Exhibit 10.4

 

 

 

LIMITED LIABILITY COMPANY AGREEMENT

OF

KEANE INVESTOR HOLDINGS LLC

January 20, 2017

 

 

 

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Table of Contents            Page  

ARTICLE I. GENERAL PROVISIONS

     1   

Section 1.1

  Registered Office      1   

Section 1.2

  Other Offices      2   

Section 1.3

  Purpose; Nature of Business Permitted; Powers      2   

Section 1.4

  Limited Liability of Members      2   

Section 1.5

  Tax Classification; No State Law Partnership      2   

Section 1.6

  Definitions      2   

Section 1.7

  Certificates; Approval      19   

Section 1.8

  Term      20   

ARTICLE II. UNITS, CAPITAL CONTRIBUTIONS AND CAPITAL ACCOUNTS

     20   

Section 2.1

  Units      20   

Section 2.2

  Capital Contributions      20   

Section 2.3

  Capital Accounts      23   

Section 2.4

  Admission of New Members      23   

Section 2.5

  Interest      23   

Section 2.6

  Capital Withdrawal Rights, Interest and Priority      23   

Section 2.7

  Management Members/Management Incentive Plan.      24   

ARTICLE III. MANAGEMENT OF THE COMPANY

     25   

Section 3.1

  Company Governance.      25   

Section 3.2

  Authority, Duties and Obligations of the Management Board      27   

Section 3.3

  Other Activities of the Members of the Management Board      28   

Section 3.4

  Management Board Certifications      29   

Section 3.5

  Voting Rights of Members      29   

Section 3.6

  Cost of Services; Expenses      30   

Section 3.7

  Certain Provisions Relating to Keane Group Stock.      31   

ARTICLE IV. GENERAL GOVERNANCE

     33   

Section 4.1

  No Fiduciary Duties      33   

Section 4.2

  Information      34   

Section 4.3

  Access      36   

Section 4.4

  Standard of Care      36   

Section 4.5

  Non-Competition      36   

Section 4.6

  Reduction of Trican Class A Units      38   

ARTICLE V. TRANSFERS OF UNITS; PREEMPTIVE RIGHTS

     39   

Section 5.1

  Restrictions on Transfer      39   

Section 5.2

  Tag-Along Rights      40   

Section 5.3

  Drag-Along Rights      43   

Section 5.4

  Rights of First Refusal on New Issue Securities      44   

Section 5.5

  Trican Right of First Offer; Call Option on Trican Units      45   

Section 5.6

  Existing Holder ROFO      47   

 

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Table of Contents

(continued)

           Page  

ARTICLE VI. ALLOCATIONS

     49   

Section 6.1

  General Rules; Allocation of Profits and Losses      49   

Section 6.2

  Other Allocation Rules      49   

Section 6.3

  Tax Allocations: Code Section 704(c)      49   

ARTICLE VII. DISTRIBUTIONS AND EXPENSES

     50   

Section 7.1

  Distributions      50   

Section 7.2

  Amounts Withheld      52   

Section 7.3

  Expenses      52   

Section 7.4

  Tax Distributions      52   

Section 7.5

  Trican Repayment      52   

ARTICLE VIII. OTHER TAX MATTERS

     53   

Section 8.1

  Tax Matters Member      53   

Section 8.2

  Furnishing Information to Tax Matters Member      53   

Section 8.3

  Tax Claims and Proceedings      53   

Section 8.4

  Books and Records      54   

Section 8.5

  Survival      54   

ARTICLE IX. REPRESENTATIONS AND WARRANTIES

     55   

Section 9.1

  Representations and Warranties of Members      55   

Section 9.2

  ERISA Representation      56   

Section 9.3

  Survival      56   

ARTICLE X. DISSOLUTION AND TERMINATION OF THE COMPANY

     57   

Section 10.1

  Dissolution      57   

Section 10.2

  Continuation of Interest of Member’s Representative      57   

Section 10.3

  Dissolution, Winding Up and Liquidation      57   

Section 10.4

  Member Bankruptcy      57   

ARTICLE XI. INDEMNIFICATION AND CONTRIBUTION

     58   

Section 11.1

  Exculpation and Indemnification      58   

Section 11.2

  Not Exclusive      59   

Section 11.3

  Insurance      59   

Section 11.4

  Beneficiaries      59   

Section 11.5

  Indemnification Procedure for Third Party and Other Claims      59   

Section 11.6

  Other Claims      60   

Section 11.7

  Limitation on Damages      60   

ARTICLE XII. MISCELLANEOUS PROVISIONS

     60   

Section 12.1

  Entire Agreement      60   

Section 12.2

  Amendments      61   

 

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Table of Contents

(continued)

           Page  

Section 12.3

  Applicable Law; Venue      61   

Section 12.4

  Enforcement      62   

Section 12.5

  Headings      62   

Section 12.6

  Severability      62   

Section 12.7

  Counterparts      62   

Section 12.8

  Filings      62   

Section 12.9

  Additional Documents      62   

Section 12.10

  Notices      63   

Section 12.11

  Waiver of Right to Partition and Bill of Accounting      65   

Section 12.12

  Confidentiality; Press Releases      65   

Section 12.13

  Uniform Commercial Code      67   

Section 12.14

  Binding Agreement      67   

Section 12.15

  DISCLOSURES      67   

 

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THE TRANSFER OF THE LIMITED LIABILITY COMPANY INTERESTS DESCRIBED IN THIS
AGREEMENT IS RESTRICTED AS DESCRIBED HEREIN.

LIMITED LIABILITY COMPANY AGREEMENT

OF

KEANE INVESTOR HOLDINGS LLC,

a Delaware Limited Liability Company

THIS LIMITED LIABILITY COMPANY AGREEMENT of Keane Investor Holdings LLC, a
Delaware limited liability company (the “Company”), is made effective as of
January 20, 2017 (this “Agreement”), by and among the Cerberus Funds, JS Keane
Coinvestor LLC (“JS”), Trican Well Service, L.P. (“Trican”), SJK Family Limited
Partnership, LP (“SJK”), KCK Family Limited Partnership, LP (“KCK”), Tim Keane
(“TK”), Brian Keane (“BK”), SJ Keane Family Trust (“SK”), Jacquelyn Keane
(“JK”), Cindy Keane (“CK”), KC Family Trust (“KK” and, together with SJK, KCK,
TK, BK, SK, JK and CK, each, a “Keane Party” and collectively, the “Keane
Parties”), the Cerberus Representative, the Keane Representative, and the
Persons listed on Schedule A hereto (the “Management Members” and, together with
the Cerberus Funds, JS, Trican and the Keane Parties and any other Person who
becomes a member of the Company from time to time in accordance with the
provisions hereof, the “Members”).

RECITALS:

1. A Certificate of Formation of the Company was filed with the Secretary of
State of the State of Delaware on October 11, 2016; and

2. In accordance with the Act, the holders of Units of the Company wish to enter
into this Agreement to: (i) set forth the respective rights, powers and
interests of such parties with respect to the Company; (ii) establish the terms
for the issuance of interests therein; and (iii) provide for the management of
the business and operations of the Company.

NOW, THEREFORE, in consideration of the mutual promises and agreements herein
made and intending to be legally bound hereby, the parties hereto agree as
follows:

ARTICLE I.

GENERAL PROVISIONS

Section 1.1 Registered Office

The registered agent and office of the Company in the State of Delaware shall be
The Corporation Trust Company, Corporation Trust Center, 1209 Orange Street,
Wilmington, Delaware 19801. A majority vote of the Class A Units Held by the
Class A Members may change said registered office from one location to another
in the State of Delaware.

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Section 1.2 Other Offices

The Company may have one or more offices as may be established from time to time
by the Management Board.

Section 1.3 Purpose; Nature of Business Permitted; Powers

The purpose to be conducted or promoted by the Company is to engage in the
following activities:

(i) to acquire, own, hold, vote, sell, Transfer, convey, safekeep, dispose of,
pledge, assign, borrow money against, finance, refinance or otherwise deal with,
the Keane Group Stock in accordance with the terms hereof; and

(ii) to engage in any lawful act or activity and to exercise any powers
permitted to limited liability companies organized under the Laws of the State
of Delaware that are related or incidental to and necessary, convenient or
advisable for the accomplishment of the above-mentioned purpose.

Section 1.4 Limited Liability of Members

No Member or any of its Affiliates or Affiliated Individuals shall have any
liability for the debts, obligations or liabilities of the Company or of any
other Member. Except as provided in Section 11.7, subject to the provisions of
this Agreement, including, without limitation, Article XI hereof, any liability
of any Member or any of its Affiliates or Affiliated Individuals to another
Member or to the Company hereunder shall be limited to the Units of such Member
or its Affiliates.

Section 1.5 Tax Classification; No State Law Partnership

The Members intend that the Company shall be treated as a partnership for
federal, state and local tax purposes. Each Member and the Company agree to file
all tax returns and otherwise take all tax and financial reporting positions in
a manner consistent with such treatment. No provision of this Agreement shall be
deemed or construed to constitute the Company (including its Subsidiaries) as a
partnership (including a limited partnership) or joint venture, or any Member as
a partner of or with any other Member for any purposes other than tax purposes.

Section 1.6 Definitions

Unless the context otherwise requires, the terms defined in this Section 1.6
shall, for the purposes of this Agreement, have the meanings herein specified
(such meanings to be equally applicable to both the singular and plural forms of
the terms defined).

“1933 Act” has the meaning set forth in Section 12.15.

 

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“1934 Act” means the Securities Exchange Act of 1934, as amended, and the rules
and regulations thereunder.

“1940 Act” means the Investment Company Act of 1940, as amended, and the rules
and regulations thereunder.

“50% Trigger Date” has the meaning set forth in Section 3.7(f).

“Act” means the Delaware Limited Liability Company Act (as it may be amended
from time to time and any successor to such Act).

“Additional Units” has the meaning set forth in Section 2.2(b)(ii).

“Affiliate” means, with respect to a Person, another Person that directly or
indirectly controls, is controlled by or is under common control with such first
Person; provided, however, that for purposes only of the term “Permitted
Transferee”, the term “Affiliate” shall have the meaning ascribed to it therein.
For the avoidance of doubt, for purposes of this Agreement, including, without
limitation, the definition of “Permitted Transferee,” an Affiliate of the
Cerberus Funds includes, without limitation, any entity or fund directly or
indirectly controlled by the Persons that, as of the date hereof, control the
Cerberus Funds.

“Affiliated Individual” means, with respect to a Person, any individual who is
an officer, director, shareholder, employee, partner or member of such Person or
an individual who is related by blood, marriage or adoption to any of the
foregoing.

“Agreement” has the meaning set forth in the Preamble.

“Asset” means an asset owned by the Company or its Subsidiaries.

“Bankruptcy” means, with respect to any Person, a “Voluntary Bankruptcy” or an
“Involuntary Bankruptcy”. A “Voluntary Bankruptcy” shall mean, with respect to
any Person, (i) an admission in writing by such Person of its inability to pay
its debts generally or a general assignment by such Person for the benefit of
creditors, (ii) the filing of any petition or answer by such Person seeking to
adjudicate it bankrupt or insolvent or seeking for itself any liquidation,
winding up, reorganization, arrangement, adjustment, protection, relief or
composition of such Person or its debts under any Law relating to bankruptcy,
insolvency, reorganization or relief of debtors, or seeking, consenting to or
acquiescing in the entry of an order for relief or the appointment of a
receiver, trustee, custodian or other similar official for such Person or for
any substantial part of its property, or (iii) corporate action taken by such
Person to authorize any of the actions set forth above. An “Involuntary
Bankruptcy” shall mean, with respect to any Person, without the consent or
acquiescence of such Person, the entering of an order for relief or approving a
petition for relief or reorganization or any other petition seeking any
reorganization, arrangement, composition, readjustment, liquidation, dissolution
or other similar relief under any present or future bankruptcy, insolvency or
similar statute, Law or regulation or the filing of any such petition against
such Person which order or petition shall not be dismissed within 90 days or,
without the consent or acquiescence of such

 

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Person, the entering of an order appointing a trustee, custodian, receiver or
liquidator of such Person or of all or any substantial part of the property of
such Person which order shall not be dismissed within 90 days.

“Budget Act” means the Bipartisan Budget Act of 2015 and any provisions of the
Code or the Regulations promulgated thereunder.

“Business Day” means any day other than a Saturday, Sunday or any other day on
which banks in New York City are required or permitted by Law to be closed.

“BK” has the meaning set forth in the Preamble.

“Call Option” has the meaning set forth in Section 5.5(e)(i).

“Call Option Exercise Notice” has the meaning set forth in Section 5.5(e)(iii).

“Capital Account” has the meaning set forth in Section 2.3(a).

