from the Company, cash or Shares (at the Company’s choice), subject to Section 12 hereof, in an amount equal to the excess of the closing price of the Shares on the Toronto Stock Exchange (“TSX”) on the last
trading day preceding the date of surrender of the Option and contemporaneous exercise of the TSAR, over the Grant Price (as defined below) for the Shares (“Appreciated Value”). Each TSAR shall be subject to the same terms and conditions
as the related Option. 
 An Option granted under the Plan will not be exercisable by an optionee until such Option has been evidenced by a written option
grant agreement duly executed and delivered by the Company and by such optionee confirming optionee’s acceptance of the terms and conditions of such grant. An optionee may hold more than one Option at any time. 

Without limiting the generality of the foregoing, all grants of Options shall be subject to the following terms and conditions: 

 

	(a)	the aggregate number of Shares issuable, at any time, to or for the benefit of insiders pursuant to Options, when combined with the number of Shares issuable to insiders pursuant to all other security based compensation
arrangements of the Company, shall not exceed 10% of the issued and outstanding Shares (on a non-diluted basis); and 

  

	(b)	there may not be issued to insiders, within any one-year period, a number of Shares that, when combined with the number of Shares issued to insiders pursuant to all other security
based compensation arrangements of the Company, would exceed 10% of the issued and outstanding Shares (on a non-diluted basis). 

For the purpose of this Plan, the term “insider” has the meaning ascribed thereto in the TSX Company Manual. 

 

	5.	GRANT PRICE 

 The grant price for each Share that may be purchased through the exercise of an Option (the
“Grant Price”) shall be fixed by the Committee for each Option effective as of the Grant Date, but shall not be less than the Market Value of the Shares. For this purpose, “Market Value” means the volume-weighted average (rounded
to two decimal places) of the trading price of one Share on the TSX during the five (5) trading days immediately preceding the Grant Date or, if at least one Share did not trade on a particular day during the immediately preceding five
(5) trading day period, the volume-weighted average (rounded to two decimal places) of the trading price for one Share on the TSX during the immediately preceding five (5) days on which at least one Share was traded. 

 

	6.	OPTION PERIOD 

 Each Option (unless terminated sooner in accordance with the terms, conditions and
limitations of the Option determined by the Committee including, without limitation, this Plan and any corresponding Option grant agreement) granted to eligible employees on or after February 24,

			
	Encana Corporation	  	Page 3
	Employee Stock Option Plan	  	
	(With amendments as of February 22, 2016)	  	

  

 
2015 shall be exercisable during such period not exceeding seven (7) years from the date the Option was granted, as the Committee may determine (the “Option Period”). Each Option
(unless terminated sooner in accordance with the terms, conditions, and limitations of the Option determined by the Committee including, without limitation, this Plan and any corresponding Option grant agreement) granted to eligible employees prior
to February 24, 2015 shall have an Option Period not exceeding five (5) years from the date the Option was granted. The Committee may, with the consent of the Optionee and the prior consent of the TSX, cancel the unexercised balance of any
Option. All rights under the Option unexercised at the expiry or termination of the respective Option Period shall be forfeited. All Shares reserved for Options that are forfeited or cancelled shall be available for subsequent grant of Options. 

 

	7.	EXERCISE OF OPTIONS AND STOCK APPRECIATION RIGHTS 

 An Option or its associated TSAR may be exercised
from time to time by delivery to the Company at its principal office in Calgary, Alberta or to such person designated by the Company, of a written notice of exercise specifying the number of Shares with respect to which the Option or TSAR is being
exercised and, if the Option is being exercised, accompanied by payment in full of the purchase price of the Shares then being purchased. If a TSAR associated with the Option is being exercised, the Company will then issue cash or Shares (at the
Company’s option) for the Appreciated Value to the optionee. No person shall have any of the rights of a shareholder in respect of any Shares subject to an Option or TSAR until such Shares have been paid for in full and issued. 

 

	8.	NON-ASSIGNABILITY 

 No Option or any right conferred by an Option
shall be assignable, negotiable or otherwise transferable other than by will or the laws of descent and distribution. Options or rights conferred by an Option shall be exercisable during the optionee’s lifetime only by such optionee or, after
death or incapacitation, by the optionee’s guardian or legal representative. 
  

	9.	EFFECTS OF ALTERATION OF SHARE CAPITAL 

 In the event of any change in the outstanding common shares of
the Company by reason of any stock dividend, split, recapitalization, merger, consolidation, combination or exchange of shares or other similar corporate change, equitable adjustments shall be made in the maximum number and kind of Shares issuable
under the Plan and in the maximum number and kind of and the Grant Price for Shares issuable under outstanding Options. Such adjustments shall be made by the Committee and shall be conclusive and binding for all purposes of the Plan. 

 

	10.	EFFECTIVE DATE OF THE PLAN 

 The Plan shall have effect from and after October 1, 2001
(“Effective Date”). 
  

	11.	AMENDMENT OR TERMINATION OF PLAN 

 The Board of Directors of the Company may, at any time and from time
to time, amend, suspend, discontinue or terminate the Plan in whole or in part; provided, however, no such amendment, suspension, discontinuance or termination may, without the consent of the optionee, adversely alter or impair the rights under any
Option previously granted to an optionee 

			
	Encana Corporation	  	Page 4
	Employee Stock Option Plan	  	
	(With amendments as of February 22, 2016)	  	

  

 
under the Plan. Any amendment to be made to the Plan or an Option under the Plan is subject to the prior approval of the TSX and the shareholders of the Company where required by the rules of the
TSX. Without limiting the generality of the foregoing, the Board shall have the power and authority to approve amendments relating to the Plan or a specific Option without further approval of the shareholders of the Company, to the extent that such
amendments relate to: 
  

	(a)	extending or accelerating the terms of vesting applicable to any Option or group of Options; 

  

	(b)	altering the terms and conditions of vesting applicable to any Option or group of Options; 

  

	(c)	changing the termination provisions of the Plan or any Option, provided that the change does not provide for an extension beyond the original expiry date of such Option, as provided for in Section 6 hereof;

  

	(d)	accelerating the expiry date in respect of an Option; 

  

	(e)	determining the adjustment provisions pursuant to Section 9 hereof; 

  

	(f)	amending the definitions contained within the Plan and other amendments of a “housekeeping” nature; and 

  

	(g)	amending or modifying the mechanics of exercise of an Option or TSAR. 

