Exhibit 10.2

 

RESTRICTED INCENTIVE UNIT AGREEMENT

 

THIS RESTRICTED INCENTIVE UNIT AGREEMENT (this “Agreement”) is entered into by
and between Crosstex Energy GP, LLC, a Delaware limited liability company (the
“Company”), and             (“Participant”) as of the Grant Date.

 

WITNESSETH:

 

WHEREAS, the Crosstex Energy GP, LLC Amended and Restated Long-Term Incentive
Plan (As Amended and Restated on May 9, 2013) (the “Plan”) was adopted by the
Company for the benefit of certain employees of the Company or its Affiliates
(as defined in the Plan) and non-employee directors of the Company;

 

WHEREAS, the Committee (as defined in the Plan) is responsible for granting
Awards (as defined in the Plan) pursuant to the Plan; and

 

WHEREAS, Participant is eligible to participate in the Plan and the Committee
has authorized the grant to Participant of the Subject Award (as defined in
Section 2 of this Agreement) in respect of common units representing limited
partner interests (“Units”) of Crosstex Energy, L.P., a Delaware limited
partnership (the “Partnership”);

 

NOW, THEREFORE, in consideration of the premises and the mutual covenants and
agreements hereinafter set forth, the Company and Participant hereby agree as
follows:

 

1.             Definitions.  Capitalized terms used herein and not otherwise
defined herein shall have the meaning ascribed to them in the Plan.

 

“Cause” means (i) Participant has failed to perform the duties assigned to him
and such failure has continued for 30 days following delivery by the Company of
written notice to Participant of such failure, (ii) Participant has been
convicted of a felony or misdemeanor involving moral turpitude,
(iii) Participant has engaged in acts or omissions against the Company
constituting dishonesty, breach of fiduciary obligation, or intentional
wrongdoing or misfeasance, (iv) Participant has acted intentionally or in bad
faith in a manner that results in a material detriment to the assets, business
or prospects of the Company, or (v) Participant has breached any obligation
under this Agreement.

 

“Good Reason” means any of the following: (i) a reduction in Participant’s base
annual salary; (ii) a material adverse change in Participant’s authority, duties
or responsibilities; or (iii) the Company requires Participant to move his or
her principal place of employment to a location that is 30 or more miles from
his or her current place of employment and the new location is farther from his
or her primary residence.  For purposes of this definition, no act or failure to
act on the Company’s part shall be considered a “Good Reason” unless
(x) Participant has given the Company written notice of such act or failure to
act within 30 days thereof, (y) the Company fails to remedy such act or failure
to act within 30 days of its receipt of such notice, and (z) Participant
terminates his or her employment with the Company within 60 days following the
Company’s receipt of written notice.

 

“Grant Date” means     .

 

“Prorated Amount” means a number equal to the total number of outstanding
Restricted Incentive Units granted hereunder multiplied by a fraction (i) the
numerator of which is the number of days that elapse from the Vesting
Commencement Date to the date of the Qualifying Termination and (ii)

 

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the denominator of which is the full number of days beginning on the Vesting
Commencement Date and ending at the conclusion of the Restricted Period (as
defined below).

 

“Qualifying Termination” means Participant’s employment or service with the
Company or its Affiliates is terminated due to (i) Participant’s retirement with
the approval of the Committee on or after reaching age 60, (ii) an involuntary
termination of Participant by the Company for reasons other than Cause, or
(iii) a termination by Participant for Good Reason.

 

“Restricted Incentive Unit” means a unit granted hereunder as part of the
Subject Award described in Section 2 of this Agreement, which, subject to the
restrictions and forfeiture conditions described herein, evidences the right to
receive one Unit.

 

“Vested Units” means the Units which shall be delivered to Participant upon the
vesting of the Restricted Incentive Units pursuant to Section 3 of this
Agreement.

 

“Vesting Commencement Date” means     .

 

2.             Restricted Incentive Unit Award.  On the terms and conditions and
subject to the restrictions, including forfeiture, hereinafter set forth, the
Company hereby grants to Participant, and Participant hereby accepts, an award
of                    Restricted Incentive Units (the “Subject Award”).  The
Restricted Incentive Units granted hereunder shall be evidenced by the Committee
in a book entry or in such other manner as the Committee may determine.

 

3.             Vesting/Forfeiture.  At the time of vesting of any Restricted
Incentive Units, as described in this Section 3, such Restricted Incentive Units
shall be converted into Participant’s right to receive delivery of such number
of Vested Units that shall be equal to the number of Restricted Incentive Units
that became vested at such time.

