Exhibit 10.42

EP ENERGY CORPORATION
2014 OMNIBUS INCENTIVE PLAN

Notice of Performance Unit Grant

You (the “Grantee”) have been granted the following award of Performance Units
pursuant to the EP Energy Corporation 2014 Omnibus Incentive Plan (the “Plan”):

Name of Grantee:
 
Number of Performance Units
 
Target Value Per Unit
$100
Effective Date of Grant:
 
Performance Period(s):
[insert performance period(s)]
Vesting and Settlement Date
Subject to the terms of the Plan and the Performance Unit Award Agreement
attached hereto, one-third of the Performance Units shall vest and be settled
following the end of each Performance Period set forth above.

Settlement of each tranche of the award shall occur within 75 days following the
end of the applicable Performance Period and Grantee must be employed by the
Company on the settlement date to receive the payout.

Form of Settlement
Shares of Class A Common Stock of EP Energy Corporation (the “Company”), par
value $0.01 per share (“Shares”), or cash, as determined by the Plan
Administrator in its sole discretion

By your electronic acceptance/signature, you agree and acknowledge that this
Performance Unit award is granted under and governed by the terms and conditions
of the Plan and the attached Performance Unit Award Agreement, which are
incorporated herein by reference.

 
EP Energy Corporation

By:

Title:_____________________________

EP ENERGY CORPORATION
2014 OMNIBUS INCENTIVE PLAN

Performance Unit Award Agreement

SECTION 1.GRANT OF PERFORMANCE UNITS

(a)    Performance Units. On the terms and conditions set forth in the Notice of
Performance Unit Grant and this Performance Unit Award Agreement (the
“Agreement”), the Company grants to the Grantee on the Effective Date of Grant
the Performance Units set forth in the Notice of Performance Unit Grant.
(b)    Plan and Defined Terms. The Performance Units are granted pursuant to the
Plan. All terms, provisions, and conditions applicable to the Performance Units
set forth in the Plan and not set forth herein are hereby incorporated by
reference herein. To the extent any provision hereof is inconsistent with a
provision of the Plan, the provisions of the Plan will govern. All capitalized
terms that are used in the Notice of Performance Unit Grant or this Agreement
and not otherwise defined therein or herein shall have the meanings ascribed to
them in the Plan.
SECTION 2.    VALUE OF PERFORMANCE UNITS

(a)    Determination of Value. The value of a Performance Unit is based on the
relative position of the average total shareholder return (“TSR”) of the
Company’s Class A Common Stock during the Performance Period, compared to the
TSR of each member of the Peer Group during the same Performance Period, as
provided in the following table:
Relative TSR Position Compared to Peer Group
Value of
Performance Unit*
Below 25th Percentile
$0
25th Percentile
$50
50th Percentile
$100
75th Percentile or Higher
$200