“Capital Call Valuation” has the meaning set forth in Section 2.2(b)(ii).

“Capital Contribution” means, with respect to any Member, the amount of money or
the value of other assets, in each case contributed to the Company in exchange
for Units in the Company.

“Cash Available for Distribution” means all cash receipts and cash equivalents
of the Company after deducting payments for accounts payable by the Company,
amounts necessary to establish and maintain a minimum cash reserve of $2,500,000
and any other amounts that the Management Board determines in good faith are
required to be set aside for the restoration, increase or creation of reserves
related to extraordinary events.

“Cause” means, unless otherwise defined in a MIP Agreement, either (i) “cause”
or such similar term as defined in an employment agreement (or other
arrangement, including, but not limited to, any severance arrangement) between
the Management Member and Keane Group or its Subsidiaries; or (ii) if no such
employment agreement (or other arrangement, including, but not limited to, any
severance arrangement) exists or “cause” or such similar term is not defined
therein, with respect to a Management Member, as determined by Keane Group in
its reasonable judgment: (a) the Management Member’s indictment for a felony or
any crime involving dishonesty, moral turpitude or theft; (b) the Management
Member’s conduct in connection with his employment duties or responsibilities
that is fraudulent, unlawful or grossly negligent; (c) the Management Member’s
willful misconduct; (d) the Management Member’s contravention of specific lawful
directions related to a material duty or responsibility which is directed to be
undertaken from the board of directors of Keane Group or the person to whom the
Management Member reports; (e) the Management Member’s material breach of the
Management Member’s obligations under the Management Incentive Plan, a MIP
Agreement or any other agreement between the Management Member and Keane Group
and its Subsidiaries; (f) any acts of dishonesty by the Management Member
resulting or intending to result in personal gain or enrichment at the expense
of Keane Group, its Subsidiaries or Affiliates; or (g) the Management Member’s
failure to comply with a material policy of Keane Group, its Subsidiaries or
Affiliates.

 

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“CEO Manager” has the meaning set forth in Section 3.1(b)(ii).

“Cerberus Contribution Loan” has the meaning set forth in Section 2.2(b)(iii).

“Cerberus Funds” means, including any successors and permitted assigns, Cerberus
International II Master Fund, L.P., Cerberus Institutional Partners, L.P. –
Series Four, Cerberus Institutional Partners V, L.P., Cerberus CP Partners,
L.P., Cerberus MG Fund, L.P., CIP VI Overseas Feeder, Ltd. and CIP VI
Institutional Feeder, L.P.

“Cerberus Managers” has the meaning set forth in Section 3.1(b)(ii).

“Cerberus Representative” means, unless otherwise designated by the Cerberus
Funds, Cerberus Capital Management, L.P., in its capacity as the representative
of the Cerberus Funds.

“Certificate of Formation” means the Certificate of Formation referred to in the
first Recital of this Agreement and any and all amendments thereto and
restatements thereof filed on behalf of the Company with the office of the
Secretary of State of the State of Delaware pursuant to the Act.

“Change of Control” means the first to occur of any of the following events:
(i) one Person other than the Cerberus Funds becomes the beneficial owner,
directly or indirectly, of more than fifty percent (50%) of the combined voting
power of the then issued and outstanding securities of Keane Group; (ii) a
reduction in the Cerberus Funds’ beneficial ownership, directly or indirectly,
to less than thirty percent (30%) of the combined voting power of the then
issued and outstanding securities of Keane Group, or (iii) the sale, transfer or
other disposition of all or substantially all of the business and assets of
Keane Group, whether by sale of assets, merger or otherwise (determined on a
consolidated basis), to one Person other than to Cerberus Funds. Notwithstanding
anything herein to the contrary, the following shall not constitute a Change of
Control: (a) an initial public offering of Keane Group common stock; (b) any
acquisition of Keane Group’s securities directly from Keane Group; (c) any
acquisition by Keane Group; (d) any acquisition by any employee benefit plan (or
related trust) sponsored or maintained by Keane Group or any Affiliate; and
(e) any transaction described in clause (iii) above solely for equity securities
of the survivor or transferee that is publicly-traded unless the Cerberus Funds
have sold at least fifty percent (50%) of the equity securities acquired by it
in the survivor or the transferee in such sale of assets, merger or other
disposition.

“Class A Member” means any Member owning Class A Units, or any series or
classification thereof, according to the books and records of the Company.

“Class A Units” shall mean the Class A Units of the Company representing limited
liability company interests in the Company, having such rights associated with
such Class A Units as set forth in this Agreement.

 

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“Class B Member” means any Management Member holding Class B Units, or any
series or classification thereof, according to the books and records of the
Company.

“Class B Units” means the Class B Units of the Company representing limited
liability company interests in the Company, having such rights associated with
such Class B Units as set forth in this Agreement, the Management Incentive
Plan, any Management Member’s MIP Agreement or any employment agreement with the
applicable Management Member.

“Class C Member” means any Member holding Class C Units, or any series or
classification thereof, according to the books and records of the Company.

“Class C Interests” has the meaning set forth in Section 2.1(d).

“Class C Units” means the Class C Units of the Company representing limited
liability company interests in the Company, having such rights associated with
such Class C Units as set forth in this Agreement.

“Code” means the Internal Revenue Code of 1986, as amended from time to time.

“Company” has the meaning set forth in the Preamble.

“Competitive Business” has the meaning set forth in Section 4.5(a).

“Confidential Information” has the meaning set forth in Section 12.12(a).

“Control” means, with respect to any Person, the power of another Person,
through ownership of equity, contract rights or otherwise, to direct the
management and policies of such Person, and “controlled” and “controlling” have
correlative meanings.

“Covered Person” means (i) a current or former Member or Manager, a Tax Matters
Member, an Affiliate of a current or former Member or Manager, or any officer,
director, shareholder, partner, member, employee, representative or agent of a
current or former Member or Manager or any of their respective Affiliates and
(ii) any current or former officer of the Company or former officer of Keane
Group Holdings, LLC, in each case whether or not such Person continues to have
the applicable status referred to above; provided that the term “Covered Person”
shall exclude any employee of the Company or its Subsidiaries that is not a
current or former officer of the Company or former officer of Keane Group
Holdings, LLC.

“Deemed Allocated Stock” has the meaning set forth in Section 3.7(c).

“Defaulted Payment Amount” has the meaning set forth in Section 4.6(a).

“Depreciation” means, for each taxable period, an amount equal to the
depreciation, amortization or other cost recovery deduction allowable with
respect to an asset for such taxable period, except that if the Gross Asset
Value of such asset differs from its adjusted basis for federal income tax
purposes at the beginning of such taxable

 

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period, Depreciation shall be an amount that bears the same ratio to such
beginning Gross Asset Value as the federal income tax depreciation,
amortization, or other cost recovery deduction for such taxable period bears to
such beginning adjusted tax basis; provided, however, that if the adjusted basis
for federal income tax purposes of an asset at the beginning of such taxable
period is zero, Depreciation shall be determined with reference to such
beginning Gross Asset Value using any reasonable method selected by the
Management Board.

“Disclosing Member” has the meaning set forth in Section 12.12(c).

“Drag-Along Rights” has the meaning set forth in Section 5.3(a)(iii).

“Drag-Along Sale” has the meaning set forth in Section 5.3(a).

“Dragged Member” has the meaning set forth in Section 5.3(a).

“Dragged Members” has the meaning set forth in Section 5.3(a).

“Dragging Member” has the meaning set forth in Section 5.3(a).

“Effective Date” means the date of this Agreement.

“Eligible Stockholder” has the meaning set forth in Section 5.4(a).

“Equity Securities” means, as applicable, (i) any capital stock, membership
interests or other equity interest of any Person; (ii) any securities directly
or indirectly convertible into or exchangeable for any capital stock, membership
interests or other equity interest of any Person; or (iii) any rights or options
directly or indirectly to subscribe for or to purchase any capital stock,
membership interests or other equity interest of any Person or to subscribe for
or to purchase any securities directly or indirectly convertible into or
exchangeable for any capital stock, membership interests or other equity
interest of any Person.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended
from time to time.

“Excluded Stock” has the meaning set forth in Section 3.7(c).

“Exercise Period” has the meaning set forth in Section 5.4(a).

“Exercising Member” has the meaning set forth in Section 5.4(b).

“Existing Holder ROFO” has the meaning set forth in Section 5.6(a).

“Existing Holder ROFO Acceptance” has the meaning set forth in Section 5.6(c).

“Existing Holder ROFO Notice” has the meaning set forth in Section 5.6(b).

“Existing Holder ROFO Units” has the meaning set forth in Section 5.6(a).

 

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“Existing Holders” has the meaning set forth in Section 5.5(a).

“Fair Market Value” means, with respect to any property other than cash, the
value of such property that a buyer would be willing to pay in an arms’ length
transaction between a ready and willing buyer and a seller under no compulsion
to sell as determined in good faith by the Management Board.

“Family Member” means, as to any individual Person, that Person’s spouse,
sibling, child, step child, grandchild, or parent, or the spouse of any of the
foregoing, or a trust or family limited partnership, or other similar structure
for the benefit of such Person or any of the foregoing.

“Financing Sources” has the meaning set forth in Section 5.5(e)(i).

“First Class C Threshold” means, with respect to any particular date, the amount
set forth on Schedule C attached hereto with respect to such date.

“Fiscal Year” means the 12-month period commencing on January 1 and ending on
December 31, or such other commencement and ending dates as the Management Board
may determine.

“Foreclosure Notice” has the meaning set forth in Section 5.5(e)(ii).

“GAAP” means United States generally accepted accounting principles, as in
effect from time to time.

“Governmental Entity” means any federal, state, local or foreign governmental,
administrative, judicial or regulatory agency, commission, court, body, entity
or authority.

“Gross Asset Value” means, with respect to any asset, the asset’s adjusted basis
for federal income tax purposes, except as follows:

(i) the initial Gross Asset Value of any asset contributed by a Member to the
Company shall be the fair market value of such asset at the time it is accepted
by the Company, unreduced by any liability secured by such asset, as reasonably
determined by the Management Board;

(ii) the Gross Asset Values of all Assets shall be adjusted to equal their
respective fair market values, unreduced by any liabilities secured by such
assets, as reasonably determined by the Management Board as of the following
times: (x) the acquisition of an additional interest in the Company by any new
or existing Member in exchange for more than a de minimis Capital Contribution;
(y) the distribution by the Company to a Member of more than a de minimis amount
of property as consideration for an interest in the Company; and (z) the
liquidation of the Company within the meaning of Regulations
Section 1.704-1(b)(2)(ii)(g); provided, however, that an adjustment described in
clauses (x) and (y) of this paragraph shall be made only if the Management Board
reasonably determines that such an adjustment is necessary to reflect the
relative economic interests of the Members;

 

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(iii) the Gross Asset Value of any Asset distributed to any Member shall be
adjusted to equal the fair market value of such asset on the date of
distribution, unreduced by any liability secured by such asset, as reasonably
determined by the Management Board; and

(iv) the Gross Asset Value of all Assets shall be increased (or decreased) to
reflect any adjustments to the adjusted basis of such assets pursuant to Code
Section 734(b) or Code Section 743(b), but only to the extent that such
adjustments are taken into account in determining Capital Accounts pursuant to
Regulations Section 1.704-1(b)(2)(iv)(m) and paragraph (vi) of the definition of
“Profits” and “Losses”; provided, however, that Gross Asset Value shall not be
adjusted pursuant to this paragraph (iv) to the extent that an adjustment
pursuant to paragraph (ii) is required in connection with a transaction that
would otherwise result in an adjustment pursuant to this paragraph (iv).

If the Gross Asset Value of an asset has been determined or adjusted pursuant to
paragraphs (i), (ii) or (iv) of this definition, such Gross Asset Value shall
thereafter be adjusted by the Depreciation taken into account with respect to
such asset for purposes of computing Profits and Losses.

“Held”, “Hold”, “Holder” or “Holding” means, with respect to a specified number
or percentage of the Units, being the record holder of, and having pecuniary
interest in, such number or percentage of Units.

“Imputed Underpayment” has the meaning set forth in Section 8.3.

“Indebtedness” of any Person at any date, means without duplication, (i) all
indebtedness of such Person for borrowed money, (ii) all obligations of such
Person for the deferred purchase price of property or services (other than
current trade payables incurred in the ordinary course of such Person’s
business, and excluding earnouts, escrows, holdbacks and similar deferred
payment obligations), (iii) all obligations of such Person evidenced by notes,
bonds, debentures or other similar instruments, (iv) all indebtedness created or
arising under any conditional sale or other title retention agreement with
respect to property acquired by such Person (even though the rights and remedies
of the seller or lender under such agreement in the event of default are limited
to repossession or sale of such property), (v) all capital leases of such
Person, (vi) all guarantees of such Person in respect of obligations of the kind
referred to in clauses (i) through (v) above, and (vii) all obligations of the
kind referred to in clauses (i) through (v) above secured by (or for which the
holder of such obligation has an existing right, contingent or otherwise, to be
secured by) any lien on property or assets owned by such Person, whether or not
such Person has assumed or become liable for the payment of such obligation.

