2021 Form of Phantom Unit Agreement

THIS PHANTOM UNIT AGREEMENT (this “Agreement”) is made and entered into by and between Rattler Midstream GP LLC, a Delaware limited liability company (the “General Partner”), and _____________ (“you”), effective as of ____________ (the “Date of Grant”).

    WHEREAS, Rattler Midstream LP, a Delaware limited partnership (the “Partnership”), acting through the board of directors of the General Partner (the “Board”), has adopted the Rattler Midstream LP Long-Term Incentive Plan, as it may be amended from time to time (the “Plan”), to, among other things, attract, retain and motivate certain directors, employees and officers of the Partnership, the General Partner and their respective Affiliates (collectively, the “Partnership Entities”); and

    WHEREAS, the Board has authorized the grant of Phantom Units under the Plan to you as part of your compensation for services provided to the Partnership Entities.

    NOW, THEREFORE, in consideration of the mutual covenants set forth herein and for other valuable consideration hereinafter set forth, the parties agree as follows:

1.    Grant of Phantom Units. The General Partner hereby grants to you, effective as of the Date of Grant, the right (the “Award”) to receive an aggregate of _______ Units (the “Phantom Units”) on the terms and conditions set forth herein and in the Plan, which Plan is incorporated herein by reference as part of this Agreement. Capitalized terms used in this Agreement but not otherwise defined herein shall have the meanings given to such terms in the Plan, unless the context requires otherwise.

2.    Phantom Units. Each Phantom Unit under the Award is a notional Unit granted under Section 6(d) of the Plan, which upon vesting entitles you to receive, at the time of settlement (which may or may not be coterminous with the vesting schedule of the Award), a Unit.

3.    Vesting of Phantom Units. Phantom Units shall be deemed “Nonvested Phantom Units” unless and until they have become “Vested Phantom Units” in accordance with this Section 3.

(a)    Vesting Schedule. Subject to the other terms and conditions set forth herein, the Phantom Units granted pursuant to this Agreement will become Vested Phantom Units in accordance with the following schedule, provided that you remain in Continuous Service with the Partnership Entities until the applicable vesting dates:

(b)    Change of Control. Notwithstanding the above vesting schedule, in the event of a termination of your Continuous Service with the Partnership Entities (i) by the applicable Partnership Entity other than for Cause (and not as a result of your death or Disability (as defined below)) or (ii) as a result of your resignation for Good Reason (as defined for purposes of the Diamondback Energy, Inc. Senior Management Severance Plan), in either case, upon the consummation of or within 24 months after the occurrence of a Change of Control (an “Acceleration Event”), any Nonvested Phantom Units will become Vested Phantom Units upon the occurrence of an Acceleration Event. As used herein: “Cause” means “cause” (or term of like import) as defined under a severance plan participation agreement between the Participant and a Partnership Entity (a “Severance Agreement”) or, in the absence of any Severance Agreement that defines “cause” (or term of like import) means (A) the commission by you of, or plea of guilty or no contest by you to, a felony or a crime involving moral turpitude or the commission of any other act involving willful malfeasance or material fiduciary breach with respect to any Partnership Entity, (B) your conduct tending to bring any Partnership Entity into substantial public disgrace, or disrepute, (C) your gross negligence or willful misconduct with respect to any Partnership Entity, or (D) your material violation of state or federal securities laws. The Committee, in its absolute discretion, shall determine the effect of all matters and questions relating to whether you have been discharged for Cause.

(c)    Termination of Employment.

(i)    General. Except as provided in Sections 3(b) and 3(c)(ii), upon the termination of your Continuous Service with the Partnership Entities, all Nonvested Phantom Units will remain unvested, will become null and void and will be forfeited as of the date of such termination.

(ii)    Death and Disability. If your Continuous Service with the Partnership Entities is terminated due to death or Disability, then all Nonvested Phantom Units subject to this Agreement will immediately become Vested Phantom Units as of the date of such termination. As used herein, “Disability” means your inability to substantially perform your duties to the General Partner, the Partnership, or any Affiliate by reason of a medically determinable physical or mental impairment that is expected to last for a period of six months or longer or result in death.

