Exhibit 10.1

Execution Version

STOCK ISSUANCE AGREEMENT

dated as of May 10, 2017

by and among

WILDHORSE RESOURCE DEVELOPMENT CORPORATION

and

ADMIRAL A HOLDING L.P.,

TE ADMIRAL A HOLDING L.P.,

and

AURORA C-I HOLDING L.P.

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TABLE OF CONTENTS

 

         Page     ARTICLE I   

ISSUANCE; CLOSING

     1  

Section 1.1

  Issuance      1  

Section 1.2

  Closing      1  

Section 1.3

  Closing Conditions      2     ARTICLE II   

REPRESENTATIONS AND WARRANTIES

     4  

Section 2.1

  Representations and Warranties of the Company      4  

Section 2.2

  Representations and Warranties of the Admiral Sellers      10     ARTICLE III
  

COVENANTS

     12  

Section 3.1

  Filings; Other Actions      12  

Section 3.2

  Negative Covenants      12  

Section 3.3

  Registration Rights Agreement      13  

Section 3.4

  Further Assurances      13     ARTICLE IV   

ADDITIONAL AGREEMENTS

     13  

Section 4.1

  Legend      13     ARTICLE V   

MISCELLANEOUS

     14  

Section 5.1

  Survival; Limitations on Liability      14  

Section 5.2

  Amendment; Waiver      14  

Section 5.3

  Counterparts      14  

Section 5.4

  Governing Law      15  

Section 5.5

  Waiver of Jury Trial      15  

Section 5.6

  Notices      15  

Section 5.7

  Entire Agreement      16  

Section 5.8

  Assignment      17  

Section 5.9

  Interpretation; Other Definitions      17  

Section 5.10

  Captions      20  

Section 5.11

  Severability      20  

Section 5.12

  No Third Party Beneficiaries      20  

Section 5.13

  Conspicuousness      20  

Section 5.14

  Public Announcements      20  

Section 5.15

  Specific Performance      20  

Section 5.16

  Termination      21  

Section 5.17

  Effects of Termination      21  

Section 5.18

  Expenses      21  

Section 5.19

  Non-Recourse      21  

 

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INDEX OF DEFINED TERMS

 

Term    Location of Definition accredited investor    2.2(c) Acquisition   
Recitals Acquisition Agreement    Recitals Admiral Seller(s)    Preamble
Affiliate    5.9(g) Agreement    Preamble business day    5.9(d) Capitalization
Date    2.1(b)(i) Closing    1.2(a) Closing Date    1.2(a) Common Stock   
Section 5.9(h) Common Stock Price    Section 5.9(i) Company    Preamble Company
Material Adverse Effect    5.9(j) Company Preferred Stock    2.1(b)(i) Company
Stock Awards    2.1(b)(i) Consideration Common Stock    1.1 control/controlled
by/under common control with    Section 5.9(g) Damages    Section 5.9(k) Effect
   5.9(l) Environmental Laws    5.9(m) Exchange Act    Section 2.1 FCPA   
2.1(l) GAAP    2.1(g)(iii) Governmental Entity    Section 5.9(n)
herein/hereof/hereunder    5.9(c) HSR Act    Section 5.9(o)
including/includes/included/include    5.9(b) Issuance    1.1 Knowledge of the
Company    Section 5.9(p)

 

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Term    Location of Definition Law    Section 5.9(q) Lien    Section 5.9(r)
Money Laundering Laws    2.1(m) Non-Recourse Party    5.18 OFAC    2.1(n) or   
5.9(a) Order    Section 5.9(s) party/parties    Section 5.9(e) Permit    Section
5.9(t) person    5.9(f) Plan    2.1(b)(i) poison pill    2.1(b)(i) Preferred
Purchase Agreement    Section 5.9(u) Preliminary Settlement Statement    Section
5.9(v) Registration Rights Agreement    Section 5.9(w) SEC    2.1(g)(i) SEC
Documents    2.1(g)(i) Securities Act    Section 2.1 Stock Purchase Price   
Section 5.9(x) Subsidiary    Section 5.9(y) Voting Debt    2.1(b)(ii)

 

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STOCK ISSUANCE AGREEMENT, dated as of May 10, 2017 (this “Agreement”), by and
among (i) WildHorse Resource Development Corporation, a Delaware corporation
(the “Company”), and (ii) Admiral A Holding L.P., a Delaware limited
partnership, TE Admiral A Holding L.P., a Delaware limited partnership and
Aurora C-I Holding L.P., a Delaware limited partnership (the persons in this
clause (ii), collectively, the “Admiral Sellers” and each, an “Admiral Seller”).

RECITALS:

WHEREAS, concurrently with the execution of this Agreement, a wholly owned
Subsidiary of the Company has entered into a Purchase and Sale Agreement (as it
may be amended or supplemented from time to time, the “Acquisition Agreement”
and, the transactions contemplated thereby, the “Acquisition”), by and among
such Subsidiary, the Admiral Sellers and Anadarko E&P Onshore LLC, a Delaware
limited liability company;

WHEREAS, as consideration payable to the Admiral Sellers pursuant to the
Acquisition Agreement, the Company shall, at the Closing, issue to the Admiral
Sellers certain shares of its Common Stock, subject to the terms and conditions
set forth in this Agreement; and

WHEREAS, capitalized terms used in this Agreement have the meanings set forth in
Section 5.9 or as otherwise indicated in the preceding Index of Defined Terms.

NOW, THEREFORE, in consideration of the premises, and of the representations,
warranties, covenants and agreements set forth herein, the parties agree as
follows:

ARTICLE I

ISSUANCE; CLOSING

Section 1.1 Issuance. On the terms and subject to the conditions herein, on the
Closing Date as consideration for the Acquisition, as set forth in the
Acquisition Agreement, the Company agrees to issue and deliver to the Admiral
Sellers an aggregate number of shares of Common Stock equal to (i) the Stock
Purchase Price, as adjusted pursuant to the Preliminary Settlement Statement,
divided by (ii) the Common Stock Price (the “Consideration Common Stock”). The
issuance of the shares of Consideration Common Stock pursuant to this
Section 1.1 is referred to as the “Issuance.” The shares of Consideration Common
Stock shall be allocated among the Admiral Sellers as set forth in a written
notice to be furnished to the Company by the Admiral Sellers no later than five
(5) days prior to the Closing Date.

Section 1.2 Closing.

(a) Subject to the terms and conditions hereof, the closing of the Issuance (the
“Closing”) shall be held at the offices of Vinson & Elkins L.L.P., 1001 Fannin
Street, Suite 2500, Houston, Texas 77002, on the date of the closing of the
Acquisition, and contemporaneously therewith, or at such other time and place as
the Company and the Admiral Sellers agree in writing (the “Closing Date”).

(b) Subject to the satisfaction or waiver on the Closing Date of the conditions
to the Closing in Section 1.3, at the Closing:

 

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(i) the Company will deliver to each Admiral Seller (i) the number of shares of
Consideration Common Stock set forth in the written notice to be delivered by
the Admiral Sellers pursuant to Section 1.1, which shall be registered in the
name of such Admiral Seller in book-entry form and (ii) all other documents,
instruments and writings required to be delivered by the Company to the Admiral
Sellers pursuant to this Agreement or otherwise required in connection herewith;
and

(ii) each Admiral Seller will deliver or cause to be delivered all documents,
instruments and writings required to be delivered by such Admiral Seller to the
Company pursuant to this Agreement or otherwise required in connection herewith.

Section 1.3 Closing Conditions.

(a) The obligations of each Admiral Seller, on the one hand, and the Company, on
the other hand, to effect the Closing is subject to the satisfaction or waiver
at or prior to the Closing of the following conditions (or, to the extent
permitted by applicable Law, waiver by the Company and a Admiral Seller, as to
such Admiral Seller):

(i) on the Closing Date, no Order restraining, enjoining or otherwise
prohibiting the consummation of the transactions contemplated by this Agreement
shall have been issued and remain in force, and no suit, action or other
proceeding by any Governmental Entity seeking to restrain, enjoin or otherwise
prohibit the consummation of the transactions contemplated by this Agreement, or
seeking substantial Damages in connection therewith, shall be pending before any
Governmental Entity; and

(ii) all conditions to closing the Acquisition set forth in Article 9 of the
Acquisition Agreement shall have been satisfied or waived in accordance with the
Acquisition Agreement (excluding conditions that, by their nature cannot be
satisfied until the closing thereof, so long as such conditions will be
satisfied at the closing thereof).

(b) The obligations of each Admiral Seller to effect the Closing are also
subject to the satisfaction or waiver at or prior to the Closing of the
following conditions (or, to the extent permitted by applicable Law, waiver by
any Admiral Seller (as to such Admiral Seller)):

(i) (i) the representations and warranties of the Company set forth in
Section 2.1 hereof (other than Sections 2.1(a), 2.1(b), 2.1(c)(i), 2.1(g),
2.1(i) and 2.1(k)) shall be true and correct (disregarding all qualifications or
limitations as to materiality or Company Material Adverse Effect) as of the
Closing Date as though made on and as of the Closing Date (other than
representations and warranties that refer to a specified date, which need only
be true and correct on and as of such specified date), except where the failure
of such representations and warranties to be so true and correct would not,
individually or in the aggregate, have a Company Material Adverse Effect,
(ii) the representations and warranties of the Company set forth in Section
2.1(b) shall be true and correct as of the Closing Date as though made on and as
of the Closing Date (other than representations and warranties that refer to a
specified date, which need only be true and correct on and as of such specified
date) except for de minimis inaccuracies, (iii) the representations and
warranties of the Company set forth in Section

 

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2.1(g)(ii) (other than Section 2.1(g)(ii)(ii)(B)) shall be true and correct
(disregarding all qualifications or limitations as to materiality or Company
Material Adverse Effect) in all material respects as of the Closing Date as
though made on and as of the Closing Date (other than representations and
warranties that refer to a specified date, which need only be true and correct
on and as of such specified date) and (iv) the representations and warranties of
the Company set forth in Sections 2.1(a), 2.1(c)(i), 2.1(g)(i),
2.1(g)(ii)(ii)(B), 2.1(g)(iii), 2.1(i), and 2.1(k) shall be true and correct as
of the Closing Date as though made on and as of the Closing Date (other than
representations and warranties that refer to a specified date, which need only
be true and correct on and as of such specified date);

(ii) the Company shall have performed in all material respects its obligations
required to be performed by it pursuant to this Agreement at or prior to the
Closing;

(iii) the Admiral Sellers shall have received a certificate signed on behalf of
the Company by a senior executive officer certifying to the effect that the
conditions set forth in Section 1.3(b)(i) and (ii) have been satisfied;

(iv) the shares of Consideration Common Stock to be issued hereunder shall have
been approved for listing on the New York Stock Exchange, subject to official
notice of issuance; and

(v) the Admiral Sellers shall have received a counterpart of the Registration
Rights Agreement, duly executed by the Company.

(c) The obligation of the Company to effect the Closing is subject to the
satisfaction or waiver by the Company at or prior to the Closing of the
following conditions (or, to the extent permitted by applicable Law, waiver by
the Company):

(i) (i) the representations and warranties of each Admiral Seller set forth in
Section 2.2 hereof (other than Sections 2.2(a), 2.2(b)(i) and 2.2(d)) shall be
true and correct (disregarding all qualifications or limitations as to
materiality) in all material respects as of the Closing Date as though made on
and as of the Closing Date (other than representations and warranties that refer
to a specified date, which need only be true and correct on and as of such
specified date), and (ii) the representations and warranties of each Admiral
Seller set forth in Sections 2.2(a), 2.2(b)(i) and 2.2(d) shall be true and
correct as of the Closing Date as though made on and as of the Closing Date
(other than representations and warranties that refer to a specified date, which
need only be true and correct on and as of such specified date);

(ii) each Admiral Seller shall have performed in all material respects its
obligations required to be performed by it pursuant to this Agreement at or
prior to the Closing; and

(iii) the Company shall have received a certificate signed on behalf of each
Admiral Seller by a senior executive officer certifying to the effect that the
conditions set forth in Section 1.3(c)(i) and (ii) have been satisfied.

 

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ARTICLE II

REPRESENTATIONS AND WARRANTIES

Section 2.1 Representations and Warranties of the Company. Except as set forth
(x) in the SEC Documents filed by the Company with the SEC, and publicly
available before the date of this Agreement, excluding any disclosures set forth
in risk factors or any “forward looking statements” within the meaning of the
Securities Act of 1933, as amended (the “Securities Act”), or the Securities
Exchange Act of 1934, as amended, (the “Exchange Act”) or any other statements
that are similarly predictive, cautionary or forward looking in nature or (y) in
a correspondingly identified schedule attached hereto (provided, that any item
disclosed in any particular schedule attached hereto shall be deemed to be
disclosed with respect to any other schedule to the extent it is reasonably
apparent on the face of such disclosure that it applies to such other schedule),
the Company represents and warrants to the Admiral Sellers, as of the date
hereof and as of the Closing, that (provided, that the Company makes no
representations or warranties whatsoever in this Agreement regarding assets,
operations or business to be acquired by the Company pursuant to the Acquisition
Agreement):

(a) Organization. The Company is a corporation duly organized and validly
existing under the laws of the State of Delaware, has all requisite power and
authority to own its properties and conduct its business as presently conducted,
is duly qualified to do business and is in good standing in all jurisdictions
where its ownership or leasing of property or the conduct of its business
requires it to be so qualified and where failure to be so qualified and in good
standing would, individually or in the aggregate, reasonably be expected to have
a Company Material Adverse Effect.

(b) Capitalization.

(i) The authorized capital stock of the Company consists of 500,000,000 shares
of Common Stock and 50,000,000 shares of preferred stock, par value $0.01 per
share (the “Company Preferred Stock”). As of the close of business on April 30,
2017 (the “Capitalization Date”), there were 93,987,541 shares of Common Stock
outstanding and zero shares of Company Preferred Stock outstanding or designated
as a series. As of the close of business on the Capitalization Date, (i)
9,512,500 shares of Common Stock were reserved for issuance under the WildHorse
Resource Development Corporation 2016 Long Term Incentive Plan (the “Plan”), of
which 363,334 shares of Common Stock have been issued subject to restricted
stock awards granted pursuant to the Plan (collectively, the “Company Stock
Awards”), (ii) no shares of Common Stock were held by the Company in its
treasury and (iii) no shares of Company Preferred Stock were held by the Company
in its treasury. All of the issued and outstanding shares of Common Stock have
been duly authorized and validly issued in accordance with applicable securities
laws and are fully paid, nonassessable and free of preemptive rights. From the
Capitalization Date through and as of the date of this Agreement, no other
shares of Common Stock or Company Preferred Stock have been issued other than
shares of Common Stock issued in respect of Company Stock Awards in the ordinary
course of business and shares of Company Preferred Stock issued as contemplated
by the Preferred Purchase Agreement. The Company does not have outstanding
shareholder purchase rights, a “poison pill” or any similar arrangement in
effect.

 

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(ii) No bonds, debentures, notes or other indebtedness having the right to vote
on any matters on which the stockholders of the Company or any of its
Subsidiaries may vote (“Voting Debt”) are issued and outstanding. As of the date
of this Agreement, except (i) pursuant to the surrender of shares to the Company
or the withholding of shares by the Company to cover tax withholding obligations
under Company Stock Awards, and (ii) as set forth in Section 2.1(b)(i), neither
the Company nor any of its Subsidiaries has or is bound by any outstanding
options, subscriptions, preemptive rights, rights of first offer, warrants,
calls, commitments or other rights or agreements calling for the purchase or
issuance of, or securities or rights convertible into, or exchangeable for, any
shares of Common Stock or any other equity securities of the Company or its
Subsidiaries or Voting Debt or any securities representing the right to purchase
or otherwise receive any shares of capital stock of the Company (including any
rights plan or agreement) or its Subsidiaries.

(iii) As of the close of business on the Capitalization Date, Schedule
2.1(b)(iii) sets forth (A) a complete listing of all capital stock of each
Subsidiary of the Company, along with the applicable par value for such stock
(B) the number of shares of capital stock that are outstanding, by class and
designated series, as applicable, (C) the number of shares of capital stock that
are reserved for issuance under any agreement, whether written or otherwise and
(D) the number of shares of treasury stock held by each such Subsidiary. All
shares of issued and outstanding capital stock of each Subsidiary have been duly
authorized and validly issued in accordance with applicable securities laws and
are fully paid, nonassessable and free of preemptive rights. From the
Capitalization Date through and as of the date of this Agreement, no other
shares of capital stock (whether common, preferred or otherwise) have been
issued. No Subsidiary of the Company is subject to any shareholder purchase
rights, a poison pill or any similar arrangement.

(c) Authorization; Consents.

