Exhibit 10.2
HOLLY ENERGY PARTNERS, L.P.
LONG-TERM INCENTIVE PLAN
AMENDED AND RESTATED PERFORMANCE UNIT AGREEMENT
This Performance Unit Agreement (the “Agreement”) was made and entered into by
and between Holly Logistic Service, L.L.C., a Delaware limited liability company
(the “Company”), and Matthew P. Clifton (the “Service Provider”). This Agreement
was entered into as of the 1st day of March, 2012 (the “Date of Grant”) and is
amended and restated as of April 29, 2014 to be effective as of February 28,
2014 to clarify the continued “double-trigger” vesting of the Performance Units
in connection with a Special Involuntary Termination.
W I T N E S S E T H:
WHEREAS, the Company has adopted the HOLLY ENERGY PARTNERS, L.P. LONG-TERM
INCENTIVE PLAN (the “Plan”) to attract, retain and motivate employees,
executives, directors and consultants; and
WHEREAS, the Company continues to believe that the grant to the Service Provider
of performance units of Holly Energy Partners, L.P. (the “Partnership”) as part
of the Service Provider’s compensation for services provided to the Company
and/or the Partnership was and is consistent with the stated purposes for which
the Plan was adopted.
NOW, THEREFORE, in consideration of the services rendered by the Service
Provider, it is agreed by and between the Company and the Service Provider, as
follows:
1.Grant. The Company previously granted to the Service Provider as of the Date
of Grant an Award of 5,718 performance units (the “Performance Units”), subject
to the terms and conditions set forth in this Agreement. Depending on the
performance of the Partnership, the Service Provider may earn from fifty percent
(50%) to one hundred fifty percent (150%) of the Performance Units, based on the
increase in the Partnership’s distributable cash flow per Common Unit
(“DCF/Unit”).
2.    Distribution Equivalent Rights. As long as the Service Provider holds the
Performance Units granted pursuant to this Agreement, the Service Provider shall
be entitled to receive distribution equivalent rights (“DERs’) in accordance
with this Section 2. In the event the Partnership makes a distribution in
respect of outstanding Common Units of the Partnership (“Common Units”) and, on
the record date for such distribution, the Service Provider holds Performance
Units that have not yet become earned and payable under this Agreement, the
Company shall pay the Service Provider an amount in cash equal to the
distribution amounts the Service Provider would have received if the Service
Provider were the holder of record, as of such record date, of a number of
Common Units equal to the number of such Performance Units that have not become
earned and payable as of such

US 2395053v.2

--------------------------------------------------------------------------------

record date, such payment to be made on or promptly following the date that the
Partnership makes such distribution (however, in no event shall the DERs be paid
later than 30 days following the date on which the Partnership makes such
distribution to unitholders generally).
3.    Nature of Award. The Performance Units represent an Award for the
“Performance Period” which begins on January 1, 2012 and ends on December 31,
2014. Following the completion of the Performance Period, the Service Provider
shall be entitled to a payment of Common Units as determined under this
Section 3 and/or Section 4, as applicable, and payable in Common Units at the
time indicated in Section 5 or Section 4(b), as applicable.
(a)    Performance Measure. The percentage of Performance Units earned for the
Performance Period is determined on the basis of the total increase in the
Partnership’s DCF/Unit during the Performance Period over a DCF/Unit of $15.105.
(b)    Common Units Payable. The number of Common Units payable is equal to the
result of multiplying Performance Units by the “Performance Percentage” set
forth below:

3-Year Total Increase in DCF/Unit over $15.105
Performance Percentage (%) to be Multiplied by Performance Units
$0.000
50%
$1.241
100%
$2.548
150%

The percentages above shall be interpolated between points. In its sole
discretion, the Committee may make a payment to the Service Provider assuming a
Performance Percentage of up to one hundred fifty percent (150%) of the
Performance Units instead of the Performance Percentage as determined pursuant
to this Section 3(b).