4.    Settlement and Payment of Phantom Units.

(a)    Time of Settlement. Subject to your satisfaction of the applicable tax withholding obligations of Section 6 and the requirements Section 4(b) below, Vested Phantom Units will be settled within 10 business days following the date such Vested Phantom Units become vested pursuant to Section 3 (the date of such settlement, the “Settlement Date”).

(b)    Extension of Settlement Date. Notwithstanding the foregoing provisions of this Section 4, in the event the issuance and delivery of Units on any Settlement Date would violate any applicable Federal, state, local or foreign law (including if, at the time of a proposed settlement, there shall be an effective registration statement registering under the Securities Act of 1933, as amended (the “Securities Act”), the issuance of Units upon vesting of Awards under the Plan (the “Registration Statement”), and there shall have occurred an event which makes any statement made in the Registration Statement, related prospectus or any document incorporated therein by reference untrue in any material respect or which requires the making of any changes in such Registration Statement, prospectus or other documents so that they will not contain any untrue statement of material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading), the General Partner may specify another date, during a 30 day period beginning on the date the issuance and delivery of Units for your Vested Phantom Units, or any portion thereof, would first no longer violate an applicable federal, state, local or foreign law, as the Settlement Date for your Vested Phantom Units, or portion thereof, but not later than two and one-half months after the end of the calendar year in which such Award becomes Vested Phantom Units.

(c)    Delivery of Units. No fractional Units shall be issued with respect to Vested Phantom Units; rather, you will receive a cash payment for such amount as is necessary to eliminate fractional Units and effect the issuance and acceptance of only whole Units. Unless and until a certificate or certificates representing such Units shall have been issued by the Partnership to you or the transfer of such Units shall be entered in the Partnership’s ledger or otherwise properly reflected in the Partnership’s books and records, you shall not be or have any of the rights or privileges of a unitholder of the Partnership with respect to Units acquirable upon vesting of the Award. The Partnership will not have any obligation to settle the vesting of any Award by transfer of such Units unless and until the General Partner receives the full amount of money as the General Partner may require to meet its withholding obligation under applicable tax laws or regulations and to satisfy the tax withholding obligations of Section 6 hereof.

(d)    Distribution Equivalents. If the Partnership pays any cash distribution to its outstanding Unit holders for which the record date occurs after the Date of Grant, the Partnership will pay you as of the distribution payment date an amount equal to the amount of the distribution paid by the Partnership with respect to a single Unit multiplied by (i) the sum of the Nonvested Phantom Units as of such record date and the Vested Phantom Units that have not been settled under Section 4 as of such record date (“Distribution Equivalents”). Distribution Equivalents will vest and be paid to you on the distribution payment date (but not later than two and one-half months after the end of the year that includes the distribution record date) if you are in Continuous Service with the Partnership Entities or otherwise hold Vested Phantom Units on the distribution record date declared by the Partnership.

5.    Transferability. This Agreement and the Phantom Units granted hereunder will not be transferrable or assignable by you other than by will or the laws of descent and distribution, except to the extent approved by the Committee in accordance with the terms of the Plan. Notwithstanding the foregoing, if you are serving as a Designated Director of the General Partner, you may enter into a transfer agreement that transfers this Award and requires issuance of the Units in settlement of the Vested Phantom Units to an entity, including without limitation a private equity or other investment fund that is an investor in the Partnership (an “Investor”), subject to compliance with all applicable securities laws. A “Designated Director” is a Director of the General Partner who is an employee or partner of an Investor and who is treated as serving on behalf of such Investor because the services provided to the General Partner depend upon the exercise of expertise and are similar to those that are performed for the Investor and the Investor has established a policy that provides that the Investor is entitled to the benefit of any compensation provided for services provided as a Director of any portfolio company.