(i) The Company has the requisite power, authority and capacity to execute and
deliver this Agreement and the other instruments and agreements to be executed
and delivered by it as contemplated hereby and to consummate the transactions
contemplated hereby and thereby. The execution, delivery and performance of this
Agreement and all documents required to be executed and delivered by the Company
at the Closing, and the performance of the transactions contemplated hereby and
thereby, have been duly and validly authorized by all necessary action on the
part of the Company. This Agreement has been duly executed and delivered by the
Company (and all documents required hereunder to be executed and delivered by
the Company at the Closing will be duly executed and delivered by the Company)
and this Agreement constitutes, and at the Closing such documents will
constitute, the valid and binding obligations of the Company, enforceable in
accordance with their terms, subject to any bankruptcy, insolvency,
reorganization, moratorium, fraudulent transfer or other Laws, now or hereafter
in effect, relating to or limiting creditors’ rights generally and to general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at Law).

(ii) The execution, delivery and performance of this Agreement by the Company,
and the transactions contemplated by this Agreement, will not (a) violate any
provision of the organizational documents of the Company, (b) result in a
default (with or

 

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without due notice or lapse of time or both) under or require any consent under
any note, bond, mortgage, indenture or other agreement to which the Company is a
party or by which the Company or its property or other assets are bound or
subject, (c) violate any Law applicable to the Company, (d) assuming the
accuracy of the representation in Section 2.2(b)(ii)(d), require any filing,
notice or submission or observation of any waiting period under the HSR Act or
(e) assuming the accuracy of the representation in Section 2.2(b)(ii)(d), other
than the securities or blue sky laws of the various states, require the Company
to obtain any material consent or approval of any Governmental Entity that has
not been made or obtained, except any matters described in clauses (b) or (c) of
this Section 2.1(c)(ii) that, individually or in the aggregate, would not
reasonably be expected to materially and adversely affect the ability of the
Company to consummate the transactions contemplated hereby.

(d) Sale of Securities. Assuming the accuracy of the Admiral Sellers’
representations in Section 2.2(c), the Issuance is exempt from the registration
and prospectus delivery requirements of the Securities Act and the rules and
regulations promulgated thereunder. Without limiting the foregoing, neither the
Company nor to the Knowledge of the Company any other Person authorized by the
Company to act on its behalf, has engaged in a general solicitation or general
advertising (within the meaning of Regulation D of the Securities Act) of
investors with respect to offer or sales of the Consideration Common Stock and
neither the Company nor, to the Knowledge of the Company, any person acting on
its behalf has made any offers or sales of any security or solicited any offers
to buy any security, under circumstances that would cause the offering or
issuance of the Consideration Common Stock under this Agreement to be integrated
with prior offerings by the Company for purposes of the Securities Act that
would result in none of Regulation D or any other applicable exemption from
registration under the Securities Act to be available, nor will the Company take
any action or steps that would cause the offering or issuance of the
Consideration Common Stock under this Agreement to be integrated with other
offerings.

(e) No Price Manipulation. Neither the Company nor any of its Subsidiaries has
taken, directly or indirectly, any action designed to, or that has constituted
or that could reasonably be expected to, cause or result in the artificial
stabilization or manipulation of the price of any security of the Company or to
facilitate the sale or resale of its securities.

(f) Status of Securities. The shares of Consideration Common Stock have been
duly authorized by all necessary corporate action. When issued and sold against
receipt of the consideration therefor as provided in this Agreement, such
securities will be validly issued, fully paid and nonassessable, will not be
subject to preemptive rights of any other stockholder of the Company, and will
be free and clear of all Liens, except restrictions imposed by the Securities
Act and any applicable state or foreign securities laws. The respective rights,
preferences, privileges, and restrictions of the Consideration Common Stock are
as stated in the Certificate of Incorporation or as otherwise provided by
applicable Law. Neither the Company nor any of its Subsidiaries have, directly
or indirectly through any agent, sold, offered for sale, solicited offers to buy
or otherwise negotiated in respect of, any “security” (as defined in the
Securities Act) that is or will be integrated with the sale of the Common Stock
hereunder in a manner that would require registration under the Securities Act.

 

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(g) SEC Documents; Financial Statements.

(i) The Company has filed all required reports, proxy statements, forms, and
other documents with the Securities and Exchange Commission (the “SEC”) since
January 1, 2017 (collectively, the “SEC Documents”). Each of the SEC Documents,
as of its respective date complied as to form in all material respects with the
requirements of the Securities Act and the Exchange Act, as the case may be, and
the rules and regulations of the SEC promulgated thereunder applicable to such
SEC Documents, and, except to the extent that information contained in any SEC
Document has been revised or superseded by a later filed SEC Document filed and
publicly available prior to the date of this Agreement, none of the SEC
Documents contained any untrue statement of a material fact or omitted to state
a material fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading.

(ii) The Company (i) has implemented and maintains an effective system of
disclosure controls and procedures (as defined in Rule 13a-15(e) under the
Exchange Act) that are reasonably designed to ensure that the information
required to be disclosed by the Company, including its consolidated
Subsidiaries, in the reports it files or will file or submit under the Exchange
Act, is made known to the individuals responsible for the preparation of the
Company’s filings with the SEC on a timely basis and (ii) has disclosed, based
on its most recent evaluation prior to the date of this Agreement, to the
Company’s outside auditors and the board of director’s audit committee (A) any
significant deficiencies and material weaknesses in the design or operation of
internal controls over financial reporting (as defined in Rule 13a-15(f) under
the Exchange Act) that are reasonably likely to adversely affect the Company’s
ability to record, process, summarize and report financial information and
(B) any fraud, whether or not material, that involves management or other
employees who have a significant role in the Company’s internal controls over
financial reporting. As of the date of this Agreement, to the Knowledge of the
Company, there is no reason that its outside auditors and its chief executive
officer and chief financial officer, would not be able to give as of the date
hereof and as of the Closing Date, and will not be able to give when next due,
the certifications and attestations required pursuant to the rules and
regulations adopted pursuant to Section 404 of the Sarbanes-Oxley Act of 2002,
without qualification.

(iii) The financial statements of the Company and its consolidated Subsidiaries
included in the SEC Documents (a) complied as to form in all material respects
with applicable accounting requirements and the published rules and regulations
of the SEC with respect thereto, in each case as of the date such SEC Document
was filed, and (b) have been prepared in accordance with generally accepted
accounting principles (“GAAP”) applied on a consistent basis during the periods
involved (except as may be indicated in such financial statements or the notes
thereto or as permitted by Regulation S-X) in all material respects and fairly
present in all material respects the consolidated financial position of the
Company and its consolidated Subsidiaries as of the dates thereof and the
consolidated results of their operations and cash flows of the Company and its
consolidated Subsidiaries for the periods then ended (subject, in the case of
unaudited statements, to normal recurring audit adjustments).

 

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(h) Undisclosed Liabilities. Except for (i) those liabilities that are reflected
or reserved for in the consolidated financial statements of the Company included
in its Annual Report on Form 10-K for the year ended December 31, 2016,
(ii) liabilities incurred since December 31, 2016 in the ordinary course of
business (including incremental borrowings under the Company’s revolving credit
facility), (iii) liabilities that would not, individually and in the aggregate,
reasonably be expected to have a Company Material Adverse Effect, (iv) the
$350,000,000 in aggregate principal amount of 6.875% Senior Notes due 2025
issued by the Company on February 1, 2017 and obligations to make payment of
interest with respect thereto and (v) liabilities incurred pursuant to the
transactions contemplated by this Agreement, the Acquisition Agreement or the
Preferred Purchase Agreement, the Company and its Subsidiaries do not have any
liabilities or obligations of any nature whatsoever (whether accrued, absolute,
contingent or otherwise). The Company does not maintain any “off-balance sheet
arrangements” within the meaning of Item 303(a)(4)(ii) of Regulation S-K of the
SEC.

(i) Brokers and Finders. Except for Evercore Partners Inc. and Barclays Capital
Inc., the fees of which will be paid by the Company, no Admiral Seller shall,
directly or indirectly, have any responsibility, liability or expense, as a
result of undertakings or agreements of the Company, for brokerage fees,
finder’s fees, agent’s commissions or other similar forms of compensation in
connection with this Agreement or any agreement or transaction contemplated
hereby.

(j) Listing and Maintenance Requirements. The Common Stock is registered
pursuant to Section 12(b) or 12(g) of the Exchange Act, and the Company has
taken no action designed to, or which is reasonably likely to, have the effect
of terminating the registration of the Common Stock under the Exchange Act nor
has the Company received as of the date of this Agreement any notification that
the SEC is contemplating terminating such registration.

(k) Absence of Certain Changes. Since January 1, 2017, there has not been any
event that has caused, or is reasonably likely to cause, directly or indirectly,
a Company Material Adverse Effect.

(l) Foreign Corrupt Practices Act. None of the Company or any of its
Subsidiaries, nor, to the knowledge of the Company, any of their directors,
officers, agents or employees, has since December 31, 2016 (i) violated or is in
violation of any provision of the United States Foreign Corrupt Practices Act of
1977, as amended (the “FCPA”), or similar law of a jurisdiction in which the
Company or any of its Subsidiaries conduct their business and to which they are
lawfully subject or (ii) made any unlawful bribe, rebate, payoff, influence
payment, kickback or other unlawful payment.

(m) Money Laundering Laws. The operations of the Company and its Subsidiaries
are and have been conducted at all times in compliance with applicable financial
recordkeeping and reporting requirements of the Currency and Foreign
Transactions Reporting Act of 1970, as amended, the money laundering statutes of
all jurisdictions, the rules and regulations thereunder and any related or
similar rules, regulations or guidelines, issued, administered or enforced by
any Governmental Entity (collectively, the “Money Laundering Laws”), and no
action, suit or proceeding by or before any court or Governmental Entity or any
arbitrator involving the Company or its Subsidiaries with respect to the Money
Laundering Laws is pending or, to the Knowledge of the Company, threatened.

 

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(n) OFAC. None of the Company, any of its Subsidiaries, or, to the Knowledge of
the Company, any director, officer, agent, employee or affiliate of the Company,
is in violation of any of the country or list-based economic and trade sanctions
administered and enforced by the Office of Foreign Assets Control of the U.S.
Treasury Department (“OFAC”). Neither the Company nor any of its Subsidiaries
(i) is currently subject to any United States sanctions administered by OFAC,
(ii) have any assets located in a country or entity that is currently subject to
United States sanctions administered by OFAC or (iii) derives revenues from
investments in, or transactions with, persons or entities subject to any United
States sanctions administered by OFAC.

(o) Litigation. Except (i) as described or disclosed in the SEC Documents or
(ii) as would not, individually or in the aggregate, reasonably be expected to
have a Company Material Adverse Effect, there are no legal or governmental
proceedings pending to which the Company or its Subsidiaries is a party or of
which any property or assets of the Company or its Subsidiaries is the subject.
To the Company’s Knowledge, no such proceedings are threatened or contemplated
by any Governmental Entity or others, except as would not, individually or in
the aggregate, reasonably be expected to have a Company Material Adverse Effect.

(p) Investment Company Status. The Company is not an “investment company” within
the meaning of the Investment Company Act of 1940, as amended.

(q) Environmental, Health and Safety. Except, in each case, as would not,
individually or in the aggregate, reasonably be expected to have a Company
Material Adverse Effect, the Company, its Subsidiaries, its predecessors, and
its and their operations are and have been in material compliance with, and are
not subject to any material liability under and Environmental Law. Neither the
Company nor any of its Subsidiaries has received any written notice, report, or
other information that it is or was in material violation of, or has or had any
material liability under, any Environmental Law, except as would not,
individually or in the aggregate, reasonably be expected to have a Company
Material Adverse Effect.

(r) No Additional Representations. EXCEPT FOR THE REPRESENTATIONS AND WARRANTIES
MADE BY THE COMPANY IN THIS ARTICLE II AND IN ARTICLE 7 OF THE ACQUISITION
AGREEMENT, NEITHER THE COMPANY NOR ANY OTHER PERSON MAKES (AND THE ADMIRAL
SELLERS HEREBY ACKNOWLEDGE THAT THEY HAVE NOT RELIED UPON) ANY EXPRESS OR
IMPLIED REPRESENTATION OR WARRANTY WITH RESPECT TO THE CONSIDERATION COMMON
STOCK, THE COMMON STOCK OR THE COMPANY OR ANY OF ITS SUBSIDIARIES OR THEIR
RESPECTIVE BUSINESSES, OPERATIONS, ASSETS, LIABILITIES, CONDITION OR PROSPECTS,
AND THE COMPANY HEREBY DISCLAIMS ANY SUCH OTHER REPRESENTATIONS OR WARRANTIES.
IN PARTICULAR, WITHOUT LIMITING THE FOREGOING DISCLAIMER, NEITHER THE COMPANY
NOR ANY OTHER PERSON MAKES OR HAS MADE ANY REPRESENTATION OR WARRANTY TO THE
ADMIRAL SELLERS, OR ANY OF THEIR RESPECTIVE AFFILIATES OR REPRESENTATIVES WITH
RESPECT TO (I) ANY FINANCIAL PROJECTION, FORECAST, ESTIMATE, BUDGET OR PROSPECT
INFORMATION RELATING TO THE COMPANY OR ANY OF ITS SUBSIDIARIES OR THEIR
RESPECTIVE BUSINESS, OR (II) EXCEPT FOR

 

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THE REPRESENTATIONS AND WARRANTIES MADE BY THE COMPANY IN THIS ARTICLE II, ANY
ORAL OR WRITTEN INFORMATION PRESENTED TO THE ADMIRAL SELLERS OR ANY OF THEIR
RESPECTIVE AFFILIATES OR REPRESENTATIVES IN THE COURSE OF THEIR DUE DILIGENCE
INVESTIGATION OF THE COMPANY, THE NEGOTIATION OF THIS AGREEMENT OR IN THE COURSE
OF THE TRANSACTIONS CONTEMPLATED HEREBY. NOTWITHSTANDING ANYTHING TO THE
CONTRARY HEREIN, NOTHING IN THIS AGREEMENT SHALL LIMIT THE RIGHT OF THE ADMIRAL
SELLERS AND THEIR RESPECTIVE AFFILIATES TO RELY ON THE REPRESENTATIONS,
WARRANTIES, COVENANTS AND AGREEMENTS EXPRESSLY SET FORTH IN THIS AGREEMENT OR
THE ACQUISITION AGREEMENT OR IN ANY CERTIFICATE DELIVERED HEREUNDER OR
THEREUNDER, NOR WILL ANYTHING IN THIS AGREEMENT OPERATE TO LIMIT ANY CLAIM BY
THE ADMIRAL SELLERS OR ANY OF THEIR RESPECTIVE AFFILIATES FOR FRAUD.

Section 2.2 Representations and Warranties of the Admiral Sellers. Each Admiral
Seller, severally and not jointly, hereby represents and warrants to the
Company, as of the date hereof and as of the Closing, that:

(a) Organization and Authority. Such Admiral Seller is (i) a limited partnership
existing and in good standing under the Laws of the State of Delaware, (ii) duly
qualified and authorized to do business in, and is in good standing in, each
jurisdiction where the conduct of its business as currently conducted requires
such qualifications and (iii) has the corporate power and authority to own or
lease its property and assets, as applicable, and to transact the business in
which it is currently engaged and presently proposes to engage.

(b) Authorization; Consents.

(i) Such Admiral Seller has the requisite power and authority to execute and
deliver this Agreement and the other instruments and agreements to be executed
and delivered by it as contemplated hereby and to consummate the transactions
contemplated hereby and thereby. The execution, delivery and performance of this
Agreement and all documents required to be executed and delivered by such
Admiral Seller at the Closing, and the performance of the transactions
contemplated hereby and thereby, have been duly and validly authorized by all
necessary corporate, partnership or limited liability action on the part of such
Admiral Seller. This Agreement has been duly executed and delivered by such
Admiral Seller (and all documents required hereunder to be executed and
delivered by such Admiral Seller at the Closing will be duly executed and
delivered by such Admiral Seller) and this Agreement constitutes, and at the
Closing such documents will constitute, assuming the due execution and delivery
of all other parties thereto, the valid and binding obligations of such Admiral
Seller, enforceable in accordance with their terms, subject to any bankruptcy,
insolvency, reorganization, moratorium, fraudulent transfer or other Laws, now
or hereafter in effect, relating to or limiting creditors’ rights generally and
to general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at Law).

 

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(ii) The execution, delivery and performance of this Agreement by such Admiral
Seller, and the transactions contemplated by this Agreement, will not
(a) violate any provision of the organizational documents of such Admiral
Seller, (b) result in a default (with or without due notice or lapse of time or
both) under, or require any consent under, any note, bond, mortgage, indenture
or other agreement to which such Admiral Seller is a party or by which such
Admiral Seller is bound or subject, (c) violate any Law applicable to such
Admiral Seller, (d) require any filing, notice or submission or observation of
any waiting period under the HSR Act or (e) other than the securities or blue
sky laws of the various states, require such Admiral Seller to obtain any
material consent or approval of any Governmental Entity that has not been made
or obtained except any matters described in clauses (b) or (c) of this
Section 2.2(b)(ii) that, individually or in the aggregate, would not reasonably
be expected to materially and adversely affect the ability of such Admiral
Seller to consummate the transactions contemplated hereby.