4.    Early Termination. In the event Service Provider ceases to provide
services to the Partnership and the Company prior to the end of the Performance
Period on account of an event described in this Section 4, the number of
Performance Units with respect to which payment at the end of the Performance
Period is based shall be determined as follows:
(a)    In the event that the Service Provider ceases to provide services to the
Partnership and the Company:
(i)    for any reason other than voluntary separation, Cause (as defined in
Section 4(c)(vii)) or a Special Involuntary Separation (as defined in Section
4(c)(vi)),
(ii)    due to the Service Provider’s death,

2
US 2395053v.2

--------------------------------------------------------------------------------

(iii)    due to the Service Provider’s total and permanent disability as
determined by the Compensation Committee of the Company’s Board of Directors
(the “Committee”) in its sole discretion, or
(iv)    due to the Service Provider’s retirement from any service relationship
with the Company and its subsidiaries on or after attaining normal retirement
age of 62 or after attaining an earlier retirement age approved by the Committee
in its sole discretion,
the number of Performance Units that shall be earned by and paid to the Service
Provider or his beneficiary, in accordance with and at the time specified in
Section 5, shall be determined as follows: the Service Provider shall forfeit a
percentage of the Performance Units earned equal to the percentage that the
number of full months following the date of separation, death, disability or
retirement to the end of the Performance Period bears to thirty-six (36). The
Committee shall determine the number of Performance Units earned by the Service
Provider or his beneficiary in accordance with Section 3 for the entire
Performance Period as soon as administratively practicable after the end of the
Performance Period. In its sole discretion, the Committee may make a payment to
the Service Provider assuming a Performance Percentage of up to one hundred
fifty percent (150%) of the Performance Units instead of the pro-rata number of
Performance Units as determined pursuant to this Section 4(a). Unless the
Committee determines otherwise, the Service Provider will have no right to any
other Performance Units and those other Performance Units granted under this
Agreement will be forfeited. If the Service Provider separates from service
prior to the end of the Performance Period due to voluntary separation or on
account of Cause, all Performance Units hereunder will be forfeited.
(b)    In the event of a Special Involuntary Termination, as defined in
Section 4(c)(vi), before the end of the Performance Period, no Performance Units
shall be forfeited, and payment with respect to one hundred fifty percent (150%)
of the Performance Units shall be made as soon as administratively practicable
following the Special Involuntary Termination, but in no event later than two
and one-half months after the Service Provider’s service terminates. Payment
pursuant to this Section 4(b) is in lieu of payment pursuant to Section 4(a) and
if the Service Provider receives payment pursuant to this Section 4(b) the
Service Provider will not be entitled to any payment pursuant to Section 4(a).
(c)    Definitions. For purposes of this Section 4,
(i)    “Change in Control” shall mean:
A.    Any Person (as defined in Section 4(c)(ii) below), other than
HollyFrontier Corporation (“HFC”) or any of its wholly-owned subsidiaries, HEP
Logistics Holdings, L.P. (the “General Partner”), the Partnership, the Company,
or any of their subsidiaries,

3
US 2395053v.2

--------------------------------------------------------------------------------

a trustee or other fiduciary holding securities under an employee benefit plan
of HFC, the Partnership, the Company or any of their Affiliates (as defined in
Section 4(c)(v) below), an underwriter temporarily holding securities pursuant
to an offering of such securities, or any entity owned, directly or indirectly,
by the holders of the voting securities of HFC, the Company, the General Partner
or the Partnership in substantially the same proportions as their ownership in
HFC, the Company, the General Partner or the Partnership, respectively, is or
becomes the Beneficial Owner (as defined in Section 4(c)(iii) below), directly
or indirectly, of securities of HFC, the Company, the General Partner or the
Partnership (not including in the securities beneficially owned by such Person
any securities acquired directly from HFC, the General Partner, the Partnership,
the Company or their Affiliates) representing more than forty percent (40%) of
the combined voting power of HFC’s, the Company’s, the General Partner’s or the
Partnership’s then outstanding securities, excluding any Person who becomes such
a Beneficial Owner in connection with a transaction described in Section
4(c)(i)(C)(1) below.
B.    The individuals who as of the Date of Grant constitute the Board of
Directors of HFC (the “HFC Board”) and any New Director (as defined in Section
4(c)(iv) below) cease for any reason to constitute a majority of the HFC Board.
C.    There is consummated a merger or consolidation of HFC, the Company, the
General Partner or the Partnership with any other entity, except if:
(1)    the merger or consolidation results in the voting securities of HFC, the
Company, the General Partner or the Partnership outstanding immediately prior
thereto continuing to represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity or any parent thereof)
at least sixty percent (60%) of the combined voting power of the voting
securities of HFC, the Company, the General Partner or the Partnership, as
applicable, or such surviving entity or any parent thereof outstanding
immediately after such merger or consolidation; or
(2)    the merger or consolidation is effected to implement a recapitalization
of HFC, the Company, the General Partner or the Partnership (or similar
transaction) in which no Person is or becomes the Beneficial Owner, directly,

