Exhibit 10.25

Legacy Reserves LP
Long-Term Incentive Plan

Form of Grant of Phantom Units Under Objective Component of Long-Term Equity
Incentive Compensation

Grantee:
Grant Date:
1.
Grant of Phantom Units. Legacy Reserves LP (the “Partnership”) hereby grants to
you ________ Phantom Units under the Amended and Restated Legacy Reserves LP
Long-Term Incentive Plan (the “Plan”) on the terms and conditions set forth
herein and in the Plan, which is attached hereto as Appendix A and is
incorporated herein by reference as a part of this Agreement. A Phantom Unit is
a notional Unit of the Partnership that is subject to the forfeiture and
non-transferability provisions set forth below in this Agreement. Each Phantom
Unit granted to you also includes a tandem Distribution Equivalent Right
(“DER”), which provides that when the Partnership makes a cash distribution with
respect to a Unit, an amount of cash with respect to each of your Phantom Units
equal to the amount of the quarterly distribution paid on such Unit will be
accrued and on each vesting date, such accrued amounts will be payable to you
with respect to the number of your Phantom Units actually vested. No accrued
distribution amounts will be payable with respect to unvested or forfeited
Phantom Units. The terms of this Agreement are set forth below. In the event of
any conflict between the terms of this Agreement and the Plan, the Plan shall
control. Capitalized terms used in this Agreement but not defined herein shall
have the meanings ascribed to such terms in the Plan, unless the context
requires otherwise.

2.
Conditions to Vesting. Except as otherwise provided in Section 3 below, the
Phantom Units granted pursuant to this Agreement under the objective or
performance-based component of equity-based incentive compensation are subject
to vesting, as described below in this Section 2, over a three-year period in
accordance with the criteria set forth under the Amended and Restated Legacy
Reserves LP Compensation Policy (Effective February 18, 2010) (the “Compensation
Policy”) (attached hereto as Appendix B). The number of Phantom Units that
actually vest each year for the three-year vesting period is subject to the
achievement by the Partnership of certain objective, performance-based criteria
(as determined by the “Employer” (as defined below)) during the fiscal year
prior to the applicable vesting date, in accordance with the Compensation
Policy. If none or only a portion of the Phantom Units of a particular tranche
vest as a result of target performance levels not being met, such number of
Phantom Units that fail to vest will be forfeited and cancelled. Upon any such
forfeiture of a Phantom Unit, the tandem DERs, along with any associated accrued
distribution of cash with respect to the tandem DERs, shall automatically be
cancelled without payment.

Additionally, your “employment with the Partnership” (as defined in Section 3),
or any of its Affiliates, as the case may be (the “Employer”), must be
continuous from the Grant Date through

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the applicable vesting date in order for the Phantom Units to become vested
under the provisions of this Agreement.
3.
Events Occurring Prior to Vesting.

 
(a)
Death or Disability. If your “employment with the Employer” (as defined below in
this Section 3) terminates as a result of your death or you become disabled
(within the meaning of Section 409A of the Internal Revenue Code of 1986, as
amended and in effect from time to time (the “Code”)), 50% of the Phantom Units
granted to you pursuant to this Agreement and then held by you automatically
will become fully vested.

(b)
Termination by the Employer other than for Cause. If your “employment with the
Employer” (as defined below in this Section 3) is terminated by the Employer for
any reason other than “Cause” (as defined below in this Section 3), as
determined by the Employer, 50% of the Phantom Units granted to you pursuant to
this Agreement and then held by you automatically will become fully vested.

(c)
Other Terminations. Except as provided in Section 2 hereof, if your “employment
with the Employer” (as defined below in this Section 3) should terminate for any
reason other than as provided in Sections 3(a) and (b) above prior to the
applicable vesting date, all unvested Phantom Units granted to you pursuant to
this Agreement and then held by you automatically shall be forfeited and
cancelled without payment upon such termination. Upon forfeiture of a Phantom
Unit, the tandem DER, along with any associated accrued distribution of cash
with respect to the tandem DER, shall automatically be cancelled without
payment. Upon vesting of a Phantom Unit, the tandem DER shall automatically be
cancelled without payment other than payment of any distributions accrued prior
to the vesting date.

(d)
Change of Control. 50% of the Phantom Units granted to you pursuant to this
Agreement then outstanding and then held by you automatically shall become fully
vested upon a Change of Control.

For purposes of this Section 3, “employment with the Employer” or “employment
with the Partnership” shall include being an employee of or a director (or
equivalent) or consultant to the Partnership or an Affiliate.
For purposes of this Section 3, “Cause” means any of the following:

(i) the Grantee’s conviction of, or plea of nolo contendere to, any felony or to
any crime or offense causing substantial harm to any of the Partnership or its
direct or indirect subsidiaries (whether or not for personal gain) or involving
acts of theft, fraud, embezzlement, moral turpitude or similar conduct;

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(ii) the Grantee’s repeated intoxication by alcohol or drugs during the
performance of his duties;

(iii) malfeasance in the conduct of Grantee’s duties, including, but not limited
to, (A) willful and intentional misuse or diversion of any of the Partnerships’
or its subsidiaries’ funds, (B) embezzlement or (C) fraudulent or willful and
material misrepresentations or concealments on any written reports submitted to
any of the Partnership or its subsidiaries;

(iv) the Grantee’s material failure to perform the duties of the Grantee’s
employment consistent with his position, or material failure to follow or comply
with the reasonable and lawful written directives of the Board;

(v) a material breach of the Grantee’s employment agreement; or

(vi) a material breach by the Grantee of written policies of the Partnership
concerning employee discrimination or harassment.