“Indemnifiable Losses” has the meaning set forth in Section 11.1.

 

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“Indemnitee” has the meaning set forth in Section 11.1.

“Indemnified Party” has the meaning set forth in Section 11.5.

“Initial Public Offering” means a bona fide underwritten initial public offering
of Equity Securities of the Company, pursuant to an effective registration
statement filed under the 1933 Act (excluding registration statements filed on
Form S-8, any similar successor form or another form used for a purpose similar
to the intended use for such forms).

“Initial Purchase Agreement” means that certain Amended and Restated Purchase
Agreement, dated as of March 4, 2011, by and among Keane Fracing Acquisition
Corp., the Keane Parties, Keane Brothers, L.P. and other parties thereto.

“Instrument of Accession” means an instrument of accession, a form of which is
attached hereto as Exhibit A.

“Investor Holdings Subsidiary” means any Subsidiary of the Company other than
Keane Group and any Subsidiary of Keane Group.

“Investor Members” means (i) Cerberus Funds taken as a group, as represented by
the Cerberus Representative, (ii) Trican and (iii) the Keane Parties taken as a
group, as represented by the Keane Representative.

“Involuntary Bankruptcy” has the meaning set forth in the definition of
Bankruptcy.

“KCK” has the meaning set forth in the Preamble.

“Keane Control Group” means the Company and their respective Affiliates (as
defined in Rule 12b-2 of the 1934 Act), or any person who is an express assignee
or designee of their respective rights under Keane Group’s certificate of
incorporation (and such assignee’s or designee’s respective Affiliates) and who
is or becomes a party to the Stockholders’ Agreement.

“Keane Group” means Keane Group, Inc., a Delaware corporation.

“Keane Group Contribution and Exchange Agreement” means that certain
Contribution and Exchange Agreement, dated as of the date hereof, by and between
the Company and Keane Group.

“Keane Group Stock” means the common stock, par value $0.01 per share, of Keane
Group acquired by the Company pursuant to the Keane Group Contribution and
Exchange Agreement and Equity Securities into which such shares of common stock
shall have been changed, or any Equity Securities resulting from any
reclassification, recapitalization, reorganization, merger, consolidation,
conversion, stock or other equity split or dividend or similar transactions with
respect to such shares of common stock or other Equity Securities.

 

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“Keane Manager” has the meaning set forth in Section 3.1(b)(ii).

“Keane Party” or “Keane Parties” has the meaning set forth in the Preamble.

“Keane Representative” means S & K Management Services, LLC, in its capacity as
the representative of the Keane Parties.

“KK” has the meaning set forth in the Preamble.

“Law” means any foreign or domestic law, statute, code, ordinance, rule,
regulation, order, judgment, writ, stipulation, award, injunction, decree or
arbitration award or finding of any Governmental Entity.

“Major Decision” means:

 

  (i) (x) to issue any additional Class C Units, (y) to issue any new class or
series of Units that provides for distributions pursuant to Section 7.1 with
priority over distributions to the Class C Members pursuant to Section 7.1, or
(z) to issue any new class or series of Units that provides for distributions
pursuant to Section 7.1 with priority over distributions to the Class A Members
pursuant to Section 7.1; provided, however, that such action shall not be
considered a Major Decision if, in the case of clauses (x) and (y), the Company
obtains a fairness opinion from a nationally recognized investment bank or
similar financial firm indicating that the consideration proposed to be paid in
respect of such issuances is fair from a financial point of view to the Company;

 

  (ii) to amend, modify or waive any provisions of this Agreement, the
Certificate of Formation or the organizational documents of the Company in a
manner that materially, disproportionately and adversely affects Trican or the
Keane Parties;

 

  (iii) any act in contravention of this Agreement;

 

  (iv) any action which would cause the Company (x) to become an entity other
than a Delaware limited liability company, or other than a “pass through” entity
for Federal income taxes or (y) to be treated as a corporation for Federal
income tax purposes;

 

  (v) changing the business purpose of the Company;

 

  (vi) making in-kind distributions with respect to any material portion of the
Assets of the Company or any Investor Holdings Subsidiary other than
distributions of Keane Group Stock pursuant to and in accordance with
Section 3.7(b) or Section 3.7(c);

 

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  (vii) indemnification of any Person by the Company or any Investor Holdings
Subsidiary other than an Officer, Manager, or a Member or its Affiliates in
accordance with the provisions of Article XI of this Agreement, other than any
indemnification clause that is included in any contract or other agreement
between the Company and any vendor or other contracting party of the Company in
the ordinary course of business;

 

  (viii) entering into any agreement (x) which would cause any Member to become
personally liable on or in respect of or to guarantee any indebtedness of the
Company or any Investor Holdings Subsidiary or (y) which is not nonrecourse to
such Member, except to the extent such liability or recourse is pursuant to
customary carve-outs for real estate financing;

 

  (ix) causing the Company or any Investor Holdings Subsidiary (w) to make loans
to any Member, (x) to accept or require additional Capital Contributions from
any Member not provided for in this Agreement, (y) to enter into any contract,
arrangement or understanding with or paying any salary, fees or other
compensation to, any Investor Member or any Affiliate of an Investor Member
(other than as otherwise contemplated by this Agreement or as is consistent with
any employment agreement with a Member), or (z) to borrow money from a Member or
its Affiliates;

 

  (x) except as otherwise expressly permitted by this Agreement, the Management
Incentive Plan, any Management Member’s MIP Agreement, any employment agreement
with a Management Member or in connection with the repurchase, redemption,
conversion or cancellation of Units Held by Trican pursuant to the terms of this
Agreement, any redemption, repurchase or reclassification of Equity Securities
of the Company, recapitalization of the Company or change in equity structure of
the Company (including, but not limited to, any equity split or reverse equity
split, exchange or readjustment of shares, or restructuring or other
reorganization), in each case that materially, disproportionately and adversely
affects the rights of the Members as a class;

 

  (xi) any equity incentive grants by the Company to employees or Managers, or
creating any employee equity incentive program by the Company other than those
equity incentives and employee equity incentive programs of the Company in place
on the Effective Date;

 

  (xii) entering into or effecting a Sale-of-the-Company, dissolution or
liquidation, in each case solely with respect to the Company and not any of its
Subsidiaries, other than in compliance with Section 5.3;

 

  (xiii) obtaining, incurring, modifying, prepaying or refinancing any
Indebtedness of the Company or any Investor Holdings Subsidiary or executing or
delivering on behalf of the Company any guarantee or other agreement whereby the
Company or any Investor Holdings Subsidiary is or may become liable for any
obligations of any other Person;

 

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  (xiv) requiring any additional Capital Contributions (other than pursuant to
Section 2.2(b));

 

  (xv) causing or permitting an Initial Public Offering of the Company or any
Investor Holdings Subsidiary;

 

  (xvi) consenting (to the extent consent of the Management Board is required)
to a Member directly or indirectly making a Transfer of all or any portion of
its Units pursuant to Section 5.1;

 

  (xvii) admitting a Person as a Member, except as otherwise specifically
provided in this Agreement;

 

  (xviii) permitting the withdrawal of any Member except as otherwise provided
in this Agreement;

 

  (xix) approving any affiliate transaction (other than with respect to the
employment of a Management Member) between the Company or any Investor Holdings
Subsidiary on the one hand, and any Member or any Affiliate thereof on the other
hand;

 

  (xx) conducting any business other than (x) the purchasing, holding, voting
and disposing of the Keane Group Stock and (y) taking actions permitted under
the Stockholders’ Agreement not otherwise inconsistent with this Agreement; and

 

  (xxi) taking any action in respect of the Keane Group Stock in breach of
Section 3.7 or otherwise Sell any Keane Group Stock other than in accordance
with Section 3.7.

“Management Board” has the meaning set forth in Section 3.1(a).

“Management Distributions” means all distributions to the Class B Members in any
applicable fiscal year, including, for the avoidance of doubt, any projected
distributions that would be made to the Class B Members in connection with any
transaction for which the First Class C Threshold, and if applicable, the Second
Class C Threshold, is calculated.

“Management Incentive Plan” means the Keane Investor Holdings LLC Management
Incentive Plan, as amended and restated, which was formerly called the “Keane
Management Holdings LLC Management Incentive Plan” prior to its assignment to
the Company.

“Management Member” has the meaning set forth in the Preamble.

“Manager” means an individual on the Management Board.

“Member Approval” has the meaning set forth in Section 3.2(c)(i).

 

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“Member Contribution and Exchange Agreements” means those certain Contribution
and Exchange Agreements, dated as of the date hereof, by and among the Company
and certain Members, pursuant to which such Members contributed certain Equity
Securities to the Company in exchange for Class A Units, Class B Units and Class
C Units as set forth therein.

“Members” has the meaning set forth in the Preamble.

“MIP Agreement” means a written award agreement between a Management Member and
Keane Management Holdings LLC, as amended and assigned, effective on the
Effective Date, to the Company as successor to Keane Management Holdings LLC.

“New Issue Securities” has the meaning set forth in Section 5.4(a).

“New Rules” has the meaning set forth in Section 12.2(a).

“Non-Exercising Member” has the meaning set forth in Section 5.4(b).

“Non-Participating Member” has the meaning set forth in Section 3.7(c).

“Notice of Acceptance” has the meaning set forth in Section 5.4(b).

“Observers” has the meaning set forth in Section 3.1(b)(iii).

“Officer” means any officer of the Company appointed in accordance with this
Agreement.

“Over-allotment Notice” has the meaning set forth in Section 5.4(b).

“Permitted Transferee” means: (i) with respect to any Member who is not a
natural person, any Affiliate of such Member (provided that for purposes of this
clause (i), “Affiliate” shall mean, with respect to the Member in question, that
such Member solely controls, is controlled solely by or under common control
with such Affiliate (and no Person other than the common controlling Person
controls such Affiliate) and such Member or its ultimate parent owns, directly
or indirectly, more than 80% of the economic interests of such Affiliate and
provided further that notwithstanding the immediately preceding proviso,
Affiliates as further defined in the second sentence of the definition of
Affiliate are affiliates for purposes of this clause (i); (ii) with respect to
any Member who is a natural person (including any entities or trusts formed for
estate or family planning purposes by such natural person), (x) upon the death
of such natural person, any Person in accordance with such natural person’s will
or the Laws of intestacy; (y) the Family Members of such natural person,
entities formed for estate or family planning purposes and/or one or more trusts
for the sole benefit of such natural person and/or the Family Members of such
natural person, provided that such natural person shall not be released from his
obligations under this Agreement as a Member; and (iii) in the event of the
dissolution, liquidation or winding up of any such Person that is a corporation,
partnership or limited liability company, the stockholders of a corporation that
is such Person, the partners of a partnership that is such Person, the members
of a

 

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limited liability company that is such Person or a successor corporation all of
the stockholders of which or a successor partnership all of the partners of
which or a limited liability company all of the members of which are the Persons
who were the stockholders of such corporation or the partners of such
partnership or the members of such limited liability company immediately prior
to the dissolution, liquidation or winding up of such Person; provided further,
however, that no such Transfer under any one or more of the foregoing clauses
(i) through (iii) to any such Person shall be permitted where such Transfer
(x) fails to comply with the terms of Section 5.1, including, without
limitation, by reason of a failure to comply in any respect with any federal or
state securities Laws, including, without limitation, the 1940 Act, or (y) would
result in the Company becoming subject to the 1934 Act.

“Person” means any individual, corporation, association, partnership (general or
limited), joint venture, trust, joint-stock company, estate, limited liability
company, Series, unincorporated organization or other legal entity or
organization.

“Pledged Units” has the meaning set forth in Section 5.5(e)(i).

“Preemptive Right Notice” has the meaning set forth in Section 5.4(a).