 Approval by the shareholders of the
Company will be required for amendments that relate to: 
  

	 	(i)	any increase in the number of shares reserved for issuance under the Plan, including an increase to a fixed maximum number of Common Shares, or a change from a fixed maximum number of Common Shares to a fixed maximum
percentage; 

  

	 	(ii)	any reduction in Grant Price or cancellation and reissue of Options; 

  

	 	(iii)	any extension of the term of an Option beyond the original expiry date, except as permitted under Section 12 hereof; 

  

	 	(iv)	any amendment to Section 12 that increases the length of the Blackout Extension Period; 

  

	 	(v)	the inclusion of non-employee directors, on a discretionary basis, as eligible participants under the Plan; 

 

	 	(vi)	any allowance for the transferability or assignability of Options other than for estate settlement purposes as outlined in Section 8; and 

 

	 	(vii)	amendments required to be approved by shareholders under applicable law (including, without limitation, the rules, regulations and policies of the TSX). 

In the event of any conflict between subsections (a) to (g) and (i) to (vii) above, the latter shall prevail to the extent of any conflict. 

			
	Encana Corporation	  	Page 5
	Employee Stock Option Plan	  	
	(With amendments as of February 22, 2016)	  	

  

 No amendment, suspension, discontinuance or termination of the Plan may contravene the requirements of the
TSX or any securities commission or regulatory body to which the Plan or the Company is now or may hereafter be subject. 
  

	12.	BLACKOUT PERIOD 

 Notwithstanding Section 6, if the Option Period of an Option expires during, or
within ten (10) business days following a Blackout Period, then the Option Period of such Option shall be extended to the date which is ten (10) business days after the last day of the Blackout Period (the “Blackout Extension
Period”), after which time such Option shall expire and terminate. 
 * * *EX-10.7

 Exhibit 10.7 

ENCANA CORPORATION 

EMPLOYEE STOCK OPTION PLAN 

[EXECUTIVE] 20● STOCK OPTION GRANT AGREEMENT 

 

			
	Participant:	  	###PARTICIPANT_NAME###
	Grant Name:	  	###GRANT_NAME###
	Grant Date:	  	###GRANT_DATE###
	Expiry Date:	  	###EXPIRY_DATE###, subject to the terms and conditions contained herein
	Grant Price:	  	CDN###GRANT_PRICE###
	Total Options with TSARs:	  	###TOTAL_AWARDS###

 THIS OPTION AND TANDEM STOCK APPRECIATION RIGHTS AGREEMENT including Schedules “A” and “B” hereto
(collectively, this “Agreement”) is made between Encana Corporation (the “Corporation”) and the Participant listed above (the “Participant”), an eligible employee of the Corporation or one of its
Related Corporations. 
 WHEREAS the Corporation has established an Employee Stock Option Plan (the “Plan”) for employees of the
Corporation and its Related Corporations (collectively, the “Affiliated Entities” or, individually, an “Affiliated Entity”); 

AND WHEREAS the Board of Directors of the Corporation (the “Board”) has approved the grant to the Participant under the Plan of an
option to purchase the number of Shares set out above (collectively, the “Options” and individually, an “Option”), upon and subject to the terms and conditions of the Plan and this Agreement; 

AND WHEREAS the Plan was amended effective February 23, 2015 (the “Effective Date”) and such amendments, as required, approved by
shareholders at the Corporation’s May 12, 2015 Annual Meeting of Shareholders, to provide for (unless otherwise specified by the Committee) a new Option Period not to exceed seven (7) years from the Date of Grant of the Option (the
“Extended Term”), in respect of each Option granted on or following the Effective Date; 
 AND WHEREAS with the Extended Term does
not apply to or amend the Term or Expiry Date of an Option granted to the Participant prior to the Effective Date, the Option Period of which shall remain a period not exceeding five (5) years from Date of Grant of such Option; 

NOW THEREFORE in consideration of other good and valuable consideration and the sum of one dollar ($1.00) now paid to the Corporation (the receipt
whereof by the Corporation is hereby acknowledged) it is agreed by and between the parties hereto as follows: 
  

	1.	DEFINITIONS 

 In this Agreement, capitalized terms shall have the meanings set forth in Schedule
“A” hereto unless specified. 
  

	2.	GRANT OF OPTIONS AND TANDEM STOCK APPRECIATION RIGHTS 

 Subject to the terms and conditions of the
Plan and this Agreement, the Corporation hereby grants the Options to the Participant. Each Option granted, once vested hereunder, shall entitle the Participant to acquire one Share, subject to and in accordance with the terms and conditions of the
Plan and this 

  
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Agreement. Each Option granted hereunder shall have associated with it a Tandem Stock Appreciation Right (“TSAR”). Except as otherwise provided in the Plan or this Agreement,
each associated TSAR shall be subject to the same terms and conditions as the Option to which it relates. 
  

	3.	EVIDENCE OF GRANT AND ACKNOWLEDGEMENT 

 This Agreement shall evidence the grant by the Corporation
to the Participant of the Options effective as of the Grant Date. 
 The Participant acknowledges that the Extended Term applies only to an Option or
Options granted on or following the Effective Date and shall not apply to an Option or Options granted prior to such date. 
 The Participant further
acknowledges nothing in the Plan or this Agreement shall be construed to require the Corporation to grant to the Participant an additional option or options beyond the Options granted hereunder. The grant of an additional option or options to the
Participant by the Corporation shall, in each case, constitute a new and separate agreement between the Participant and the Corporation in respect of same. 
  

	4.	CLASSIFICATION OF OPTIONS 

 The Options granted to the Participant hereunder are classified as
“Time-Based Options” and shall hereinafter be referred to as “Time-Based Options”. 
  

	5.	VESTING OF TIME-BASED OPTIONS 

  

	(a)	Subject to Section 5(b) and Sections 6 to 11 hereof, Time-Based Options shall become Vested Options as follows: 

  

	 	(i)	30 percent on the first Anniversary Date; 

  

	 	(ii)	an additional 30 percent on the second Anniversary Date; and 

  

	 	(iii)	an additional 40 percent on the third Anniversary Date. 

  

	(b)	The number of Time-Based Options that become Vested Options under Section 5(a) shall be determined by rounding the result up to the nearest whole number of Time-Based Options, if necessary, to an aggregate maximum of
the total number of Time-Based Options granted under this Agreement. No fractional Time-Based Options shall become Vested Options. No cash or other compensation shall be paid to the Participant at any time in lieu thereof any fractional Time-Based
Options. 