4.
Payment Upon Vesting of Phantom Units and Payment of Amounts Due Under DERs.

  
(a)
Subject to the tax withholding requirements of Section 5 below, not later than
seventy-four (74) days following the date on which a Phantom Unit vests
hereunder, the Partnership shall mail or otherwise deliver to you, in book-entry
form, a Unit in respect of each Phantom Unit then vested.  Subject to any tax
withholding requirements of Section 5 below, not later than seventy-four (74)
days following any date on which a Phantom Unit vests hereunder, the Partnership
shall mail or otherwise deliver to you, in a single lump sum in cash in respect
of each DER granted in tandem with a Phantom Unit, an amount of cash equal to
all accrued cash distributions on such Unit.

(b)
Notwithstanding the preceding provisions of Section 4(a), to the extent that (i)
the limitations (set forth in Code Section 409A and regulations or other
regulatory guidance issued thereunder) on payments to specified employees, as
defined in Code Section 409A and regulations or other regulatory guidance issued
thereunder, apply to you and (ii) at any time prescribed under Code Section 409A
and regulations or other regulatory guidance issued thereunder, you are a key
employee, as defined in Code Section 416(i) without regard to paragraph 5
thereof, except to the extent permitted under Code Section 409A and regulations
or other regulatory guidance issued thereunder, no distribution or payment that
is subject to Code Section 409A shall be made under this Agreement on account of

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your separation from service, as defined in Code Section 409A and the
regulations or other regulatory guidance issued thereunder, with the Employer
(at any time when you are deemed under Code Section 409A and regulations or
other regulatory guidance issued thereunder to be a specified employee, as
defined in Code Section 409A and regulations or other regulatory guidance issued
thereunder, and any equity interest of the Employer is publicly traded on an
established securities market or otherwise) before the date that is the first
day of the month that occurs six (6) months after the date of your separation
from service (or, if earlier, your date of death or any other date permitted
under Code Section 409A and regulations or other regulatory guidance issued
thereunder).
5.
Withholding of Tax. Any amount payable pursuant to Section 4 shall be subject to
collection by the Partnership or an Affiliate, as applicable, of all applicable
federal, state and local income and employment taxes required to be withheld in
respect of such amount.

6.
No Rights as a Unitholder. You shall not be, or have any of the rights or
privileges of, a unitholder of the Partnership with respect to any Phantom Unit.

7.
Limitations Upon Transfer. All rights under this Agreement shall belong to you
alone and may not be transferred, assigned, pledged, or hypothecated by you in
any way (whether by operation of law or otherwise), other than by will or the
laws of descent and distribution and shall not be subject to execution,
attachment, or similar process. Upon any attempt by you to transfer, assign,
pledge, hypothecate, or otherwise dispose of such rights contrary to the
provisions in this Agreement or the Plan, or upon the levy of any attachment or
similar process upon such rights, such rights shall immediately become null and
void.

8.
Binding Effect. This Agreement shall be binding upon and inure to the benefit of
any successor or successors of the Partnership and upon any person lawfully
claiming under you.

9.
Rights of Grantee. Any benefits payable under Section 4 of this Agreement shall
be provided from the general assets of the Partnership or an Affiliate, as
applicable. The Grantee’s rights hereunder shall not rise above those of a
general creditor of the Partnership or an Affiliate, as applicable.

10.
Entire Agreement and Amendment. 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 Phantom Units and DERs, and any associated accrued
distributions of cash with respect to the DERs, 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. Any modification of this
Agreement shall be effective only if it is in writing and signed by both you and
an authorized officer of the Company.

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11.
Notices. Any notices given in connection with this Agreement shall, if issued to
Grantee, be delivered to Grantee’s current address on file with the Partnership,
or if issued to the Partnership, be delivered to the Partnership’s principal
offices.

12.
Execution of Receipts and Releases. Any payment of cash or property to Grantee,
or to Grantee’s legal representatives, heirs, legatees or distributees, in
accordance with the provisions hereof, shall, to the extent thereof, be in full
satisfaction of all claims of such persons hereunder. The Partnership may
require Grantee or Grantee’s legal representatives, heirs, legatees or
distributees, as a condition precedent to such payment or issuance, to execute a
release and receipt therefor in such form as it shall determine.

13.
Governing Law. This grant shall be governed by, and construed in accordance
with, the laws of the State of Texas, without regard to conflicts of laws
principles thereof.

Legacy Reserves LP
 
Grantee
 
 
 
 
 
By:
Legacy Reserves GP, LLC, its General Partner
 
 
 
 
 
 
 
 
By:
 
 
By:
 
 
 
 
 
 
Name:
 
Name:
 
 
 
 
 
Title:
 
Title:
 
 
 
 
 

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APPENDIX A

AMENDED AND RESTATED
LEGACY RESERVES LP
LONG TERM INCENTIVE PLAN

Page 1

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APPENDIX B

AMENDED AND RESTATED
LEGACY RESERVES LP
COMPENSATION POLICY

(Effective February 18, 2010)