(c) Investment. Such Admiral Seller acknowledges that the shares of
Consideration Common Stock issued hereunder have not been registered under the
Securities Act or under any state securities laws. Such Admiral Seller
(1) acknowledges that it is acquiring the Consideration Common Stock pursuant to
an exemption from registration under the Securities Act solely for investment
with no present intention to distribute any of the Consideration Common Stock to
any person in violation of applicable securities laws, (2) will not sell or
otherwise dispose of any of the Consideration Common Stock, except in compliance
with the registration requirements or exemption provisions of the Securities Act
and any other applicable securities laws, (3) has such knowledge and experience
in financial and business matters and in investments of this type that it is
capable of evaluating the merits and risks of its investment in the
Consideration Common Stock and of making an informed investment decision, (4) is
an “accredited investor” (as that term is defined by Rule 501 of the Securities
Act) and (5) (A) has been furnished with or has had full access to all the
information that it considers necessary or appropriate to make an informed
investment decision with respect to the Consideration Common Stock, (B) has had
an opportunity to discuss with management of the Company the intended business
and financial affairs of the Company and to obtain information (to the extent
the Company possessed such information or could acquire it without unreasonable
effort or expense) necessary to verify any information furnished to it or to
which it had access and (C) can bear the economic risk of (x) an investment in
the Consideration Common Stock indefinitely and (y) a total loss in respect of
such investment. Such Admiral Seller has such knowledge and experience in
business and financial matters so as to enable it to understand and evaluate the
risks of and form an investment decision with respect to its investment in the
Consideration Common Stock and to protect its own interest in connection with
such investment.

(d) Brokers and Finders. The Company shall not, directly or indirectly, have any
responsibility, liability or expense, as a result of undertakings or agreements
of such Admiral Seller entered into in connection with this Agreement, for
brokerage fees, finder’s fees, agent’s commissions or other similar forms of
compensation in connection with this Agreement or any agreement or transaction
contemplated hereby.

(e) Ownership. As of the date of this Agreement, neither such Admiral Seller nor
any of their respective Affiliates (other than any portfolio company with
respect to which such Admiral Seller is not the party exercising control over
investment decisions) are the owners of record of shares of Common Stock or
securities convertible into or exchangeable for Common Stock.

 

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ARTICLE III

COVENANTS

Section 3.1 Filings; Other Actions.

(a) From the date hereof until the Closing, each Admiral Seller, on the one
hand, and the Company, on the other hand, will cooperate and consult with the
other and use commercially reasonable efforts to prepare and file all necessary
documentation, to effect all necessary applications, notices, petitions, filings
and other documents, and to obtain all necessary permits, consents, orders,
approvals and authorizations of, or any exemption by, all third parties and
Governmental Entities, and the expiration or termination of any applicable
waiting period, required to consummate the Issuance.

(b) The Admiral Sellers and the Company will have the right to review in
advance, and to the extent practicable each will consult with the other, in each
case subject to applicable laws relating to the exchange of information, all the
information relating to such other party, and any of their respective
Affiliates, which appears in any filing made with, or written materials
submitted to, any third party or any Governmental Entity in connection with the
transactions contemplated by this Agreement. In exercising the foregoing right,
each of the parties hereto agrees to act reasonably and as promptly as
practicable. Each party hereto agrees to keep the other party apprised of the
status of matters referred to in this Section 3.1. The Admiral Sellers shall
promptly furnish the Company, and the Company shall promptly furnish the Admiral
Sellers, to the extent permitted by applicable law, with copies of written
communications received by it or its Subsidiaries from, or delivered by any of
the foregoing to, any Governmental Entity in respect of the transactions
contemplated by this Agreement.

(c) Notwithstanding anything to the contrary in this Agreement, nothing in this
Section 3.1 shall require the Company or any of its Affiliates to (i) hold
separate or divest or refrain from acquiring, investing in or otherwise dealing
in any property, assets, facilities, business, or equity or (ii) commit on
behalf of itself any of its Affiliates to any conduct remedies or any amendment,
modification or termination of any existing, or entering into any new, contracts
with any third parties.

Section 3.2 Negative Covenants. From the date of this Agreement through the
Closing, the Company and its Subsidiaries shall not, without the prior written
consent of the Admiral Sellers:

(a) declare, or make payment in respect of, any dividend or other distribution
upon any shares of capital stock of the Company;

(b) other than as contemplated by the Preferred Purchase Agreement, amend the
Certificate of Incorporation or Bylaws in a manner that would affect the Admiral
Sellers in an adverse manner as a holder of Common Stock;

(c) authorize, issue or reclassify any capital stock, or debt securities
convertible into capital stock, of the Company or any of its Subsidiaries other
than (i) the authorization and issuance of the Company Preferred Stock
contemplated by the Preferred Purchase Agreement, (ii) the issuance of the
Consideration Common Stock contemplated herein,

 

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and (iii) the issuance of Common Stock in respect of the exercise of Company
Stock Awards outstanding as of the date of this Agreement or the issuance or
grant of Common Stock or other securities in the ordinary course pursuant to the
Plan;

(d) repurchase, redeem or otherwise acquire any outstanding shares of capital
stock or other ownership interests in the Company or its Subsidiaries other than
Common Stock repurchased, redeemed or otherwise acquired pursuant to net
settlement of any award granted under the Plan, including net withholding to
satisfy applicable tax withholding obligations and the net exercise of stock
options, stock appreciation rights or similar awards granted under the Plan;

(e) permit the Company or any of its Subsidiaries to enter into or modify the
terms of any transaction with an Affiliate of the Company or its Subsidiaries or
terminate any such arrangement, in each case solely to the extent such
transaction or arrangement (or action related thereto) is not approved by the
independent directors in accordance with the policies of the Company applicable
to affiliate transactions; or

(f) agree or commit to do any of the foregoing.

Section 3.3 Registration Rights Agreement. At the Closing, the Company shall
deliver to the Admiral Sellers an executed counterpart to the Registration
Rights Agreement in substantially the form attached hereto as Exhibit A.

Section 3.4 Further Assurances. After the Closing, the Company and the Admiral
Sellers agree to take such further actions and to execute, acknowledge and
deliver all such further documents as are reasonably requested by the other
party for carrying out the purposes of this Agreement or of any document
delivered pursuant to this Agreement.

ARTICLE IV

ADDITIONAL AGREEMENTS

Section 4.1 Legend.

(a) The Admiral Sellers agree that all certificates or other instruments
representing the Consideration Common Stock subject to this Agreement will bear
a legend substantially to the following effect:

THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY
NOT BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT WHILE A REGISTRATION
STATEMENT RELATING THERETO IS IN EFFECT UNDER SUCH ACT AND APPLICABLE STATE
SECURITIES LAWS OR PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT OR
SUCH LAWS.

 

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(b) Upon request of the applicable Admiral Seller, upon receipt by the Company
of an opinion of counsel reasonably satisfactory to the Company to the effect
that such legend is no longer required under the Securities Act and applicable
state laws, the Company shall promptly cause the legend described in
Section 4.1(a) to be removed from any certificate for any Consideration Common
Stock to be transferred in accordance with the terms of this Agreement. The
Admiral Sellers acknowledge that the shares of Consideration Common Stock issued
hereunder have not been registered under the Securities Act or under any state
securities laws and agrees that it will not sell or otherwise dispose of any of
such Consideration Common Stock, except in compliance with the registration
requirements or exemption provisions of the Securities Act and any other
applicable securities laws or pursuant to the terms of the Registration Rights
Agreement.

ARTICLE V

MISCELLANEOUS

Section 5.1 Survival; Limitations on Liability. The representations and
warranties of the parties contained in this Agreement shall survive until the
first anniversary of the Closing, except (i) the representations and warranties
contained in Sections 2.1(a), Section 2.1(b), Section 2.1(c)(i), 2.1(g), 2.1(i)
and 2.1(k), which shall survive until the expiration of the applicable statute
of limitations and (ii) the representations and warranties contained in
Sections 2.2(a), 2.2(b)(i) and 2.2(d), which shall survive until the expiration
of the applicable statute of limitations. All of the covenants or other
agreements of the parties contained in this Agreement that must be performed
(i) between the date hereof and Closing shall survive until the first
anniversary of the Closing (ii) after Closing shall survive in accordance with
their terms and until fully performed (which, for the avoidance of doubt, those
covenants and agreements set forth in Section 5.15 shall survive indefinitely).
Except as otherwise set forth in Section 5.15, the sole and exclusive remedy of
any party to this Agreement shall be as set forth in Article 12 of the
Acquisition Agreement and, except as set forth therein, no party shall have any
liability for any Damages or any other matter arising out or relating to this
Agreement or the Issuance, other than any liability resulting from actual (and
not constructive) fraud.

Section 5.2 Amendment; Waiver. This Agreement may be amended or modified only by
an agreement in writing executed by all parties and expressly identified as an
amendment or modification. Any failure by any party to comply with any of its
obligations, agreements or conditions herein contained may be waived by the
party to whom such compliance is owed by an instrument signed by such party and
expressly identified as a waiver, but not in any other manner. No waiver of, or
consent to a change in, any of the provisions of this Agreement shall be deemed
or shall constitute a waiver of, or consent to a change in, other provisions
hereof (whether or not similar), nor shall such waiver constitute a continuing
waiver unless otherwise expressly provided. Notwithstanding anything to the
contrary contained herein, the Admiral Sellers may waive the obligations
contained in Section 3.3 in their sole discretion by delivering written notice
of such waiver to the Company.

Section 5.3 Counterparts. This Agreement may be executed in counterparts, each
of which shall be deemed an original instrument, but all such counterparts
together shall constitute but one agreement. Any party’s delivery of an executed
counterpart signature page by facsimile or email is as effective as executing
and delivering this Agreement in the presence of the other parties. No party
shall be bound until such time as all of the parties have executed counterparts
of this Agreement.

 

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Section 5.4 Governing Law.

(a) THIS AGREEMENT AND THE LEGAL RELATIONS BETWEEN THE PARTIES SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS WITHOUT
REGARD TO PRINCIPLES OF CONFLICTS OF LAW WHICH WOULD PERMIT OR REQUIRE THE
APPLICATION OF THE LAWS OF ANOTHER JURISDICTION.

(b) THE PARTIES HEREBY IRREVOCABLY SUBMIT TO THE EXCLUSIVE JURISDICTION OF THE
FEDERAL COURTS OF THE UNITED STATES OF AMERICA OR THE CIVIL DISTRICT COURTS OF
THE STATE OF TEXAS LOCATED IN HARRIS COUNTY, TEXAS AND APPROPRIATE APPELLATE
COURTS THEREFROM, AND EACH PARTY HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN
RESPECT OF ANY DISPUTE, CONTROVERSY OR CLAIM ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR ANY DOCUMENT DELIVERED IN CONNECTION HEREWITH MAY BE HEARD AND
DETERMINED IN SUCH COURTS. THE PARTIES HEREBY IRREVOCABLY WAIVE, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAWS, ANY OBJECTION WHICH THEY MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH DISPUTE, CONTROVERSY OR CLAIM
BROUGHT IN ANY SUCH COURT OR ANY DEFENSE OF INCONVENIENT FORUM FOR THE
MAINTENANCE OF SUCH DISPUTE, CONTROVERSY OR CLAIM. EACH PARTY AGREES THAT A
JUDGMENT IN ANY SUCH DISPUTE MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON
THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY APPLICABLE LAW.

Section 5.5 Waiver of Jury Trial. EACH OF THE PARTIES HEREBY UNCONDITIONALLY AND
IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY DOCUMENT
DELIVERED IN CONNECTION HEREWITH. EACH PARTY ACKNOWLEDGES THAT IT HAS HAD AN
OPPORTUNITY TO CONSULT WITH INDEPENDENT COUNSEL AND THAT IT HAS KNOWINGLY AND
VOLUNTARILY AGREED TO THIS WAIVER OF ITS RIGHT TO TRIAL BY JURY.

Section 5.6 Notices. All notices and other communications that are required or
may be given pursuant to this Agreement must be given in writing, in English and
delivered personally, by courier, by facsimile or by registered or certified
mail, postage prepaid, as follows.

 

  (a)

If to the Admiral Sellers:

Admiral A Holding L.P.

TE Admiral A Holding L.P.

Aurora C-I Holding L.P.

600 Travis Street, Suite 7200

Houston, Texas 77002

Attention: Dash Lane

 

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Fax: (713) 583-9430

with a copy to (which copy alone shall not constitute notice):

Kirkland & Ellis LLP

600 Travis Street, Suite 3300

Houston, Texas 77002

Attention: John D. Pitts, P.C.; Doug Bacon, P.C.

Facsimile: (713) 835-3601

 

  (b)

If to the Company:

WildHorse Resource Development Corporation

9805 Katy Freeway, Suite 400

Houston, Texas 77024

Attn: Kyle N. Roane

Fax: (713) 568-4911

with a copy to (which copy alone shall not constitute notice):

Vinson & Elkins L.L.P.

1001 Fannin Street, Suite 2500

Houston, Texas 77002

Attn: Douglas E. McWilliams

Fax: (713) 758-2222

Any party may change its address for notice by providing notice to the other
parties in the manner set forth above. All notices shall be deemed to have been
duly given and the receiving party charged with notice (a) if personally
delivered, when received, (b) if sent by facsimile during normal business hours
of the recipient, upon confirmation of transmission, or if sent by facsimile
after normal business hours of the recipient, on the next business day, (c) if
mailed, two business days after the date of mailing to the address below or
(d) if sent by overnight courier, one day after sending. Notwithstanding the
foregoing, any notices or other communications delivered pursuant to this
Agreement prior to or at the Closing may be given via email, return receipt
requested, during normal business hours of the recipient. Such email notices can
be sent to the Admiral Sellers at dash.lane@kkr.com and the Company at
kroane@wildhorserd.com.

Section 5.7 Entire Agreement. This Agreement (including, for purposes of
certainty, the Appendices, Exhibits and Schedules attached hereto), the
Acquisition Agreement and the documents to be executed hereunder and thereunder
(including the Registration Rights Agreement) constitute the entire agreement
among the parties pertaining to the subject matter hereof, and supersede all
prior agreements, understandings, negotiations and discussions, whether oral or
written, of the parties pertaining to the subject matter hereof.

 

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Section 5.8 Assignment. No party shall assign all or any part of this Agreement,
nor shall any party assign or delegate any of its rights or duties hereunder,
without the prior written consent of the other parties, which consent may be
withheld for any reason, and any assignment or delegation made without such
consent shall be void; provided, however, that no such consent shall be required
to assign this Agreement in part or in whole to one or more Affiliates of the
Admiral Sellers (including EIGF Aggregator LLC, a Delaware limited liability
company, and TE Drilling Aggregator LLC, a Delaware limited liability company);
provided, further, that no assignment by an Admiral Seller to its Affiliate
shall relieve such Admiral Seller from any of its obligations hereunder; and
provided, further, that such assignee (i) makes the representations and
warranties of the Admiral Sellers set forth in Section 2.2 of this Agreement as
of the date of such assignment and (ii) represents and warrants to the Company
as of the date of such assignment that such assignment will not require the
Company to comply with the registration and prospectus delivery requirements of
the Securities Act and the rules and regulations promulgated thereunder. Subject
to the foregoing, this Agreement shall be binding upon and inure to the benefit
of the parties and their respective successors and permitted assigns.

Section 5.9 Interpretation; Other Definitions. Wherever required by the context
of this Agreement, the singular shall include the plural and vice versa, and the
masculine gender shall include the feminine and neuter genders and vice versa,
and references to any agreement, document or instrument shall be deemed to refer
to such agreement, document or instrument as amended, supplemented or modified
from time to time. All article, section, paragraph or clause references not
attributed to a particular document shall be references to such parts of this
Agreement, and all exhibit, annex and schedule references not attributed to a
particular document shall be references to such exhibits, annexes and schedules
to this Agreement. In addition, the following terms are ascribed the following
meanings:

(a) the word “or” is not exclusive;

(b) the words “including,” “includes,” “included” and “include” are deemed to be
followed by the words “without limitation”;

(c) the terms “herein,” “hereof” and “hereunder” and other words of similar
import refer to this Agreement as a whole and not to any particular section,
paragraph or subdivision;

(d) the term “business day” means each calendar day except Saturdays, Sundays,
and United States federal holidays;

(e) the term “party” means the Company and each Admiral Seller, individually,
and the term “parties” means the Company and the Admiral Sellers, collectively;
and

(f) the term “person” has the meaning given to it in Section 3(a)(9) of the
Exchange Act and as used in Sections 13(d)(3) and 14(d)(2) of the Exchange Act.

(g) “Affiliate” means, with respect to any person, any person directly or
indirectly controlling, controlled by or under common control with, such other
person; provided, however, that the Company, any of its Subsidiaries, or any of
the Company’s other controlled Affiliates, in each case, will not be deemed to
be Affiliates of any Admiral Seller for purposes of this Agreement. For purposes
of this Agreement, “control” (including, with correlative meanings, the terms
“controlled by” and “under common control with”) when used with respect to any
person, means the possession, directly or indirectly, of the power to cause the
direction of management or policies of such person, whether through the
ownership of voting securities, by contract or otherwise.