  

	(c)	Subject to Sections 3, 6 to 11, the Participant shall be entitled to exercise or surrender all or any number of the Vested Options, in accordance with Section 13, during the period from the Vesting Date of such
Vested Option pursuant to Section 5(a) to the Expiry Date, or such earlier termination date as provided herein. 

  

	(d)	 As an alternative to the exercise of a Vested Option, the Participant may surrender any Vested Option as to an
associated TSAR in accordance with Section 13 hereof. Upon surrendering to the Corporation the Vested Options to purchase a specified number of Shares, the Participant shall receive a cash payment equal to the Appreciated Value multiplied by
the number of Vested Options surrendered, less required applicable statutory and other withholdings. Thereafter the number of Vested Options so surrendered with respect to such specified number

  
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of Shares will be cancelled and terminated by the Corporation and the Participant shall have no further right, title or interest in such surrendered Vested Options or the underlying Shares.

  

	6.	TERMINATION OF EMPLOYMENT 

  

	(a)	Upon a Termination of Employment, the Participant shall be entitled to exercise or surrender any Vested Options during the Termination Exercise Period, but only to the extent such Vested Options have become Vested
Options pursuant to Section 5(a) on or prior to the Date Employment Ceases. 

  

	(b)	Notwithstanding Section 5(a), Time-Based Options which do not become Vested Options on or prior to the Date Employment Ceases shall not thereafter become Vested Options. 

 

	7.	DEATH OR RETIREMENT OF PARTICIPANT 

  

	(a)	In the event the Participant ceases to be an employee of the Corporation or an Affiliated Entity by reason of the Participant’s death or Retirement on a date prior to the date he or she reaches age 60:

  

	 	(i)	the Participant shall be entitled to exercise or surrender any Vested Options during the Death or Retirement Exercise Period, but only to the extent they have become Vested Options pursuant to Section 5(a) on or prior
to the date of such death or Date of Retirement, as applicable; and 

  

	 	(ii)	notwithstanding Section 5(a), Time-Based Options which do not become Vested Options on or prior to the date of such death or Date of Retirement, as applicable, shall not thereafter become Vested Options.

  

	(b)	In the event the Participant ceases to be an employee of the Corporation or an Affiliated Entity by reason of his or her death or Retirement on a date that occurs on or after the date he or she reaches the age 60, but
before age 65, his or her Time-Based Options shall continue to become Vested Options in accordance with the provisions of this Agreement including, without limitation, Section 5(a), and the Participant shall be entitled to exercise or surrender any
such Vested Options until the Expiry Date. 

  

	(c)	In the event the Participant ceases to be an employee of the Corporation or an Affiliated Entity by reason of his or her death or Retirement on a date that occurs on or after the date he or she reaches age 65, the
Participant shall be entitled, during the period extending from the date of such death or Date of Retirement, as applicable, to the Expiry Date, to exercise or surrender, in full or in part, any unexercised Time-Based Option (irrespective of whether
such Time-Based Option has become a Vested Option in accordance with the provisions of this Agreement including, without limitation Section 5(a)). 

  

	8.	DISABILITY OF PARTICIPANT 

 In the event of the Participant’s Short-Term Disability or
Long-Term Disability, Time-Based Options shall continue to be and become Vested Options in accordance with the provisions of this Agreement including, without limitation, Section 5(a) and the Participant shall be entitled to exercise or surrender
any Vested Options during the period of such Short-Term Disability or Long-Term Disability and thereafter, unless there occurs a Termination of Employment during such period, in which case the provisions of Section 6 shall apply, or unless the
Participant’s death or Retirement occurs during such period, in which case the provisions of Section 7 shall apply. 

  
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	9.	LEAVES OF ABSENCE AND FAMILY LEAVE 

  

	(a)	In the event the Participant is on a Paid Leave of Absence or on Family Leave, Time-Based Options shall continue to be and become Vested Options in accordance with the provisions of this Agreement including, without
limitation, Section 5(a), and the Participant shall be entitled to exercise or surrender any Vested Options during the period of such Paid Leave of Absence or Family Leave and thereafter, unless there occurs a Termination of Employment during such
period, in which case the provisions of Section 6 shall apply, or unless the Participant’s death or Retirement occurs during such period, in which case the provisions of Section 7 shall apply. 

 

	(b)	In the event the Participant is on an Unpaid Leave of Absence: 

  

	 	(i)	Time-Based Options shall continue to be and become Vested Options in accordance with the provisions of Section 5(a) during the period commencing on the Date of Unpaid Leave of Absence and ending on the 31st calendar day following the Date of Unpaid Leave of Absence, unless there occurs a Termination of Employment during such period, in which case the provisions of Section 6 shall apply, or unless
the Participant’s death or Retirement occurs during such period, in which case the provisions of Section 7 shall apply; 

  

	 	(ii)	notwithstanding Section 5(a), Time-Based Options which do not become Vested Options on or prior to the 31st calendar day following the Date of Unpaid Leave of Absence
shall not become Vested Options during the balance of the Participant’s Unpaid Leave of Absence, unless the Participant’s death or Retirement occurs during such period, in which case the provisions of Section 7 shall apply;

  

	 	(iii)	notwithstanding Section 5(a), Time-Based Options which do not become Vested Options on or prior to the 31st calendar day following the Date of Unpaid Leave of Absence
shall become Vested Options on the Participant’s Return to Service Date, but only to the extent that such Time-Based Options would have become Vested Options pursuant to Section 5(a) on or prior to the Return to Service Date if the period of
Unpaid Leave of Absence had not occurred and provided that the Return to Service Date occurs prior to the Expiry Date; 

  

	 	(iv)	in the event that the Participant’s Return to Service Date occurs prior to the Expiry Date, any Time-Based Options which did not become Vested Options on or prior to the 31st calendar day following the Date of Unpaid Leave of Absence or pursuant to Section 9(b)(iii) shall become Vested Options solely in accordance with the provisions of Section 5(a); and

  

	 	(v)	from the Date of Unpaid Leave of Absence until the Expiry Date, the Participant shall be entitled to exercise or surrender any Vested Options which become Vested Options in accordance with the provisions hereof, unless
there occurs a Termination of Employment during such period of Unpaid Leave of Absence, in which case the provisions of Section 6 shall apply, or unless the Participant’s death or Retirement occurs during such period, in which case the
provisions of Section 7 shall apply. 