“Profits” or “Losses” means for each taxable period, an amount equal to the
taxable income or loss for such taxable period. Such amount shall be determined
in accordance with Code Section 703(a) (for this purpose, all items of income,
gain, loss, or deduction required to be stated separately pursuant to Code
Section 703(a)(1) shall be included in taxable income or loss), with the
following adjustments (without duplication):

(i) any income that is exempt from federal income tax and not otherwise taken
into account in computing Profits or Losses pursuant to this definition shall be
added to such taxable income or loss;

(ii) any expenditures described in Code Section 705(a)(2)(B) or treated as Code
Section 705(a)(2)(B) expenditures pursuant to Regulations
Section 1.704-1(b)(2)(iv)(i), and not otherwise taken into account in computing
Profits or Losses pursuant to this definition shall be subtracted from such
taxable income or loss;

(iii) in the event that the Gross Asset Value of any Asset is adjusted pursuant
to paragraphs (ii) or (iii) of the definition of Gross Asset Value, the amount
of such adjustment shall be taken into account as an item of gain (if the
adjustment increases the Gross Asset Value of the asset) or an item of loss (if
the adjustment decreases the Gross Asset Value of the asset) from the
disposition of such asset and shall be taken into account for purposes of
computing Profits or Losses;

(iv) gain or loss resulting from any disposition of property with respect to
which gain or loss is recognized for federal income tax purposes shall be
computed by reference to the Gross Asset Value of property disposed of,
notwithstanding that the adjusted tax basis of such property differs from its
Gross Asset Value;

 

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(v) in lieu of depreciation, amortization, and other cost recovery deductions
taken into account in computing such taxable income or loss there shall be taken
into account Depreciation for such taxable period, computed in accordance with
the definition of Depreciation; and

(vi) to the extent an adjustment to the adjusted tax basis of any Asset pursuant
to Code Section 734(b) or 743(b) is required pursuant to Regulations
Section 1.704-1(b)(2)(iv)(m) to be taken into account in determining Capital
Accounts as a result of a distribution other than in liquidation of a Member’s
interest in the Company, the amount of such adjustment shall be treated as an
item of gain (if the adjustment increases the basis of the asset) or loss (if
the adjustment decreases the basis of the asset) from the disposition of the
asset and shall be taken into account for purposes of computing Profits or
Losses.

“Pro Rata Portion” means, with respect to any Tag-Along Member in a Tag-Along
Sale: (i) with respect to Class A Units, such portion of its Class A Units which
represents the same proportion of the total number of Class A Units owned of
record by such Tag-Along Member, as the total number of Class A Units proposed
to be Sold by the Tag-Along Selling Member, represents to the total number of
Class A Units owned of record by such Tag-Along Selling Member; (ii) with
respect to Class B Units, such portion of its vested Class B Units which
represents the same proportion of the total number of vested Class B Units owned
of record by such Tag-Along Member, as the total number of Class A Units
proposed to be Sold by the Tag-Along Selling Member, represents to the total
number of Class A Units owned of record by such Tag-Along Selling Member; and
(iii) with respect to Class C Units, such portion of its Class C Units which
represent the same proportion of the total number of Class C Units owned of
record by such Tag-Along Member that are in-the-money as determined by the then
applicable strike amount for the Class C Interests as set forth on Schedule C
and Schedule D as if such Class C Units were converted to Class A Units on a
fully diluted basis pursuant to the Management Board’s reasonable good faith
determination of Fair Market Value for such Units immediately prior to the
Tag-Along Sale (and the Management Board may retain an independent valuation
firm to make such determination), as the total number of Class A Units proposed
to be Sold by the Tag-Along Selling Member, represents to the total number of
Class A Units owned of record by such Tag-Along Selling Member.

“Proportionate Class A Unit Percentage” shall mean, with respect to any Member,
the fraction the numerator of which is the number of Class A Units then Held by
such Member and the denominator of which is the aggregate number of Class A
Units then Held by all Members.

“QIB” means a “qualified institutional buyer” within the meaning of Rule 144A
under the 1933 Act.

“Regulations” means the federal income tax regulations promulgated by the
Treasury Department under the Code, as such regulations may be amended from time
to time. All references herein to a specific section of the Regulations shall be
deemed also to refer to any corresponding provisions of succeeding Regulations.

 

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“Representative” has the meaning set forth in Section 10.2.

“Restricted Period” has the meaning set forth in Section 5.1(a).

“Sale” means the direct or indirect sale, assignment, transfer or other
disposition for value of (i) beneficial ownership (as used in Rule 13d-3(a)
under the 1934 Act) or (ii) the economic interest, in each case, of Units
(including, without limitation, by reorganization, merger or sale of
substantially all of the assets of, or sale of beneficial ownership or the
economic interest of ownership interests in, any holding company a majority of
the assets of which (on a consolidated basis with its subsidiaries) consist of
Units (provided that any such sale shall only constitute a “Sale” of the pro
rata portion of such underlying Units)); provided that the term “Sale” shall
exclude any assignment (as collateral), mortgage, pledge, hypothecation,
encumbrance or similar grant of interest pursuant to any bona fide financing.
The terms “Sell” and “Sold” have corresponding meanings.

“Sale-of-the-Company” means the sale of all or substantially all of the
consolidated assets of the Company, whether held by the Company or one or more
of its Subsidiaries and whether by way of an asset sale, direct or indirect
equity interest sale, security sale, tender offer, merger, consolidation or
other similar transaction.

“Second Class C Threshold” means, with respect to any particular date, the
amount set forth on Schedule D attached hereto with respect to such date.

“Sell-Down” has the meaning set forth in Section 3.7(c).

“Sell-Down Notice” has the meaning set forth in Section 3.7(c).

“Selling Holder” has the meaning set forth in Section 5.6(a).

“Side Letter” means any letter agreement between the Company and any employee of
the Company or its Subsidiaries relating to or in connection with such
employee’s employment, compensation, participation in any incentive program or
otherwise. In the event of any conflict between (i) a Side Letter between any
employee of the Company or its Subsidiaries and the Company and (ii) this
Agreement, such Side Letter shall control with respect to such employee.

“SJK” has the meaning set forth in the Preamble.

“Stockholders’ Agreement” means the Keane Group Stockholders’ Agreement, dated
as of the date hereof, by and among the Company and the other parties thereto,
as amended from time to time.

“Subsidiary” of a Person means any corporation, partnership, limited liability
company, trust and other entity, whether incorporated or unincorporated, with
respect to which such Person, directly or indirectly, legally or beneficially,
owns (i) a right to a majority of the profits of such entity; or (ii) securities
having the power to elect a majority of the board of directors or similar body
governing the affairs of such entity.

 

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“Tag-Along Members” has the meaning set forth in Section 5.2(a).

“Tag-Along Notice” has the meaning set forth in Section 5.2(a).

“Tag-Along Offered Units” has the meaning set forth in Section 5.2(a)(i).

“Tag-Along Right” has the meaning set forth in Section 5.2(a)(vi).

“Tag-Along Sale” has the meaning set forth in Section 5.2(a).

“Tag-Along Selling Member” has the meaning set forth in Section 5.2(a).

“Tax Matters Member” has the meaning set forth in Section 8.1.

“Territory” means the United States (including Alaska and Hawaii), including its
territorial waters.

“Third Party Claim” has the meaning set forth in Section 11.5.

“Transaction Notice” has the meaning set forth in Section 4.5(a).

“Transaction Transfer Restrictions” has the meaning set forth in Section 3.7(c).

“Transfer” means the direct or indirect sale, lease, donation, assignment (as
collateral or otherwise), mortgage, pledge, grant, hypothecation, encumbrance,
gift, bequest or other transfer or disposition of any interest (legal or
beneficial) in any security (including, without limitation, transfer by
reorganization, merger, sale of substantially all of the assets, sale of
interests in any entity substantially all the assets of which comprise
securities subject to the restrictions in this Agreement, or by operation of
law); provided that (i) the direct or indirect sale, lease, donation, assignment
(as collateral or otherwise), mortgage, pledge, grant, hypothecation,
encumbrance, gift, bequest or other transfer or disposition of any securities
constituting equity of a Member that does not result in a change of Control of
such Member will not be deemed a Transfer and (ii) any direct or indirect sale
or transfer (whether by merger, amalgamation or reorganization) of equity
interests of Trican Parent will not be deemed a Transfer so long as such sale or
transfer does not involve the Sale or Transfer of Trican’s Units separately from
the direct or indirect sale or transfer of the equity interests of Trican
Parent.

“Trican” has the meaning set forth in the Preamble.

“Trican Closing Date” means the “Closing Date” as set forth in the Trican
Purchase Agreement.

“Trican Manager” has the meaning set forth in Section 3.1(b)(ii).

“Trican Parent” means Trican Well Service Ltd. and such other successors thereto
as the ultimate parent entity of Trican from time to time.

 

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“Trican Purchase Agreement” means that certain Asset Purchase Agreement, dated
January 25, 2016, by and among the Keane Group Holdings, LLC, Trican, Trican
Parent, TriLib Management LLC, Trican LLC and Keane Frac, LP, pursuant to which,
among other things, Keane Group Holdings, LLC and/or Keane Frac, LP purchased
certain assets of Trican in exchange for cash and certain equity interests in
Keane Group Holdings, LLC on the terms and conditions set forth therein.

“Trican Repayment” has the meaning set forth in Section 2.2(b)(iii).

“Trican Required Contribution” has the meaning set forth in Section 2.2(b)(iii).

“Trican ROFO” has the meaning set forth in Section 5.5(a).

“Trican ROFO Acceptance” has the meaning set forth in Section 5.5(c).

“Trican ROFO Exercising Member” has the meaning set forth in Section 5.5(c).

“Trican ROFO Non-Exercising Member” has the meaning set forth in Section 5.5(c).

“Trican ROFO Notice” has the meaning set forth in Section 5.5(b).

“Trican ROFO Over-allotment Notice” has the meaning set forth in Section 5.5(c).

“Trican ROFO Units” has the meaning set forth in Section 5.5(a).

“TK” has the meaning set forth in the Preamble.

“Units” means the units issued by the Company representing a fractional part of
the ownership of the Company and having the rights, preferences and obligations
specified in this Agreement.

“Voluntary Bankruptcy” has the meaning set forth in the definition of
Bankruptcy.

Any capitalized term not defined herein shall have the meaning ascribed to such
term in the Act.

Section 1.7 Certificates; Approval

Each Officer of the Company and any other person designated by the Management
Board, which initially shall be Lucas Batzer, Lisa Gray, Lenard Tessler and
Scott Wille, is an authorized Person within the meaning of the Act to execute,
deliver and file any certificates (and any amendments and/or restatements
thereof) necessary for the Company to qualify to do business in a jurisdiction
within the United States in which the Company may wish to conduct business.
Reuben Zaramian is hereby designated as an “authorized person” within the
meaning of the Act, and has executed, delivered and filed the Certificate of
Formation of the Company with the Secretary of State of the State of Delaware.
Each Officer of the Company is hereby authorized to execute and deliver any
documents on behalf of the Company in connection

 

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with the Initial Public Offering and any associated restructuring of Keane Group
and its Affiliates, including the Member Contribution and Exchange Agreements
and the Keane Group Contribution and Exchange Agreement, and any actions
previously taken with respect thereto are hereby authorized and approved.

Section 1.8 Term

The term of the Company shall begin on the date the Certificate of Formation was
filed with the Secretary of State of the State of Delaware and shall continue
until terminated in accordance with the provisions hereof or pursuant to the
Act.

ARTICLE II.

UNITS, CAPITAL

CONTRIBUTIONS AND CAPITAL ACCOUNTS

Section 2.1 Units

(a) As of the date hereof, membership interests in the Company shall be
represented by Units, each having the rights, privileges and obligations as
provided in this Agreement, including, without limitation, Class A Units, Class
B Units and Class C Units.

(b) Title to assets of the Company, whether real, personal or mixed, tangible or
intangible, shall be deemed to be owned by the Company, and no Member,
individually or collectively, shall have any ownership interest in such assets
or any portion thereof.

(c) The Units shall be uncertificated unless the Management Board otherwise
determines.

(d) The Class C Units issued to Trican shall initially be classified as the
“Class C Interests”. Distributions made in connection with the Class C Interests
shall be made in accordance with Section 7.1. The Class C Interests shall have
no scheduled date of expiration and shall convert into other equity securities
upon a dissolution, liquidation or similar event of the Company in accordance
with Section 10.3.

(e) Class B Units, or any classification or series thereof, are issued to each
Management Member, subject to the terms of this Agreement, pursuant to the
Management Incentive Plan and the Management Member’s MIP Agreement, each of
which has been assigned to, and assumed by, the Company.

Section 2.2 Capital Contributions

(a) Capital Contributions. Certain of the Members have contributed interests in
KG Fracing Acquisition Corp., KSD Newco Corp., Keane Group Holdings, LLC, Keane
Management Holdings LLC, CIP VI Keane International, LLC and CIP VI Keane
Overseas, LLC in exchange for certain Class A Units, Class B Units and Class C
Units of the Company. The Members’ ownership of Units as of the date of this
Agreement is as reflected on Schedule B hereto.

 

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(b) Additional Capital Contributions.