 

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(h) “Common Stock” means the common stock of the Company, par value $0.01 per
share.

(i) “Common Stock Price” means $11.01.

(j) “Company Material Adverse Effect” shall mean, with respect to the Company,
any Effect that, individually or taken together with all other Effects that have
occurred prior to the date of determination of the occurrence of the Company
Material Adverse Effect, is or is reasonably likely to be materially adverse to
the business, assets, liabilities, results of operations or financial condition
of the Company and its Subsidiaries, taken as a whole; provided, however, that
in no event shall any of the following, alone or in combination, be deemed to
constitute, or be taken into account in determining whether a Company Material
Adverse Effect has occurred: (A) any change in the Company’s stock price or
trading volume, (B) any failure by the Company to meet revenue or earnings
projections, (C) any Effect that results from changes affecting the oil and gas
industry generally, or the United States economy generally, or any Effect that
results from changes affecting general worldwide economic or capital market
conditions, in each case except to the extent such changes disproportionately
affect the Company and its Subsidiaries, taken as a whole, relative to other oil
and gas exploration and production companies operating in the United States,
(D) any Effect caused by the announcement or pendency of the Acquisition, the
issuance of Company Preferred Stock pursuant to the Preferred Purchase
Agreement, or the identity of the Company or any of its Affiliates as the
acquirer in connection with the Acquisition (including any litigation arising
from the Acquisition Agreement, the Preferred Purchase Agreement or the
transactions contemplated by the Acquisition Agreement or the Preferred Purchase
Agreement), (E) any Effect caused by the announcement or pendency of the
transactions contemplated by this Agreement, or the identity of the Admiral
Sellers or any of their Affiliates as the Admiral Sellers in connection with the
transactions contemplated by this Agreement (including any litigation arising
from this Agreement or the transactions contemplated by this Agreement),
(F) acts of war or terrorism or natural disasters, (G) the performance of this
Agreement, the Acquisition Agreement, the Preferred Purchase Agreement and the
transactions contemplated hereby and thereby, including compliance with the
covenants set forth herein and therein, or any action taken or omitted to be
taken by the Company at the request or with the prior consent of the Admiral
Sellers, (H) changes in GAAP or other accounting standards (or any
interpretation thereof) or (I) changes in any Laws or other binding directives
issued by any Governmental Entity or interpretations or enforcement thereof;
provided, however, that (x) the exceptions in clause (A) and (B) shall not
prevent or otherwise affect a determination that any Effect underlying such
change or failure has resulted in, or contributed to, a Company Material Adverse
Effect, and (y) without limiting clause (C), with respect to clauses (F), (H)
and (I), such Effects, alone or in combination, may be deemed to constitute, or
be taken into account in determining whether a Company Material Adverse Effect
has occurred, but only to the extent such Effects disproportionately affect the
Company and its Subsidiaries, taken as a whole, relative to other oil and gas
exploration and production companies operating in the United States.

 

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(k) “Damages” means the amount of any liability, fine, expense, debt, diminution
in value, penalties, obligation, loss, cost, expense, claim, tax, award,
settlement or judgment incurred or suffered by any person under any theory of
tort, contract, breach of contract or otherwise, including contractual indemnity
claims (whether absolute, accrued, contingent, fixed or otherwise, or whether
known or unknown, or due or to become due or otherwise), including reasonable
fees and expenses of attorneys, consultants, accountants or other agents and
experts reasonably incident to matters indemnified against, and the costs of
investigation and/or monitoring of such matters, and the costs of enforcement of
the indemnity.

(l) “Effect” shall mean any change, event, effect or circumstance.

(m) “Environmental Laws” shall mean all Laws relating to human or worker health
and safety, pollution, or protection of the environment.

(n) “Governmental Entity” means any instrumentality, subdivision, court,
administrative agency, commission, official or other governmental authority of
the United States or any other country or any state, municipality, locality,
tribe or other government or political subdivision thereof, or any
quasi-governmental or private body exercising any administrative, executive,
judicial, legislative, police, regulatory, taxing, importing or other
governmental or quasi-governmental body.

(o) “HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended, and the regulations promulgated thereto.

(p) “Knowledge of the Company” means the actual knowledge of one or more of Jay
Graham and Andrew J. Cozby.

(q) “Law” means all Permits, laws, statutes, rules, regulations, ordinances,
Orders and codes of Governmental Entities and common law.

(r) “Lien” means any mortgage, claim, encumbrance, pledge, lien (statutory or
otherwise), security agreement, restriction on transfer, conditional sale or
trust receipt or a lease, consignment or bailment, preference or priority,
assessment, deed of trust, charge, easement, servitude or other encumbrance upon
or with respect to any property of any kind.

(s) “Order” means any judgment, order, consent order, injunction, decree or writ
of any Governmental Entity.

(t) “Permit” means all permits, approvals, consents, licenses, waivers, grants,
concessions, exemptions, orders, registrations or authorizations by, or filings
with, any Governmental Entity.

(u) “Preferred Purchase Agreement” means that certain Preferred Stock Purchase
Agreement dated as of the date hereof by and between the Company and CP VI Eagle
Holdings, L.P.

(v) “Preliminary Settlement Statement” has the meaning given to it in the
Acquisition Agreement.

 

19

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(w) “Registration Rights Agreement” has the meaning given to it in the Preferred
Purchase Agreement.

(x) “Stock Purchase Price” has the meaning given to it in the Acquisition
Agreement.

(y) “Subsidiary” means, as to any person, any corporation or other entity of
which: (i) such person or a subsidiary of such person is a general partner or
manager; (ii) at least a majority of the outstanding equity interest having by
the terms thereof ordinary voting power to elect a majority of the board of
directors or similar governing body of such corporation or other entity
(irrespective of whether or not at the time any equity interest of any other
class or classes of such corporation or other entity shall have or might have
voting power by reason of the happening of any contingency) is at the time
directly or indirectly owned or controlled by such person or one or more of its
subsidiaries; or (iii) any corporation or other entity as to which such person
consolidates for accounting purposes.

Section 5.10 Captions. The article, section, paragraph and clause captions
herein are for convenience of reference only, do not constitute part of this
Agreement and will not be deemed to limit or otherwise affect any of the
provisions hereof.

Section 5.11 Severability. The invalidity or unenforceability of any term or
provision of this Agreement in any situation or jurisdiction shall not affect
the validity or enforceability of the other terms or provisions hereof or the
validity or enforceability of the offending term or provision in any other
situation or in any other jurisdiction, and the remaining terms and provisions
shall remain in full force and effect unless doing so would result in an
interpretation of this Agreement that is manifestly unjust.

Section 5.12 No Third Party Beneficiaries. Nothing in this Agreement shall
entitle any person other than the Company and the Admiral Sellers Sellers to any
claim, cause of action, remedy or right of any kind.

Section 5.13 Conspicuousness. THE ADMIRAL SELLERS AND THE COMPANY AGREE THAT, TO
THE EXTENT REQUIRED BY APPLICABLE LAW TO BE EFFECTIVE, THE PROVISIONS IN THIS
AGREEMENT IN BOLD-TYPE ALL CAPS FONT ARE “CONSPICUOUS” FOR THE PURPOSE OF ANY
APPLICABLE LAW.

Section 5.14 Public Announcements. Neither the Admiral Sellers nor the Company
shall make any press release or other public disclosure regarding the identity
of the parties or disclosing express terms of this Agreement, other than as set
forth in the Acquisition Agreement.

Section 5.15 Specific Performance. The parties agree that if any of the
provisions of this Agreement were not performed in accordance with their
specific terms, irreparable damage would occur, no adequate remedy at Law would
exist and damages would be difficult to determine, and the parties shall be
entitled to specific performance of the terms hereof and immediate injunctive
relief, without the necessity of proving the inadequacy of money damages as a
remedy, in addition to any other remedy available at Law or in equity.

 

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Section 5.16 Termination. Prior to the Closing, this Agreement may only be
terminated:

(a) without any action by any party, if the Acquisition Agreement is terminated
in accordance with its terms; or

(b) by mutual written consent of the parties hereto;

Section 5.17 Effects of Termination. In the event of any termination of this
Agreement in accordance with Section 5.16, no party (or any of its Affiliates)
shall have any liability or obligation to the other parties (or any of their
Affiliates) under or in respect of this Agreement, other than as set forth in
Sections 11.2 and 11.3 of the Acquisition Agreement. In the event of any such
termination, this Agreement shall become void and have no effect, and the
transactions contemplated hereby shall be abandoned without further action by
the parties hereto, in each case, except (x) as set forth in the preceding
sentence and (y) that the provisions of Sections 5.2 to 5.14, this Section 5.17
and Section 5.18 shall survive the termination of this Agreement.

Section 5.18 Expenses. All costs and expenses, including fees and disbursements
of counsel, financial advisors and accountants, incurred in connection with the
preparation, negotiation and due diligence of this Agreement shall be paid by
the party incurring such costs and expenses; provided, however, that the Company
shall reimburse the Admiral Sellers and their Affiliates for all of their
reasonable, third-party costs and expenses incurred in connection with the
preparation of financial statements required under Rule 3.05 of Regulation S-X
of the Securities Act in connection with the transactions contemplated by this
Agreement and the Acquisition Agreement.

Section 5.19 Non-Recourse. This Agreement may only be enforced against, and any
claims or causes of action that may be based upon, arise out of or relate to
this Agreement, or the negotiation, execution or performance of this Agreement
may only be made against the entities that are expressly identified as parties
hereto, including entities that become parties hereto after the date hereof or
that agree in writing for the benefit of the Company to be bound by the terms of
this Agreement applicable to the Admiral Sellers, and no former, current or
future equityholders, controlling persons, directors, officers, employees,
agents or Affiliates of any party hereto or any former, current or future
equityholder, controlling person, director, officer, employee, general or
limited partner, member, manager, agent or Affiliate of any of the foregoing
(each, a “Non-Recourse Party”) shall have any liability for any obligations or
liabilities of the parties to this Agreement or for any claim (whether in tort,
contract or otherwise) based on, in respect of, or by reason of, the
transactions contemplated hereby or in respect of any representations made or
alleged to be made in connection herewith. Without limiting the rights of any
party against the other parties hereto, in no event shall any party or any of
its Affiliates seek to enforce this Agreement against, make any claims for
breach of this Agreement against, or seek to recover monetary damages from, any
Non-Recourse Party.

[Signature Pages Follow]

 

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IN WITNESS WHEREOF, this Agreement has been duly executed and delivered by the
duly authorized officers of the parties hereto as of the date first herein above
written.

 

WILDHORSE RESOURCE DEVELOPMENT CORPORATION

By:

 

/s/ Jay C. Graham

Name:

 

Jay C. Graham

Title:

 

Chief Executive Officer

[Signature Page to Stock Issuance Agreement]

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ADMIRAL A HOLDING L.P.

By:

 

Admiral A Holding GP LLC,

 

its general partner

By:

 

/s/ Thomas Dashiell Lane

Name:

 

Thomas Dashiell Lane

Title:

 

Vice President

 

TE ADMIRAL A HOLDING L.P.

By:

 

TE Admiral A Holding GP LLC,

 

its general partner

By:

 

/s/ Thomas Dashiell Lane

Name:

 

Thomas Dashiell Lane

Title:

 

Vice President

 

AURORA C-I HOLDING L.P.

By:

 

Aurora Holding GP LLC,

 

its general partner

By:

 

/s/ Thomas Dashiell Lane

Name:

 

Thomas Dashiell Lane

Title:

 

Vice President

[Signature Page to Stock Issuance Agreement]

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EXHIBIT A

Form of Registration Rights Agreement

--------------------------------------------------------------------------------

Final Form

AMENDED AND RESTATED

REGISTRATION RIGHTS AGREEMENT

This Amended and Restated Registration Rights Agreement (this “Agreement”),
dated as of [•], 2017, is entered into by and among WildHorse Resource
Development Corporation, a Delaware corporation (the “Company”), and each of the
other parties listed on the signature pages hereto (the “Initial Holders” and,
together with the Company, the “Parties”).

WHEREAS, in connection with the Company’s initial public offering, the Company
entered into that certain Registration Rights Agreement, dated as of
December 19, 2016, by and among the Company and the IPO Holders (as defined
below) (the “Initial RRA”);

WHEREAS, the Company and Carlyle are parties to that certain Preferred Stock
Purchase Agreement, dated as of May 10, 2017, pursuant to which the Company has
issued and sold certain shares of Convertible Preferred Stock (as defined below)
to Carlyle (the “Preferred Purchase Agreement”);

WHEREAS, the Company and the KKR Holders are parties to that certain Stock
Issuance Agreement, dated as of May 10, 2017, pursuant to which the Company has
issued and sold certain shares of Common Stock (as defined below) to the KKR
Holders (the “Stock Issuance Agreement”).

WHEREAS, as a condition to the closing of the transactions contemplated by the
Preferred Purchase Agreement, the Company and Carlyle agreed to execute and
deliver this Agreement in order for the Company to grant certain registration
and other rights to Carlyle by amending the Initial RRA on the terms and subject
to the conditions set forth in this Agreement.

WHEREAS, as a condition to the closing of the transactions contemplated by the
Stock Issuance Agreement, the Company and the KKR Holders agreed to execute and
deliver this Agreement in order for the Company to grant certain registration
and other rights to the KKR Holders by amending the Initial RRA on the terms and
subject to the conditions set forth in this Agreement.

NOW THEREFORE, in consideration of the mutual covenants and agreements set forth
herein and for good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged by each party hereto, the Parties hereby agree as
follows:

1. Definitions. As used in this Agreement, the following terms have the meanings
indicated:

“Acquisition Co. Holdings” means WHE AcqCo Holdings, LLC, a Delaware limited
liability company.

“Affiliate” means, with respect to any specified Person, a Person that directly
or indirectly Controls or is Controlled by, or is under common Control with,
such specified Person; provided, however, that (i) the Company shall not be
considered an Affiliate of any Holder for purposes of this Agreement and
(ii) the Preferred Holders and the Sponsoring Holders shall not be considered
Affiliates of each other for purposes of this Agreement.

 

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“Automatic Shelf Registration Statement” means an “automatic shelf registration
statement” as defined under Rule 405.

“Board” means the board of directors of the Company.

“Business Day” means any day other than a Saturday, Sunday, any federal holiday
or any other day on which banking institutions in the State of Texas or the
State of New York are authorized or required to be closed by law or governmental
action.

“Carlyle” means CP VI Eagle Holdings, L.P.

“Certificate” means the Certificate of Designations establishing the terms of
the Convertible Preferred Stock filed with the Secretary of State of the State
of Delaware on [•], 2017.

“Commission” means the Securities and Exchange Commission or any other federal
agency then administering the Securities Act or Exchange Act.

“Common Stock” means the common stock, par value $0.01 per share, of the
Company.

“Company Securities” means any equity interest of any class or series in the
Company.

“Control” (including the terms “Controls,” “Controlled by” and “under common
Control with”) means the possession, direct or indirect, of the power to
(a) direct or cause the direction of the management and policies of a Person,
whether through the ownership of voting securities, by contract or otherwise or
(b) vote 10% or more of the securities having ordinary voting power for the
election of directors of a Person.

“Convertible Preferred Stock” means the shares of Series A Perpetual Convertible
Preferred Stock of the Company issued to Carlyle pursuant to the Preferred
Purchase Agreement.

“Effective Date” means the time and date that a Registration Statement is first
declared effective by the Commission or otherwise becomes effective.

“Esquisto Holdings” means Esquisto Holdings, LLC, a Delaware limited liability
company.

“Exchange Act” means the Securities Exchange Act of 1934, as amended from time
to time, and the rules and regulations of the Commission promulgated thereunder.

“Holder” means (a) WildHorse Holdings unless and until WildHorse Holdings ceases
to hold any Registrable Securities; (b) Esquisto Holdings unless and until
Esquisto Holdings ceases to hold any Registrable Securities; (c) Acquisition Co.
Holdings unless

 

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and until Acquisition Co. Holdings ceases to hold any Registrable Securities,
(d) Jay Graham unless and until Jay Graham ceases to hold any Registrable
Securities, (e) Anthony Bahr unless and until Anthony Bahr ceases to hold any
Registrable Securities, (f) NGP unless and until NGP ceases to hold any
Registrable Securities, (g) each Preferred Holder unless and until such
Preferred Holder ceases to hold any Registrable Securities; (h) each KKR Holder
unless and until such KKR Holder ceases to hold any Registrable Securities; and
(i) any holder of Registrable Securities to whom registration rights conferred
by this Agreement have been transferred in compliance with Section 8(e) hereof;
provided that any Person referenced in clause (i) shall be a Holder only if such
Person agrees in writing to be bound by and subject to the terms set forth in
this Agreement.

“Initiating Holder” means the Sponsoring Holder or Preferred Holder delivering
the Demand Notice or the Underwritten Offering Notice, as applicable.

