[FORM] EAGLE ROCK ENERGY PARTNERS LONG-TERM INCENTIVE PLAN RESTRICTED UNIT AGREEMENT FOR OFFICERS

This Restricted Unit Agreement (this “Agreement”) is made and entered into by and between EAGLE ROCK ENERGY G&P, LLC, a Delaware limited liability company (the “Company”), and [_____________________] (the “Officer”).  This Agreement is entered into as of the [_____] day of [________________], 20[__] (the “Date of Grant”).  Capitalized terms used in this Agreement but not otherwise defined herein shall have the meanings ascribed to suc h terms in the Plan (as defined below), unless the context requires otherwise.

W I T N E S S E T H:

WHEREAS, the Company has adopted the AMENDED AND RESTATED EAGLE ROCK ENERGY PARTNERS LONG-TERM INCENTIVE PLAN (the “Plan”), which was approved by the unitholders of EAGLE ROCK ENERGY PARTNERS, L.P., a Delaware limited partnership (the “Partnership”), on September 17, 2010, to attract, retain and motivate employees, officers, directors and consultants; and

WHEREAS, the Board of Directors of the Company (the “Board”) has authorized the grant to employees and officers of restricted units of the Partnership, as part of their compensation for services performed for the Company, the Partnership, or any other entity which is an affiliate (within the meaning of such term under the Exchange Act and the rules promulgated thereunder) of the foregoing entities (collectively, the “Partnership Entities”).

NOW, THEREFORE, in consideration of the Officer’s agreement to provide or to continue providing services to the Partnership Entities, the Officer and the Company agree as follows:

           SECTION 1.              Grant.

The Company hereby grants to the Officer as of the Date of Grant an award of _________ Units, subject to the terms and conditions set forth in the Plan, which is incorporated herein by reference, and in this Agreement, including, without limitation, those restrictions described in Section 2 (the “Restricted Units”).  

           SECTION 2.              Restricted Units.

The Restricted Units are restricted in that they may be forfeited to the Company and in that they may not, except as otherwise provided in Section 5, be transferred or otherwise disposed of by the Officer until such restrictions are removed or expire as described in Section 4 of this Agreement.  The Company shall issue in the Officer’s name the Restricted Units and shall retain the Restricted Units until the restrictions on such Restricted Units expire or until the Restricted Units are forfeited as described in Section 4 of this Agreement.  The Officer agrees that the Company will hold the Restricted Units pursuant to the terms of this Agreement until such time as the Restricted Units are either delivered to the Officer or forfeited pursuant to this Agreement.   

           SECTION 3.              Rights of Officer; Unit Distribution Rights.

Effective as of the Date of Grant, the Officer shall be treated for all purposes as a Unit holder with respect to all of the Restricted Units granted to him pursuant to Section 1 (except that the Officer shall not be treated as the owner of the Units for federal income tax purposes until the Restricted Units vest (unless the Officer makes an election under section 83(b) of the Code, in which case the Officer shall be treated as the owner of the Units for all purposes on the Date of Grant)) and shall, except as provided herein, have all of the rights and obligations of a unit holder with respect to all such Restricted Units, including any right to vote with respect to such Restricted Units and to receive any UDRs thereon if, as, and when decla red and paid by the Partnership, including, without limitation, any UDRs consisting of the distribution of special purchase or other rights.  Notwithstanding the preceding provisions of this Section 3, the Restricted Units shall be subject to the restrictions described herein, including, without limitation, those described in Section 2.    

SECTION 4.               Forfeiture and Expiration of Restrictions.

(a)    Vesting Schedule.  Subject to the terms and conditions of this Agreement, the restrictions described in Section 2 shall lapse and the Restricted Units shall become vested and nonforfeitable (“Vested Units”), provided the Officer has continuously provided services to the Partnership Entities, without interruption, from the Date of Grant through each applicable vesting date (each, a “Vesting Date”), in accordance with the followin g schedule:

(b)    Termination of Service.  