(i) Other than as the Management Board determines in its reasonable discretion
is necessary to pay reasonable third party (and not, for the avoidance of doubt,
any Member’s or such Member’s Affiliates) costs and expenses incurred by the
Company in carrying out its business not to exceed $2,500,000 per annum,
including, without limitation, liability and other insurance premiums, expenses
incurred in the preparation of reports to the Members and any third party legal,
accounting and other professional fees and expenses, none of the Members shall
have any further capital commitment with regard to the ongoing conduct of the
business of the Company beyond their respective initial Capital Contributions;
provided, that, no requirement to fund additional capital pursuant to this
Section 2.2(b) shall apply to any Management Member.

(ii) If the Management Board determines in good faith that it is necessary or
desirable for the Company to obtain additional Capital Contributions, subject to
Section 2.2(b)(i), the Management Board may at any time and from time to time
request that each Class A Member make such additional Capital Contribution in
cash pro rata in accordance with the percentage of Class A Units then Held by
each such Class A Members and each Class A Member may elect to make such
additional Capital Contribution (provided, that to the extent not all Class A
Members make such additional Capital Contributions up to their full pro rata
portion, the Class A Members that do elect to make such additional Capital
Contributions may elect to make additional Capital Contributions to satisfy the
Company’s request for Capital Contributions up to their respective pro rata
portion as between such Class A Members so contributing) and shall receive a
number of additional Class A Units (with respect to each contributing Class A
Member, in proportion to the Class A Units held by such Class A Member prior to
the additional Capital Contribution) at a value per Class A Unit calculated to
reflect the Management Board’s reasonable good faith determination of Fair
Market Value for such Class A Units immediately prior to the Capital
Contribution (the “Capital Call Valuation”) (and the Management Board may retain
an independent valuation firm to make such determination) (the “Additional
Units”). The Company shall reflect any such additional Capital Contributions in
its books and records as promptly as practicable following receipt of the
relevant Capital Contribution. For the avoidance of doubt, a Class A Member’s
decision to elect not to make an additional Capital Contribution, as requested
pursuant to this Section 2.2(b), shall not result in any remedy, forfeiture,
penalty or payment due or owed to the Company, such decision being a voluntary
decision of each Class A Member.

(iii) Notwithstanding anything to the contrary, with respect to any request by
the Management Board to make any additional Capital Contributions pursuant to
Section 2.2(b)(ii) that are to be contributed to the Company on or prior to
March 16, 2017, Trican may elect to require the Cerberus Funds, collectively, to
contribute Trican’s respective share of such additional Capital Contributions
(the “Trican Required Contribution”) and Trican shall receive from the Company
all of the Additional Units issuable in connection with the Trican Required
Contribution if such election is made; provided, that such Trican Required
Contribution by the Cerberus Funds shall take the form of a one-year member
loan, bearing

 

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interest at a rate of 15% per annum compounded quarterly, to the Company (the
“Cerberus Contribution Loan”) and Trican shall be required to contribute to the
Company the full amount of such Cerberus Contribution Loan (including accrued
interest thereon) (the “Trican Repayment”) within 12 months of the date of such
Cerberus Contribution Loan; provided, further, that: (i) if Trican so
contributes the full amount of the Trican Repayment (including accrued interest
thereon) to the Company within 12 months of the date of the Cerberus
Contribution Loan, the Company shall distribute such amount (which shall include
interest paid) to the applicable Cerberus Funds, as designated by the Cerberus
Representative, in satisfaction of the Cerberus Contribution Loan; and (ii) if
Trican does not so contribute the full amount of the Trican Repayment (including
accrued interest thereon) to the Company within 12 months of the date of the
Cerberus Contribution Loan, then the equivalent number of Class A Units (based
on the Capital Call Valuation for such Class A Units) Held by Trican equal to
the amount of the Trican Repayment (including accrued interest thereon) not so
contributed to the Company shall be automatically cancelled and forfeited and
the same number of Class A Units shall be issued to the applicable Cerberus
Funds, as designated by the Cerberus Representative, in satisfaction of the
Trican Repayment (and accrued interest thereon). In the event that a
Sale-of-the-Company or other dissolution or liquidation event of the Company
occurs prior to the full Trican Repayment (including accrued interest thereon),
or satisfaction thereof in accordance with this Section 2.2(b), then any related
proceeds that would otherwise be distributable to Trican in connection therewith
shall be distributed to the applicable Cerberus Funds, as designated by the
Cerberus Representative, unless and until the full amount of the Cerberus
Contribution Loan (including accrued interest thereon) has been repaid.

(iv) In the event of a Trican Required Contribution by the Cerberus Funds, the
Keane Parties shall have the opportunity, but not the obligation to participate
in such Trican Required Contribution by contributing up to their pro rata
portion (as determined in proportion to the aggregate amount of Class A Units
Held by the Cerberus Funds and the Keane Parties) of the amount of the Cerberus
Contribution Loan in exchange for their corresponding pro rata portion of the
Trican Repayment (including interest thereon), in each case in accordance with
the terms of Section 2.2(b)(iii).

(c) Withholding of Distributions to Fund Capital Contributions. In the event of
a secondary offering of Keane Group Stock by the Company, the Management Board
may authorize the withholding of up to $2,500,000 from the Investor Members to
fund the costs and expenses of the Company in lieu of requiring contributions
(to the extent of such withholding) from the Investor Members pursuant to clause
(b) above.

(d) Payment of Capital Contributions. Any Capital Contributions in cash made by
the Members shall be made in U.S. dollars by wire transfer of federal funds to
an account or accounts of the Company specified by the Company or the Management
Board. Except as otherwise provided herein, no Member shall be entitled to any
compensation by reason of its Capital Contribution or by reason of serving as a
Member. No Member shall be required to lend any funds to the Company.

 

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Section 2.3 Capital Accounts

(a) Capital Accounts. A capital account (“Capital Account”) shall be maintained
for each Member in accordance with this Section 2.3. A Member’s Capital Account
shall be increased by (i) the amount of money contributed by the Member to the
Company, (ii) the initial Gross Asset Value of property contributed by the
Member to the Company, as determined by the contributing Member and the
Management Board (net of liabilities that the Company is considered to assume or
take subject to pursuant to Code Section 752), and (iii) allocations to the
Member of Profits pursuant to Article VI. A Member’s Capital Account shall be
decreased by (x) the amount of money distributed to the Member, (y) the Gross
Asset Value of any property so distributed to the Member as determined by the
distributee Member and the Management Board (net of any liabilities that such
Member is considered to assume or take subject to pursuant to Code Section 752),
and (z) allocations to the Member of Losses pursuant to Article VI.

(b) Negative Capital Account. No Member shall be required to make up a deficit
balance in such Member’s Capital Account or to pay to any Member the amount of
any such deficit in any such account.

(c) Credit of Capital Contribution. For purposes of computing the balance in a
Member’s Capital Account, no credit shall be given for any Capital Contribution
which such Member is to make until such Capital Contribution is actually made.

Section 2.4 Admission of New Members

Unless otherwise permitted under Article V, new Members may only be admitted to
membership in the Company with the approval of the Management Board. A new
Member must agree in writing to be bound by the terms and provisions of the
Certificate of Formation and this Agreement, each as may be amended from time to
time, and must execute a counterpart of, or an agreement adopting, this
Agreement and any other related agreement as the Management Board may require.
Upon admission, the new Member shall have all rights and duties of a Member of
the Company; provided, however, that such new Member shall only be entitled to
such voting rights as are provided pursuant to this Agreement.

Section 2.5 Interest

No interest shall be paid or credited to the Members on their Capital Accounts
or upon any undistributed amounts held by the Company.

Section 2.6 Capital Withdrawal Rights, Interest and Priority

Except as expressly provided in this Agreement, no Member shall be entitled to
withdraw or reduce such Member’s Capital Accounts in whole or in part until the
dissolution, liquidation and winding-up of the Company, except to the extent
that distributions pursuant to Article VII represent returns of capital. A
Member who withdraws or purports to withdraw as a Member of the Company without
the consent of all of the Members or as otherwise allowed by this Agreement
shall be liable to the Company for any damages suffered by the Company on
account of the breach and shall not be entitled to receive any payment in
respect of its Units in the Company or a return of its Capital Contribution
until the time otherwise provided herein for distributions to Members.

 

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Section 2.7 Management Members/Management Incentive Plan.

(a) A Management Member shall be eligible to become vested in his or her Class B
Units in accordance with the Management Incentive Plan, the applicable MIP
Agreement and this Agreement. Any Class B Units that are forfeited by a
Management Member pursuant to the terms of the Management Incentive Plan or the
applicable MIP Award Agreement shall be cancelled and cease to be issued or
outstanding. Except in connection with the issuance of Class B Units to
Management Members listed on Schedule A hereto on the Effective Date in exchange
for corresponding class b interests of Keane Management Holdings LLC, no Class B
Units or other equity incentive grants shall be issued to employees or Managers
pursuant to the Management Incentive Plan (or any similar plan of the Company)
on or after the Effective Date.

(b) Except as otherwise provided in a Management Member’s MIP Agreement, a
Management Member shall become vested in his or her Class B Units at such time
and upon such terms and conditions as set forth below unless otherwise
determined by the Manager:

(i) Class B Units shall vest with respect to thirty-three and one-third percent
(33-1/3rd %) of the Class B Units on the first anniversary of the date on which
an award under the Management Incentive Plan was granted to the Management
Member and with respect to an additional thirty-three and one-third percent
(33-1/3rd %) on each of the next two anniversaries thereafter (each such
anniversary, a “Vesting Date”), subject to the Management Member’s continued
service with the Company or its Subsidiaries on each Vesting Date.

(ii) Notwithstanding the foregoing, upon a Change of Control which occurs prior
to an initial public offering of Keane Group common stock, all of a Management
Member’s Class B Units, to the extent not previously forfeited or terminated,
shall immediately vest.

(iii) All unvested Class B Units shall be forfeited by a Management Member upon
the termination of a Management Member’s service with Keane Group or its
Subsidiaries for any reason. Notwithstanding the foregoing, if a Management
Member’s service with Keane Group or its Subsidiaries is terminated as the
result of a termination of a Management Member’s employment with Keane Group and
its Subsidiaries without Cause, (i) the Management Member’s Class B Units that
would have vested on the next Vesting Date following the Management Member’s
termination shall vest upon such termination of employment, and (ii) the
Management Member’s remaining unvested Class B Units shall remain outstanding
for a period of ninety (90) days following the date of termination and if a
Change of Control occurs within such ninety (90) day period, then all of the
Management Member’s unvested Class B Units shall vest upon such Change of
Control. If a Change of Control does not occur within such ninety (90) day
period, the Management Member’s unvested Class B Units shall be forfeited on the
ninety-first (91st) day following the Management Member’s termination. All
vested Class B Units shall be subject to repurchase by the Company or Keane
Group in accordance with Section 12 of the Management Incentive Plan.
Notwithstanding the foregoing, all vested and unvested Class B Units shall be
forfeited upon the termination of a Management Member’s service by Keane Group
or its Subsidiaries for Cause.

 

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ARTICLE III.

MANAGEMENT OF THE COMPANY

Section 3.1 Company Governance.

(a) Management by the Management Board. The Company hereby establishes a
Management Board for the Company (the “Management Board”), which shall have all
of the powers of a board of directors of a Delaware corporation. Except as
otherwise expressly provided in this Agreement, the Management Board shall have
the exclusive right and full power and authority to manage and control the
business and affairs of the Company and its Subsidiaries and to take any action
deemed necessary or desirable by it in connection with the business of the
Company and its Subsidiaries.

(b) Size; Initial Composition; Election of Managers; Term.

(i) The authorized number of Managers on the Management Board shall be seven,
subject to increase or reduction, as applicable, in accordance with this Article
III.

(ii) As of and after the Effective Date, subject to Section 3.1(b)(iv), the
composition of the Management Board shall consist of seven members as follows:

 

  A. Four individuals designated by the Cerberus Representative acting on behalf
of the Cerberus Funds (the “Cerberus Managers”);

 

  B. One individual that, at any given time, is the Chief Executive Officer of
Keane Group (the “CEO Manager”);

 

  C. One individual designated by the Keane Representative acting on behalf of
the Keane Parties Holding in excess of 50% of the Class A Units then Held by the
Keane Parties (the “Keane Manager”); and

 

  D. One individual designated by Trican (the “Trican Manager”); and

In addition, each of the Cerberus Representative, on behalf of the Cerberus
Funds, Trican and the Keane Representative, on behalf of the Keane Parties
Holding in excess of 50% of the Class A Units then Held by the Keane Parties,
respectively, shall be entitled to designate in advance an alternate manager,
who can temporarily act in place of a Cerberus Manager, a Trican Manager or a
Keane Manager, respectively, who is unable to participate in a meeting of the
Management Board. Effective as of the date hereof, (I) the names of the Cerberus
Managers are Scott Wille, Lenard Tessler, Lisa Gray and Lucas Batzer, (II) the
name of the CEO Manager is James Stewart, (III) the name of the Keane Manager is
Shawn Keane and (IV) the name of the Trican Manager is Dale Dusterhoft, in each
case, until the earlier of their resignation or removal or until their
respective successors are duly elected and qualified, as the case may be, in
accordance with this Agreement.