“IPO Holders” means WildHorse Holdings, Esquisto Holdings, Acquisition Co.
Holdings, Jay Graham, Anthony Bahr and NGP.

“KKR Holders” means Admiral A Holding L.P., a Delaware limited partnership, TE
Admiral A Holding L.P., a Delaware limited partnership, and Aurora C-I Holding
L.P., a Delaware limited partnership.

“Lock-Up Period” (i) with respect to the Preferred Holders, means the first
anniversary of the date of this Agreement and (ii) with respect to all other
Holders, has the meaning set forth in the underwriting agreement entered into by
the Company in connection with the initial underwritten public offering of
shares of Common Stock.

“Material Adverse Change” means (a) any general suspension of trading in, or
limitation on prices for, securities on any national securities exchange or in
the over-the-counter market in the United States; (b) the declaration of a
banking moratorium or any suspension of payments in respect of banks in the
United States; (c) a material outbreak or escalation of armed hostilities or
other international or national calamity involving the United States or the
declaration by the United States of a national emergency or war or a change in
national or international financial, political or economic conditions; or
(d) any event, change, circumstance or effect that is or is reasonably likely to
be materially adverse to the business, properties, assets, liabilities,
condition (financial or otherwise), operations, results of operations or
prospects of the Company and its subsidiaries taken as a whole.

“NGP” means NGP XI US Holdings, L.P., a Delaware limited partnership.

“Person” means an individual, corporation, partnership, trust, incorporated or
unincorporated association, joint venture, limited liability company, joint
stock company, estate, trust, government (or an agency or subdivision thereof)
or other entity of any kind.

“Preferred Holder” means (a) Carlyle unless and until Carlyle ceases to hold any
Convertible Preferred Stock or Registrable Securities and (b) any holder of
Convertible Preferred Stock or Registrable Securities to whom registration
rights of a “Preferred

 

3

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Holder” conferred by this Agreement have been transferred in compliance with
Section 8(e) hereof; provided that any Person referenced in clause (b) shall be
a Preferred Holder only if such Person agrees in writing to be bound by and
subject to the terms set forth in this Agreement.

“Preferred No-Blocking Period” is defined in Section 3(o).

“Proceeding” means any action, claim, suit, proceeding or investigation
(including a preliminary investigation or partial proceeding, such as a
deposition) pending or, to the knowledge of the Company, to be threatened.

“Prospectus” means the prospectus included in a Registration Statement
(including a prospectus that includes any information previously omitted from a
prospectus filed as part of an effective Registration Statement in reliance upon
Rule 430A, Rule 430B or Rule 430C promulgated under the Securities Act), as
amended or supplemented by any prospectus supplement, with respect to the terms
of the offering of any portion of the Registrable Securities covered by such
Registration Statement and all other amendments and supplements to the
Prospectus, including post-effective amendments, and all material incorporated
by reference or deemed to be incorporated by reference in such Prospectus.

“Registrable Securities” means the Shares; provided, however, that Registrable
Securities shall not include: (a) any Shares that have been registered under the
Securities Act and disposed of pursuant to an effective Registration Statement
or otherwise transferred to a Person who is not entitled to the registration and
other rights hereunder; (b) any Shares that have been sold or transferred by the
Holder thereof pursuant to Rule 144 (or any similar provision then in force
under the Securities Act) and the transferee thereof does not receive
“restricted securities” as defined in Rule 144; and (c) any Shares that cease to
be outstanding (whether as a result of repurchase and cancellation, conversion
or otherwise); provided, however, that any Registrable Security shall cease to
be a Registrable Security at such time that (a) the holder thereof (together
with its Affiliates) ceases to hold at least 2.5% of the outstanding Common
Stock (on an as-converted basis with respect to any Convertible Preferred Stock
outstanding); (b) such Registrable Security may be sold pursuant to any section
of Rule 144 under the Securities Act (or any successor or similar provision
adopted by the SEC then in effect) without any volume or manner of sale
restrictions or information requirements thereunder; and (c) at least two years
have elapsed since the date of this Agreement.

“Registration Statement” means a registration statement of the Company in the
form required to register under the Securities Act and other applicable law for
the resale of the Registrable Securities in accordance with the intended plan of
distribution of each Holder included therein, and including any Prospectus,
amendments and supplements to each such registration statement or Prospectus,
including pre- and post-effective amendments, all exhibits thereto, and all
material incorporated by reference or deemed to be incorporated by reference in
such registration statement.

“Rule 144” means Rule 144 promulgated by the Commission pursuant to the
Securities Act.

 

4

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“Rule 405” means Rule 405 promulgated by the Commission pursuant to the
Securities Act.

“Rule 415” means Rule 415 promulgated by the Commission pursuant to the
Securities Act.

“Rule 424” means Rule 424 promulgated by the Commission pursuant to the
Securities Act.

“Securities Act” means the Securities Act of 1933, as amended.

“Selling Expenses” means all underwriting discounts, selling commissions and
stock transfer taxes applicable to the sale of Registrable Securities and fees
and disbursements of counsel for any Holder.

“Shares” means (i) with respect to the Preferred Holders, any shares of Common
Stock issued or issuable upon conversion of the Convertible Preferred Stock,
(ii) with respect to all other Holders, the shares of Common Stock held by the
IPO Holders as of the date hereof and (iii) any other equity interests of the
Company or equity interests in any successor of the Company issued in respect of
such shares referenced in clauses (i) and (ii) by reason of or in connection
with any stock dividend, stock split, combination, reorganization
recapitalization, conversion to another type of entity or similar event
involving a change in the capital structure of the Company.

“Shelf Registration Statement” means a Registration Statement of the Company
filed with the Commission on Form S-3 (or any successor form or other
appropriate form under the Securities Act) for an offering to be made on a
continuous or delayed basis pursuant to Rule 415 (or any similar rule that may
be adopted by the Commission) covering the Registrable Securities, as
applicable.

“Sponsoring Holder” means (a) WildHorse Holdings unless and until WildHorse
Holdings ceases to hold any Registrable Securities; (b) Esquisto Holdings unless
and until Esquisto Holdings ceases to hold any Registrable Securities;
(c) Acquisition Co. Holdings unless and until Acquisition Co. Holdings ceases to
hold any Registrable Securities; and (d) any holder of Registrable Securities to
whom registration rights of a “Sponsoring Holder” conferred by this Agreement
have been transferred in compliance with Section 8(e) hereof; provided that any
Person referenced in clause (d) shall be a Sponsoring Holder only if such Person
agrees in writing to be bound by and subject to the terms set forth in this
Agreement.

“Stockholders Agreement” means that certain Stockholders Agreement, dated as of
December 19, 2016, by and among the Company, Wildhorse Holdings, Esquisto
Holdings and Acquisition Co. Holdings.

“Trading Market” means the principal national securities exchange on which
Registrable Securities are listed.

 

5

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“Underwritten Offering” means an underwritten offering of Common Stock for cash
(whether a Requested Underwritten Offering or in connection with a public
offering of Common Stock by the Company, stockholders or both), excluding an
offering relating solely to an employee benefit plan, or an offering relating to
a transaction on Form S-4 or S-8.

“VWAP” means, as of a specified date and in respect of Registrable Securities,
the volume weighted average price for such security on the Trading Market for
the five trading days immediately preceding, but excluding, such date.

“WildHorse Holdings” means WHR Holdings LLC, a Delaware limited liability
company.

“WKSI” means a “well known seasoned issuer” as defined under Rule 405.

Unless the context requires otherwise: (a) any pronoun used in this Agreement
shall include the corresponding masculine, feminine or neuter forms;
(b) references to Sections refer to sections of this Agreement; (c) the terms
“include,” “includes,” “including” and words of like import shall be deemed to
be followed by the words “without limitation”; (d) the terms “hereof,” “hereto,”
“herein” or “hereunder” refer to this Agreement as a whole and not to any
particular provision of this Agreement; (e) unless the context otherwise
requires, the term “or” is not exclusive and shall have the inclusive meaning of
“and/or”; (f) defined terms herein will apply equally to both the singular and
plural forms and derivative forms of defined terms will have correlative
meanings; (g) references to any law or statute shall include all rules and
regulations promulgated thereunder, and references to any law or statute shall
be construed as including any legal and statutory provisions consolidating,
amending, succeeding or replacing the applicable law or statute; (h) references
to any Person include such Person’s successors and permitted assigns; and
(i) references to “days” are to calendar days unless otherwise indicated.

2. Registration.

(a) Demand Registration.

(i) At any time after the expiration of the applicable Lock-Up Period, any
Preferred Holder and Sponsoring Holder shall severally have the option and
right, exercisable by delivering a written notice to the Company (a “Demand
Notice”), to require the Company to, pursuant to the terms of and subject to the
limitations contained in this Agreement, prepare and file with the Commission a
Registration Statement registering the offering and sale of the number and type
of Registrable Securities on the terms and conditions specified in the Demand
Notice, which may include sales on a delayed or continuous basis pursuant to
Rule 415 pursuant to a Shelf Registration Statement (a “Demand Registration”).
The Demand Notice must set forth the number of Registrable Securities that the
Initiating Holder intends to include in such Demand Registration and the
intended methods of disposition thereof. Notwithstanding anything to the
contrary herein, in no event shall the Company be required to effectuate a
Demand

 

6

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Registration unless the Registrable Securities of the Holders to be included
therein after compliance with Section 2(a)(ii) have an aggregate value of at
least $75 million based on the VWAP (the “Minimum Amount”) as of the date of the
Demand Notice; provided, however, that the Minimum Amount shall not apply in the
event that, as the result of Cutback Shares being removed from such Registration
Statement pursuant to this Section 2(a)(i), the Registrable Securities of the
Holders to be included therein after compliance with Section 2(a)(ii) have an
aggregate value of less than $75 million. If at any time the Commission takes
the position that some or all of the Registrable Securities proposed to be
included in a Registration Statement filed pursuant to a Demand Registration
must be removed from such Registration Statement (such portion of the
Registrable Securities, the “Cut Back Shares”) in order for all of the
Registrable Securities in such Registration Statement filed pursuant to a Demand
Registration to be eligible to be made on a delayed or continuous basis under
the provisions of Rule 415 or for the Initiating Holder to not be named as an
“underwriter” in such Registration Statement, then if the Initiating Holder so
elects, the Company shall remove the Cutback Shares from such Registration
Statement. Any Cut Back Shares so removed pursuant to this Section 2(a)(i) shall
be allocated among the Holders including Registrable Securities for resale on
such Registration Statement on a pro rata basis. Further, a Demand Registration
shall not constitute a Demand Registration of the Initiating Holder for purposes
of Section 2(a)(iii) if, as a result of the cutback provisions in this Section
2(a)(i) or Registrable Securities of Holders other than the Initiating Holder
included in such Demand Registration pursuant to Section 2(a)(ii), there is
included in the Demand Registration less than the lesser of (x) Registrable
Securities of the Initiating Holder having a VWAP measured on the effective date
of the related Registration Statement of $75 million and (y) two-thirds of the
number of Registrable Securities the Initiating Holder set forth in the
applicable Demand Notice.

(ii) Within five Business Days (or if the Registration Statement will be a Shelf
Registration Statement, within two Business Days) after the receipt of the
Demand Notice, the Company shall give written notice of such Demand Notice to
all Holders and, within 30 days after receipt of the Demand Notice (except if
the Company is not then eligible to register for resale the Registrable
Securities on Form S-3, in which case, within 90 days thereof), shall, subject
to the limitations of this Section 2(a), file a Registration Statement in
accordance with the terms and conditions of the Demand Notice, which
Registration Statement shall cover all of the Registrable Securities that the
Holders shall in writing request to be included in the Demand Registration (such
request to be given to the Company within three Business Days (or if the
Registration Statement will be a Shelf Registration Statement, within one
Business Day) after receipt of notice of the Demand Notice given by the Company
pursuant to this Section 2(a)(ii)). The Company shall use reasonable best
efforts to cause such Registration Statement to become and remain effective
(including using reasonable best efforts to file a Registration Statement
including Registrable Securities included on any previous Registration Statement
that ceases to be effective, which, for the avoidance of doubt shall not be
considered an additional Demand Registration for any Holder pursuant to Section
2(a)(iii)) under the Securities Act until all such securities registered for
resale thereunder cease to be Registrable Securities (the “Effectiveness
Period”).

 

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(iii) Subject to the other limitations contained in this Agreement, the Company
is not obligated hereunder to effect (A) a Demand Registration within 90 days
after the closing of any Underwritten Offering (or such shorter time as the
Company may notify the Holders in writing) (any such time period, a “No Demand
Period”), unless any Preferred No-Blocking Period exists during such No Demand
Period, in which case the Company shall nevertheless be required to effect a
Demand Registration initiated by any Preferred Holder that is then otherwise
entitled to initiate a Demand Registration during such Preferred No-Blocking
Period, (B) more than a total of four Demand Registrations for which WildHorse
Holdings (or any transferee thereof in accordance with Section 8(e)) is the
Initiating Holder, (C) more than a total of four Demand Registrations for which
Esquisto Holdings (or any transferee thereof in accordance with Section 8(e)) is
the Initiating Holder, (D) more than a total of four Demand Registrations for
which Acquisition Co. Holdings (or any transferee thereof in accordance with
Section 8(e)) is the Initiating Holder, (E) more than a total of six Demand
Registrations for which any Preferred Holder is the Initiating Holder; and (F) a
subsequent Demand Registration pursuant to a Demand Notice if a Registration
Statement covering all of the Registrable Securities held by the Initiating
Holder shall have become and remains effective under the Securities Act and is
sufficient to permit offers and sales of the number and type of Registrable
Securities on the terms and conditions specified in the Demand Notice in
accordance with the intended timing and method or methods of distribution
thereof specified in the Demand Notice. No Demand Registration shall be deemed
to have occurred for purposes of this Section 2(a)(iii) if the Registration
Statement relating thereto does not become effective or is not maintained
effective for its entire Effectiveness Period, in which case the Initiating
Holder shall be entitled to an additional Demand Registration in lieu
thereof.    

(iv) A Holder may withdraw all or any portion of its Registrable Securities
included in a Demand Registration from such Demand Registration at any time
prior to the effectiveness of the applicable Registration Statement. Upon
receipt of a notice from the Initiating Holder that the Initiating Holder is
withdrawing all of its Registrable Securities from the Demand Registration or a
notice from a Holder to the effect that the Holder is withdrawing an amount of
its Registrable Securities such that the remaining amount of Registrable
Securities to be included in the Demand Registration is below the Minimum
Amount, the Company may cease all efforts to secure effectiveness of the
applicable Registration Statement, unless one or more Holders other than the
withdrawing Holder(s) shall promptly request the Company in writing to include
additional Registrable Securities in the Demand Registration such that amount of
Registrable Shares to be included in the Demand Registration satisfies the
Minimum Amount (a “Requisite Holder Substitution”). In the absence of a
Requisite Holder Substitution, such registration nonetheless shall be deemed a
Demand Registration with respect to the Initiating Holder for purposes of
Section 2(a)(iii) unless (A) the Initiating Holder shall have paid or reimbursed
the Company for its pro rata share of all reasonable and documented
out-of-pocket fees and expenses incurred by the Company in connection with the
withdrawn registration of such Registrable Securities (based on the number of
securities the Initiating Holder sought to register, as compared to the total
number of securities included in such Demand Registration) or (B) the withdrawal
is made following the occurrence of a Material Adverse Change or pursuant to the
Company’s request for suspension pursuant to Section 3(o).

 

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(v) The Company may include in any such Demand Registration other Company
Securities for sale for its own account or for the account of any other Person,
subject to Section 2(c)(iii).

(vi) Subject to the limitations contained in this Agreement, the Company shall
effect any Demand Registration on such appropriate registration form of the
Commission (A) as shall be selected by the Company and (B) subject to applicable
law and the requirements of the Commission, as shall permit the disposition of
the Registrable Securities in accordance with the intended method or methods of
disposition specified in the Demand Notice; provided that, subject to Section
3(o), (X) if the Registration Statement is on Form S-1, the Company shall
maintain the effectiveness of the Registration Statement then in effect until
such time as a Registration Statement on Form S-3 covering the Registrable
Securities has been declared effective by the Commission (provided that Form S-1
is then available for sales on a delayed or continuous basis under the
provisions of Rule 415 in respect of such Demand Registration), and (Y) if the
Company becomes, and is at the time of its receipt of a Demand Notice eligible
to use Form S-3, the Demand Registration for any offering and selling of
Registrable Securities shall be registered on Form S-3 (or any equivalent or
successor form under the Securities Act (if available to the Company) and (Z) if
at the time of its receipt of a Demand Notice, the Company is a WKSI, the Demand
Registration for any offering and selling of Registrable Securities shall be
registered on an Automatic Shelf Registration Statement on Form S-3 or any
equivalent or successor form under the Securities Act (if available to the
Company). If at any time a Registration Statement on Form S-3 is effective and a
Holder provides written notice to the Company that it intends to effect an
offering of all or part of the Registrable Securities included on such
Registration Statement, the Company will amend or supplement such Registration
Statement as may be necessary in order to enable such offering to take place.