  

	10.	FORFEITURE AND TERMINATION OF TIME-BASED OPTIONS 

  

	(a)	 Unless previously forfeited in accordance with the provisions hereof, upon the occurrence of a Termination of
Employment, Time-Based Options which have not become Vested Options on or prior to the Date Employment Ceases shall be forfeited by the Participant and shall terminate on 

  
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the Date Employment Ceases and, thereafter, the Participant will have no further right, title or interest in such Time-Based Options. 

 

	(b)	Upon the occurrence of a Termination of Employment, Vested Options which are not exercised or surrendered by the end of the Termination Exercise Period shall be forfeited by the Participant and shall terminate on the
last day of the Termination Exercise Period and, thereafter, the Participant will have no further right, title or interest in such Vested Options. 

  

	(c)	Where the Participant ceases to be an employee of the Corporation or an Affiliated Entity by reason of the Participant’s death or Retirement on a date that is prior to the date that the Participant reaches age 60,
unless previously forfeited in accordance with the provisions hereof, Time-Based Options which have not become Vested Options on or prior to the date of death or Date of Retirement, as applicable, shall be forfeited by the Participant and shall
terminate on the date of death or Date of Retirement, as applicable, and, thereafter, the Participant will have no further right, title or interest in such Time-Based Options. 

 

	(d)	Where the Participant ceases to be an employee of the Corporation or an Affiliated Entity by reason of the Participant’s death or Retirement on a date that is prior to the date that the Participant reaches age 60,
Vested Options which are not exercised or surrendered by the end of the Death or Retirement Exercise Period shall be forfeited by the Participant and shall terminate on the last day of the Death or Retirement Exercise Period and, thereafter, the
Participant will have no further right, title or interest in such Vested Options. 

  

	(e)	On the Expiry Date, all Time-Based Options which have not been exercised or surrendered or otherwise terminated pursuant to the provisions hereof shall expire and be of no further force or effect whatsoever.

  

	(f)	After the occurrence of any of the events in Sections 10(a) – (e), this Agreement shall terminate and be of no further force or effect whatsoever with respect to those Time-Based Options which have been
forfeited and terminated or have expired and the Participant shall have no cause of action nor make any claim against the Corporation or any Affiliated Entity for damages or for loss of opportunity arising from the forfeiture and termination or
expiry of such Time-Based Options or the termination of this Agreement insofar as it relates to such Time-Based Options pursuant to this Section 10. 

  

	11.	EARLY EXERCISE AND ACCELERATED VESTING 

  

	(a)	Notwithstanding any other provision of this Agreement, but subject to Section 11(b), the Committee or the Board may pass a resolution which accelerates the vesting of a Time-Based Option and which permits the
Participant to exercise or surrender in full or in part any unexercised Time-Based Option, whether or not the Time-Based Option has otherwise become a Vested Option, at such time or times and/or in such manner following the passing of such
resolution as is specified in the resolution, which resolution may be passed for any reason which, in the sole opinion of the Committee or the Board, warrants altering the provisions pursuant to which a Time-Based Option vests or is exercisable or
can be surrendered upon the occurrence of a Change in Control, including a Take-Over Bid which would, if successful, result in a Change in Control. 

  

					
	(b)	  	(i)	  	Notwithstanding any other provision of this Agreement but subject to Section 11(b)(ii), upon the occurrence of a Change in Control, the Participant shall be entitled, on the date of the Change in Control, to exercise or surrender in
full or in part any unexercised Time-Based Option (irrespective of whether such Time-Based Option has become a Vested Option in accordance with Section 5(a)) until the Expiry Date.

  
 -5- 

	 	(ii)	If a “take-over bid” (within the meaning of applicable securities legislation) made by any person for the voting securities of the Corporation (a “Take-over Bid”) would, if successful, result
in a Change in Control, then: 

  

	 	(A)	the Corporation will promptly notify the Participant of the Take-over Bid and the Participant’s rights under this Section 11(b); 

 

	 	(B)	vesting of all Time-Based Options that have not yet become Vested Options pursuant to Section 5(a) at the time a formal Take-over Bid offer has been made will be accelerated so as to be and become Vested Options
(irrespective of whether such Time-Based Options have become Vested Options in accordance with Section 5(a) on the date the formal Take-over Bid offer is made; 

  

	 	(C)	the Participant shall be entitled to exercise, in full or in part, the Time-Based Options in the manner set out in this Agreement, with any necessary modifications (or such other manner as may be prescribed by the
Committee or the Board including, but not limited to, a form of cashless exercise), during the period ending on the earlier of the expiration of the Take-over Bid and the Expiry Date, for the purpose of tendering the Shares acquired pursuant to the
exercise of the Time-Based Options to the Take-over Bid; 

  

	 	(D)	the Participant shall be entitled to deal with the Time-Based Options in such other manner (in addition to the exercise set out in paragraph 11(b)(ii)(C)) as may be prescribed by the Committee or the Board, in its
discretion; and 

  

	 	(E)	if the Shares acquired pursuant to the exercise of the Time-Based Options are not deposited by the Participant pursuant to the Take-over Bid or, if deposited, are subsequently withdrawn by the Participant or not all
taken up and paid for by the offeror or if the offeror fails to take-up and pay for the Shares pursuant to the terms of the Take-over Bid or if the Take-over Bid fails to close for any other reason, then the
Participant shall promptly return such Shares (or the portion that are not taken up and paid for) to the Corporation for cancellation. Such Shares shall be deemed not to have been issued and the related Time-Based Options shall be deemed not to have
been exercised, and the Corporation shall refund to the Participant, if applicable, the aggregate Exercise Price for the Time-Based Options. In such event, Time-Based Options will become Vested Options solely in accordance with Section 5(a), and any
other action by the Participant permitted in accordance with Section 11(b)(ii)(D) shall be deemed not to have occurred. 

