Exhibit 10.1

Form Agreement

NEW SOURCE ENERGY PARTNERS L.P.

LONG TERM INCENTIVE PLAN

RESTRICTED UNIT AGREEMENT

(Subordination Period Vesting)

 

Employee:                                           

Date of

Grant:                             

 

Number of

Restricted Units:                                 

This Restricted Unit Agreement (this “Agreement”) is made as of [Date] between
New Source Energy Partners L.P., a Delaware limited partnership
(the “Partnership”), and                      (the “Employee”) pursuant to the
terms and conditions of the New Source Energy Partners L.P. Long Term Incentive
Plan (the “Plan”). The Employee acknowledges receipt of a copy of the Plan, and
agrees that the terms and provisions of the Plan, including any future
amendments thereto, shall be deemed a part of this Agreement as if fully set
forth herein. Capitalized terms used in this Agreement but not otherwise defined
herein shall have the meanings ascribed to such terms in the Plan, unless the
context requires otherwise.

WHEREAS, the Partnership, acting through the Board of its General Partner, has
adopted the Plan to, among other things, attract, retain and motivate certain
employees, consultants and directors of the Partnership, the General Partner and
their respective Affiliates (each, a “Company Entity” and, collectively,
the “Company Entities”); and

WHEREAS, the Partnership desires to grant to the Employee on the terms and
conditions set forth herein and in the Plan, and the Employee desires to accept
on such terms and conditions, the number of Restricted Units set forth herein.

NOW, THEREFORE, in consideration of the Employee’s agreement to provide or to
continue providing services for the benefit of the Company Entities, the
Partnership and the Employee agree as follows:

1. Grant of Restricted Units. The Partnership hereby grants to the Employee,
effective as of                      (the “Date of Grant”),                     
Restricted Units, subject to all of the terms and conditions set forth in the
Plan and in this Agreement (the “Restricted Units”).

2. Forfeiture Restrictions. The Restricted Units may not be sold, assigned,
pledged, exchanged, hypothecated, or otherwise transferred, encumbered, or
disposed of to the extent then subject to the Forfeiture Restrictions (as
defined below). The prohibition against transfer and the obligation to forfeit
the Restricted Units to the Partnership upon termination of employment or the
failure of the Restricted Units to vest are referred to herein as the
“Forfeiture Restrictions.”

3. Rights of Employee. The Restricted Units shall be evidenced either (a) by
certificates issued in the Employee’s name that are retained by the Partnership
until the Restricted Units are no longer subject to the Forfeiture Restrictions
or are forfeited or (b) in book

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entry form by the Partnership’s transfer agent with a notation that they are
subject to restrictions, at the Partnership’s discretion. Notwithstanding the
foregoing, the Employee shall have all voting rights, if any, with respect to
the Restricted Units and the right to receive any Unit Distribution Rights
thereon. Any Unit Distribution Rights payments will be made to the Employee on
or promptly following the date on which the distributions are otherwise paid to
the holders of Units; provided, however, in no event shall the distribution
payment be made later than thirty (30) days following the date on which the
Company pays such distributions to the holders of Units generally; provided,
further, however, that, notwithstanding the date of payment of any such Unit
Distribution Rights to the Employee, the Employee shall vest in such Unit
Distribution Right as of the record date for such distribution. No interest will
accrue on any Unit Distribution Rights between the issuance of the distribution
to Unit holders generally and the settlement of the Unit Distribution Right.
Notwithstanding the preceding provisions of this Section 3, the Restricted Units
shall be subject to all of the restrictions described herein, including, without
limitation, the Forfeiture Restrictions.

4. Performance Vesting for Restricted Units. Except as otherwise provided in
this Agreement, the Restricted Units will vest in full immediately on the date
that the Subordination Period ends for the Company’s Subordinated Units (the
“Performance Goal”), provided that the Employee remains continuously employed by
a Company Entity from the Date of Grant through the date that the Performance
Goal is satisfied or continues to comply with the provisions of Section 6 below
(the “Restrictive Covenants”). For purposes of this Section 4, the terms
“Subordination Period” and “Subordinated Unit” shall have the same meaning given
such terms in the First Amended and Restated Agreement of Limited Partnership of
New Source Energy Partners L.P., as amended from time to time. Restricted Units
that have become vested pursuant to the satisfaction of the Performance Goal are
referred to herein as “Vested Units” and the date that the Restricted Units
become Vested Units shall be referred to herein as the “Vesting Date.”

