Exhibit 10.2

WESTWOOD HOLDINGS GROUP, INC.

MUTUAL FUND SHARE INCENTIVE AGREEMENT

AGREEMENT, made as of the 7th day of March, 2014, by and between WESTWOOD
HOLDINGS GROUP, INC. (the “Company” and, together with its subsidiaries, “WHG”),
and MARK FREEMAN (“Participant”), pursuant to the Westwood Holdings Group, Inc.
Stock Incentive Plan (the “Plan”). Capitalized terms used but not defined in
this Agreement shall have the meanings ascribed to them under the Plan.

WHEREAS, Participant is a valued WHG employee engaged in WHG’s mutual fund
management business, in connection with the Westwood Income Opportunity Fund –
Institutional Share Class (WHGIX) (the “Fund”); and

WHEREAS, the Compensation Committee of the Company’s Board of Directors (the
“Committee”) desires to provide Participant with an opportunity to earn
incentive compensation for 2014 based upon the performance of the Fund for that
year.

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

1. Grant of Incentive Opportunity. The Company hereby grants to Participant the
opportunity to earn an incentive compensation award under the Plan for the
twelve-month period beginning January 1, 2014 and ending December 31, 2014 (the
“Performance Period”), in an amount and upon the terms and conditions set forth
in this Agreement. This opportunity is intended to be a Performance-Based Award
under the Plan and the terms and conditions of this Agreement will be construed
and applied accordingly.

2. Performance Rating. The Morningstar rating assigned to the Fund for the
Performance Period shall be the Overall Rating reflecting Fund performance
through December 31 of the Performance Period (the “Morningstar Rating”) as
published by Morningstar on or about the third business day following the end of
the Performance Period. Similarly, the Morningstar Risk Rating assigned to the
Fund for the Performance Period shall be the 3-Year Risk Rating reflecting Fund
performance through December 31 of the Performance Period (the “Morningstar Risk
Rating”) as published by Morningstar on or about the third business day
following the end of the Performance Period.

3. Amount.

(a) General. The amount, if any, of the incentive compensation that may be
earned by Participant under this Agreement (the “Performance Bonus”) shall be
equal to $500,000 (the “Target Bonus Amount”) multiplied by the Applicable
Percentage, determined in accordance with the following table based upon the
Morningstar Rating assigned to the Fund for the Performance Period. In the event
the Fund is classified by Morningstar in the Moderate Allocation Category, as
reported by Morningstar at the end of the Performance Period, and the Fund’s
Morningstar Risk Rating for the Performance Period is “Below Average” or “Low”,
then the Performance Bonus shall be equal to the Target Bonus Amount multiplied
by the Alternate Percentage, determined in accordance with the following table
based upon the Morningstar Rating assigned to the Fund for the Performance
Period. In all other cases, the Applicable Percentage will apply.

 

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Morningstar Rating

 

Applicable Percentage

 

Alternate Percentage

5 Stars   200%   200% 4 Stars   100%   200% 3 Stars   0%   100%

Other than as set forth above, no Performance Bonus will be awarded under this
Agreement if the Morningstar Rating of the Fund is less than 4 stars. The amount
of the Performance Bonus, if any, earned by Participant under this Agreement
will be determined by the Committee and communicated to Participant promptly
after the applicable Morningstar Rating, Morningstar Risk Rating, and
Morningstar Category is published at the end of the Performance Period.

(b) Termination of Employment During Performance Period. Unless otherwise
specified in this subparagraph, no Performance Bonus will be earned and payable
under this Agreement if Participant’s employment terminates before the end of
the Performance Period. Notwithstanding the foregoing, if the Participant’s
employment terminates during the Performance Period by reason of the
Participant’s death or Disability, then the deceased Participant’s Beneficiary
or the Participant, as the case may be, will be entitled to receive an amount
equal to the product of (1) the Performance Bonus that would have been earned
for the Performance Period if the Participant’s employment had continued,
multiplied by (2) the percentage of the Performance Period elapsed as of the
date of the Participant’s termination of employment (or such greater percentage
not to exceed 100% as the Committee, acting in its sole discretion, may
determine). The amount, if any, payable to the Beneficiary (or the disabled
Participant, as the case may be) will be determined promptly after the
applicable Morningstar Rating and Morningstar Category is published as set forth
above and will be paid to the Beneficiary (or the disabled Participant) as soon
as practicable (but not more than 30 days) after such determination is made.