 

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(iii) As of and after the Effective Date, each of the Cerberus Representative,
acting on behalf of the Cerberus Funds, Trican and the Keane Representative,
acting on behalf of the Keane Parties Holding in excess of 50% of the Class A
Units then Held by the Keane Parties, respectively, shall be entitled to, at its
option, designate up to two individuals in the capacity of non-voting observers
(the “Observers”). The appointment and removal of any Observer shall be by
written notice to the Management Board. Except to the extent that an Observer
has or is reasonably likely to have an actual or potential conflict of interest
(as determined in good faith by the Management Board) with respect to the
subject matter of a meeting of the Management Board or any committee of the
Management Board or a portion of such meeting, the Observer shall be permitted
to attend all meetings of the Management Board or any committee of the
Management Board and shall receive all materials and communications relating to
such meetings as and when received by the Managers; provided that Observers
shall not have access to any portion of a meeting of the Management Board or any
committee of the Management Board at which privileged and confidential
information is discussed, and shall not receive any materials and communications
related thereto. The Observers shall have no authority to vote on any matter
presented to the Management Board or any committee of the Management Board.

(iv) Notwithstanding anything to the contrary, following the Effective Date:
(A) if the Keane Parties as a group cease to Hold at least 50% of the Class A
Units Held by the Keane Parties as of the Effective Date, the Keane Parties
shall no longer be entitled to designate any individual to the Management Board
under Section 3.1(b)(ii) or have any right to appoint Observers under
Section 3.1(b)(iii) and (I) shall cause any such individual so designated or
appointed by them to immediately resign and (II) the size of the Management
Board shall be reduced by one Manager; and (B) if Trican ceases to Hold at least
25% of the Class A Units held by Trican as of the Effective Date, Trican shall
no longer be entitled to designate any individual to the Management Board under
Section 3.1(b)(ii) or have any right to appoint Observers under
Section 3.1(b)(iii) and (I) shall cause any such individual designated or
appointed by them to immediately resign, and (II) the size of the Management
Board shall be correspondingly reduced by one Manager.

(v) In the event of any vacancy on the Management Board resulting from the
departure of a Cerberus Manager, a Trican Manager or Keane Manager, other than
pursuant to Section 3.1(b)(iv), the Cerberus Representative on behalf of the
Cerberus Funds, Trican or the Keane Representative on behalf of the Keane
Parties Holding in excess of 50% of the Class A Units then Held by the Keane
Parties, respectively, shall be entitled to designate the replacement Manager.
In the event that, for any reason or for no reason, the individual that is the
CEO Manager is no longer the Chief Executive Officer of Keane Group, such
individual shall be deemed to have automatically resigned as the CEO Manager
from the Management Board, and the resulting vacancy on the Management Board
shall be filled by the individual that is thereafter appointed to the positon of
Chief Executive Officer of Keane Group.

 

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(vi) Each Manager shall serve until his or her successor is duly elected or
appointed and qualified, or until such Manager’s death or disability, or until
such Manager is replaced in accordance with Section 3.1(b)(v), resigns in
accordance with Section 3.1(c) or is removed in accordance with
Section 3.1(b)(iv) or Section 3.1(d).

(c) Resignation by Managers. A Manager may resign at any time by giving written
notice to the Company. Any such resignation shall take effect at the time
specified in such notice or, if not so specified, immediately upon receipt of
such notice by the Company. The vacancy on the Management Board caused by any
such resignation shall be filled in accordance with Section 3.1(b)(v).

(d) Removal of Managers. Any Cerberus Manager, Trican Manager or Keane Manager
may be removed with or without cause only with the consent of the Cerberus
Representative on behalf of the Cerberus Funds, Trican or the Keane
Representative on behalf of the Keane Parties Holding in excess of 50% of the
Class A Units then Held by the Keane Parties respectively. The vacancy on the
Management Board caused by any such removal shall be filled in accordance with
Section 3.1(b)(v).

(e) Board Action; Quorum. Each Manager attending a meeting of the Management
Board (in person or by telephone) shall have the right to cast, on each vote
taken at such meeting, one vote. Except as expressly provided in this Agreement,
(i) at all meetings of the Management Board, the presence in person or by
telephone of a majority of the Managers shall constitute a quorum for the
transaction of business, and (ii) at any Management Board meeting at which a
quorum is present, the act of a majority of the Managers present at such meeting
shall, subject to Section 3.2(c), constitute the act of the Management Board.
Any action required or permitted to be taken at a Board meeting may be taken
without a meeting if a written consent is signed by all of the Managers.

(f) Limitation on Liability of Member of the Management Board. Managers shall
not, solely by reason of being a Manager, be personally liable for the expenses,
liabilities or obligations of the Company whether arising in contract, tort or
otherwise.

Section 3.2 Authority, Duties and Obligations of the Management Board

(a) Except as otherwise expressly provided in this Agreement, the Management
Board shall have the authority, on behalf of the Company, to take any action or
make any decisions on behalf of the Company hereunder, to carry out any and all
of the purposes of the Company and to perform all acts and enter into and
perform all contracts and other undertakings which it may deem necessary or
advisable or incidental thereto.

(b) Without limiting Section 3.2(a), each of the Members, by executing this
Agreement, authorizes the Company and the Management Board to make such
regulatory and other filings as shall be required in connection with the
acquisition of the Keane Group Stock and the operation of the business of the
Company, all without any further act, vote or approval of the Company, any
Member or any other Person notwithstanding any other provision of this
Agreement, the Act or applicable Law, rule or regulation. In furtherance of the
foregoing, unless otherwise directed in writing by the Management Board, the
Company and the Management Board hereby designate the Cerberus Representative to
sign on behalf of the Company with respect to any such regulatory and/or other
filings to be made by the Company pursuant to this Section 3.2(b).

 

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(c) Actions Requiring Certain Approvals.

(i) Subject to the provision of Section 3.2(c)(ii) and Section 3.2(c)(iii), the
Company shall be prohibited from taking or agreeing to take any action
constituting a Major Decision without the unanimous approval of the Investor
Members Holding Class A Units.

(ii) If the Keane Parties as a group cease to Hold at least 50% of the Class A
Units Held by the Keane Parties as of the Effective Date, then notwithstanding
the foregoing, the Company shall only be required to obtain the voting approval
of a majority of the Investor Members Holding Class A Units, including the
voting approval of Trican subject to Section 3.2(c)(iii) (but not the voting
approval of the Keane Representative), before taking or agreeing to take any
action pursuant to Section 3.2(c)(i) (other than with respect to items (i),
(ii), (iv), (v), (viii)-(xi) and (xiv) of the definition of Major Decision).

(iii) If Trican ceases to Hold at least 50% of the Class A Units Held by Trican
as of the Effective Date, then notwithstanding the foregoing, the Company shall
only be required to obtain the voting approval of a majority of the Investor
Members Holding Class A Units, including the voting approval of the Keane
Representative subject to Section 3.2(c)(ii) (but not the voting approval of
Trican), before taking or agreeing to take any action pursuant to
Section 3.2(c)(i) (other than with respect to items (i), (ii), (iv), (v),
(viii)-(xi) and (xiv) of the definition of Major Decision).

(iv) During the occurrence of any enforcement of any financial covenant or
obligation in which a lender or financing source may exercise voting rights with
respect to any pledged or encumbered Units, or other security event affecting
Trican or Trican Parent and the enforcement of such security event that results
in the Transfer of any Units or equity interests in the Company from Trican or
Trican Parent, the Company shall only be required to obtain the voting approval
of a majority of the Investor Members Holding Class A Units and Trican’s (or if
applicable in such security event, Trican’s or Trican Parent’s lender or
financing source so enforcing its rights in such security event), voting,
consent, veto and appointment rights shall not be required before taking or
agreeing to take any action under this Agreement, including pursuant to Article
III and Article IV. Trican shall cause, and shall cause Trican Parent to cause,
any lender or financing source holding any pledge or other similar encumbrance
over any of Trican’s or Trican Parent’s direct or indirect equity interests in
the Company to acknowledge the terms of this Section 3.2(c)(iv).

Section 3.3 Other Activities of the Members of the Management Board

The members of the Management Board shall devote as much of their time to the
affairs of the Company as in the judgment of the members of the Management Board
the conduct of the Company’s business shall reasonably require, and the members
of the Management Board shall not be obligated to do or perform any act or thing
in connection with the business of the

 

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Company not expressly set forth herein. Nothing contained in this Agreement
shall be deemed to preclude the members of the Management Board from engaging
directly or indirectly in any other business or from directly or indirectly
purchasing, selling, holding or otherwise dealing with any securities for the
account of any such other business, for its own accounts or for other clients.
No Member shall, by reason of being a Member, have any right to participate in
any manner in any profits or income earned, derived by or accruing to the
members of the Management Board or any of their Affiliates from the conduct of
any business other than the business of the Company (to the extent provided
herein) or from any transaction in securities effected by the members of the
Management Board or any of their Affiliates for any account other than that of
the Company.

Section 3.4 Management Board Certifications

Any Person dealing with the Company may rely (without duty of further inquiry)
upon a certificate issued by the Company that is signed by any Manager or any of
the Officers as to any of the following:

(a) the identity of any Member or Officer or other agent of the Company;

(b) the existence or nonexistence of any fact or facts which constitute(s) a
condition precedent to acts by the Management Board or the Members;

(c) the Person or Persons authorized to execute and deliver any instrument or
document of the Company; or

(d) any act or failure to act by the Company or any other matter whatsoever
involving the Company.

Section 3.5 Voting Rights of Members

(a) Except as expressly provided in this Agreement or otherwise required by the
Act, Members shall have no voting rights; provided, however, that the Holders of
Class A Units (other than Holders that became Holders as a result of a Transfer
that was not in compliance with the terms and conditions of this Agreement)
shall be entitled to one vote per Class A Unit (other than Class A Units that
are Held as a result of a Transfer that was not in compliance with the terms and
conditions in this Agreement) Held by such Holder on all matters (if any) on
which such Class A Members are entitled to vote pursuant to this Agreement and
the Act; provided, further, that Class B Members and Class C Members shall have
no voting rights. In the event any Member shall transfer less than all of its
Class A Units to an unaffiliated third party or any other Member in a
transaction or in a series of transactions then the portion of such Member’s
votes that is equal to the portion of such Member’s Class A Units transferred
shall be deemed cancelled and the transferee (if an unaffiliated third party) in
such transfer shall not be a Member. In the event any Member shall transfer all
its Class A Units held on the date of such transfer to an unaffiliated third
party or any other Member in a transaction or in a series of transactions, then
all of the votes of its Class A Units on the date of such transfer shall be
deemed to have been transferred to such transferee upon the satisfaction of the
conditions contained in Article V. Notwithstanding the foregoing, if at any time
a Member (x) shall transfer

 

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more than 50% of such Member’s Class A Units (excluding, however, transfers made
by such Member to a Permitted Transferee), (y) with respect to an Investor
Member, ceases to be controlled by their respective controlled Affiliates as of
the date hereof, as applicable or (z) shall be in default with respect to its
obligations to fund additional Capital Contributions pursuant to Section 2.2
above, the remaining votes of such Member shall be deemed cancelled and such
Member shall have no voting rights except as otherwise required by the Act;
provided, that in the case of clause (z), (A) to the extent a Member elects to
treat its obligation to fund capital as a loan and such Member repays all such
loans (including all interest thereon) within 15 days, the voting rights of such
Member shall be reinstated and (B) to the extent a Member elects to treat its
obligation to fund capital as a Capital Contribution, the Company shall provide
notice to such Member on the next Business Day indicating such election and the
voting rights of such Member shall be deemed cancelled if the Member does not
provide its Capital Contribution to the Company within 15 days after receipt of
such notice.

(b) Any action by the Class A Members shall require the affirmative vote or
written consent of the majority of the voting power with respect to the Class A
Units of the Class A Members entitled to vote, voting together as one class,
except as otherwise set forth Section 12.2. Notwithstanding anything in this
Agreement to the contrary, this Section 3.5(b) shall not be amended without the
unanimous consent of the Class A Members. Meetings of the Members may be called
only by the holders of a majority of the outstanding Class A Units or a majority
of the Management Board. A meeting shall be held at a time and place determined
by the Management Board in its sole discretion.