 

(a)           The Restricted Incentive Units shall be subject to a restricted
period that shall commence on the Grant Date and terminate on the third
anniversary of the Vesting Commencement Date, if Participant is in the
continuous service of the Company or its Affiliates until such vesting date
(such period herein called the “Restricted Period”).

 

(b)           The Restricted Incentive Units shall be forfeited to the Company
at no cost to the Company if Participant’s employment or service with the
Company or its Affiliates terminates prior to the termination of the Restricted
Period applicable to such Restricted Incentive Units; provided, however, (i) in
the event a Qualifying Termination occurs during the Restricted Period, a
Prorated Amount of the Restricted Incentive Units shall become fully vested and
the Restricted Period shall terminate, and (ii) in the event Participant dies,
Participant becomes disabled and qualified to receive benefits under the
Company’s long-term disability plan, or a Change in Control occurs during the
Restricted Period, the Restricted Incentive Units shall become fully vested and
the Restricted Period shall terminate.  Notwithstanding the foregoing, to the
extent the Subject Award is subject to Section 409A, Vested Units shall not be
delivered when Participant becomes disabled and qualified to receive benefits
under the Company’s long-term disability plan unless Participant incurs a
“disability” within the meaning of Treas. Reg. Section 1.409A-3(i)(4).

 

(c)           Upon the termination of the Restricted Period applicable to the
Restricted Incentive Units, the restrictions applicable to the Restricted
Incentive Units that have not theretofore been forfeited shall terminate and
such unforfeited Restricted Incentive Units shall be vested for purposes of this
Agreement.  As soon as practicable thereafter, the certificate(s) representing
the number of Vested Units that are issuable with respect to the vested
Restricted Incentive Units, together with any

 

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distributions with respect to such Restricted Incentive Units then being held by
the Company pursuant to the provisions of this Agreement, if any, shall be
delivered, free of all such restrictions, to Participant or Participant’s
beneficiary or estate, as the case may be, it being understood that the delivery
of such certificate(s) shall constitute delivery of such Vested Units for
purposes of this Agreement.  Notwithstanding anything contained herein to the
contrary, in no event shall such Vested Units be delivered to Participant later
than (i) the end of the calendar year in which vesting occurs, or, if later,
(ii) the 15th day of the third calendar month following the date on which
vesting occurs.

 

(d)           Notwithstanding anything contained herein to the contrary, the
Committee shall have the right to cancel all or any portion of any outstanding
restrictions prior to the termination of such restrictions with respect to any
or all of the Restricted Incentive Units on such terms and conditions as the
Committee may, in writing, deem appropriate.

 

(e)           Notwithstanding anything contained herein to the contrary, in no
event shall Participant have any right to vote any Restricted Incentive Units or
to exercise any other rights, powers and privileges of a holder of the Units
with respect to such Restricted Incentive Units until such time that (i) the
Restriction Period applicable to such Restricted Incentive Units or a portion
thereof shall have expired (and all other vesting requirements with respect
thereto have been fulfilled), (ii) such Restricted Incentive Units are converted
into the right to receive Vested Units and (iii) such Vested Units are delivered
to Participant.

 

4.             DER Grant.  Subject to the following, the Subject Award granted
hereunder includes a tandem award of a number of DERs equal to the number of
Restricted Incentive Units subject to such Subject Award.  Each DER shall
entitle Participant to receive cash payments equal to the cash distributions
made by the Partnership (on a per Unit basis) with respect to its outstanding
Units generally (“General Distribution”); provided that, no such cash payments
shall be payable to or on behalf of Participant with respect to record dates
before the Grant Date, or with respect to any record date (or date of a General
Distribution) occurring after the Grant Date on which Participant has forfeited
the Restricted Incentive Units pursuant to the terms of this Agreement or the
Plan; provided further that, in no event shall such cash payments be paid to
Participant later than (i) the end of the calendar year in which a General
Distribution occurs, or, if later, (ii) the 15th day of the third calendar month
following the date on which such General Distribution occurs.  The DERs shall
lapse on the earlier of (x) the date on which the Restricted Incentive Units are
forfeited or (y) the termination of the Restricted Period.

 

5.             Taxes.

 

(a)           PARTICIPANT REPRESENTS THAT PARTICIPANT IS NOT RELYING ON THE
COMPANY OR ITS AFFILIATES FOR ANY TAX ADVICE IN CONNECTION WITH THE RESTRICTED
INCENTIVE UNITS.

 

(b)           (i)  Participant shall pay to the Company or its Affiliates, or
make arrangements satisfactory to the Committee regarding payment of, any
federal, state or local taxes of any kind required by law to be withheld with
respect to (x) payments received due to the grant of DERs, and (y) the
termination of restrictions with respect to the Restricted Incentive Units (in
which case arrangements will be made no later than the date of the termination
of the restrictions).