  

	12.	EFFECTS OF ALTERATION OF SHARE CAPITAL 

 In the event of any change in the Shares by reason of any
stock dividend, split, recapitalization, merger, consolidation, combination or exchange of shares or other similar corporate change, equitable adjustments may be made in the number of Time-Based Options, the type of shares or securities subject to
the Time-Based Options, the Exercise Price and the formula for determining the cash payable upon the surrender of Time-Based Options pursuant to associated TSARs. The Committee shall determine which adjustments shall be made in any such event in its
sole discretion and its determination shall be conclusive and binding for all purposes of this Agreement; provided that such adjustments shall not result in any adverse Canadian or United States federal income tax consequences. Without limiting the
generality of the foregoing, it is expressly intended that no Time-Based Option or TSAR shall become subject to Section 409A and no adjustment shall be made to the Exercise Price, the formula for determining the cash payable upon the surrender of
Time-Based 

  
 -6- 

 
Options pursuant to associated TSARs, or any other term or condition of this Agreement if to do so would cause the Time-Based Option or TSAR to become deferred compensation subject to Section
409A. 
  

	13.	METHOD OF EXERCISE OR SURRENDER OF TIME-BASED OPTIONS 

 Any Vested Option may be exercised or
surrendered by the Participant or, after death or incapacitation, by the Participant’s duly appointed legal guardian or legal personal representative, in a manner prescribed by the Corporation from time to time as published on the
Corporation’s internal employee website or otherwise communicated in writing to the Participant from time to time. 
  

	14.	OBLIGATIONS OF THE PARTICIPANT 

 Nothing contained in this Agreement or done pursuant to this
Agreement shall oblige the Participant to purchase and pay for any Shares except those Shares underlying the Time-Based Options that the Participant has exercised in the manner provided in this Agreement. 

The Participant agrees and acknowledges (and shall be conclusively deemed to have so acknowledged and agreed by participating in the Plan) that the
Participant will, at all times, act in strict compliance with Applicable Law and all Corporation Policies applicable to the Participant in connection with the Plan. Such Applicable Law and Corporation Policies shall include, without limitation,
those governing “insiders” or “reporting issuers” as those terms are construed for the purposes of applicable securities laws, regulations, and rules. 
  

	15.	SUBJECT TO APPLICABLE LAW 

 The grant of any Time-Based Option hereunder and the obligation to
make any payment (including the delivery of Shares) in respect of any Time-Based Option is subject to compliance with Applicable Law including, without limitation, Sections 26 and 27 hereof. As a condition of participating in the Plan, each
Participant agrees to comply with all such Applicable Law and agrees to furnish to the Corporation all information and undertakings as may be required to permit compliance with Applicable Law. 

 

	16.	WITHHOLDINGS 

 The Corporation or any Affiliated Entity may withhold or cause to be withheld from
any amount payable to a Participant, either under the Plan or this Agreement, or otherwise, such amount as may be necessary so as to ensure that the Corporation or any Affiliated Entity, as applicable, will be able to comply with the applicable
provisions of any federal, provincial, state or local law relating to the withholding of tax or other required deductions, including on the amount, if any, includable in the income of a Participant. 

The Participant acknowledges that all taxes which may be payable by the Participant as a result of the granting, exercise, or surrender of the Time-Based
Options are the Participant’s sole responsibility and that it is the Participant’s duty and responsibility to comply with all provisions of the law in relation to the reporting of the acquisition or exercise or surrender of the Time-Based
Options and the trading of any Shares issued pursuant to this Agreement. 

  
 -7- 

	17.	NO AGREEMENT TO EMPLOY 

 Nothing contained in this Agreement or done pursuant to this Agreement
shall constitute or be construed to constitute or to be evidence of an agreement or understanding, express or implied, on the part of the Corporation or an Affiliated Entity to retain the Participant in the Participant’s employment for
any specific period of time or in any specific capacity or position. 
  

	18.	NON-QUALIFIED STOCK OPTIONS 

 The Time-Based Options
granted to the Participant hereunder are non-qualified stock options for United States tax purposes. 
  

	19.	NO REPRESENTATION AS TO PRICE 

 The Corporation makes no representation nor gives any warranty as
to the price of the Shares and shall not be held liable for any fluctuation in the price of the Shares either before or after the exercise of any right conferred under this Agreement. 

 

	20.	NON-ASSIGNABILITY 

 The Time-Based Option and the rights
conferred hereby are not assignable, negotiable or otherwise transferable by the Participant other than by will or the laws of descent and distribution. The Time-Based Option is exercisable only during the Participant’s lifetime and only by the
Participant, except in the event of the Participant’s death or incapacity, in which case the Time-Based Option may be exercised or surrendered by the Participant’s duly appointed legal guardian or legal personal representative as provided
herein. 
  

	21.	SUBJECT TO CLAWBACK POLICY 

 You acknowledge and agree that all Options granted hereunder (and the
grant thereof), including any payment in respect thereof, are expressly subject to the terms and conditions of the Corporation’s “Incentive Compensation Clawback Policy”, attached hereto as Schedule “B”, as same may be
amended by the Corporation from time to time. 
  

	22.	SUBJECT TO PLAN 

 The provisions of this Agreement shall be interpreted so as to be expressly
subject to the provisions of the Plan. The Participant acknowledges that the Committee or the Board has full and complete authority to interpret the Plan and to prescribe such rules and regulations and make such other determinations as it deems
necessary or desirable for the administration of the Plan in its sole discretion and that any such rules, regulations or determinations shall be final and binding on the parties to this Agreement. 

 

	23.	AMENDMENT AND TERMINATION 

 Subject to Applicable Law and to Section 11 of the Plan, this
Agreement and the Plan may be amended or terminated at any time by the Board in whole or in part. 
  

	24.	TIME OF ESSENCE 

 Time shall be of the essence of this Agreement. 

 

	25.	NOTICES 

 Any notice to be given by the Participant hereunder shall be sent to the Corporation at:

 Encana Corporation 
 500
Centre Street SE 
 P.O. Box 2850 

Calgary, Alberta T2P 2S5 

  
 -8- 

 Fax: (403) 645-3400 

Attention: Vice-President, Human Resources 

and any notice from the Corporation to the Participant shall be sent to the Participant at the Participant’s office or residence address last known to
the Corporation. Either party may change the address to which notice may be given by mailing the same, postage prepaid, or delivering the same to the Corporation or to the Participant, as the case may be, in accordance with the foregoing. Any such
notice if delivered shall be deemed to have been given or made on the date on which it was delivered or if mailed shall be deemed to have been given or made on the third business day following the date on which it was mailed. In the event of a
general postal disruption, notice shall be delivered. 
 The Participant hereby consents to the exchange of information and documents between the
Participant and the Corporation electronically over the Internet or by e-mail (if to the Participant at the e-mail address most recently provided by the Participant to
the Corporation) and it is hereby agreed and acknowledged that any such information and documents sent or received in electronic form shall be the equivalent of original written paper documents. 