(i)           Termination For Cause or Without Good Reason.  If, at any time prior to the final Vesting Date, the Officer ceases providing services to the Partnership Entities by reason of the Officer’s voluntary termination of service without Good Reason or if the Officer’s service relationship is terminated by a Partnership Entity for Cause, then all

(ii)           Termination due to Death or Disability.  If, at any time prior to the final Vesting Date, the Officer ceases providing services to the Partnership Entities by reason of the Officer’s death or Disability, then all Restricted Units granted pursuant to this Agreement that remain unvested as of the date of the Officer’s termination shall immediately become fully vested and nonforfeitable as of the date of such termination.

(iii)           Termination Without Cause or For Good Reason.  If, at any time prior to the final Vesting Date, the Officer ceases providing services to the Partnership Entities by reason of a termination of the Officer’s services by the Officer for Good Reason or by a Partnership Entity without Cause, then all Restricted Units granted pursuant to this Agreement that have not yet vested as of the date of the Officer’s termination shall become null and void as of the date of such termination, shall be forfeited to the Company and the Officer shall cease to have any rights with respect thereto; provided, that, the Committee, in its sole and absolute discretion, may decide to vest all or any portion of the Restricted Units granted pursuant to this Agreement that remain unvested as of the date of the Officer’s termination.  The portion of the Restricted Units, if any, for which restrictions do not lapse in accordance with the foregoing shall become null and void as of the date of termination; provided, that the portion, if any, of the Restricted Units for which forfeiture restrictions lapse as of the date of termination shall survive.

       (c)    Termination Following a Change of Control.  In the event of termination of the Officer’s service relationship with the Partnership Entities by the Officer for Good Reason or by a Partnership Entity without Cause, in either case within 2 years following a Change of Control and prior to the final Vesting Date, all restrictions described in Section 2 shall lapse and all Restricted Units granted pursuant to this Agreement shall become imm ediately vested and nonforfeitable.

(d)           Definitions.  For purposes of this Agreement, the following terms shall have the meanings set forth below:

(i)           Cause.  The term “Cause” means a determination made in good faith by two-thirds (2/3) of the Board that the Officer (A) willfully and continually failed to substantially perform the Officer’s duties with the Partnership Entities (other than a failure resulting from the Officer’s incapacity due to physical or mental illness) which failure continued for a period of at least thirty (30) days after a written notice of demand for substantial performance has been delivered to the Officer specifying the manner in which the Officer has failed to substantially perform or (B) will fully engaged in conduct which is demonstrably and materially injurious to the Partnership Entities, monetarily or otherwise; provided, however, that no termination of the Officer’s services shall be for Cause as set forth in clause (B) above until (1) there shall have been delivered to the Officer a copy of a written notice setting forth that the Officer was guilty of the conduct

(ii)           Disability.  The term “Disability” means (A) a physical or mental impairment of sufficient severity that, in the opinion of the Board, the Officer is unable to continue performing the duties assigned to the Officer prior to such impairment or the Officer’s condition entitles the Officer to disability benefits under any insurance or employee benefit plan of any Partnership Entity in which the Officer participates, and (B) the impairment or condition is cited by the employing Partnership Entity as the reason for the Officer’s termination.