(c) To the extent a vote, action or approval of the Keane Parties, or the
Class A Units Held by the Keane Parties, is required pursuant to this Agreement
or the Act, the Keane Representative shall vote or provide such approval on
behalf of all such Keane Parties at the direction of the Keane Parties that
collectively Hold in excess of 50% of the Class A Units Held by all of the Keane
Parties immediately prior to such vote or approval.

(d) To the extent a vote, action or approval of the Cerberus Funds, or the
Class A Units Held by the Cerberus Funds, is required pursuant to this Agreement
or the Act, the Cerberus Representative shall vote or provide such approval on
behalf of all such Cerberus Funds at the direction of the Cerberus Funds that
collectively Hold in excess of 50% of the Class A Units Held by all of the
Cerberus Funds immediately prior to such vote or approval.

Section 3.6 Cost of Services; Expenses

Subject to Section 3.5 above, Members shall be entitled to reimbursement of
their third party out-of-pocket costs and expenses, upon presentation of
reasonable documentation with respect to such expenses incurred by such Member,
in connection with providing services to the Company. The Company shall be
responsible for paying, and, except as otherwise contemplated by this Agreement,
the Management Board shall pay directly out of Company funds, all reasonable
third party costs and expenses incurred by the Company in carrying out its
business, including, without limitation, liability and other insurance premiums,
expenses incurred in the preparation of reports to the Members and any legal,
accounting and other professional fees and expenses incurred by the Company.

 

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Section 3.7 Certain Provisions Relating to Keane Group Stock.

(a) Each of the Members hereby agrees and authorizes the Company and the
Management Board to, in the Company’s and/or the Management Board’s sole
discretion exercised in good faith, at any special or any general meeting of the
stockholders of Keane Group, vote or direct the voting of, the Keane Group
Stock.

(b) Except as otherwise provided in the following sentence, after the date upon
which the Keane Control Group holds less than 35% of the issued and outstanding
common stock of Keane Group in the aggregate, subject to compliance with
applicable securities Laws (including any blackout periods then in effect), the
Management Board may cause the Company to distribute the Keane Group Stock to
the Members in accordance with the distributions that such Members would be
entitled to pursuant to Section 7.1.

(c) In the event the Company proposes to effect a private block sale, resale or
to demand or participate in a registered offering of Keane Group Stock (a
“Sell-Down”), the Company shall promptly provide written notice to each Member,
specifying (i) the amount and percentage of Keane Group Stock then held by the
Company to be sold in such Sell-Down, (ii) the estimated amount of Keane Group
Stock allocable to such Member (as determined by the Management Board in good
faith, taking into account the priority of distributions pursuant to Section 7.1
in the event that all of such proposed block of the Keane Group Stock were sold
as of such date, at the market price for such Keane Group Stock in effect on
such date) that will be sold in such Sell-Down (a Member’s “Deemed Allocated
Stock”) and (iii) all other material terms and conditions of the Sell-Down (the
“Sell-Down Notice”). Each Member’s Deemed Allocated Stock shall be sold in such
Sell-Down and the proceeds with respect to such Sell-Down shall be distributed
to the applicable Members deemed participating in the sale in accordance with
Section 7.1 (calculated using the actual market price on the date of sale and
excluding all Non-Participating Members from the distribution calculation),
unless such Member delivers a written notice to the Company by the close of
business on the date which is 10 Business Days after the Sell-Down Notice is
delivered to such Member, which such notice shall include the amount of Deemed
Allocated Stock such Member elects to exclude from such Sell-Down (the “Excluded
Stock”, and such notifying Member, the “Non-Participating Member”). Any Member
that does not deliver such notice shall have its Deemed Allocated Stock sold in
the Sell Down. If any Member elects not to have its Deemed Allocated Stock sold
in such Sell-Down, the Company shall, unless prohibited by applicable Law,
promptly distribute the Excluded Stock to the Non-Participating Member,
provided, that (i) the Non-Participating Member complies with the provisions of
Section 3.7(d) and (ii) the Excluded Stock shall be subject to the same
restrictions on transfer, market stand-off and lock-up provisions to which the
Keane Group Stock of the Company to be sold in the Sell-Down are subject in the
Stockholders’ Agreement and with respect to such Sell-Down (the “Transaction
Transfer Restrictions”). Subject to compliance with applicable Law, the Excluded
Stock may be sold or otherwise disposed of by the Member so long as no
Transaction Transfer Restriction period is in effect. The fees and expenses
incurred by the Company in connection with such Sell-Down, other than any
underwriter’s fees and expenses, shall be borne pro rata by the Members,
including the Non-Participating Members. The Company shall provide notice to
such Non-Participating Member or its representatives of its intention to effect
a Sell-Down not more than 30 calendar days prior to the intended date for the
completion of such Sell-Down, in which event the Non-Participating Member, after
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notice of such sale, shall have the right to participate in such Sell-Down with
the Company on the same terms and conditions as the Company pro rata based on
the Non-Participating Member’s beneficial ownership of Keane Group Stock
(including any Excluded Stock and other Deemed Allocated Stock, if any,
allocated to such Non-Participating Member), or, if not participating in such
Sell-Down, shall not sell or otherwise dispose of the Excluded Stock (or other
Keane Group Stock beneficially owned by such Member) during such 30 calendar day
period following delivery of such notice and such longer transfer, market
stand-off or lock up provision that the Company and/or its Members shall become
subject to in connection with such Sell-Down, and fees and expenses incurred by
the Company, other than any underwriter’s fees and expenses, shall be borne pro
rata by the Members, including any Non-Participating Member participating in
such Sell-Down with respect to any Keane Group Stock beneficially owned by such
Non-Participating Member. For the avoidance of doubt, distributions of Excluded
Stock in connection with a Sell-Down shall be taken into account and treated in
the same manner as the distribution of proceeds with respect to Deemed Allocated
Stock in such Sell-Down when determining the amount of subsequent distributions
pursuant to Section 7.1.

(d) Any Member who receives a distribution of Keane Group Stock shall, to the
extent not already a party to the Stockholders’ Agreement, execute and deliver a
joinder agreement, in form and substance reasonably acceptable to the Keane
Group, agreeing to be bound by the terms and conditions of the Stockholders’
Agreement. Subject to compliance with applicable securities Laws and rules and
for so long as no Transaction Transfer Restriction period or Keane Group
black-out period (including periods during which Keane Group insiders are
restricted from trading under an insider trading policy adopted by Keane Group
or other “special” black-out period) is then in effect with respect to such
Member, a Member may make a subsequent distribution of Excluded Stock to an
equityholder of such Member (A) free of any obligations set forth in this
Agreement and the Stockholders’ Agreement and (B) free of any restrictive legend
other than restrictions relating to applicable securities rules and Laws. For
the sake of clarity, any equityholder of a Member to whom Excluded Stock is
distributed pursuant to the preceding sentence may make transfers without
restriction other than restrictions relating to applicable securities rules and
Laws.

(e) As of the Effective Date, the Company’s initial nominees to the board of
directors of Keane Group are James Stewart, Lucas Batzer, James Geisler, Lisa
Gray, Shawn Keane, Lenard Tessler, Scott Wille, Dale Dusterhoft, Marc Edwards,
Gary Halverson and Elmer Reed. From and after the designation of the initial
nominees set forth in the previous sentence, each Investor Member (for so long
as it has a right to designate a director) shall have the right to select its
own nominee or nominees to the board of directors of Keane Group in place of its
initial nominee, provided, that such nominee (i) is affiliated with such
Investor Member, (ii) satisfies the Director Requirements (as such term is
defined in the Stockholders’ Agreement) and (iii) is otherwise not disqualified
(in the reasonable determination of the Management Board) from serving as a
director on the board of directors of Keane Group.

(f) For so long as Keane Group is a controlled company of the Keane Control
Group under the NASDAQ Listing Rules (the “50% Trigger Date”), the Company’s
appointees to the board of directors of Keane Group will include six
(6) designees of the Cerberus Funds (if the Cerberus Representative so
requests), one (1) designee from Trican (if Trican so requests) and the Chief
Executive Officer of Keane Group, and such appointees will be selected by the
affirmative vote of members of the Management Board.

 

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(g) From and after the 50% Trigger Date, for so long as the Keane Control Group
has beneficial ownership of at least 35% of the common stock of Keane Group,
such that the Company is entitled to appoint five (5) members to the board of
directors of Keane Group, the Company’s appointees to the board of directors of
Keane Group will include four (4) designees of the Cerberus Funds (if the
Cerberus Representative so requests) and one (1) designee from Trican (if Trican
so requests), and such appointees will be selected by the affirmative vote of
members of the Management Board.

(h) Until immediately prior to the time at which the Keane Control Group ceases
to have beneficial ownership of at least 50% of the common stock of Keane Group,
the Keane Control Group shall cause its directors appointed to the board of
directors of Keane Group to vote in favor of maintaining an 11-person board of
directors. For so long as Keane Control Group has beneficial ownership of less
than 50% but at least 35% of the common stock of Keane Group, Keane Control
Group shall, unless otherwise determined by the Management Board in accordance
with this Agreement, cause its individuals designated to the board of directors
of Keane Group to vote in favor of maintaining the size of the board of
directors at 11 individuals.

(i) Nominees by the Company to the board of directors of Keane Group shall
include a sufficient number of individuals who are “independent” for purposes of
the NASDAQ Listing Rules if the board of directors of Keane Group is so required
to comply with such rules.

ARTICLE IV.

GENERAL GOVERNANCE

Section 4.1 No Fiduciary Duties

Any duties (including fiduciary duties) of a Covered Person to the Company or to
any other Covered Person that would otherwise apply at law or in equity are
hereby eliminated to the fullest extent permitted under the Act and any other
applicable Law, provided that (i) the foregoing shall not eliminate the
obligation of each Member to act in compliance with the express terms of this
Agreement and (ii) the foregoing shall not be deemed to eliminate the implied
contractual covenant of good faith and fair dealing or any liability for acts or
omissions involving willful misconduct or knowing violations of criminal law.
Notwithstanding anything to the contrary contained in this Agreement, each of
the Members hereby acknowledges and agrees that each Manager, in determining
whether or not to vote in support of or against any particular decision for
which the Management Board’s consent is required, may act in and consider the
best interest of the Member or Members who designated such Manager and shall not
be required to act in or consider the best interests of the Company, any
Subsidiary of the Company or any other Members. For the avoidance of doubt, no
Member or Manager shall have any duty to disclose to the Company or the
Management Board confidential information regarding any corporate opportunity or
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possession even if it is material and relevant information to the Company and/or
the Management Board and neither such Member nor such Manager shall be liable to
the Company or the other Members for breach of any duty (including the duty of
loyalty and any other fiduciary duties) as a Manager or Member by reason of such
lack of disclosure of such confidential information. The provisions of this
Agreement, to the extent that they restrict or eliminate the duties (including
the duty of loyalty and other fiduciary duties) and liabilities of a Manager
otherwise existing at law or in equity or by operation of this Section 4.1, are
agreed by the Members to replace such duties and liabilities of such Manager. If
a Manager acquires knowledge of a potential transaction or matter that may be a
business opportunity for both the Member (or an Affiliate of the Member) that
has the right to designate such Manager hereunder and the Company or another
Member, such Manager shall have no duty to communicate or offer such business
opportunity to the Company or any other Member and shall not be liable to the
Company or the other Members for breach of any duty (including any fiduciary
duties) as a Manager by reason of the fact that such Manager directs such
opportunity to the Member or an Affiliate of the Member that has the right to
designate such Manager or any other Person, or does not communicate information
regarding such opportunity to the Company, and any such direction of an
opportunity by such Manager, and any action with respect to such an opportunity
by such Member or Affiliate of such Member, shall not be wrongful or improper or
constitute a breach of any duty hereunder, at law, in equity or otherwise.