4. Account. If the Committee determines that a Performance Bonus is payable,
then, as soon as practicable (but not more than 10 business days after the
Committee’s determination, the amount of such Performance Bonus will be credited
to a bookkeeping account established by the Company in Participant’s name (the
“Account”). The amount credited to Participant’s Account will be converted on a
notional basis into a number of shares of the Fund (the “Fund Shares”) equal to
the Performance Bonus amount divided by the net closing value of a Fund share on
the date the Performance Bonus amount is credited to the Account. The value of
Participant’s Account will be adjusted (up or down) to reflect changes in the
net value of the Fund Shares credited to the Account. If and when distributions
are paid by the Fund with respect to its shares, the Company will credit
Participant’s Account with additional Fund shares having a value equal to the
amount of the distributions that would have been payable if the shares credited
to the Account were issued and outstanding. Participant will receive or have
access to monthly statements of the Account. Neither the Company nor the
Committee nor any other person acting for or on behalf of the Company or the
Committee shall have any responsibility for the investment performance of the
Fund Shares in which Participant’s Account is notionally invested, and shall
have no liability to Participant or any other person with respect to any other
matters relating to the notional investment of the Account.

 

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5. Vesting in Account.

(a) General. Participant’s right to receive payment of the Account will become
vested twelve (12) months from December 31, 2014, which is the end of the
Performance Period (the “Stated Vesting Date”), subject to Participant’s
continuous employment with WHG. If Participant’s employment with WHG terminates
before the Stated Vesting Date (or before an Accelerated Vesting Date, as
described below), the Participant will forfeit the entire Account balance and
will have no further rights under or in respect of this Agreement, except where
vesting terms that are more favorable to the Participant are specified elsewhere
in this Agreement, in the employment agreement between Westwood Holdings Group,
Inc. and Participant effective February 7, 2012, or as determined by the
Committee (in its sole discretion), the vesting terms most favorable to the
Participant shall control.

(b) Termination Due to Death or Disability. If Participant’s employment with WHG
terminates before the Stated Vesting Date by reason of Participant’s death,
then, at the time of such termination (the “Accelerated Vesting Date”),
Participant’s Account will become fully vested and non-forfeitable. If the
Participant’s employment with WHG is terminated before the Stated Vesting Date
by reason of Participant’s Disability, then the Committee, acting in its
discretion, may determine that some or all of the disabled Participant’s Account
will become vested and payable (as opposed to being forfeited) and, to the
extent vesting is so accelerated, the date of the Participant’s termination of
employment will be deemed to be an Accelerated Vesting Date for the purposes
hereof. Any determination to accelerate vesting of the disabled Participant’s
Account will be made as soon as practicable (but not more than 60 days) after
the date the Participant’s employment is terminated.

6. Change in Control. If a Change in Control occurs before the Stated Vesting
Date (or an Accelerated Vesting Date) and if the acquiring or successor company
does not assume the obligations of the Company under this Agreement, then,
immediately prior to the Change in Control, Participant’s Account will become
fully vested and non-forfeitable. If a Change in Control occurs before the
Stated Vesting Date and if the acquiring or successor company assumes the
obligations of the Company under this Agreement, then Participant’s Account will
continue to be subject to the vesting conditions set forth herein; provided,
however, that, if Participant’s employment is subsequently terminated before the
Stated Vesting Date or an Accelerated Vesting Date (other than termination by
Participant’s employer for Cause or voluntary termination by Participant without
Good Reason), then, at the time of such termination of employment, Participant’s
Account will become fully vested and non-forfeitable.

7. Distribution of Vested Account. If Participant’s Account becomes vested in
accordance with this Agreement, the amount credited to Participant’s vested
Account will be payable to Participant (or Participant’s Beneficiary, as the
case may be) on or as soon as practicable (but not more than 30 days) after the
vesting date. Unless the Committee determines otherwise, Participant’s vested
Account will be paid in the form of shares of the Fund (equal in number to the
number of shares credited to the Account at the end of the day immediately
preceding the distribution date. Such shares may be transferred by the Company
to a Westwood Trust account owned by Participant (or Participant’s Beneficiary).
The Committee may direct that all or part of the amount of Participant’s vested
Account be distributed in the form of cash or other property. Any distribution
or payment made in settlement of Participant’s Account will be subject to the
satisfaction of applicable tax withholding requirements. If and to the extent
the Account is settled in the form of

 

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Fund shares, the Committee may withhold Fund shares having a net share value
sufficient to cover all or part of the tax withholding obligation. The Committee
may also cause the tax withholding obligation to be satisfied in whole or in
part from salary and/or incentive compensation otherwise payable to Participant
outside of this Agreement.