5. Termination and Change of Control.

(a) Termination of Employment for Cause. In the event that any member of the
Company Entities terminates the Employee’s employment with the Company Entities
for Cause prior to the time that any Restricted Units have become Vested Units,
any unvested Restricted Unit shall be forfeited immediately without
consideration. For purposes of this Agreement, the term “Cause” shall be defined
as one or more of the following events: (i) the Employee’s willful engagement in
dishonesty, illegal conduct or gross misconduct, which, in each case, is or
could reasonably be expected to be materially injurious to the financial
condition or the business reputation of the Company Entities; (ii) the
Employee’s embezzlement, misappropriation or fraud, whether or not related to
the Employee’s employment with the Company Entities; (iii) the Employee’s
conviction of or plea of guilty or nolo contendere to a crime that constitutes a
felony, or a crime that constitutes a misdemeanor that involves moral turpitude;
or (iv) the Employee’s breach of fiduciary duties to the Company Entities that
results in material harm to the Company Entities.

(b) Termination of Employment due to Death. In the event that the Employee’s
termination of employment with the Company Entities is terminated due to his or
her death, all unvested Restricted Units shall immediately be accelerated and
become Vested Units.

 

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(c) Termination of Employment for Any Reason other than for Cause or Death. In
the event that the Employee’s termination of employment with the Company
Entities is terminated for any other reason than for Cause or due to the
Employee’s death, as described above, prior to the time that any Restricted
Units have become Vested Units, the Restricted Units will be eligible to
continue vesting in accordance with the vesting schedule in Section 4 above;
provided, however, that if the Employee violates any provision of the
Restrictive Covenants, following the Employee’s termination of employment but
prior to the time that the Restricted Units have become Vested Units, the
unvested Restricted Units shall be forfeited immediately without consideration.

(d) Change of Control. In the event that a Change of Control occurs, all
unvested Restricted Units shall immediately be accelerated and become Vested
Units.

6. Restrictive Covenants.

(a) Non-Solicitation. In consideration of the Partnership’s grant of the
Restricted Units to the Employee pursuant to this Agreement and, further, so as
to protect the legitimate business interests of the Company Entities (including
the confidential information and trade secrets of the Company Entities and the
goodwill with which the Employee will be associated, and that the Employee will
help build, during the Employee’s employment), the Employee agrees that for the
period commencing on the Date of Grant and ending on the first to occur of the
following: (i) the last day of the Subordination Period, or (ii) the two year
anniversary of the Employee’s termination of employment with the Company
Entities, the Employee will not:

(i) directly solicit the sale of goods, services, or a combination of goods and
services from the established customers of the Company Entities other than on
behalf of the Company Entities; or

(ii) directly or indirectly solicit or contact any employee or officer of the
Company Entities in order to cause, encourage or induce such person to cease his
or her affiliation or employment with any Company Entity.

(b) Value and Reasonableness. The Employee agrees that the Company Entities’
substantial investments in its business interests, goodwill, confidential
information and trade secrets are worthy of protection, and that the Company
Entities’ need for the protection afforded by this Section 6 is greater than any
hardship the Employee might experience by complying with its terms. The Employee
agrees that the limitations as to time and scope of activity to be restrained
contained in this Agreement are reasonable and are not greater than necessary to
protect the confidential information, trade secrets, goodwill and other
legitimate business interests of the Company Entities.

(c) Reformation Requested. Although the Partnership and the Employee believe the
limitations as to time and scope of activity contained in this Section 6 are
reasonable and do not impose a greater restraint than necessary to protect the
Company Entities’

 

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confidential information, trade secrets, goodwill and legitimate business
interests, if this is judicially determined not to be the case, the Partnership
and the Employee specifically request that the limitations contained in this
Section 6 be reformed to the extent necessary to make this Section 6
enforceable.

(d) Right to Injunction. The Employee acknowledges that the Employee’s violation
or threatened or attempted violation of the covenants contained in this
Section 6 will cause irreparable harm to the Company Entities and that money
damages would not be sufficient remedy for any breach. The Employee agrees that
the Partnership shall be entitled as a matter of right to specific performance
of the covenants in this Agreement on behalf of itself and each Company Entity,
including entry of an ex parte temporary restraining order in state or federal
court, preliminary and permanent injunctive relief against activities in
violation of this Agreement, or both, or other appropriate judicial remedy, writ
or order, in any court of competent jurisdiction, restraining any violation or
further violation of such agreements by the Employee or others acting on the
Employee’s behalf, without any showing of irreparable harm and without any
showing that the Partnership does not have an adequate remedy at law. The
Company Entities’ right to injunctive relief shall be cumulative and in addition
to any other remedies provided by law or equity, including the recovery of
damages, attorney’s fees, costs and expenses. The Employee further acknowledges
and agrees that the existence of any claim or cause of action the Employee may
have against any Company Entity shall not constitute a defense to the
enforcement by the Partnership of the terms of this Agreement.