4
US 2395053v.2

--------------------------------------------------------------------------------

or indirectly, of securities of, as applicable, (not including in the securities
beneficially owned by such Person any securities acquired directly from HFC, the
Company, the General Partner or the Partnership or their Affiliates other than
in connection with the acquisition by HFC, the Company, the General Partner or
the Partnership or its Affiliates of a business) representing more than forty
percent (40%) of the combined voting power of HFC’s, the Company’s the General
Partner’s or the Partnership’s, as applicable, then outstanding securities.
D.    The holders of the voting securities of HFC, the Company, the General
Partner or the Partnership approve a plan of complete liquidation or dissolution
of HFC, the Company, the General Partner or the Partnership or an agreement for
the sale or disposition by the Company of all or substantially all of the
Company’s assets, other than a sale or disposition by holders of the voting
securities of HFC, the Company, the General Partner or the Partnership of all or
substantially all of HFC’s, the Company’s, the General Partner’s or the
Partnership’s assets, as applicable, to an entity at least sixty percent (60%)
of the combined voting power of the voting securities of which is owned by the
direct and indirect holders of the voting securities of HFC, the Company, the
General Partner or the Partnership in substantially the same proportions as
their ownership of the voting securities of HFC, the Company, the General
Partner or the Partnership, as applicable, immediately prior to such sale.
(ii)    “Person” shall have the meaning given in section 3(a)(9) of the
Securities Exchange Act of 1934 (the “1934 Act”) as modified and used in
sections 13(d) and 14(d) of the 1934 Act.
(iii)    “Beneficial Owner” shall have the meaning provided in Rule 13d-3 under
the 1934 Act.
(iv)    “New Director” shall mean an individual whose election by HFC’s Board or
nomination for election by holders of the voting securities of HFC was approved
by a vote of at least two-thirds (2/3) of the directors then still in office who
either were directors at the Date of Grant or whose election or nomination for
election was previously so approved or recommended. However, New Director shall
not include a director whose initial assumption of office is in connection with
an actual or threatened election contest, including but not limited to a consent
solicitation relating to the election of directors of the HFC.

5
US 2395053v.2

--------------------------------------------------------------------------------

(v)    “Affiliate” shall have the meaning set forth in Rule 12b-2 promulgated
under section 12 of the 1934 Act.
(vi)    “Special Involuntary Termination” shall mean the occurrence of (1) or
(2) within sixty (60) days prior to, or at any time after, a Change in Control
(as defined in Section 4(c)(i)), where (1) is termination by the Company of the
Service Provider’s service relationship with the Company and the Partnership
(including subsidiaries of the Company and the Partnership), for any reason
other than Cause (as defined in Section 4(c)(vii)) and (2) is a resignation by
the Service Provider from service with the Company and the Partnership
(including subsidiaries of the Company and the Partnership) within ninety (90)
days after an Adverse Change (as defined in Section 4(c)(viii)) in the terms of
the Service Provider’s service relationship.
(vii)    “Cause” shall mean:
A.    An act or acts of dishonesty on the part of the Service Provider
constituting a felony or serious misdemeanor and resulting or intended to result
directly in gain or personal enrichment at the expense of the Company;
B.    Gross or willful and wanton negligence in the performance of the Service
Provider’s material and substantial duties of employment or service relationship
with the Company; or
C.    Conviction of a felony involving moral turpitude.
The existence of Cause shall be determined by the Committee, in its sole and
absolute discretion.
(viii)    “Adverse Change” shall mean, without the express written consent of
the Service Provider, the occurrence of any of the following on or after the
60th day preceding a Change in Control (A) a change in the Service Provider’s
principal office to a location more than 25 miles from the Service Provider’s
work address, (B) a material increase (without adequate consideration) or a
material reduction in duties of the type previously performed by the Service
Provider, or (C) a material reduction in the Service Provider’s base
compensation (other than bonuses and other discretionary items of compensation)
that does not apply generally to employees of the Company or its successor.
Service Provider shall provide notice to the Company of the event alleged to
constitute an Adverse Change within ninety (90) days of the occurrence of such
event and the Company shall be given the opportunity to remedy the alleged
Adverse Change and/or to contest

