exv10w2






Exhibit 10.2




Regency GP LLC

Long-Term Incentive Plan




Grant of Phantom Units

with DERs



Grantee:     
                  
                 
                   
             




Grant Date:       
                   
                  
         , 20___





	1.	 	Grant of Phantom Units with DERs. Regency GP LLC (the “Company”) hereby grants to
you                   
   Phantom Units under the Regency GP LLC Long-Term Incentive Plan (the “Plan”) on the
terms and conditions set forth in this agreement (the “Agreement”) and in the Plan. This grant
of Phantom Units includes a tandem grant of DERs with respect to each Phantom Unit. In the
event of any conflict between the terms of this Agreement and the Plan, which is incorporated
herein by reference as a part of this Agreement, the terms of 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.	 	Vesting. Subject to Paragraph 3 below, the Phantom Units granted hereunder shall
vest on each Vesting Date as follows:





	 	 	 	 	 
	 	 	Cumulative
	Vesting Date	 	Vested Percentage
	First Anniversary of the Vesting Commencement Date
	 	 	33	1/3%
	Second Anniversary of the Vesting Commencement Date
	 	 	66	2/3%
	Third Anniversary of the Vesting Commencement Date
	 	 	100	%







	 	 	The “Vesting Commencement Date” means                     , 20___.
	 
	 	 	The Company shall establish, with respect to each Phantom Unit, a bookkeeping account (a
“DER Account”) to which it shall credit (without interest) an amount equal to any cash
distributions made by the Partnership with respect to a Common Unit during the period such
Phantom Unit remains credited to you. Upon the vesting of a Phantom Unit, the DER Account
with respect to such vested Phantom Unit shall also become vested. Similarly, upon the
forfeiture of a Phantom Unit, the DER Account with respect to such forfeited Phantom Unit
shall also be forfeited.




 









 












	3.	 	Events Occurring Prior to Full Vesting.






	 	(a)	 	Death or Disability. If, prior to a Vesting Date, your employment with
the Company terminates as a result of your death or a disability that entitled you to
benefits under the Company’s long-term disability plan (“Disability”), all Phantom
Units then credited to you and all DER Accounts automatically will become fully vested
upon such termination.
	 
	 	(b)	 	Other Terminations. If, prior to a Vesting Date, your employment with
the Company terminates for any reason other than as provided in Paragraph 3(a) above or
Paragraph 3(d) below, all Phantom Units then credited to you and all DER Accounts
automatically shall be forfeited without payment upon such termination.
	 
	 	(c)	 	Change of Control. Except as otherwise provided in Paragraph 3(d)
below, upon and following a Change of Control prior to a Vesting Date, all outstanding
Phantom Units then credited to you and all DER Accounts will remain outstanding and
will only vest as otherwise set forth in this Agreement.
	 
	 	(d)	 	Change of Control Termination. Notwithstanding Paragraph 3(c) above,
if, upon or within 12 months following a Change of Control and prior to a Vesting Date,
your employment with the Company is terminated without “Cause” (as defined below) or
you resign for “Good Reason” (as defined below) (such termination or resignation, a
“Change of Control Termination”), all outstanding Phantom Units then credited to you
and all DER Accounts automatically will become fully vested upon such termination.






	 	 	For purposes of this Agreement,






(i) “employment with the Company” means being an Employee, Consultant or a
Director of the Company or any of its Affiliates and a change of status
between being an Employee, Consultant or Director of the Company and/or any
Affiliate(s) shall not constitute a termination of “employment with the
Company”;




(ii) “Cause” means the Company (which, for purposes of this definition,
shall include the Company and any of its Affiliates) having “Cause” to
terminate your employment with the Company, as defined in any employment or
similar agreement between you and the Company; provided that, in the absence
of an agreement containing such a definition, the Company shall have “Cause”
to terminate your employment with the Company upon (A) your willful failure
to substantially perform your duties (other than any such failure resulting
from your Disability) which is not remedied within thirty (30) days after
receipt of written notice from the Company specifying such failure, (B) your
willful failure to carry out, or comply with, in any material respect, any
lawful and reasonable directive of the Board, which is not remedied within
thirty (30) days after



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receipt of written notice from the Company specifying such failure, (C) your
commission at any time of any act or omission that results in, or may
reasonably be expected to result in, a conviction, plea of no contest, plea
of nolo contendere, or imposition of unadjudicated probation for any felony
or crime involving moral turpitude, (D) your unlawful use (including being
under the influence) or possession of illegal drugs on the Company’s
premises or while performing your duties and responsibilities, or (E) your
commission at any time of any act of fraud, embezzlement, misappropriation,
material misconduct, or breach of fiduciary duty against the Company (or any
predecessor thereto or successor thereof); and




(iii) “Good Reason” means a material reduction in your annual base salary or
target bonus following a Change of Control; provided, however, that,
notwithstanding the foregoing, you may not resign for Good Reason unless you
have provided the Company with 30 days prior written notice of your intent
to resign for Good Reason and the Company has not remedied such reduction
within such 30-day period.




	4.	 	Payments.






	 	(a)	 	Phantom Units. Subject to Paragraph 5, on the date of vesting of a
Phantom Unit, the Company shall, in its sole discretion, pay you either (i) an amount
of cash equal to the Fair Market Value of a Unit on the vesting date or (ii) one Unit.
If more than one Phantom Unit vests at the same time, the Company may pay such Phantom
Units in any combination of cash and units as the Company, in its discretion, elects.
	 
	 	(b)	 	DER Accounts. Subject to Paragraph 5, upon the vesting of a Phantom
Unit, the Company shall pay you an amount of cash equal to the amount then credited to
the DER Account maintained with respect to such Phantom Unit.






	5.	 	Withholding of Taxes. To the extent that the vesting or payment of a Phantom Unit
or cash with respect to a DER Account results in the receipt of compensation by you with
respect to which the Company or an Affiliate has a tax withholding obligation pursuant to
applicable law, the Company or Affiliate shall withhold from the cash and from the Units
otherwise to be delivered, that amount of cash and that number of Units having a Fair Market
Value equal to the Company’s or Affiliate’s tax withholding obligations with respect to such
cash and Unit payments, respectively. No payment of a vested Phantom Unit or a cash
distribution with respect to a DER Account shall be made pursuant to this Agreement until the
applicable tax withholding requirements with respect to such event have been satisfied in
full.
	 
	6.	 	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 or
a qualified domestic relations order and shall not be subject to execution, attachment, or
similar process. Upon any attempt by you to transfer, assign, pledge,




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	 	 	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.
	 
	7.	 	Binding Effect. This Agreement shall be binding upon and inure to the benefit of any
successor or successors of the Company and upon any person lawfully claiming under you.
	 
	8.	 	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 Phantom
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.
	 
	9.	 	Modifications. Any modification of this Agreement shall be effective only if it is
in writing and signed by both you and an authorized individual on behalf of the Company.
	 
	10.	 	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.





	 	 	 	 	 
	 	Regency GP LLC

 	 
	 	By:  	 	 
	 	 	Name:  	Byron R. Kelley 	 
	 	 	Title:  	Chairman, President and Chief Executive Officer 	 
	 








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APPENDIX A





     This Appendix A is attached to the Form of Grant of Phantom Units – Service Vesting between
the Company and certain of its executive officers and other employees or service providers. The
form of Grant of Phantom Units – Service Vesting between the Company and Byron R. Kelley varies
from this Exhibit 10.1 by providing for accelerated vesting of Mr. Kelley’s Phantom Units and DER
Accounts upon his retirement from the Company on or after reaching age 65.



Appendix A to
Exhibit 10.2