 

	26.	GOVERNING LAW 

 This Agreement shall be governed by and construed in accordance with the laws in
force in the Province of Alberta and the federal laws of Canada as applicable herein. In the event of a dispute, the Participant agrees to submit to the jurisdiction of the Alberta courts. 

 

	27.	COMPLIANCE WITH SECTION 409A 

 Notwithstanding any provision of the Plan or this Agreement to the
contrary, where applicable, it is intended that the provisions of the Plan and this Agreement comply with Section 409A, and all provisions of the Plan shall be construed and interpreted in a manner consistent with the requirements for avoiding taxes
or penalties under Section 409A. Each US Participant is solely responsible and liable for the satisfaction of all taxes and penalties that may be imposed on or for the account of such US Participant in connection with the Plan or any other Plan
maintained by the Corporation or an Affiliated Entity (including any taxes and penalties under Section 409A), and neither the Corporation nor any Affiliated Entity shall have any obligation to indemnify or otherwise hold such US Participant (or any
beneficiary) harmless from any or all of such taxes or penalties. In addition, should any provision of the Plan or this Agreement be subject to Section 409A, the Date Employment Ceases and the Date of Retirement shall be determined to mean a
“separation from service” as defined in Section 409A whenever necessary to ensure compliance therewith for any payment or settlement of a benefit conferred under the Plan or this Agreement that is subject to Section 409A, and, for such
purposes, shall be determined based upon a reduction in the bona fide level of services performed to a level equal to twenty percent (20%) or less of the average level of services performed by the Participant during the immediately preceding 36-month period. Any distribution or settlement of a benefit conferred under the Plan or this Agreement following the Date Employment Ceases or the Date of Retirement that would be subject to Section 409A as a
distribution following a separation from service of a “specified employee” as defined under Section 409A, shall occur no earlier than the expiration of the six-month period following such Date
Employment Ceases or Date of Retirement. 
  

	28.	EXECUTION BY THE CORPORATION 

 This Agreement may be executed by application of the facsimile or
authorized electronic signature of the Executive Vice-President, Corporate Services of the Corporation (or his or her written designate) and such signature shall be as valid and effective as if such officer signed this Agreement in person.

  
 -9- 

	29.	ACCEPTANCE BY PARTICIPANT 

 The Participant shall confirm acceptance of the terms and conditions
of this Agreement by electronically selecting and clicking on the button beside the words “I Accept” from the options provided below. By indicating such acceptance, the Participant agrees to be legally bound by the terms and conditions of
this Agreement, and hereby agrees that such acceptance shall be as valid and effective as of the Date of Grant as if the Participant signed this Agreement in person on that date. In the event the Participant does not accept the terms and conditions
of this Agreement because an error exists in the Option information provided at the outset of this Agreement, the Participant must electronically select and click on the button beside the words “I Do Not Accept” from the options provided
below, in which case the parties shall take such steps as may be necessary to correct any such error. 
 IN WITNESS WHEREOF this Agreement has been
executed effective as of the Grant Date. 
 ENCANA CORPORATION 

Mike Williams 
 Executive Vice-President, Corporate Services 

  
 -10- 

 SCHEDULE “A” 

DEFINITIONS 
 In this Agreement,
the following terms shall have the meanings respectively set forth below: 
  

	(a)	“Agreement” means this Option and Tandem Stock Appreciation Rights Agreement between the Corporation and the Participant; 

 

	(b)	“Anniversary Date” means, in respect of the Time-Based Options, each anniversary of the Date of Grant; 

  

	(c)	“Applicable Law” means any applicable provision of law, domestic or foreign, including, without limitation, applicable securities legislation, together with all regulations, rules, policy statements,
rulings, notices, orders or other instruments promulgated thereunder, and any rules of the Toronto Stock Exchange; 

  

	(d)	“Appreciated Value” means, in respect of each TSAR associated with an Time-Based Option, an amount equal to the excess of the closing price of a Share on the Toronto Stock Exchange on the last Trading
Day preceding the date of the surrender of the Time-Based Option, over the Exercise Price; 

  

	(e)	“Change in Control” means, for purposes of this Agreement, the date any of the following occurs: 

  

	 	(i)	any individual, partnership, firm, corporation, association, trust, unincorporated organization or other entity, or any persons acting jointly or in concert with the foregoing, is, or becomes, the beneficial owner,
directly or indirectly, of securities of the Corporation representing more than 30% of the combined voting power of the Corporation’s then outstanding securities entitled to vote in the election of the directors of the Corporation;

  

	 	(ii)	the Corporation shall have disposed of: (A) all or substantially all of its assets, such that shareholder approval was required or should have been required to be obtained under the Canada Business Corporations
Act, or (B) assets in any 12 month period representing 50% or more of the total assets of the Corporation, determined as of the date of the audited financial statements of the Corporation then most recently published; 

 

	 	(iii)	pursuant to a single election or appointment or a series of elections or appointments over any period from and after the date of this Agreement (A) those individuals who at the date of this Agreement constituted
the Board, together with (B) any new or additional director or directors whose nomination for election by the Corporation’s shareholders, or whose appointment to the Board by the Board, has been approved by at least 75% of the votes cast
by all of the directors then still in office, who either were directors at the date of this Agreement or whose appointment or nomination for election was previously so approved, cease for any reason to constitute a majority of the Board; or

  

	 	(iv)	the Board, by resolution duly adopted by the affirmative vote of a simple majority of the votes cast by the Board, determines that, for purposes of this Agreement, a Change in Control of the Corporation has occurred.

  
 -11- 

 Securities beneficially owned or controlled or directed by an employee plan or related trust
sponsored or maintained by the Corporation or any of its Affiliated Entities shall not be taken into account in determining whether the threshold percentage in Section (h)(i) is exceeded. 

For the purposes of this Section (h): 
  

	 	(i)	the term “acting jointly or in concert” shall be interpreted in accordance with Section 159 of the Securities Act (Alberta), as amended; and 

 

	 	(ii)	the term “beneficial ownership” shall be interpreted in accordance with Sections 5 and 6 of the Securities Act (Alberta) and “beneficial owner” shall have a corresponding meaning, except that
for purposes of this Agreement, options and convertible securities granted by the Corporation to employees, officers or directors shall not be included in determining beneficial ownership or beneficial owner. 