8. Funding. The Company may purchase shares of the Fund corresponding to the
Fund shares that are notionally credited to Participant’s Account in order to
enable the Company to fund its obligations under this Agreement. Any such shares
will be owned by and held in the name of the Company, and neither Participant or
Participant’s Beneficiary (or any other person claiming through or under
Participant or Participant’s Beneficiary) shall have any legal or equitable
ownership interest in, or lien on, such shares or any other assets of the
Company that may be set aside or earmarked for the satisfaction of the Company’s
obligations under this Agreement. If the Company elects to maintain a separate
fund or makes specific investments to fund its obligations under this Agreement,
the Company reserves the right, in its sole discretion, to terminate such method
of funding at any time, in whole or in part. Nothing contained herein and no
action taken by the Company pursuant to the provisions hereof shall be deemed to
create a trust of any kind or a fiduciary relationship between Participant or
Participant’s Beneficiary (or other interested person) and the Company or the
Committee (or any of its or their affiliates, agents or employees), or require
the Company to maintain or set aside any specific funds for the purpose of
paying any amounts that may become payable hereunder. Any amount payable to a
Participant or Beneficiary pursuant to the Plan shall be paid from the general
assets of the Company. Nothing contained herein and no action taken by the
Company pursuant to the provisions hereof shall be deemed to create a trust of
any kind or a fiduciary relationship between any Participant or Beneficiary (or
other interested person) and the Company or the Committee (or any of its or
their affiliates, agents or employees), or require the Company to maintain or
set aside any specific funds for the purpose of paying any amounts that may
become payable hereunder. To the extent that a Participant or Beneficiary
acquires any rights to receive payments under the Plan, such rights shall be no
greater than the rights of any unsecured general creditor of the Company. If and
to the extent that Participant or Participant’s Beneficiary has the right to
receive payments under this Agreement in settlement of Participant’s vested
Account, such right shall be that of a general unsecured creditor of the
Company, it being understood that the Company’s obligations hereunder are
unfunded and unsecured for purposes of applicable law.

9. Miscellaneous.

(a) This Agreement supersedes any prior agreement or understanding, written or
oral, with respect to the subject matter, except the employment agreement
between Westwood Holdings Group, Inc. and Participant effective February 7,
2012. This Agreement may be amended only by written agreement signed by both
parties.

(b) No right or interest of Participant (or Participant’s Beneficiary) under
this Agreement may be assigned, alienated, pledged, hypothecated or otherwise
transferred by Participant (or Participant’s Beneficiary), and any attempt to do
so shall be null and void.

 

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(c) Nothing contained in this Agreement shall be deemed to constitute a contract
of employment between Participant and any member of WHG, or to give Participant
any right to be retained in the employ or other service of any member of WHG, or
to interfere with the right of any member of WHG to terminate or modify the
terms of Participant’s employment. Similarly, nothing contained in this
Agreement shall give Participant any right to receive future awards of incentive
compensation, whether under the Plan or otherwise.

(d) The bonus opportunity covered by this Agreement is intended to be exempt
from Section 409A of the Internal Revenue Code of 1986 pursuant to the
“short-term deferral” exemption set forth in Treasury Regulation
§1.409A-1(b)(4). This Agreement will be administered, interpreted and applied
accordingly. Notwithstanding the foregoing, Participant will be solely
responsible for satisfying any tax obligations, including any related penalty
and interest assessments, resulting from the compensation, if any, earned by
Participant hereunder.

(e) Except as otherwise preempted by the laws of the United States, this
Agreement and the rights and obligations of the parties hereunder shall be
governed by and construed in accordance with the laws of the State of Texas,
without giving effect to its conflict of law provisions.

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

 

WESTWOOD HOLDINGS GROUP, INC. By:   /s/ Brian O. Casey   Brian O. Casey  
President and Chief Executive Officer PARTICIPANT: By:   /s/ Mark Freeman   Mark
Freeman   Executive Vice President, Chief Investment Officer

 

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