(iii)           Good Reason.  The term “Good Reason” means the occurrence of any of the following events or conditions: (A) a change in the Officer’s status, title, position or responsibilities (including reporting responsibilities) which represents a substantial reduction of the status, title, position or responsibilities as in effect immediately prior thereto, the assignment to the Officer of any duties or responsibilities that are inconsistent with such status, title, position or responsibilities, or any removal of the Officer from or failure to reappoint or reelect the Officer to any of such positions, except in connection with the termination of the Officer’s services for Cause, due to the Officer’s Disability or death, or by the Officer voluntarily without Good Reason, (B) a reduction in the Officer’s annual base salary, (C) a change in the geographic location at which the Officer must perform services (without the consent of the Officer) to a location more than thirty-five (35) miles from the location at which the Officer normally performs such services as of the Date of Grant, except for reasonably required business travel that is not materially greater than such travel requirements prior to the Date of Grant, (D) the failure by the Partnership Entities to continue in effect any material compensation or benefit plan in which the Officer was participating as of the Date of Grant or to provide the Officer with compensation and benefits at least equal (in terms of benefit levels and/or reward opportunities) to those provided for under each compensation or employee benefi t plan, program and practice as in effect immediately prior to the Date of Grant (or as in effect following the Date of Grant, if greater), (E) any material breach by a Partnership Entity of any provision of the Plan or of any provision of the Officer’s employment agreement, if any, or (F) any purported termination of the Officer’s employment for Cause by a Partnership Entity that does not otherwise comply with the terms of the Plan, this Agreement or the Officer’s employment agreement, if any.  In the case of the Officer’s allegation of Good Reason, (1) the Officer shall provide notice to the Committee of the event alleged to constitute Good Reason within 90 days of the occurrence of such event, and (2) the Partnership Entities shall have the opportunity to remedy the alleged Good Reason event within 30 days from receipt of notice of such allegation.

SECTION 5.    Limitations on Transfer.

SECTION 6.              Nontransferability of Agreement.

SECTION 7.              Adjustment of Restricted Units.

           SECTION 8.                  Delivery of Vested Units.

           SECTION 9.                  Securities Act.

SECTION 10.     Copy of Plan.

SECTION 11.     Notices.

Company:Eagle Rock Energy G&P, LLC

Officer:  At the Officer’s current address as shown in the Company’s records.  

SECTION 12.     General Provisions.

(a)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 Committee with respect thereto and with respect to this Agreement shall be final and binding upon the Officer 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.

(b)Continuation of Service. This Agreement shall not be construed to confer upon the Officer any right to continue in the service of the Partnership Entities.

(c)Governing Law. This Agreement shall be interpreted and administered under the

(d)Amendments.  This Agreement may be amended only by a written agreement executed by the Company and the Officer, except that the Committee may unilaterally waive any conditions or rights under, amend any terms of, or alter this Agreement provided no such change (other than pursuant to Section 4(c) or 7(c) of the Plan) materially reduces the rights or benefits of the Officer with respect to the Restricted Units without his consent.  

(e)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 the Officer.  

(f)Entire Agreement. This Agreement constitutes the entire agreement of the parties with regard to this subject matter hereof, and contains all the covenants, promises, representations, warranties and agreements between the parties with respect to the Restricted 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.  

(g)No Liability for Good Faith Determinations. Neither the Partnership Entities, nor the members of the Committee or the Board, nor any officer of the Company, shall be liable for any act, omission or determination taken or made in good faith with respect to this Agreement or the Restricted Units granted hereunder.

(h)No Guarantee of Interests.  The Board and the Partnership Entities do not guarantee the Units from loss or depreciation.

(i)Withholding Taxes.  To the extent that the grant or vesting of a Restricted Unit or distribution thereon results in the receipt of compensation by the Officer with respect to which any Partnership Entity has a tax withholding obligation pursuant to applicable law, unless other arrangements have been made by the Officer that are acceptable to such Partnership Entity, the Officer shall deliver to the Partnership Entity such amount of money as the Partnership Entity may require to meet its withholding obligations under applicable law.  No issuance of an unrestricted Unit shall be made pursuant to this Agreement until the Officer has paid or made arrangements approved by the Partn ership Entity to satisfy in full the applicable tax withholding requirements of the Partnership Entity with respect to such event.  

(j)Insider Trading Policy.  The terms of the Company’s Insider Trading Policy with respect to Units are incorporated herein by reference.  

IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by its officer thereunto duly authorized, and the Officer has set his hand as to the date and year first above written.