(vii) Without limiting Section 3, in connection with any Demand Registration
pursuant to and in accordance with this Section 2(a), the Company shall
(A) promptly prepare and file or cause to be prepared and filed (1) such
additional forms, amendments, supplements, prospectuses, certificates, letters,
opinions and other documents, as may be necessary or advisable to register or
qualify the securities subject to such Demand Registration, including under the
securities laws of such jurisdictions as the Holders shall reasonably request;
provided, however, that no such qualification shall be required in any
jurisdiction where, as a result thereof, the Company would become subject to
general service of process or to taxation or qualification to do business in
such jurisdiction solely as a result of registration and (2) such forms,
amendments, supplements, prospectuses, certificates, letters, opinions and other
documents as may be necessary to apply for listing or to list the Registrable
Securities subject to such Demand Registration on the Trading Market and (B) do
any and all other acts and things that may be reasonably necessary or
appropriate or reasonably requested by the Holders to enable the Holders to
consummate a public sale of such Registrable Securities in accordance with the
intended timing and method or methods of distribution thereof.

 

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(viii) In the event a Holder transfers Registrable Securities included on a
Registration Statement and such Registrable Securities remain Registrable
Securities following such transfer, at the request of such Holder, the Company
shall amend or supplement such Registration Statement as may be necessary in
order to enable such transferee to offer and sell such Registrable Securities
pursuant to such Registration Statement; provided that in no event shall the
Company be required to file a post-effective amendment to the Registration
Statement unless (A) such Registration Statement includes only Registrable
Securities held by the Holder, Affiliates of the Holder or transferees of the
Holder or (B) the Company has received written consent therefor from a Person
for whom Registrable Securities have been registered on (but not yet sold under)
such Registration Statement, other than the Holder, Affiliates of the Holder or
transferees of the Holder.

(ix) Notwithstanding the foregoing restrictions of this Section 2(a), but
subject to any applicable No Demand Periods, the Preferred Holders shall be
permitted to deliver a Demand Notice for a Demand Registration during the
Lock-Up Period so long as (A) the Company is then-eligible to use Form S-3 to
register the resale of Registrable Securities and (B) the Preferred Holders do
not dispose of any Registrable Securities pursuant to the applicable
Registration Statement for the duration of the Lock-Up Period. Further, and for
the avoidance of doubt, nothing in this Agreement shall prohibit a Preferred
Holder from exercising its rights as a Holder during the Lock-Up Period,
including, but not limited to, a Preferred Holder’s participation in a Demand
Registration, Underwritten Offering and/or Underwritten Piggyback Offering,
other than with respect to (Y) except as provided in the immediately preceding
sentence, delivering a Demand Notice as an Initiating Holder during its Lock-Up
Period pursuant to Section 2(a)(i) and (Z) exercising its right to receive a
Piggyback Notice or to participate in any Piggyback Registration during its
Lock-Up Period with respect to the filing of a registration statement for the
sale of securities solely for the account of the Company, which registration
statement, for the avoidance of doubt, does not include Registrable Securities
of any Holder.

(b) Requested Underwritten Offering. Any Holder then able to effectuate a Demand
Registration pursuant to the terms of Section 2(a) (or who has previously
effectuated a Demand Registration pursuant to Section 2(a) but has not engaged
in an Underwritten Offering in respect of such Demand Registration) shall have
the option and right, exercisable by delivering written notice to the Company of
its intention to distribute Registrable Securities by means of an Underwritten
Offering (an “Underwritten Offering Notice”), to require the Company, pursuant
to the terms of and subject to the limitations of this Agreement, to effectuate
a distribution of any or all of its Registrable Securities by means of an
Underwritten Offering pursuant to a new Demand Registration or pursuant to an
effective Registration Statement covering such Registrable Securities (a
“Requested Underwritten Offering”); provided, that the Registrable Securities of
such Initiating Holder requested to be included in such Requested Underwritten
Offering have an aggregate value of at least equal to the Minimum Amount as of
the date of such Underwritten Offering Notice. The Underwritten Offering Notice
must set forth the number of Registrable Securities that the Initiating Holder
intends to include in such Requested Underwritten Offering. The managing
underwriter or managing underwriters of a Requested Underwritten Offering shall
be designated by the Company; provided, however, that

 

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such designated managing underwriter or managing underwriters shall be
reasonably acceptable to the Initiating Holder; provided, further, however that
no later than 9:00 A.M., New York Time, on the day of a proposed block trade or
bought deal pursuant to an Initiating Holder’s Requested Underwritten Offering
(an “Initiating Holder Block”), the Initiating Holder thereof may deliver to the
Company in writing a list of one or more proposed managing underwriters of the
Initiating Holder Block (each a “Bidding Bank” and collectively, the “Bidding
Banks”) and, unless the Company reasonably objects to any Bidding Bank in
writing to the Initiating Holder by Noon, New York Time on the same day, any one
or more of such Bidding Banks to which the Company does not so timely reasonably
object (the “Approved Bidding Banks”), shall be deemed to be designated by the
Company as a managing underwriter for the purposes of this Section 2(b), and the
Initiating Holder of the Initiating Holder Block may select, without any
additional prior consent by or approval from the Company, one or more Approved
Bidding Bank as a managing underwriter or the managing underwriters for such
Initiating Holder Block as if it as if it had assumed the Company’s the right of
designation pursuant to this Section 2(b). In connection with any Initiating
Holder Block, the Initiating Holder thereof shall take commercially reasonable
efforts to advise the Company with respect to its obligations thereunder and
related schedule thereto. Notwithstanding the foregoing, the Company is not
obligated to effect a Requested Underwritten Offering within 90 days after the
closing of an Underwritten Offering (or such shorter time as the Company may
notify the Holders in writing) (any such time period, a “No Requested
Underwritten Offering Period”), unless any Preferred No-Blocking Period exists
during such No Requested Underwritten Offering Period, in which case the Company
shall nevertheless be required to effect a Requested Underwritten Offering
initiated by any Preferred Holder that is then otherwise entitled to initiate a
Requested Underwritten Offering during such Preferred No-Blocking Period. Any
Requested Underwritten Offering (other than the first Requested Underwritten
Offering made in respect of a prior Demand Registration) shall constitute a
Demand Registration of the Initiating Holder for purposes of Section 2(a)(iii)
(it being understood that if requested concurrently with a Demand Registration
then, together, such Demand Registration and Requested Underwritten Offering
shall count as one Demand Registration); provided, however, that a Requested
Underwritten Offering shall not constitute a Demand Registration of the
Initiating Holder for purposes of Section 2(a)(iii) if, as a result of Section
2(c)(iii)(A), the Requested Underwritten Offering includes less than the lesser
of (i) Registrable Securities of the Initiating Holder having a VWAP measured on
date of the applicable Underwritten Offering Notice of $75 million and
(ii) two-thirds of the number of Registrable Securities the Initiating Holder
set forth in the applicable Underwritten Offering Notice.

(c) Piggyback Registration and Piggyback Underwritten Offering.

(i) If the Company shall at any time propose to file a registration statement
under the Securities Act with respect to an offering of Common Stock (other than
a registration statement on Form S-4, Form S-8 or any successor forms thereto or
filed solely in connection with an exchange offer or any employee benefit or
dividend reinvestment plan and other than a Demand Registration), whether or not
for its own account, then the Company shall promptly notify all Holders of such
proposal reasonably in advance of (and in any event at least five Business Days,
except if the registration statement will be a Shelf Registration Statement, at
least two Business Days, before) the anticipated filing date (the “Piggyback
Registration Notice”). The Piggyback

 

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Registration Notice shall offer Holders the opportunity to include for
registration in such registration statement the number of Registrable Securities
as they may request in writing (a “Piggyback Registration”). The Company shall
use commercially reasonable efforts to include in each such Piggyback
Registration such Registrable Securities for which the Company has received
written requests for inclusion therein (“Piggyback Registration Request”) within
three Business Days or, if the Piggyback Registration will be on a Shelf
Registration Statement, within one Business Day, after sending the Piggyback
Registration Notice. Each Holder shall be permitted to withdraw all or part of
such Holder’s Registrable Securities from a Piggyback Registration by giving
written notice to the Company of its request to withdraw; provided that (A) such
request must be made in writing prior to the effectiveness of such registration
statement and (B) such withdrawal shall be irrevocable and, after making such
withdrawal, a Holder shall no longer have any right to include Registrable
Securities in the Piggyback Registration as to which such withdrawal was made.
Any withdrawing Holder shall continue to have the right to include any
Registrable Securities in any subsequent registration statement or registration
statements as may be filed by the Company with respect to offerings of Common
Stock, all upon the terms and conditions set forth herein. Notwithstanding
anything to the contrary in this Section 2(c)(i), the Preferred Holders shall
not have the right to receive any Piggyback Notice or to participate in any
Piggyback Registration, in each case with respect to the filing of a
registration statement for the sale of securities solely for the account of the
Company, which registration statement, for the avoidance of doubt, does not
include Registrable Securities of any Holder, until the expiration of the
Lock-Up Period applicable to the Preferred Holders.

(ii) If the Company shall at any time propose to conduct an Underwritten
Offering (including a Requested Underwritten Offering), whether or not for its
own account, then the Company shall promptly notify all Holders of such proposal
reasonably in advance of (and in any event at least five Business Days, except
if the Underwritten Offering will be made pursuant to a Shelf Registration
Statement, at least two Business Days, before) the commencement of the offering,
which notice shall set forth the principal terms and conditions of the issuance,
including the proposed offering price or range of offering prices (if known),
the anticipated filing date of the related registration statement (if
applicable) and the number of shares of Common Stock that are proposed to be
registered (the “Underwritten Offering Piggyback Notice”). The Underwritten
Offering Piggyback Notice shall offer Holders the opportunity to include in such
Underwritten Offering (and any related registration, if applicable) the number
of Registrable Securities as they may request in writing (an “Underwritten
Piggyback Offering”); provided, however, that in the event that the Company
proposes to effectuate the subject Underwritten Offering pursuant to an
effective Shelf Registration Statement other than an Automatic Shelf
Registration Statement, only Registrable Securities of Holders which are subject
to an effective Shelf Registration Statement may be included in such
Underwritten Piggyback Offering. The Company shall use commercially reasonable
efforts to include in each such Underwritten Piggyback Offering such Registrable
Securities for which the Company has received written requests for inclusion
therein (“Underwritten Offering Piggyback Request”) within three Business Days
or, if such Underwritten Piggyback Offering will be made pursuant to a Shelf
Registration Statement, within one Business Day after sending the Underwritten
Offering Piggyback

 

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Notice. Each Holder shall be permitted to withdraw all or part of such Holder’s
Registrable Securities from an Underwritten Piggyback Offering at any time prior
to the effectiveness of the applicable registration statement, and such Holder
shall continue to have the right to include any Registrable Securities in any
subsequent Underwritten Offerings, all upon the terms and conditions set forth
herein. Notwithstanding anything to the contrary in this Section 2(c)(ii), the
Preferred Holders shall not have the right to receive any Underwritten Offering
Piggyback Notice or to participate in any Underwritten Piggyback Offering, in
each case with respect to an Underwritten Offering of securities solely for
account of the Company (and not including Registrable Securities of any other
Holder), until the expiration of the Lock-Up Period applicable to the Preferred
Holders.

(iii) If the managing underwriter or managing underwriters of an Underwritten
Offering advise the Company and the Holders that in their reasonable opinion
that the inclusion of all of the Holders’ Registrable Securities requested for
inclusion in the subject Underwritten Offering (and any related registration, if
applicable) (and any other Common Stock proposed to be included in such
offering) exceeds the number that can be included without being likely to have a
significant adverse effect on the price, timing or distribution of the
securities offered or the market for the securities offered, the Company shall
include in such Underwritten Offering (and any related registration, if
applicable) only that number of shares of Common Stock proposed to be included
in such Underwritten Offering (and any related registration, if applicable)
that, in the reasonable opinion of the managing underwriter or managing
underwriters, will not have such adverse effect, with such number to be
allocated as follows: (A) in the case of a Requested Underwritten Offering,
(1) first, pro-rata among all Holders (including the Initiating Holder) that
have requested to include Registrable Securities in such Underwritten Offering
based on the relative number of Registrable Securities then held by each such
Holder, (2) second, if there remains availability for additional shares of
Common Stock to be included in such Underwritten Offering, the Company, and
(3) third, if there remains availability for additional shares of Common Stock
to be included in such Underwritten Offering, any other holders entitled to
participate in such Underwritten Offering, if applicable, based on the relative
number of shares of Common Stock then held by each such holder; and (B) in the
case of any other Underwritten Offerings, (x) first, to the Company, (y) second,
if there remains availability for additional shares of Common Stock to be
included in such Underwritten Offering, pro-rata among all Holders desiring to
include Registrable Securities in such Underwritten Offering based on the
relative number of Registrable Securities then held by each such Holder, and
(z) third, if there remains availability for additional shares of Common Stock
to be included in such registration, pro-rata among any other holders entitled
to participate in such Underwritten Offering, if applicable, based on the
relative number of Common Stock then held by each such holder. If any Holder
disapproves of the terms of any such Underwritten Offering, such Holder may
elect to withdraw therefrom by written notice to the Company and the managing
underwriter(s) delivered on or prior to the time of the commencement of such
offering. Any Registrable Securities withdrawn from such underwriting shall be
excluded and withdrawn from the registration. In making any determination of the
relative number of Registrable Securities then held by each Holder for purposes
of Section 2(a)(iv) and this Section 2(c)(iii), each Holder of Convertible

 

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Preferred Stock shall be deemed for purposes of such determination to hold a
number of shares of Common Stock equal to the number of shares of Common Stock
issuable in respect of such Holder’s Convertible Preferred Stock in the event
such Holder converted all of its shares of Convertible Preferred Stock into
shares of Common Stock as of such time of determination.

(iv) The Company shall have the right to terminate or withdraw any registration
initiated by it under this Section 2(c) at any time in its sole discretion
whether or not any Holder has elected to include Registrable Securities in such
Registration Statement. The registration expenses of such withdrawn registration
shall be borne by the Company in accordance with Section 4 hereof.

(v) Each Holder agrees that, following receipt of any Piggyback Registration
Notice, Underwritten Offering Piggyback Notice or any notice pursuant to Section
2(a)(ii), such Holder will keep confidential and will not disclose, divulge, or
use for any purpose (other than as necessary to exercise its rights pursuant to
this Agreement, including, but not limited to, disclosure to its advisors and
Affiliates) the fact that such Piggyback Registration Notice, Underwritten
Offering Piggyback Notice or any notice pursuant to Section 2(a)(ii) exists or
was received by such Holder or the contents of any such Piggyback Registration
Notice, Underwritten Offering Piggyback Notice or any notice pursuant to Section
2(a)(ii), until the earlier of (a) the date that is 30 days following receipt of
such notice, (b) such time as the registration or Underwritten Offering that is
the subject of such notice is known or becomes known to the public in general
(other than as a result of a breach of this Section 2(c)(v)) and (c) the date
the Company notifies the Holder that the proposed Underwritten Piggyback
offering has been abandoned.

3. Registration and Underwritten Offering Procedures. The procedures to be
followed by the Company and each Holder electing to sell Registrable Securities
in a Registration Statement pursuant to this Agreement, and the respective
rights and obligations of the Company and such Holders, with respect to the
preparation, filing and effectiveness of such Registration Statement and the
effectuation of any Underwritten Offering, are as follows:

(a) In connection with a Demand Registration, the Company will, at least three
Business Days prior to the anticipated filing of the Registration Statement and
any related Prospectus or any amendment or supplement thereto (other than, after
effectiveness of the Registration Statement, any filing made under the Exchange
Act that is incorporated by reference into the Registration Statement), (i)
furnish to such Holders copies of all such documents prior to filing and
(ii) use commercially reasonable efforts to address in each such document when
so filed with the Commission such comments as such Holders reasonably shall
propose prior to the filing thereof.

(b) In connection with a Piggyback Registration, Underwritten Piggyback Offering
or a Requested Underwritten Offering, the Company will, at least three Business
Days (or in the case of a Shelf Registration Statement or an offering that will
be made pursuant to a Shelf Registration Statement, at least one Business Day)
prior to the anticipated filing of any initial Registration Statement that
identifies the Holders and any related Prospectus or any

 

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amendment or supplement thereto (other than amendments and supplements that do
not materially alter the previous disclosure or do nothing more than name
Holders and provide information with respect thereto), as applicable, furnish to
such Holders copies of any such Registration Statement or related Prospectus or
amendment or supplement thereto that identify the Holders and any related
Prospectus or any amendment or supplement thereto (other than amendments and
supplements that do not materially alter the previous disclosure or do nothing
more than name Holders and provide information with respect thereto). The
Company will also use commercially reasonable efforts to address in each such
document when so filed with the Commission such comments as such Holders
reasonably shall propose prior to the filing thereof.