6.    Payment of Taxes. To the extent that the settlement of this Award or the disposition of Units acquired by vesting of this Award results in compensation income or wages to you for federal, state or local tax purposes that are subject to withholding requirements, you shall deliver to the General Partner at the time of such settlement or disposition such amount of money as the General Partner may require to meet its withholding obligation under applicable tax laws or regulations. Such amounts will be paid by net issuance whereby the Partnership will retain from transfer the number of Units with a Fair Market Value not in excess of the aggregate withholding obligation, in which case the Award will be surrendered and cancelled with respect to the number of Units retained by the Partnership. Tax withholding obligations also may be paid, at your election, (i) in cash (including by certified check, bank draft or money order, or wire transfer of immediately available funds); or (ii) in the Committee’s discretion and on such terms as the Committee approves: (A) by delivering or constructively tendering by means of attestation (to the extent any applicable insider trading policy, window or restriction does not prohibit you from engaging in a sale transaction) whereby you identify for delivery specific duly endorsed Units having a Fair Market Value not in excess of the aggregate withholding obligation with a Fair Market Value on that Settlement Date that does not exceed the maximum statutory tax rates in the applicable jurisdictions (subject to your written request to withhold more than the minimum required tax withholding in the applicable jurisdictions, but not more than the maximum statutory tax rates in the applicable jurisdictions), including payroll taxes (provided that any Units used for this purpose must have been held by you for such minimum period of time, if any, as may be established from time to time by the Board), (B) to the extent permissible under applicable law (to the extent any applicable insider trading policy, window or restriction does not prohibit you from engaging in a sale transaction), through delivery of irrevocable instructions to a broker to sell a sufficient number of the Units being settled to cover the aggregate withholding obligation and delivery to the General Partner on behalf of the Partnership (on the same day that the Units issuable upon vesting are delivered) of the amount of sale proceeds required to pay the aggregate withholding obligation; or (iii) any combination of the foregoing. In the event the General Partner subsequently determines that the amount paid or withheld as payment of any tax withholding obligations is insufficient to discharge the tax withholding obligation, you will be required to pay to the General Partner on behalf of the Partnership, immediately upon the General Partner’s request, the amount of that deficiency. No

Units will be transferred to you pursuant to Section 4(c) until the full amount of any required tax withholding obligation has been received by the General Partner.

7.    Nonqualified Deferred Compensation Rules. The intent of the parties is that the Award and related rights under this Agreement will be exempt under Section 409A of the Code and the 409A Regulations as a short-term deferral and not constitute a 409A Award, and accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. In the event the Award is a 409A Award, the General Partner, the Partnership and you shall take commercially reasonable efforts to reform or amend any provision hereof to the extent it is reasonably determined that such provision would or could reasonably be expected to cause you to incur any additional tax or interest under Section 409A of the Code or the 409A Regulations to try to comply with the requirements of Section 409A of the Code and the 409A Regulations through good faith modifications, in any case, to the minimum extent reasonably appropriate to conform with such requirements; provided, that any such modification shall not increase the cost or liability to the General Partner or the Partnership. To the extent that any provision hereof is modified in order to comply with Section 409A of the Code and the 409A Regulations, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to the General Partner, the Partnership and you of the applicable provision without violating the provisions of Section 409A of the Code and the 409A Regulations. Notwithstanding the foregoing provisions of this Section 7, the General Partner, the Partnership and their respective Affiliates make no representations that this Award is exempt from or compliant with Section 409A of the Code and in no event shall the General Partner, the Partnership or their respective Affiliates be liable for any taxes, penalties, interest or other expenses (including under Section 409A of the Code) that may be incurred by you on account of the grant or vesting of, or otherwise with respect to, the Award and matters related thereto. For purposes of Section 409A of the Code, each payment or amount due under this Agreement shall be considered a separate payment.

8.    Miscellaneous.

(a)    No Right to Continued Service. This Award shall not be construed to confer upon you any right to continue as an employee of or other service provider to the Partnership Entities. Any question as to whether and when there has been a termination of Continuous Service shall be determined by the Committee and its determination shall be final and binding. Records of the Partnership Entities regarding your period of Continuous Service, termination of Continuous Service, leaves of absence and other matters shall be conclusive for all purposes hereunder, unless determined by the Committee to be incorrect.