7. Delivery and Status of Units and Unit Distribution Rights. Promptly following
the expiration of the restrictions on the Restricted Units as contemplated by
this Agreement, subject to the remainder of this Section 7, the Partnership
shall cause to be issued and delivered to the Employee the number of Vested
Units as to which all restrictions have lapsed, free of any restrictive legend
relating to the lapsed restrictions, and shall pay to the Employee any
previously unpaid Unit Distribution Rights, if any, with respect to such
delivered Units. The Employee agrees that any Vested Units that he acquires upon
vesting of the Restricted Units will not be sold or otherwise disposed of in any
manner that would constitute a violation of any applicable federal or state
securities laws, the Plan or the rules, regulations and other requirements of
the U.S. Securities and Exchange Commission (“SEC”) and any stock exchange upon
which the Units are then listed. The Employee also agrees that (a) any
certificates representing the Units acquired under this award may bear such
legend or legends as the Committee deems appropriate in order to assure
compliance with applicable securities laws, (b) the Partnership may refuse to
register the transfer of the Units acquired under this award with the
Partnership’s transfer agent if such proposed transfer would, in the opinion of
counsel satisfactory to the Partnership, constitute a violation of any
applicable securities law, and (c) the Partnership may give related instructions
to its transfer agent, if any, to stop registration of the transfer of the Units
to be acquired under this award. In addition to the terms and conditions
provided herein, the Partnership may require that the Employee make such
covenants, agreements, and representations as the Committee, in its sole
discretion, deems advisable in order to comply with any such laws, rules,
regulations, or requirements.

8. Transferability and Assignment. This Agreement and the Restricted Units
granted hereunder will not be transferable by the Employee other than by will or
the laws of descent and distribution. Any purported transfer, assignment,
alienation, pledge, hypothecation, attachment, sale, transfer or encumbrance
shall be null, void and unenforceable against the Company Entities.

 

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9. Tax Withholding. The Company Entities shall have the authority and the right
to deduct or withhold, or to require the Employee to remit to a Company Entity,
an amount sufficient to satisfy all applicable federal, state and local taxes
(including the Employee’s employment tax obligations) required by law to be
withheld with respect to any taxable event arising in connection with the
Restricted Units and the Unit Distribution Rights thereon. In satisfaction of
the foregoing requirement, unless either (a) other arrangements have been made
that are acceptable to the applicable Company Entity or (b) the Board or a
committee of the Board that is composed solely of two or more “Non-Employee
Directors” within the meaning of Rule 16b-3, the Employee shall surrender the
number of Units otherwise issuable to him having a fair market value equal to
the sums required to be withheld by the applicable Company Entity. In the event
that Units that would otherwise be issued in respect of the Restricted Units are
surrendered to satisfy such withholding obligations, the number of Units that
shall be so surrendered shall be limited to the number of Units that have a Fair
Market Value on the date of such surrender equal to the aggregate amount of such
liabilities based on the minimum statutory withholding rates for federal, state,
local and foreign income tax and payroll tax purposes that are applicable to
such supplemental taxable income.

10. General Provisions.

(a) Administration. This Agreement shall at all times be subject to the terms
and conditions of the Plan. The Committee shall have sole and complete
discretion with respect to all matters reserved to it by the Plan and all
decisions of a majority of the Committee with respect thereto and this Agreement
shall be final and binding upon the Employee and the Partnership. In the event
of any conflict between the terms and conditions of this Agreement and the Plan,
the provisions of the Plan shall control.

(b) No Effect on Service. Nothing in this Agreement or in the Plan shall be
construed as giving the Employee the right to be retained in the employ or
service of the Company Entities. Furthermore, the Company Entities may at any
time dismiss the Employee from employment free from any liability or any claim
under the Plan or this Agreement, unless otherwise expressly provided in the
Plan, this Agreement or other written agreement.

(c) Tax Consultation. None of the Board, the Committee or the Company Entities
has made any warranty or representation to the Employee with respect to the
income tax consequences of the grant or vesting of the Restricted Units or the
transactions contemplated by this Agreement, and the Employee represents that he
is in no manner relying on such entities or any of their respective managers,
directors, officers, employees or authorized representatives (including
attorneys, accountants, consultants, bankers, lenders, prospective lenders and
financial representatives) for tax advice or an assessment of such tax
consequences. The Employee represents that he has consulted with any tax
consultants that the Employee deems advisable in connection with the Restricted
Units.