6
US 2395053v.2

--------------------------------------------------------------------------------

Service Provider’s assertion that an Adverse Change event has occurred within
thirty (30) days from receipt of such notice.
5.    Payment of Performance Units.
(a)    The number of Common Units payable at the end of the Performance Period
(or such earlier time as specified under Section 4(b)) shall be payable as soon
as reasonably practicable following the close of the Performance Period, but in
no event later than two and one-half months after the end of the calendar year
in which the Performance Period closes (or such earlier time as specified under
Section 4(b)), in the amount determined in accordance with Section 3, as
adjusted by Section 4, if applicable. Such payment will be subject to
withholding for taxes and other applicable payroll adjustments. The Committee’s
determination of the amount payable shall be binding upon the Service Provider
and his beneficiary or estate.
(b)    If Service Provider is a “specified employee” within the meaning of
Treasury Regulation Section 1.409A-1(i) as of the date of the Service Provider’s
“separation from service” (within the meaning of Treasury Regulation Section
1.409A-1(h)), then Service Provider shall not be entitled to receive Common
Units in settlement of Performance Units until the earlier of (1) the date which
is six (6) months after Service Provider’s “separation from service” for any
reason other than death, or (2) the date of Service Provider’s death. The
provisions of this Section 5(b) shall only apply if and to the extent required
to avoid the imputation of any tax, penalty, or interest pursuant to Section
409A of the Code.
6.    Adjustment in Number of Performance Units. Except as provided below, in
the event that the outstanding Common Units are increased, decreased or
exchanged for a different number or kind of units or other securities, or if
additional, new or different units or securities are distributed with respect to
the Common Units through merger, consolidation, sale of all or substantially all
of the assets of the Partnership, reorganization, recapitalization, unit
dividend, unit split, reverse unit split or other distribution with respect to
such Common Units, there shall be substituted for the Common Units under the
Performance Units subject to this Agreement the appropriate number and kind of
Common Units or new or replacement securities as determined in the sole
discretion of the Committee.
7.    Delivery of Common Units. No Common Units shall be delivered pursuant to
this Agreement until the approval of any governmental authority required in
connection with this Agreement, or the issuance of Common Units hereunder, has
been received by the Company.
8.    Securities Act. The Company shall have the right, but not the obligation,
to cause the Common Units payable under this Agreement to be registered under
the appropriate rules and regulations of the Securities and Exchange Commission.
The Company shall not be required to deliver any Common Units hereunder if, in
the opinion of counsel for the Company, such delivery would violate the
Securities Act of 1933 or any other applicable federal or state securities laws
or regulations.