For greater certainty, and except as specifically provided in Sections (h)(ii) and (h)(iv), the sale, disposition or other divestiture of an
Affiliated Entity, in whole or in part, shall not constitute a Change in Control for the purposes of this Agreement. 
  

	(f)	“Close of Business” means the close of trading on the Toronto Stock Exchange on any Trading Day; 

  

	(g)	“Committee” means the Human Resources and Compensation Committee of the Board, or such other committee of the board, as constituted from time to time, which may be designated by the Board to, inter
alia, interpret, administer and implement the Plan and this Agreement, and any reference in this Agreement to action by the Committee means action by or under the authority of the Committee or, if no Committee has been designated, by the Board;

  

	(h)	“Corporation Policies” means, at a particular time, the policies and practices of the Corporation (or, if applicable, the Affiliated Entity which employs the Participant or which employed the Retired
Participant), as published on the Corporation’s internal employee website or otherwise communicated in writing to the employees (or, where necessary, to a Retired Participant) of the Corporation and/or its Affiliated Entities;

  

	(i)	“Date Employment Ceases” means: 

  

	 	(i)	in the case of voluntary termination of employment initiated by the Participant, the last date the Participant is, for the purposes of receiving his or her regular salary, on the payroll of the Corporation or an
Affiliated Entity; 

  

	 	(ii)	in the case of involuntary termination of the Participant’s employment by the Corporation or an Affiliated Entity for cause (as determined by the Corporation or the Affiliated Entity, as applicable), the
date written notification of dismissal from employment is delivered to the Participant; 

  

	 	(iii)	in the case of involuntary termination of the Participant’s employment by the Corporation or an Affiliated Entity other than for cause (as determined by the Corporation or the Affiliated Entity, as
applicable), the date identified in the written notification of termination of employment delivered to the Participant as the “Termination Date” or “Departure Date” and, where both dates are so referred to, the earlier thereof,
and, where such date is not identified in the written notification, the date written notification of dismissal from employment is delivered to the Participant; 

  
 -12- 

	 	(iv)	in the case where the Participant is employed by an Affiliated Entity and for any reason including, without limitation, by reason of sale, disposition or other divestiture thereof, in whole or in part, such employer
ceases to be an Affiliated Entity of the Corporation, the effective date (in the case of a sale, disposition or other divestiture, the closing date of such transaction or series of transactions, as determined by the Corporation) upon which the
Participant’s employer ceases to be an Affiliated Entity; 

 but, for greater certainty, shall not include any notice
period which arises or may be deemed to arise upon the termination of employment of the Participant, and shall not include the date the Participant ceases to be an employee of the Corporation or an Affiliated Entity upon the Participant’s death
or Retirement, or the date the Participant commences Short-Term Disability, Long-Term Disability, a Paid Leave of Absence, an Unpaid Leave of Absence, or Family Leave; 
  

	(j)	“Date of Grant” means the date upon which the Corporation grants the Time-Based Options to the Participant, and as evidenced by this Agreement, which term is sometimes referenced as “Grant
Date”; 

  

	(k)	“Date of Retirement” means the last day the Participant is, for the purposes of receiving his or her regular salary, on the payroll of the Corporation or an Affiliated Entity immediately prior to
commencing Retirement; 

  

	(l)	“Death or Retirement Exercise Period” means the period of time extending from the date of the Participant’s death or Date of Retirement, as applicable, to the earlier of: (i) the date that is
six months following the date of the Participant’s death or Date of Retirement, as applicable; and (ii) the Expiry Date. Should the Death or Retirement Exercise Period terminate on a date other than a Trading Day, the Death or Retirement
Exercise Period shall terminate on the Close of Business on the last Trading Day prior to that date; 

  

	(m)	“Exercise Price” means the price payable per Share on the exercise by the Participant of a Time-Based Option determined on the basis of the Grant Price; 

 

	(n)	“Expiry Date” means the Close of Business on the seventh Anniversary Date, subject to any Blackout Extension Period (as defined and set forth in the Plan). Should the Expiry Date fall on a date other
than a Trading Day, the Expiry Date shall be the Close of Business on the last Trading Day prior to that date; 

  

	(o)	“Family Leave” means a period during which, pursuant to the Corporation Policies or Applicable Law, the Participant is considered to be on family leave, and does not provide employment services to the
Corporation or an Affiliated Entity; 

  

	(p)	“Long-Term Disability” means any period of time during which the Participant receives, or is determined to be entitled to receive, disability benefits under the Corporation’s or an Affiliated
Entity’s long-term disability plans; 

  

	(q)	“Paid Leave of Absence” means a period during which, pursuant to the Corporation Policies or Applicable Law, the Participant is considered to be on a leave of absence and continues to receive his or her
normal salary, but does not provide employment services to the Corporation or an Affiliated Entity; 

  

	(r)	“Related Corporation” means a corporation that is related, within the meaning of the Income Tax Act (Canada), to the Corporation; 

  
 -13- 

	(s)	“Retired Participant” means a Participant who ceases to be an employee of the Corporation or an Affiliated Entity by reason of his or her Retirement; 

 

	(t)	“Retirement” means the early or normal retirement of the Participant from employment with the Corporation or an Affiliated Entity in accordance with the Corporation Policies; 

 

	(u)	“Return to Service Date” means the date, following an Unpaid Leave of Absence, that the Participant recommences the provision of employment services to the Corporation or an Affiliated Entity, in full
or in part; 

  

	(v)	“Section 409A” means section 409A of the United States Internal Revenue Code of 1986, as amended, and any applicable United States Treasury Regulations and other binding regulatory guidance promulgated
thereunder; 

  

	(w)	“Share” means a common share in the capital of the Corporation as is traded on the Toronto Stock Exchange; 

  

	(x)	“Short-Term Disability” means any period of time during which the Participant receives disability benefits under the Corporation’s or an Affiliated Entity’s short-term disability plans;

  

	(y)	“Take-over Bid” has the meaning assigned by Section 11(d)(ii); 

  

	(z)	“Termination Exercise Period” means the period of time extending from the Date Employment Ceases to the earlier of: (i) the Close of Business on the
60th Trading Day after the Date Employment Ceases; and (ii) the Expiry Date; 

  