* The value of the Performance Unit shall be adjusted by straight-line
interpolation for a Relative TSR Position between 25th Percentile and 50th
Percentile, and between 50th Percentile and 75th Percentile; provided, however,
that the maximum value of each Performance Unit is $100 if the absolute TSR for
the Company’s stock is negative (i.e., without comparison to the TSR of the Peer
Companies).
(b)    TSR. TSR will be determined using the volume-weighted average share price
of the relevant share during the 20 business day period ending on the first and
last business days of the Performance Period, and assuming that any dividends
paid are reinvested as of the ex-dividend date.
(c)    Peer Group. For purposes of this Award, the Peer Group for the
Performance Periods shall include: [__insert peer group companies __].
Notwithstanding the above, should any member of the Peer Group cease to provide
a meaningful comparison for purposes of this award as a result of mergers,
acquisitions, bankruptcies, changes in business or other extraordinary or
unforeseeable events, the Plan Administrator in its sole and absolute discretion
may eliminate and/or replace such member. In addition and for purposes of
clarity, the calculation of the average TSR for the Peer Group over the
applicable Performance Period shall not include the TSR of the Company’s Class A
Common Stock.
SECTION 3.    FORM OF SETTLEMENT
The value of each vested Performance Unit shall be settled in the form of Shares
or paid in cash to the Participant (or, if the Participant is not living at the
time of settlement, to the Participant’s beneficiary), as determined by the Plan
Administrator in its sole discretion. If the Plan Administrator elects to settle
the Performance Units in the form of Shares, the value of each vested
Performance Unit shall be converted into an equivalent number of Shares at the
Fair Market Value of a Share on the last day of the applicable Performance
Period. The settlement, be it in Shares or cash, shall be made within 75 days
after the end of the applicable Performance Period and the Grantee must be
employed on the settlement date to receive the payout, except as otherwise
provided in Section 4 below; provided that, to the extent required by Section
162(m) of the Code, no payments will be made until the Plan Administrator
certifies that the performance goals have been attained.
SECTION 4.    VESTING AND FORFEITURE
(a)    Vesting Period. The Performance Units shall vest and be settled (rounded
down to the nearest whole unit) in accordance with the vesting schedule set
forth in the Notice of Performance Unit Grant, subject, however to the rules set
forth in Sections 4(b) and 4(c) below.
(b)    Termination of Employment. Except as set forth in the Plan or otherwise
provided below, if the Grantee’s employment is terminated for any reason before
the applicable settlement date, all unvested Performance Units shall be canceled
immediately and shall not be payable.
(i)    Termination due to Death. Notwithstanding Section 4(b) above, if the
Grantee’s employment terminates due to the Grantee’s death, any outstanding
Performance Units shall vest in full and be settled at the Target Value set
forth in the Notice of Performance Unit Grant.

(c)    Change in Control. Upon the occurrence of a Change in Control on or
before the last day of the Performance Period, all outstanding Performance Units
shall vest in full upon the Change in Control and be settled based on actual
performance, after adjusting the Performance Period to end on the last business
day immediately prior to the Change in Control. Settlement shall occur within 30
days after the Change in Control.
SECTION 5.    MISCELLANEOUS PROVISIONS

(a)    Tax Withholding. Pursuant to Section 17.8 of the Plan, the Plan
Administrator shall have the power and right to deduct or withhold, or require
the Grantee to remit to the Company, an amount sufficient to satisfy any
federal, state and local taxes (including the Grantee’s FICA obligations)
required by law to be withheld with respect to this Award.

(b)    Ratification of Actions. By accepting this Agreement, the Grantee and
each person claiming under or through the Grantee shall be conclusively deemed
to have indicated the Grantee’s acceptance and ratification of, and consent to,
any action taken under the Plan or this Agreement and Notice of Performance Unit
Grant by the Company or the Plan Administrator.

(c)    No Rights to Employment. The Grantee acknowledges and agrees that the
vesting set forth in the Notice of Performance Unit Grant and this Agreement
shall apply only if the Grantee provides continuous services to the Company
during the Performance Period, and that any such services (as an employee or
otherwise) remain at the will of the Company. The Participant further
acknowledges that nothing in this Award or the Plan constitutes an express or
implied promise of continued engagement as an employee or consultant.

(d)    Choice of Law. This Agreement and the Notice of Performance Unit Grant
shall be governed by, and construed in accordance with, the laws of Texas,
without regard to any conflicts of law or choice of law rule or principle that
might otherwise cause the Agreement or Notice of Performance Unit Grant to be
governed by or construed in accordance with the substantive law of another
jurisdiction.
(e)    Severability. In the event any provision of this Agreement shall be held
illegal or invalid for any reason, the illegality or invalidity shall not affect
the remaining provisions of this Agreement, and this Agreement shall be
construed and enforced as if such illegal or invalid provision had not been
included.
(f)    References to Plan. All references to the Plan shall be deemed references
to the Plan as may be amended from time to time.
(g)    Tax Issues. This Award is not intended to constitute “nonqualified
deferred compensation” within the meaning of Section 409A of the Code and the
provisions hereof shall be interpreted and administered consistently with such
intent. This Award is intended to qualify as performance-based compensation
within the meaning of Section 162(m) of the Code.