7
US 2395053v.2

--------------------------------------------------------------------------------

9.    Federal and State Taxes. The Service Provider may incur certain
liabilities for Federal, state or local taxes and the Company may be required by
law to withhold such taxes for payment to taxing authorities. Upon the
determination by the Company of the amount of taxes required to be withheld, if
any, the Service Provider shall either pay to the Company, in cash or by
certified or cashier’s check, an amount equal to the taxes required to be
withheld, or the Service Provider shall authorize the Company to withhold from
the Common Units payable to the Service Provider an amount necessary to satisfy
the Federal, state or local taxes required to be withheld. Authorization of the
Service Provider to the Company to withhold taxes pursuant to this Section 9
shall be in form and content acceptable to the Committee. An authorization to
withhold taxes pursuant to this provision shall be irrevocable unless and until
the tax liability of the Service Provider has been fully paid. In the discretion
of the Committee, the required taxes may be withheld in kind from Common Units
payable under this Agreement. In the event that the Service Provider fails to
make arrangements that are acceptable to the Committee for providing to the
Company, at the time or times required, the amounts of federal, state and local
taxes required to be withheld with respect to the Common Units payable to the
Service Provider under this Agreement, the Company shall have the right to
purchase at current market price as determined by the Committee and/or to sell
to one or more third parties in either market or private transactions sufficient
Common Units payable under this Agreement to provide the funds needed for the
Company to make the required tax payment or payments.
10.    Definitions; Copy of Plan. To the extent not specifically provided
herein, all terms used in this Agreement shall have the same meanings ascribed
to them in the Plan. By the execution of this Agreement, the Service Provider
acknowledges receipt of a copy of the Plan. If any provision of this Agreement
is held to be illegal, invalid or unenforceable under any applicable law, then
such provision will be deemed to be modified to the minimum extent necessary to
render it legal, valid and enforceable; and if such provision cannot be so
modified, then this Agreement will be construed as if not containing the
provision held to be invalid, and the rights and obligations of the parties will
be construed and enforced accordingly.
11.    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 decisions
of the majority of the Committee with respect thereto and this Agreement shall
be final and binding upon the Service Provider and the Company. In the event of
any conflict between the terms and conditions of this Agreement and the Plan,
the provisions of the Plan shall control.
12.    No Right to Continued Service Relationship. This Agreement shall not be
construed to confer upon the Service Provider any right to continue as a service
provider to the Company and shall not limit the right of the Company, in its
sole discretion, to terminate the service of the Service Provider at any time.
13.    Governing Law. This Agreement shall be interpreted and administered under
the laws of the State of Texas, without giving effect to any conflict of laws
provisions.

8
US 2395053v.2

--------------------------------------------------------------------------------

14.    Amendments. This Agreement may be amended only by a written agreement
executed by the Company and the Service Provider. Any such amendment shall be
made only upon the mutual consent of the parties, which consent (of either
party) may be withheld for any reason.
15.    No Liability for Good Faith Determinations. The Company and the members
of the Committee and the Board shall not be liable for any act, omission or
determination taken or made in good faith with respect to this Agreement or the
Performance Units granted hereunder.
16.    No Guarantee of Interests. The Board and the Company do not guarantee the
Common Units from loss or depreciation.
17.    Nontransferability of Agreement. This Agreement and all rights under this
Agreement shall not be transferable by the Service Provider during his life
other than by will or pursuant to applicable laws of descent and distribution.
Any rights and privileges of the Service Provider in connection herewith shall
not be transferred, assigned, pledged or hypothecated by the Service Provider or
by any other person or persons, in any way, whether by operation of law, or
otherwise, and shall not be subject to execution, attachment, garnishment or
similar process. In the event of any such occurrence, this Agreement shall
automatically be terminated and shall thereafter be null and void.
Notwithstanding the foregoing, all or some of the Common Units or rights under
this Agreement may be transferred to a spouse pursuant to a domestic relations
order issued by a court of competent jurisdiction.
18.    Compliance with Section 409A of the Code. This Agreement is intended to
comply and shall be administered in a manner that is intended to comply with
section 409A of the Code and shall be construed and interpreted in accordance
with such intent. Payment under this Agreement shall be made in a manner that
will comply with section 409A of the Code, including regulations or other
guidance issued with respect thereto, except as otherwise determined by the
Committee. The applicable provisions of section 409A of the Code are hereby
incorporated by reference and shall control over any contrary provisions herein
that conflict therewith.
IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by its
officers thereunto duly authorized.
HOLLY LOGISTIC SERVICES, L.L.C.

By:    
Bruce R. Shaw, President

9
US 2395053v.2