 

(ii)  Participant shall, to the extent permitted by law, have the right to
deliver to the Company or its Affiliates Vested Units to which Participant shall
be entitled upon the vesting of the Restricted Incentive Units (or other
unrestricted Units owned by Participant), valued at the fair market value of
such Vested Units at the time of such delivery to the Company or its Affiliates,
to satisfy the obligation of Participant under Section 5(b)(i) of this
Agreement.

 

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(iii)  Any provision of this Agreement to the contrary notwithstanding, if
Participant does not otherwise satisfy the obligation of Participant under
Section 5(b)(i) of this Agreement, then the Company and its Affiliates shall, to
the extent permitted by law, have the right to deduct from any payments of any
kind otherwise due from the Company or its Affiliates to or with respect to
Participant, whether or not pursuant to this Agreement or the Plan and
regardless of the form of payment, any federal, state or local taxes of any kind
required by law to be withheld with respect to the grant of DERs or the
Restricted Incentive Units (with respect to which the restrictions set forth
herein have terminated).

 

6.                                      Non-Assignability.  The Subject Award is
not assignable or transferable by Participant and unless and until the Vested
Units are delivered to Participant upon vesting, the Restricted Incentive Units
(and any right to receive Vested Units) shall not be assigned, alienated,
pledged, attached sold or otherwise transferred or encumbered by Participant in
any manner.

 

7.                                      Legend.  In the event Vested Units are
delivered to Participant in connection with the vesting any of the Restricted
Incentive Units granted hereunder, the Committee, in its discretion, may cause
the certificate(s) representing such Vested Units to bear an appropriate legend
referring any conditions and/or restrictions with respect to such Vested Units.

 

8.                                      Entirety and Modification.  This
Agreement contains the entire agreement between the parties hereto with respect
to the subject matter hereof and supersedes any and all prior agreements,
whether written or oral, between such parties relating to such subject matter. 
Subject to Section 7(b) of the Plan, no modification, alteration, amendment or
supplement to this Agreement shall be valid or effective unless the same is in
writing and signed by the party against whom it is sought to be enforced.

 

9.                                      Severability.  If any provision of this
Agreement is held to be unenforceable, this Agreement shall be considered
divisible, and such provision shall be deemed inoperative to the extent it is
unenforceable, and in all other respects this Agreement shall remain in full
force and effect; provided, however, that if any such provision may be made
enforceable by limitation thereof, then such provision shall be deemed to be so
limited and shall be enforceable to the maximum extent permitted by applicable
law.

 

10.                               Gender.  Words used in this Agreement which
refer to Participant and denote the male gender shall also be deemed to include
the female gender or the neuter gender when appropriate.

 

11.                               Employment or Service.  Nothing in this
Agreement shall confer upon Participant any right to continue in the employ or
service of the Company or its Affiliates, nor shall this Agreement interfere in
any manner with the right of the Company or its Affiliates to terminate the
employment or service of Participant with or without Cause at any time.

 

12.                               Incorporation of Plan Provisions.  This
Agreement is made pursuant to the Plan and is subject to all of the terms and
provisions of the Plan as if the same were fully set forth herein.  In the event
that any provision of this Agreement conflicts with the Plan, the provisions of
the Plan shall control.  Participant acknowledges receipt of a copy of the Plan
and agrees that all decisions under and interpretations of the Plan by the
Committee shall be final, binding and conclusive upon Participant.

 

13.                               Headings.  The headings of the various
sections and subsections of this Agreement have been inserted for convenient
reference only and shall not be construed to enlarge, diminish or otherwise
change the express provisions hereof.

 

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14.                               Governing Law.  This Agreement shall be
governed by and construed in accordance with the laws of the state of Delaware
(regardless of the laws that might otherwise govern under applicable Delaware
principles of conflicts of law).

 

15.                               Counterparts.  This Agreement may be signed in
counterparts, each of which shall be deemed an original and all of which shall
constitute one and the same agreement.

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
Grant Date.

 

 

CROSSTEX ENERGY GP, LLC

 

 

 

 

 

 

 

Barry E. Davis

 

President and Chief Executive Officer

 

 

 

 

 

PARTICIPANT:

 

 

 

Name:

 

 

 

YOU MUST ACCEPT THIS GRANT AND THE TERMS OF THIS AGREEMENT IN ORDER TO RECEIVE
IT. TO ACCEPT THIS GRANT, COMPLETE THE GRANT ACCEPTANCE FORM AT THE WEBSITE OF
UBS: (www.ubs.com/onesource/XTEX)

 

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