Board Justification

The Committee bases its executive compensation decisions on principles designed to align the interests of executives with those of stockholders. The Committee intends compensation to provide a direct link with the Company’s objectives, business strategies and financial results. In order to motivate, attract and retain key executives who are critical to its long-term success, the Company believes that its pay package should be competitive with others in the oil and gas industry.

Board Justification

The Committee currently uses return on capital employed (“ROCE”) as a significant performance metric to determine the annual award under the 2012 Plan for NEO participants because it measures the quality of the Company’s earnings by looking at net income earned on the capital employed in the business.

Board Justification

Company contributions to defined contribution plans; Company plane usage based on aggregate incremental cost to the Company; Benefit attributable to Company-provided term life insurance policy; Reimbursement of tax penalty arising from the incorrect suspension of SERP benefits upon Mr. Cossé’s reemployment by the Company in 2012.

Board Justification

N/A