(d) Severability. Subject to Section 6(c), if any provision of this Agreement is
held to be illegal or invalid for any reason, the illegality or invalidity shall
not affect the remaining provisions hereof, but such provision shall be fully
severable and this Agreement shall be construed and enforced as if the illegal
or invalid provision had never been included herein.

 

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(e) Successors. This Agreement shall be binding upon the Employee, the
Employee’s legal representatives, heirs, legatees and distributees, and upon the
Partnership, its successors and assigns.

(f) Entire Agreement. This Agreement constitutes the entire agreement of the
parties with regard to the subject matter hereof, and contains all the
covenants, promises, representations, warranties and agreements between the
parties with respect to the Restricted Units granted hereby. Without limiting
the scope of the preceding sentence, all prior understandings and agreements, if
any, among the parties hereto relating to the subject matter hereof are hereby
null and void and of no further force and effect.

(g) Headings. The titles and headings of Sections are included for convenience
of reference only and are not to be considered in construction of the provisions
hereof.

(h) Governing Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware, without regard to conflicts
of law principles thereof.

(i) Gender. Words used in the masculine shall apply to the feminine where
applicable, and wherever the context of this Agreement dictates, the plural
shall be read as the singular and the singular as the plural.

(j) Amendments, Suspension and Termination. This Agreement may be wholly or
partially amended or otherwise modified, suspended or terminated at any time or
from time to time by the Board or the Committee (i) to the extent permitted by
the Plan, (ii) to the extent necessary to comply with applicable laws and
regulations or to conform the provisions of this Agreement to any changes
thereto or (iii) to settle the Restricted Units pursuant to all applicable
provisions of the Plan. Except as provided in the preceding sentence, this
Agreement cannot be modified, altered or amended in any way that is adverse to
the Employee except by a written agreement signed by both the Partnership and
the Employee.

(k) Insider Trading Policy. The terms of the Partnership’s insider trading
policy with respect to Units are incorporated herein by reference.

(l) Clawback. Notwithstanding any provisions in the Plan or this Agreement to
the contrary, any portion of the payments and benefits provided under this
Agreement or the sale of the Units granted hereunder shall be subject to a
clawback or other recovery by the Company Entities to the extent necessary to
comply with applicable law including, without limitation, the requirements of
the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 or any SEC
rule.

(m) Community Interest of Spouse. The Employee’s spouse shall be required to
execute the spousal consent set forth on the signature page attached hereto to
evidence such spouse’s agreement and consent to be bound by the terms and
conditions of this Agreement and the Plan as to such spouse’s interest, whether
as community property or otherwise, if any, in the Restricted Units granted to
the Employee hereunder.

 

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(n) Consent to Electronic Delivery; Electronic Signature. In lieu of receiving
documents in paper format, the Employee agrees, to the fullest extent permitted
by law, to accept electronic delivery of any documents that the Partnership may
be required to deliver (including, without limitation, prospectuses, prospectus
supplements, grant or award notifications and agreements, account statements,
annual and quarterly reports, and all other forms of communications) in
connection with this and any other award made or offered by the Partnership.
Electronic delivery may be via a Partnership electronic mail system or by
reference to a location on a Partnership intranet to which the Employee has
access. The Employee hereby consents to any and all procedures the Partnership
has established or may establish for an electronic signature system for delivery
and acceptance of any such documents that the Partnership may be required to
deliver, and agrees that his or her electronic signature is the same as, and
shall have the same force and effect as, his or her manual signature.

[Signature Page Follows]

 

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Form Agreement

IN WITNESS WHEREOF, the Partnership has caused this Agreement to be executed by
its duly authorized officer, effective for all purposes as provided above.

 

NEW SOURCE ENERGY PARTNERS L.P. By:  

 

Name:  

 

Title:  

 

EMPLOYEE

 

SPOUSAL CONSENT

The Employee’s spouse, if any, is fully aware of, understands and fully consents
and agrees to the provisions of this Agreement and the Plan and their binding
effect upon any marital or community property interests he or she may now or
hereafter own, and agrees that the termination of his or her and the Employee’s
marital relationship for any reason shall not have the effect of removing any
Units otherwise subject to this Agreement from coverage hereunder and that his
or her awareness, understanding, consent and agreement are evidenced by his or
her signature below.

 

 

SIGNATURE PAGE