(c) The Company will use commercially reasonable efforts to as promptly as
reasonably practicable (i) prepare and file with the Commission such amendments,
including post-effective amendments, and supplements to each Registration
Statement and the Prospectus used in connection therewith as may be necessary
under applicable law to keep such Registration Statement continuously effective
with respect to the disposition of all Registrable Securities covered thereby
for its Effectiveness Period and, subject to the limitations contained in this
Agreement, applicable law and the requirements of the Commission, prepare and
file with the Commission such additional Registration Statements in order to
register for resale under the Securities Act all of the Registrable Securities
held by the Holders; (ii) cause the related Prospectus to be amended or
supplemented by any required prospectus supplement, and as so supplemented or
amended to be filed pursuant to Rule 424; and (iii) respond to any comments
received from the Commission with respect to each Registration Statement or any
amendment thereto and, as promptly as reasonably practicable provide such
Holders true and complete copies of all correspondence from and to the
Commission relating to such Registration Statement that pertains to such Holders
as selling stockholders but not any comments that would result in the disclosure
to such Holders of material and non-public information concerning the Company.

(d) The Company will comply in all material respects with the provisions of the
Securities Act and the Exchange Act with respect to the Registration Statements
and the disposition of all Registrable Securities covered by each Registration
Statement.

(e) The Company will notify such Holders who are included in a Registration
Statement as promptly as reasonably practicable: (i)(A) when a Prospectus or any
prospectus supplement or post-effective amendment to a Registration Statement in
which such Holder is included has been filed; (B) when the Commission notifies
the Company whether there will be a “review” of the applicable Registration
Statement and whenever the Commission comments in writing on such Registration
Statement (in which case the Company shall provide true and complete copies
thereof and all written responses thereto to each of such Holders that pertain
to such Holders as selling stockholders); and (C) with respect to each
applicable Registration Statement or any post-effective amendment thereto, when
the same has been declared effective; (ii) of any request by the Commission or
any other federal or state governmental authority for amendments or supplements
to such Registration Statement or Prospectus or for additional information that
pertains to such Holders as sellers of Registrable Securities; (iii) of the
issuance by the Commission of any stop order suspending the effectiveness of
such Registration Statement covering any or all of the Registrable Securities or
the initiation of any Proceedings for that purpose; (iv) of the receipt by the
Company of any notification with respect to the suspension of the qualification
or exemption from qualification of any of the Registrable

 

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Securities for sale in any jurisdiction, or the initiation or threatening of any
Proceeding for such purpose; and (v) of the occurrence of any event or passage
of time that makes any statement made in such Registration Statement or
Prospectus or any document incorporated or deemed to be incorporated therein by
reference untrue in any material respect or that requires any revisions to such
Registration Statement, Prospectus or other documents so that, in the case of
such Registration Statement or the Prospectus, as the case may be, it will not
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading
(provided, however, that no notice by the Company shall be required pursuant to
this clause (v) in the event that the Company either promptly files a prospectus
supplement to update the Prospectus or a Form 8-K or other appropriate Exchange
Act report that is incorporated by reference into the Registration Statement,
which in either case, contains the requisite information that results in such
Registration Statement no longer containing any untrue statement of material
fact or omitting to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading).

(f) The Company will use commercially reasonable efforts to avoid the issuance
of or, if issued, obtain the withdrawal of (i) any order suspending the
effectiveness of a Registration Statement, or (ii) any suspension of the
qualification (or exemption from qualification) of any of the Registrable
Securities for sale in any jurisdiction, as promptly as reasonably practicable,
or if any such order or suspension is made effective during any Blackout Period
or Suspension Period, as promptly as reasonably practicable after such Blackout
Period or Suspension Period is over.

(g) During the Effectiveness Period, the Company will furnish to each such
Holder, without charge, at least one conformed copy of each Registration
Statement and each amendment thereto and all exhibits to the extent requested by
such Holder (including those incorporated by reference) promptly after the
filing of such documents with the Commission; provided, that the Company will
not have any obligation to provide any document pursuant to this clause that is
available on the Commission’s EDGAR system.

(h) The Company will promptly deliver to each Holder, without charge, as many
copies of each Prospectus or Prospectuses (including each form of prospectus)
authorized by the Company for use and each amendment or supplement thereto as
such Holder may reasonably request during the Effectiveness Period. Subject to
the terms of this Agreement, including Section 8(b), the Company consents to the
use of such Prospectus and each amendment or supplement thereto by each of the
selling Holders in connection with the offering and sale of the Registrable
Securities covered by such Prospectus and any amendment or supplement thereto.

(i) The Company will cooperate with such Holders to facilitate the timely
preparation and delivery of certificates representing Registrable Securities to
be delivered to a transferee pursuant to a Registration Statement, which
certificates shall be free of all restrictive legends indicating that the
Registrable Securities are unregistered or unqualified for resale under the
Securities Act, Exchange Act or other applicable securities laws, and to enable
such Registrable Securities to be in such denominations and registered in such
names as any such

 

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Holder may request in writing. In connection therewith, if required by the
Company’s transfer agent, the Company will promptly, after the Effective Date of
the Registration Statement, cause an opinion of counsel as to the effectiveness
of the Registration Statement to be delivered to and maintained with its
transfer agent, together with any other authorizations, certificates and
directions required by the transfer agent which authorize and direct the
transfer agent to issue such Registrable Securities without any such legend upon
sale by the Holder of such Registrable Securities under the Registration
Statement.

(j) Upon the occurrence of any event contemplated by Section 3(e)(v), as
promptly as reasonably practicable, the Company will prepare a supplement or
amendment, including a post-effective amendment, if required by applicable law,
to the affected Registration Statement or a supplement to the related Prospectus
or any document incorporated or deemed to be incorporated therein by reference,
and file any other required document so that, as thereafter delivered, no
Registration Statement nor any Prospectus will contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading.

(k) With respect to Underwritten Offerings, (i) the right of any Holder to
include such Holder’s Registrable Securities in an Underwritten Offering shall
be conditioned upon such Holder’s participation in such underwriting and the
inclusion of such Holder’s Registrable Securities in the underwriting to the
extent provided herein, (ii) each Holder participating in such Underwritten
Offering agrees to enter into an underwriting agreement in customary form and
sell such Holder’s Registrable Securities on the basis provided in any
underwriting arrangements approved by the Persons entitled to select the
managing underwriter or managing underwriters hereunder and (iii) each Holder
participating in such Underwritten Offering agrees to complete and execute all
questionnaires, powers of attorney, indemnities, underwriting agreements and
other documents customarily and reasonably required under the terms of such
underwriting arrangements. The Company hereby agrees with each Holder that, in
connection with any Underwritten Offering in accordance with the terms hereof,
it will negotiate in good faith and execute all indemnities, underwriting
agreements and other documents reasonably required under the terms of such
underwriting arrangements, including using all commercially reasonable efforts
to procure customary legal opinions, auditor “comfort” letters and reports of
the independent petroleum engineers of the Company relating to the oil and gas
reserves of the Company included in the Registration Statement if the Company
has had its reserves prepared, audited or reviewed by an independent petroleum
engineer.

(l) For a reasonable period prior to the filing of any Registration Statement
and throughout the Effectiveness Period, the Company will make available, upon
reasonable notice at the Company’s principal place of business or such other
reasonable place, for inspection during normal business hours by a
representative or representatives of the selling Holders, the managing
underwriter or managing underwriters and any attorneys or accountants retained
by such selling Holders or underwriters, all such financial and other
information and books and records of the Company, and cause the officers,
employees, counsel and independent certified public accountants of the Company
to respond to such inquiries, as shall be reasonably necessary (and in the case
of counsel, not violate an attorney-client privilege in such counsel’s
reasonable belief) to conduct a reasonable investigation within the meaning of
Section 11 of the

 

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Securities Act; provided, however, that any information that is not generally
publicly available at the time of delivery of such information shall be kept
confidential by such Persons unless disclosure of such information is required
by court or administrative order or, in the opinion of counsel to such Person,
law, in which case, such Person shall be required to give the Company written
notice of the proposed disclosure prior to such disclosure and, if requested by
the Company, assist the Company in seeking to prevent or limit the proposed
disclosure.

(m) In connection with any Requested Underwritten Offering, the Company will use
commercially reasonable efforts to cause appropriate officers and employees to
be available, on a customary basis and upon reasonable notice, to meet with
prospective investors in presentations, meetings and road shows.

(n) Each Holder agrees to furnish to the Company any other information regarding
the Holder and the distribution of such securities as the Company reasonably
determines is required to be included in any Registration Statement or any
Prospectus or prospectus supplement relating to an Underwritten Offering.

(o) Notwithstanding any other provision of this Agreement, the Company shall not
be required to file a Registration Statement (or any amendment thereto) or
effect a Requested Underwritten Offering (or, if the Company has filed a Shelf
Registration Statement and has included Registrable Securities therein, the
Company shall be entitled to suspend the offer and sale of Registrable
Securities pursuant to such Registration Statement) for a period of up to 60
days if (i) the Board determines that a postponement is in the best interest of
the Company and its stockholders generally due to a pending transaction
involving the Company (including a pending securities offering by the Company),
(ii) the Board determines such registration would render the Company unable to
comply with applicable securities laws or (iii) the Board determines such
registration would require disclosure of material information that the Company
has a bona fide business purpose for preserving as confidential (any such
period, a “Blackout Period”); provided, however, that in no event shall any
Blackout Period together with any Suspension Period, any No Demand Period (but
only if such No Demand Period relates to a an Underwritten Offering other than a
Requested Underwritten Offering in which the Preferred Holders participated) and
any No Requested Underwritten Offering Period (but only if such No Demand Period
relates to a an Underwritten Offering other than a Requested Underwritten
Offering in which the Preferred Holders participated) collectively exceed an
aggregate of 120 days in any 12-month period; provided, further, that nothing in
this Section 3(o) shall (i) relieve the Company of any obligation it may
otherwise have pursuant to this Agreement to file a Registration Statement (or
any amendment thereto) or effect a Requested Underwritten Offering or
(ii) permit the Company to suspend the offer and sale of Registrable Securities
pursuant to a Shelf Registration Statement that has been previously filed
pursuant to this Agreement, in each case at the request of or with respect to a
Preferred Holder or with respect to Registrable Securities of any such Preferred
Holder, within any 45-day period following the date upon which any Convertible
Preferred Stock of such Preferred Holder is converted into shares of Common
Stock pursuant to Section 7(b) of the Certificate (any such 45-day period, a
“Preferred No-Blocking Period”).

 

18

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(p) In connection with an Underwritten Offering, the Company shall use all
commercially reasonable efforts to provide to each Holder named as a selling
securityholder in any Registration Statement a copy of any auditor “comfort”
letters, customary legal opinions or reports of the independent petroleum
engineers of the Company relating to the oil and gas reserves of the Company, in
each case that have been provided to the managing underwriter or managing
underwriters in connection with the Underwritten Offering, not later than the
Business Day prior to the effective date of such Registration Statement.

(q) In connection with any Underwritten Offering (including any Requested
Underwritten Offering), any Holder that (i) together with its Affiliates owns
five percent (5%) or more of the outstanding Common Stock (assuming all
Convertible Preferred Stock held by any Holder has been converted to Common
Stock) or (ii) is entitled (or any of its Affiliates is entitled) to designate a
director to the Company’s board of directors pursuant to the Stockholders
Agreement or to elect a director to the Company’s board of directors pursuant to
the Certificate, shall execute a customary “lock-up” agreement with the
underwriters of such Underwritten Offering containing a lock-up period equal to
the shorter of (A) the shortest number of days that a director of the Company,
“executive officer” (as defined under Section 16 of the Exchange Act) of the
Company or any stockholder of the Company (other than a Holder or director or
employee of, or consultant to, the Company) who owns five percent (5%) or more
of the outstanding Common Stock contractually agrees to with the underwriters of
such Underwritten Offering not to sell any securities of the Company following
such Underwritten Offering and (B) 45 days from the date of the execution of the
underwriting agreement with respect to such Underwritten Offering.

(r) In connection with any Requested Underwritten Offering, the Company will,
and will use its commercially reasonable efforts to cause the members of the
Board of Directors of the Company and the officers of the Company that are
“executive officers” as defined under Section 16 of the Exchange Act to, execute
a customary “lock-up” agreement with the underwriters of such Requested
Underwritten Offering containing a lock-up period equal to the shorter of
(A) the number of days that the Initiating Holder in such Requested Underwritten
Offering contractually agrees with the underwriters of such Requested
Underwritten Offering not to sell securities of the Company following such
Requested Underwritten Offering and (B) 45 days from the date of the execution
of the underwriting agreement with respect to such Requested Underwritten
Offering.

4. No Inconsistent Agreements; Additional Rights. The Company shall not
hereafter enter into, and is not currently a party to, any agreement with
respect to its securities that is inconsistent in any material respect with the
rights granted to the Holders by this Agreement.

5. Registration Expenses. All Registration Expenses incident to the Parties’
performance of or compliance with their respective obligations under this
Agreement or otherwise in connection with any Demand Registration, Requested
Underwritten Offering, Piggyback Registration or Underwritten Piggyback Offering
(in each case, excluding any Selling Expenses) shall be borne by the Company,
whether or not any Registrable Securities are sold pursuant to a Registration
Statement. “Registration Expenses” shall include, without limitation, (i) all
registration and filing fees (including fees and expenses (A) with respect to
filings required to be made with the Trading Market, (B) in compliance with
applicable state securities or “Blue Sky” laws and (C) FINRA fees and expenses
associated with any Registration Statement and the

 

19

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FINRA filing obligations of any underwriter related thereto), (ii) printing
expenses (including expenses of printing certificates for Company Securities and
of printing Prospectuses if the printing of Prospectuses is reasonably requested
by a Holder of Registrable Securities included in the Registration Statement),
(iii) messenger, telephone and delivery expenses, (iv) fees and disbursements of
counsel, auditors, accountants and independent petroleum engineers for the
Company, (v) Securities Act liability insurance, if the Company so desires such
insurance, (vi) fees and expenses of all other Persons retained by the Company
in connection with the consummation of the transactions contemplated by this
Agreement, and (vii) all expenses relating to marketing the sale of the
Registrable Securities, including expenses related to conducting a “road show.”
In addition, the Company shall be responsible for all of its expenses incurred
in connection with the consummation of the transactions contemplated by this
Agreement (including expenses payable to third parties and including all
salaries and expenses of their officers and employees performing legal or
accounting duties), the expense of any annual audit and the fees and expenses
incurred in connection with the listing of the Registrable Securities on the
Trading Market.

6. Indemnification.

(a) The Company shall indemnify and hold harmless each Holder, its Affiliates
and each of their respective officers and directors and any agent thereof
(collectively, “Holder Indemnified Persons”), to the fullest extent permitted by
applicable law, from and against any and all losses, claims, damages,
liabilities, joint or several, costs (including reasonable costs of preparation
and reasonable attorneys’ fees) and expenses, judgments, fines, penalties,
interest, settlements or other amounts arising from any and all claims, demands,
actions, suits or proceedings, whether civil, criminal, administrative or
investigative, in which any Holder Indemnified Person may be involved, or is
threatened to be involved, as a party or otherwise, under the Securities Act or
otherwise (collectively, “Losses”), as incurred, arising out of or relating to
any untrue or alleged untrue statement of a material fact contained in any
Registration Statement under which any Registrable Securities were registered,
in any preliminary prospectus (if the Company authorized the use of such
preliminary prospectus prior to the Effective Date), or in any summary or final
prospectus or free writing prospectus (if such free writing prospectus was
authorized for use by the Company) or in any amendment or supplement thereto (if
used during the period the Company is required to keep the Registration
Statement current), or arising out of, based upon or resulting from the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements made therein, in the light of the
circumstances in which they were made, not misleading; provided, however, that
the Company shall not be liable to any Holder Indemnified Person to the extent
that any such claim arises out of, is based upon or results from an untrue or
alleged untrue statement or omission or alleged omission made in such
Registration Statement, such preliminary, summary or final prospectus or free
writing prospectus or such amendment or supplement, in reliance upon and in
conformity with written information furnished to the Company by or on behalf of
such Holder Indemnified Person or any underwriter specifically for use therein,
it being understood and agreed that the only such information so furnished by
any Holder to the Company consists of (A) the legal name and address of the
Holder set forth in its footnote that appears under the caption “Principal and
Selling Stockholders” of any such Registration Statement, such preliminary,
summary or final prospectus and (B) the number of shares of Common Stock or
Convertible Preferred Stock, as applicable, owned by the Holder

 

20

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before and after the offering (excluding percentages) that appears in the table
(and corresponding footnotes) under the caption “Principal and Selling
Stockholders” of any such Registration Statement, such preliminary, summary or
final prospectus (the “Selling Stockholder Information”). The Company shall
notify the Holders promptly of the institution, threat or assertion of any
Proceeding of which the Company is aware in connection with the transactions
contemplated by this Agreement. This indemnity shall be in addition to any
liability the Company may otherwise have and shall remain in full force and
effect regardless of any investigation made by or on behalf of such Holder
Indemnified Person or any indemnified party and shall survive the transfer of
such securities by such Holder. Notwithstanding anything to the contrary herein,
this Section 6 shall survive any termination or expiration of this Agreement
indefinitely.