(b)    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 Board or a majority of the members of the Committee designated to administer the Plan with respect thereto and to this Agreement shall be final and binding upon you and the Partnership Entities. In the event of any conflict between the terms and conditions of this Agreement and the Plan, the provisions of the Plan shall control.

(c)    No Liability for Good Faith Determinations. The Partnership Entities, the members of the Board and the Committee, shall not be liable for any act, omission or determination taken or made in good faith with respect to this Agreement or the Award granted hereunder.

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

(e)    Severability. If any provision of this Agreement is held to be illegal or invalid for any reason, the illegality or invalidity shall not affect the remaining provisions hereof, but such provision shall be fully severable and this Agreement shall be construed and enforced as if the illegal or invalid provision had never been included herein.

(f)    Binding Effect. This Agreement shall be binding upon you, your legal representatives, heirs, legatees and distributees, and upon the Partnership Entities and their successors and assigns.

(g)    Construction. The titles and headings of sections are included for convenience of reference only and are not to be considered in construction of the provisions hereof. Words used in the masculine shall apply to the feminine where applicable and whenever the context of this Agreement dictates, the plural shall be read as the singular and the singular as the plural.

(h)    Governing Law. All questions arising with respect to the provisions of this Agreement shall be determined by application of the laws of the State of Delaware without regard to choice of law principles thereunder, except to the extent Delaware law is preempted by federal law.

(i)    Amendment. This Agreement may be amended by the Committee; provided, however, that, unless otherwise provided in the Plan, no such amendment may materially reduce your rights or benefits inherent in this Agreement prior to such amendment without your express written consent. For the avoidance of doubt, a cancellation of all or a part of this Award where you receive a payment equal in value to the Fair Market Value of the vested Award will not constitute an impairment of your rights that requires your consent.

(j)    Furnish Information. You agree to furnish to the General Partner or the Partnership all information requested by them to enable the Partnership Entities to comply with any reporting or other requirements imposed upon them by or under any applicable statute or regulation.

(k)    Execution of Receipts and Releases. Any payment of cash or any issuance or transfer of Units or other property to you, or to your legal representative, heir, legatee or distributee, shall, to the extent thereof, be in full satisfaction of all claims of such persons hereunder. The Committee may require you or your legal representative, heir, legatee or distributee, as a condition precedent to such payment or issuance, to execute a release and receipt therefor in such form as it shall determine.

(l)    Consent to Electronic Delivery; Electronic Signature. In lieu of receiving documents in paper format, you agree, to the fullest extent permitted by law, to accept electronic delivery of any documents that the Partnership Entities may be required to deliver (including, without limitation, prospectuses, prospectus supplements, grant or award notifications and agreements, account statements, annual and quarterly reports, and all other forms of communications) in connection with this and any other award made or offered by the Partnership. Electronic delivery may be via an electronic mail system of the Partnership Entities or by reference to a location on a Partnership intranet to which you have access. You hereby consent to any and all procedures the Partnership Entities have established or may establish for an electronic signature system for delivery and acceptance of any such documents that the Partnership Entities may be required to deliver, and agree that your electronic signature is the same as, and shall have the same force and effect as, your manual signature.

IN WITNESS WHEREOF, the General Partner has caused this Agreement to be executed by its duly authorized agent effective as of the date first written above.

By your signature below and the signature of the General Partner’s representative above, you and the General Partner agree to be bound by all of the terms and conditions of this Phantom Unit Agreement and the Plan (incorporated herein by this reference as if set forth in full in this document). By executing this Phantom Unit Agreement, you hereby irrevocably elect to accept the Phantom Unit rights granted pursuant to this Phantom Unit Agreement and to receive the Award for Units of Rattler Midstream LP designated above subject to the terms of the Plan and this Phantom Unit Agreement.