	(aa)	“Termination of Employment” means an event by which the Participant ceases to be an employee of the Corporation or an Affiliated Entity but, for greater certainty, shall not include an event whereby the
Participant ceases to be an employee of the Corporation or an Affiliated Entity upon the Participant’s death or Retirement or where the Participant commences Short-Term Disability, Long-Term Disability, a Paid Leave of Absence, an Unpaid Leave
of Absence, or Family Leave; 

  

	(bb)	“Time-Based Options” has the meaning assigned by Section 4(a); 

  

	(cc)	“Trading Day” means a day on which the Toronto Stock Exchange is open for trading; 

  

	(dd)	“TSAR” means a tandem stock appreciation right which is associated with a Time-Based Option and which entitles the Participant to surrender a Vested Option in accordance with Section 5(d), subject to
the terms and conditions hereof; 

  

	(ee)	“Unpaid Leave of Absence” means a period of time during which, pursuant to the Corporation Policies or Applicable Law, the Participant is considered to be on a leave of absence and does not continue to
receive his or her salary or provide employment services to the Corporation or an Affiliated Entity which, for the purposes of this Agreement, shall be deemed to commence on the “Date of Unpaid Leave of Absence”, being the first day
of the Participant’s Unpaid Leave of Absence, as communicated in writing to the Participant by the Corporation or an Affiliated Entity in accordance with the Corporation Policies; 

 

	(ff)	“US Participant” means, where applicable, a Participant whose income in respect of services performed for the Corporation or an Affiliated Entity is subject to Section 409A; 

  
 -14- 

	(gg)	“Vested Option” means a Time-Based Option which has vested and can be exercised by the Participant to purchase a Share or, alternatively, can be surrendered by the Participant in accordance with
Section 5 (d), subject to the terms and conditions hereof; and 

  

	(hh)	“Vesting Date” means the date on which a Time-Based Option becomes a Vested Option in accordance with the provisions of this Agreement including, without limitation, Section 5(a) hereof.

  
 -15- 

 Schedule “B” 

INCENTIVE COMPENSATION CLAWBACK POLICY: 

By resolution of the Board of Directors (the “Board”) of Encana Corporation (“Encana” or the “Corporation”), this
Policy is effective as of this 22nd day of October, 2012 (the “Effective Date”). 
 This Policy applies to the President & Chief
Executive Officer and each Executive-Vice President of the Corporation and any individual who serves in either such capacity on or following the Effective Date (collectively, the “Executive”). References in this Policy to the
“Corporation” include, where applicable, any affiliate thereof. 
 This Policy has been adopted to enhance the Corporation’s alignment with
best practices in respect of risk management and executive compensation and shall be, at all times, subject to and interpreted in a manner consistent with applicable laws or the rules of any applicable stock exchange (collectively,
“Applicable Rules”). 
 This Policy applies to “Incentive-Based Compensation” which, for the purposes of this Policy, means
compensation relating to the achievement of performance goals or similar conditions, excluding salary, perquisites, benefits and pension entitlements, and including, without limitation, any award or grant of or any eligibility, entitlement or gain
of, an Executive under the Corporation’s: (i) High Performance Results Plan, or any other short-term incentive plan; or (ii) Long-Term Incentive (“LTI”) program including, without limitation, Employee Stock Option Plan,
Employee Stock Appreciation Rights Plan, Performance Share Unit Plan, Restricted Share Unit Plan and Deferred Share Unit Plan, as each may be amended from time to time (including any performance-based grants under any such plans). For greater
clarity, this Policy shall not apply to any Incentive-Based Compensation awarded, granted or paid to an Executive prior to the Effective Date. 
 Where:

  

	 	•	 	the Corporation is required to prepare an accounting restatement due to its material non-compliance with any financial reporting requirement under applicable securities laws (the “Restatement”), (the
date upon which the Corporation is required to prepare such Restatement is hereinafter the “Restatement Date”); 

  

	 	•	 	the Executive received Incentive-Based Compensation referable to the financial years subject to the Restatement in excess of what the Executive would have been paid under the Restatement (the “Overcompensation
Amount”); and 

  

	 	•	 	the Executive engaged in gross negligence, intentional misconduct or fraud which caused or significantly contributed to the Corporation’s material non-compliance with applicable securities laws which resulted in
the requirement for the Restatement; 

 the Board shall be entitled: 
  

	 	•	 	where and to the extent the Overcompensation Amount has been previously paid, transferred or otherwise made available to the Executive, to require the Executive, by written demand, to reimburse the Corporation for the
Overcompensation Amount; and 

  

	 	•	 	where all or a portion of the Overcompensation Amount has not been paid, transferred or otherwise made available to the Executive, the right of the Executive to be so paid or have such benefit transferred or otherwise
made available to him or her shall, to the extent required to reimburse the Corporation for such Overcompensation Amount, immediately terminate and be forfeited by the Executive and where required, cancelled by the Corporation to such extent and
upon such date as may be specified by the Board; and 

  

	 	•	 	to the extent the Overcompensation Amount is not immediately recovered upon demand from the Executive, whether via direct reimbursement, forfeiture and/or cancellation, to require a sufficient quantity or value of any
compensation owing by the Corporation to the Executive including, without limitation, any unvested or unexercised awards under the LTIs (the “Outstanding LTIs”), be immediately withheld and/or irrevocably cancelled by the
Corporation to compensate for (or set off the value of same against) the Overcompensation Amount or any unrecovered portion thereof, and to bring any other actions against the Executive which the Board may deem necessary to recover the
Overcompensation Amount. 

  

  
 -16- 

 The period of time during which the Corporation shall be entitled to seek recovery of the Overcompensation Amount
from the Executive shall be three (3) years from the Restatement Date. Recoupment of Overcompensation Amounts under this Policy shall be initiated by the Corporation at the request of the Board, and all amounts recoverable or payable hereunder shall
be paid to the Corporation or as directed by the Board. 
 If Applicable Rules require the Corporation to adopt a policy or provisions relating to the
recoupment or recovery of incentive-based or other compensation based on restated financial statements which are inconsistent with or materially differ from this Policy and the Board adopts such policy or provisions to comply with Applicable Rules
(the “New Policy”), such New Policy shall replace and supersede this Policy and shall apply to Incentive-Based Compensation granted or awarded to the Executive following the effective date of the New Policy. Subject to Applicable
Rules, this Policy shall continue to apply to Incentive-Based Compensation granted or awarded to the Executive prior to the effective date of the New Policy. This Policy may be terminated at any time by the Board. 

  
 -17-

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