(b) In connection with any Registration Statement in which a Holder
participates, such Holder shall, severally and not jointly, indemnify and hold
harmless the Company, its Affiliates and each of their respective officers,
directors and any agent thereof, to the fullest extent permitted by applicable
law, from and against any and all Losses as incurred, arising out of or relating
to any untrue or alleged untrue statement of a material fact contained in any
such Registration Statement, in any preliminary prospectus (if used prior to the
Effective Date of such Registration Statement), or in any summary or final
prospectus or free writing prospectus or in any amendment or supplement thereto
(if used during the period the Company is required to keep the Registration
Statement current), or arising out of, based upon or resulting from the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements made therein, in the light of the
circumstances in which they were made, not misleading, but only to the extent
that any such claim arises out of, is based upon or results from an untrue or
alleged untrue statement or omission or alleged omission made in such
Registration Statement, such preliminary, summary or final prospectus or free
writing prospectus or such amendment or supplement, in reliance upon and in
conformity with such Holder’s Selling Stockholder Information. This indemnity
shall be in addition to any liability such Holder may otherwise have and shall
remain in full force and effect regardless of any investigation made by or on
behalf of the Company or any indemnified party. In no event shall the liability
of any selling Holder hereunder be greater in amount than the dollar amount of
the proceeds received by such Holder from the sale of the Registrable Securities
giving rise to such indemnification obligation.

(c) Any Person entitled to indemnification hereunder shall (i) give prompt
written notice to the indemnifying party of any claim with respect to which it
seeks indemnification and (ii) unless in such indemnified party’s reasonable
judgment a conflict of interest between such indemnified and indemnifying
parties may exist with respect to such claim or there may be reasonable defenses
available to the indemnified party that are different from or additional to
those available to the indemnifying party, permit such indemnifying party to
assume the defense of such claim with counsel reasonably satisfactory to the
indemnified party. If such defense is assumed, the indemnifying party shall not
be subject to any liability for any settlement made by the indemnified party
without its consent (but such consent will not be unreasonably withheld). An
indemnifying party who is not entitled to, or elects not to, assume the defense
of a claim shall not be obligated to pay the fees and expenses of more than one
counsel (in addition to any local counsel) for all parties indemnified by such
indemnifying party with respect to such claim, unless in the reasonable judgment
of any indemnified party there may

 

21

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be one or more legal or equitable defenses available to such indemnified party
that are in addition to or may conflict with those available to another
indemnified party with respect to such claim. Failure to give prompt written
notice shall not release the indemnifying party from its obligations hereunder.

(d) If the indemnification provided for in this Section 6 is held by a court of
competent jurisdiction to be unavailable to an indemnified party with respect to
any Losses referred to herein, the indemnifying party, in lieu of indemnifying
such indemnified party thereunder, shall to the extent permitted by applicable
law contribute to the amount paid or payable by such indemnified party as a
result of such Losses in such proportion as is appropriate to reflect the
relative fault of the indemnifying party, on the one hand, and of the
indemnified party, on the other, in connection with the untrue or alleged untrue
statement of a material fact or the omission to state a material fact that
resulted in such Losses, as well as any other relevant equitable considerations.
The relative fault of the indemnifying party and of the indemnified party shall
be determined by a court of law by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission to state a
material fact relates to information supplied by the indemnifying party or by
the indemnified party and the parties’ relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission;
provided, that in no event shall any contribution by a Holder hereunder exceed
the net proceeds from the offering received by such Holder.

7. Facilitation of Sales Pursuant to Rule 144. To the extent it shall be
required to do so under the Exchange Act, the Company shall timely file the
reports required to be filed by it under the Exchange Act or the Securities Act
(including the reports under Sections 13 and 15(d) of the Exchange Act referred
to in subparagraph (c)(1) of Rule 144), and shall take such further action as
any Holder may reasonably request, all to the extent required from time to time
to enable the Holders to sell Registrable Securities without registration under
the Securities Act within the limitations of the exemption provided by Rule 144.
Upon the request of any Holder in connection with that Holder’s sale pursuant to
Rule 144, the Company shall deliver to such Holder a written statement as to
whether it has complied with such requirements.

8. Miscellaneous.

(a) Remedies. In the event of actual or potential breach by the Company of any
of its obligations under this Agreement, each Holder, in addition to being
entitled to exercise all rights granted by law and under this Agreement,
including recovery of damages, will be entitled to specific performance of its
rights under this Agreement. The Company agrees that monetary damages would not
provide adequate compensation for any losses incurred by reason of a breach by
it of any of the provisions of this Agreement and further agrees that, in the
event of any action for specific performance in respect of such breach, it shall
waive the defense that a remedy at law would be adequate.

(b) Discontinued Disposition. Each Holder agrees that, upon receipt of a notice
from the Company of the occurrence of any event of the kind described in clauses
(ii) through (v) of Section 3(e), such Holder will forthwith discontinue
disposition of such Registrable Securities under the Registration Statement
until such Holder’s receipt of the copies of the supplemental Prospectus or
amended Registration Statement as contemplated by Section

 

22

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3(j) or until it is advised in writing by the Company that the use of the
applicable Prospectus may be resumed, and, in either case, has received copies
of any additional or supplemental filings that are incorporated or deemed to be
incorporated by reference in such Prospectus or Registration Statement (a
“Suspension Period”). The Company may provide appropriate stop orders to enforce
the provisions of this Section 8(b).

(c) Amendments and Waivers. No provision of this Agreement may be waived or
amended except in a written instrument signed by the Company and Holders that
hold a majority of the Registrable Securities (counting Convertible Preferred
Stock held by any Preferred Holder as Registrable Securities on an as-converted
basis to Common Stock as provided in the Certificate) as of the date of such
waiver or amendment; provided, that any waiver or amendment that would have a
disproportionate adverse effect on a Holder relative to the other Holders shall
require the consent of such Holder. The Company shall provide prior notice to
all Holders of any proposed waiver or amendment. No waiver of any default with
respect to any provision, condition or requirement of this Agreement shall be
deemed to be a continuing waiver in the future or a waiver of any subsequent
default or a waiver of any other provision, condition or requirement hereof, nor
shall any delay or omission of any Party to exercise any right hereunder in any
manner impair the exercise of any such right.

(d) Notices. Any and all notices or other communications or deliveries required
or permitted to be provided hereunder shall be in writing and shall be deemed
given and effective on the earliest of (i) the date of transmission, if such
notice or communication is delivered via facsimile or electronic mail as
specified in this Section 8(d) prior to 5:00 p.m. in the time zone of the
receiving party on a Business Day, (ii) the Business Day after the date of
transmission, if such notice or communication is delivered via facsimile or
electronic mail as specified in this Agreement later than 5:00 p.m. in the time
zone of the receiving party on any date, (iii) the Business Day following the
date of mailing, if sent by nationally recognized overnight courier service or
(iv) upon actual receipt by the Party to whom such notice is required to be
given. The address for such notices and communications shall be as follows:

 

If to the Company:    WildHorse Resource Development Corporation   

Attention: General Counsel

9805 Katy Freeway, Suite 400

Houston, TX 77024

E-mail: KRoane@wildhorserd.com

  

With copy to:

 

Vinson & Elkins L.L.P.

Attention: Douglas E. McWilliams

1001 Fannin Street, Suite 2500

Houston, Texas 77002

E-mail: dmcwilliams@velaw.com

If to any Person who is then the registered Holder:    To the address of such
Holder as indicated on the signature page of this Agreement or, if different, as
it appears in the applicable register for the Registrable Securities or as may
be designated in writing by such Holder in accordance with this Section 8(d).

 

23

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(e) Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the Parties hereto and their respective heirs, executors,
administrators, successors, legal representatives and permitted assigns. Except
as provided in this Section 8(e), this Agreement, and any rights or obligations
hereunder, may not be assigned or directly or indirectly transferred without the
prior written consent of the Company and the Holders. Notwithstanding anything
in the foregoing to the contrary, the rights of a Holder pursuant to this
Agreement with respect to all or any portion of its Registrable Securities may
be assigned or transferred without such consent (but only with all related
obligations) with respect to such Registrable Securities (and any Registrable
Securities issued as a dividend or other distribution with respect to, in
exchange for or in replacement of such Registrable Securities) by such Holder in
connection with an assignment or transfer of (i) Registrable Securities to an
Affiliate of such Holder, (ii) Registrable Securities with an aggregate VWAP
(assuming any Convertible Preferred Stock that is the subject of such transfer
has been converted to Common Stock pursuant to the Certificate and the
Registrable Securities being transferred consist of such Common Stock) of at
least $75 million, or (iii) in the case of the KKR Holders, in connection with
the transfer of all of the Registrable Securities held by the KKR Holders and
all other Holders that are Affiliates of the KKR Holders, provided such transfer
consists of at least two-thirds of the Registrable Securities held by the KKR
Holders as of the date of this Agreement, in each case provided that (A) the
Company is, within a reasonable time after such transfer, furnished with written
notice of the name and address of such transferee or assignee and the
Registrable Securities with respect to which such registration rights are being
assigned and (B) such transferee or assignee agrees in writing to be bound by
and subject to the terms set forth in this Agreement. The Company may not assign
its rights or obligations hereunder without the prior written consent of the
Holders.

(f) No Third Party Beneficiaries. Nothing in this Agreement, whether express or
implied, shall be construed to give any Person, other than the parties hereto or
their respective successors and permitted assigns, any legal or equitable right,
remedy, claim or benefit under or in respect of this Agreement.

(g) Execution and Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same Agreement. In
the event that any signature is delivered by facsimile or electronic mail
transmission, such signature shall create a valid binding obligation of the
Party executing (or on whose behalf such signature is executed) the same with
the same force and effect as if such signature delivered by facsimile or
electronic mail transmission were the original thereof.

(h) Governing Law; Consent to Jurisdiction; Waiver of Jury Trial. This Agreement
shall be governed by, and construed in accordance with, the internal laws of the
State of New York. Each of the Parties irrevocably submits to the exclusive
jurisdiction of the courts of the State of New York located in in the Borough of
Manhattan in the City of New York and the United States District Court for the
Southern District of New York for the purpose of any suit, action, proceeding or
judgment relating to or arising out of this Agreement and the

 

24

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transactions contemplated hereby. Service of process in connection with any such
suit, action or proceeding may be served on each Party anywhere in the world by
the same methods as are specified for the giving of notices under this
Agreement. Each of the Parties irrevocably waives any objection to the laying of
venue of any such suit, action or proceeding brought in such courts and
irrevocably waives any claim that any such suit, action or proceeding brought in
any such court has been brought in an inconvenient forum. EACH OF THE PARTIES
HEREBY WAIVES ANY RIGHT TO REQUEST A TRIAL BY JURY IN ANY LITIGATION WITH
RESPECT TO THIS AGREEMENT AND REPRESENTS THAT COUNSEL HAS BEEN CONSULTED
SPECIFICALLY AS TO THIS WAIVER.

(i) Cumulative Remedies. The remedies provided herein are cumulative and not
exclusive of any remedies provided by law.

(j) Severability. If any term, provision, covenant or restriction of this
Agreement is held by a court of competent jurisdiction to be invalid, illegal,
void or unenforceable, the remainder of the terms, provisions, covenants and
restrictions set forth herein shall remain in full force and effect and shall in
no way be affected, impaired or invalidated, and the Parties shall use their
reasonable efforts to find and employ an alternative means to achieve the same
or substantially the same result as that contemplated by such term, provision,
covenant or restriction. It is hereby stipulated and declared to be the
intention of the Parties that they would have executed the remaining terms,
provisions, covenants and restrictions without including any of such that may be
hereafter declared invalid, illegal, void or unenforceable.

(k) Entire Agreement. This Agreement constitutes the entire agreement among the
Parties with respect to the subject matter hereof and supersedes all prior
contracts or agreements with respect to the subject matter hereof and the
matters addressed or governed hereby, whether oral or written.

(l) Transfers of Common Stock by Sponsoring Holders and NGP. From the date
hereof until the date that both (i) the Schedule 14C Waiting Period (as defined
in the Preferred Purchase Agreement) has expired and (ii) the earlier of (A) 60
days following the date of this Agreement and (B) the date on which all
approvals and authorizations of, filings and registrations with, and
notifications to, or expiration or termination of any applicable waiting period,
under the HSR Act (as defined in the Preferred Purchase Agreement) required with
respect to the Preferred Voting and Conversion Features (as defined in the
Preferred Purchase Agreement) of the Convertible Preferred Stock held by Carlyle
have been obtained, made, expired or terminated, as applicable, the Sponsoring
Holders and NGP shall not, without the prior written consent of Carlyle,
(A) sell, transfer, assign, or otherwise dispose of, directly or indirectly
(collectively, a “Transfer”), any shares of the Company’s capital stock held or
beneficially owned by such Sponsoring Holder or NGP, as applicable, except that
any Sponsoring Holder or NGP may Transfer any shares of Common Stock held by it
to an Affiliate, provided such Affiliate agrees in writing to be bound by and
subject to the terms set forth in this Agreement or (B) make any short sale of,
grant any option for the purchase of, or enter into any hedging or similar
transaction with the same economic effect as a short sale of or the purpose of
which is to offset the loss which results from a decline in the market price of,
any shares of the Company’s capital stock, or otherwise establish or increase,
directly or indirectly, a put equivalent position, as defined in Rule 16a-1(h)
under the Exchange Act, with respect to any of the Company’s capital stock.

 

25

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(m) Termination. Except for Section 6 and Section 8(m), this Agreement shall
terminate as to any Holder, when all Registrable Securities held by such Holder
no longer constitute Registrable Securities.

[Signature page follows.]

 

26

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IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date
first written above.

 

COMPANY: WILDHORSE RESOURCE DEVELOPMENT CORPORATION

By:

 

 

Name:

Title:

HOLDERS: WHR HOLDINGS, LLC

By:

 

 

Name:

Title:

Address for notice:

9805 Katy Freeway, Suite 400

Houston, Texas 77024

Attention: General Counsel

E-mail: KRoane@wildhorserd.com

With a copy to:

Natural Gas Partners

5221 N. O’Connor Boulevard, Suite 1100

Irving, Texas 75039

Fax: (972) 432-1441

Attention: General Counsel

E-mail: jzlotky@ngptrs.com

Signature Page to Registration Rights Agreement

--------------------------------------------------------------------------------

ESQUISTO HOLDINGS, LLC

By:

 

 

Name:

Title:

Address for notice:

9805 Katy Freeway, Suite 400

Houston, Texas 77024

Attention: General Counsel

E-mail: KRoane@wildhorserd.com

With a copy to:

Natural Gas Partners

5221 N. O’Connor Boulevard, Suite 1100

Irving, Texas 75039

Fax: (972) 432-1441

Attention: General Counsel

E-mail: jzlotky@ngptrs.com

 

WHE ACQCO HOLDINGS, LLC

By:

 

 

Name:

Title:

Address for notice:

9805 Katy Freeway, Suite 400

Houston, Texas 77024

Attention: General Counsel

E-mail: KRoane@wildhorserd.com

With a copy to:

Natural Gas Partners

5221 N. O’Connor Boulevard, Suite 1100

Irving, Texas 75039

Fax: (972) 432-1441

Attention: General Counsel

E-mail: jzlotky@ngptrs.com

Signature Page to Registration Rights Agreement

--------------------------------------------------------------------------------

NGP XI US HOLDINGS, L.P. By: NGP XI Holdings GP, L.L.C., general partner

By:

 

 

Name:

Title:

Address for notice:

Natural Gas Partners

5221 N. O’Connor Boulevard, Suite 1100

Irving, Texas 75039

Fax: (972) 432-1441

Attention: General Counsel

E-mail: jzlotky@ngptrs.com

Signature Page to Registration Rights Agreement

--------------------------------------------------------------------------------

JAY C. GRAHAM

 

Address for notice:

9805 Katy Freeway, Suite 400

Houston, Texas 77024

Attention: General Counsel

E-mail: jay.graham@wildhorseresources.com

Signature Page to Registration Rights Agreement

--------------------------------------------------------------------------------

ANTHONY BAHR

 

Address for notice:

9805 Katy Freeway, Suite 400

Houston, Texas 77024

Attention: General Counsel

E-mail: anthony.bahr@wildhorseresources.com

Signature Page to Registration Rights Agreement

--------------------------------------------------------------------------------

CP VI EAGLE HOLDINGS, L.P. By: TC Group VI S1, L.P., its general partner

By:

 

 

Name:

Title:

Address for notice:

[•]

Signature Page to Registration Rights Agreement

--------------------------------------------------------------------------------

ADMIRAL HOLDING L.P.

By:

 

 

Name:

Title:

Address for notice:

[•]

TE ADMIRAL A HOLDING L.P.

By:

 

 

Name:

Title:

Address for notice:

[•]

 

AURORA C-1 HOLDING L.P.

By:

 

 

Name:

Title:

Address for notice:

[•]

Signature Page to Registration Rights Agreement