Section 4.2 Information

The Company shall provide to each Investor Member:

(a) as soon as available after the end of each calendar month following the
Effective Date, but in no event later than 30 days after the end of such
calendar month, copies of:

(i) unaudited consolidated balance sheets of the Company and its subsidiaries as
of the end of such calendar month; and

(ii) unaudited consolidated statements of income and cash flows of the Company
and its subsidiaries for such calendar month and for the portion of the Fiscal
Year ending with such calendar month;

in each case prepared in accordance with GAAP;

(b) as soon as available after the end of each fiscal quarter following the
Effective Date, but in no event later than 30 days after the end of such fiscal
quarter, copies of:

(i) unaudited consolidated balance sheets of the Company and its subsidiaries as
of the end of such quarter; and

(ii) unaudited consolidated statements of income and cash flows of the Company
and its subsidiaries for such quarter and for the portion of the Fiscal Year
ending with such quarter;

 

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in each case prepared in accordance with GAAP;

(c) as soon as available after the end of each Fiscal Year, but in no event
later than 75 days after the end of such fiscal year, copies of:

(i) audited consolidated balance sheets of the Company and its subsidiaries as
of the end of such Fiscal Year; and

(ii) audited consolidated statements of income and cash flows of the Company and
its subsidiaries for such Fiscal Year;

in each case prepared by a “Big 4” accounting firm selected by the Management
Board, in accordance with GAAP and accompanied by an opinion thereon of the
independent certified public accountants of the Company;

(d) as soon as available after the end of each Fiscal Year, but in no event
later than 90 days after the end of such Fiscal Year, a U.S. federal income tax
Schedule K-1 for such Investor Member and a report setting forth in sufficient
detail to enable each Investor Member to prepare its U.S. federal income tax
return, if any. The Company shall mail such materials (i) to each Investor
Member and (ii) upon request, to each former Investor Member (or its successors,
assigns, heirs or personal representatives) that may need such information in
preparing its U.S. federal income tax return;

(e) as promptly as reasonably practicable after preparation of the same, a copy
of the proposed annual operating budget for the upcoming Fiscal Year, with a
reconciliation of actual expenditures against the annual operating budget to be
provided as promptly as practicable on a quarterly basis; and

(f) as promptly as reasonably practicable after preparation of the same, copies
of any business plans, monthly estimated cash positions and monthly estimated
inventory levels for the Company and its Subsidiaries.

(g) In addition, so long as Trican Parent is subject to continuous disclosure
requirements and to the extent any financial and operating information prepared
by the Company or its Subsidiaries in the ordinary course of business is
material to Trican Parent under applicable Canadian securities laws, the Company
or its Subsidiaries will, subject to Section 12.12(e), on a timely basis after
reasonable notice from Trican Parent, in order for Trican Parent to prepare its
continuous disclosure documents and other regulatory filings in Canada in
compliance with the filing deadlines under such laws, provide to Trican and
Trican Parent such financial and operating information, and only such
information, regarding the Company as Trican Parent requires to fulfil its
continuous disclosure requirements and other filing requirements under such
applicable Canadian securities laws and to comply with Canadian tax laws, and
shall direct the auditor of the Company (at the expense of Trican or Trican
Parent) to cooperate with and provide assistance to Trican and Trican Parent to
the extent required by Trican Parent in the preparation of Trican Parent’s
continuous disclosure documents and other regulatory filings.

 

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Section 4.3 Access

The Company shall, and shall cause its Officers, directors, employees, auditors
and other agents to, afford the officers, employees, auditors and other agents
of the Investor Members, during normal business hours and upon reasonable
notice, reasonable access to the Company’s Officers, employees, auditors, legal
counsel, properties, offices and other facilities and to all books and records
of the Company.

Section 4.4 Standard of Care

Each Member expressly acknowledges that an interest in the Company is highly
speculative in nature. The Management Board shall exercise all of its powers and
duties under this Agreement in accordance with the terms of this Agreement and
with a degree of skill, diligence, prudence and care which, and in a manner
which, a director of a Delaware corporation is required to use in the proper
discharge of such a director’s fiduciary duties; provided, however, that in the
event that a Manager is also an officer or a member of the board of directors of
Keane Group, this Section 4.4 shall not restrict such Manager from exercising
his fiduciary duties as an officer or a member of the board of directors of
Keane Group.

Section 4.5 Non-Competition

(a) During the period commencing on the Effective Date and continuing until the
earlier of (A) March 16, 2018 and (B) the date that Trican Parent ceases to
directly or indirectly own at least 5% of the issued and outstanding Class A
Units and 100% of the issued and outstanding Class C Units, Trican and its
Affiliates shall not directly or indirectly: (i) compete with the Company or its
Subsidiaries in the Territory in the oil field services business; (ii) have an
interest in any Person that competes in the Territory directly or indirectly
with the Company or its Subsidiaries in any capacity (a “Competitive Business”),
including as a partner, shareholder, member, employee, principal, agent, trustee
or consultant; or (iii) knowingly interfere in any respect with the business
relationships (whether formed prior to or after the date of this Agreement)
between the Company and its Subsidiaries, on the one hand, and any of their
respective customers, suppliers or partners, on the other hand; provided,
however, that the foregoing shall not prohibit, or be interpreted as
prohibiting, Trican Parent and its Affiliates from (1) conducting activities
constituting or relating to the Excluded Businesses, the Excluded Assets and the
Excluded Liabilities (as such terms are defined in the Trican Purchase
Agreement); (2) making equity investments in publicly owned companies which
constitute a Competitive Business, provided such investments do not exceed 10%
of the outstanding common equity of such publicly owned companies or
(3) entering into any licensing or other agreements relating to the intellectual
property of Trican Parent and its Affiliates; provided, that such licensing or
other agreements are in compliance with, and do not breach or violate, the
Intellectual Property License Agreement (as defined in the Trican Purchase
Agreement). Notwithstanding the foregoing, nothing contained in this
Section 4.5(a) or elsewhere in this Agreement shall prevent a Person that
acquires all of the equity interests of Trican Parent (whether by acquisition of
equity interests, merger or otherwise) from continuing to conduct its and its
Affiliates business and operations in and outside of the Territory; provided,
that in the event a Person consummates an acquisition, directly or indirectly,
of all or substantially all of the assets of Trican or a majority of the common
equity interests of Trican (whether by acquisition of equity interests, merger
or otherwise), Trican shall provide notice of such sale transaction (the
“Transaction Notice”) no later than three days after the consummation

 

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of such acquisition transaction and the Company shall have the option, but not
the obligation, upon notice to Trican delivered no later than 60 days after
receipt of the Transaction Notice, to purchase the Units formerly Held by Trican
prior to such sale transaction (including the Class C Units) for Fair Market
Value (and in the case of Class C Units, such Fair Market value shall be
calculated as if such Class C Units were converted to Class A Units on a fully
diluted basis based on the Fair Market Value for such Units immediately prior to
exercise of this purchase option) (as determined by an independent valuation
firm selected by the Management Board (unless a prior valuation has been
undertaken in the 30 day period prior to such calculation of Fair Market Value,
in which case Fair Market Value shall be based on such prior valuation)).

(b) During the period commencing on the Effective Date and continuing until
March 16, 2018, the Cerberus Funds, the Company and their respective Controlled
Affiliates shall not directly or indirectly (A) compete with Trican Parent or
its Affiliates in Canada in the oilfield services business, (B) have an interest
in any Person that competes directly or indirectly in Canada with Trican Parent
or its Affiliates, including as a partner, shareholder, member, employee,
principal, agent, trustee or consultant (other than (x) with respect to any
industrial services or completion tools business and (y) Persons so competing
with Trican Parent or its Affiliates with less than 25% of revenue in the prior
fiscal year attributable to such Person’s Canadian operations, provided that the
Cerberus Funds, the Company or their respective Affiliates (as applicable)
substantially divest the Canadian assets or operations of such Person within 180
days of acquiring such Person) or (C) knowingly interfere in any respect with
the business relationships (whether formed prior to or after the date of this
Agreement) between Trican Parent and its Subsidiaries, on the one hand, and any
of their respective customers, suppliers or partners, on the other hand;
provided, however, that the foregoing shall not (i) restrict the Cerberus Funds
and its Affiliates (other than the Cerberus Managers and those personnel of
Cerberus Capital Management, L.P. and Cerberus Operations & Advisory Company LLC
that are directly involved in monitoring the investment in the Company) from
participating in any distressed debt and lending transactions (including debt to
equity conversions) and (ii) prohibit or be interpreted as prohibiting the
Cerberus Funds, the Company or any of their respective Controlled Affiliates
from making equity investments in any publicly owned company (provided such
investment does not exceed 10% of the outstanding common equity of such publicly
owned company) or, in the case of the Cerberus Funds and its Controlled
Affiliates (other than the Company), from receiving any customary “equity
kicker” in connection with a debt investment in any Person. Notwithstanding the
foregoing, nothing contained in this Section 4.5(b) or elsewhere in this
Agreement shall prevent a Person that acquires the equity interests of all of
the Company (whether by acquisition of equity interests, merger or otherwise)
from continuing to conduct its and its Affiliates business and operations in and
outside of the Territory.

(c) Each of Trican, the Company and the Cerberus Funds acknowledges and agrees
that the time, scope, geographic area and other provisions of this Section 4.5
have been specifically negotiated by sophisticated commercial parties and agree
that all such provisions are reasonable under the circumstances of the
transactions contemplated hereby. It is the intention of the parties that if any
of the provisions contained in this Section 4.5 are held to cover a geographic
area or to be for a length of time that is not permitted by applicable Law, or
is in any way construed to be too broad or to any extent invalid, such
provisions shall not be construed to be null, void and of no effect, but to the
extent such

 

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provision would then be valid or enforceable under applicable Law, such
provisions shall be construed and interpreted or reformed to provide for a
restriction or covenant having the maximum enforceable geographic area, time
period and other provisions as shall be valid and enforceable under applicable
Law.

(d) Each of Trican, the Company and the Cerberus Funds further acknowledges and
agrees that, in the event of a breach or threatened breach of any of the
provisions of this Section 4.5, Trican, the Company or the Cerberus Funds (as
applicable) shall be entitled to immediate injunctive relief, as any such breach
would cause irreparable injury for which such party would have no adequate
remedy at law. Nothing contained in this Section 4.5 shall be construed so as to
prohibit Trican, the Company or the Cerberus Funds or any of their respective
Affiliates from pursuing any other remedies available to them under this
Agreement, at law or in equity for any such breach or threatened breach.

(e) Keane Group shall be an express third-party beneficiary under this
Section 4.5 and the Members hereby acknowledge and agree that Keane Group shall
be entitled to enforce the provisions of this Section 4.5.

Section 4.6 Reduction of Trican Class A Units

(a) Notwithstanding anything to the contrary, in the event that Trican or any of
its Affiliates fail to pay, or cause to be paid, amounts due under the Trican
Purchase Agreement pursuant to Section 3.8 of the Trican Purchase Agreement
prior to the Final Payment Date (as defined in the Trican Purchase Agreement)
(the “Defaulted Payment Amount”), the number of Class A Units Held by Trican
shall be immediately and automatically, without further action of the Company or
any other Person, be reduced by the number of Class A Units (or fraction
thereof) as set forth in Section 3.8 of the Trican Purchase Agreement, which
shall have a value equal to the Defaulted Payment Amount, with the value of each
such Class A Unit calculated in accordance with the good faith determination of
the Management Board, based on the Implied Default Valuation (as defined in the
Trican Purchase Agreement) divided by 1,000,000; provided, that the Members
agree to treat (and will cause each of their respective Affiliates to treat)
such reduction in Class A Units as an adjustment to the Purchase Price (as
described in Section 3.1 of the Trican Purchase Agreement) for all tax purposes.
Within ten days following the Final Payment Date, the Company shall submit a
notice to Trican in accordance with Section 10.6 of the Trican Purchase
Agreement setting forth, in reasonable detail, the calculation of any such
reduction and the number of Class A Units Held by Trican (and the fully diluted
percentage ownership thereof) after taking into account such cancellation in
accordance with this Section 4.6. In connection with such cancellation, Trican
shall forfeit any right to any amounts due or owed with respect to such
cancelled Class A Units. Notwithstanding anything to the contrary, for purposes
of this Section 4.6, references in the Trican Purchase Agreement to “Keane
Common Equity Units” and “Class A Units” shall be deemed to refer the Class A
Units under this Agreement.

(b) Promptly following the reduction in the number of Class A Units Held by
Trican in accordance with Section 4.6(a), the Company shall contribute to Keane
Group the corresponding number of shares of Keane Group Stock then Held by the
Company equal to the product of (i) the number of shares of Keane Group Stock
then Held by the Company,

 

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multiplied by (ii) a fraction, (A) the numerator of which is the number of
Class A Units Held by Trican that were reduced in accordance with Section 4.6(a)
and (B) the denominator of which is the aggregate number of Class A Units Held
by all Members immediately prior to the reduction of Class A Units Held by
Trican in accordance with Section 4.6(a).

ARTICLE V.

TRANSFERS OF UNITS; PREEMPTIVE RIGHTS

Section 5.1 Restrictions on Transfer

(a) From the date hereof until March 16, 2018 (the “Restricted Period”), none of
the Keane Parties may Transfer any Units unless such Transfer is approved by the
Management Board or in connection with Section 5.2 as a Tag-Along Member,
Section 5.3 as a Dragged Member or Section 5.6 as part of an Existing Holder
ROFO. During the period following the expiration of the Restricted Period, no
Keane Party shall Transfer any Units without the approval of the Management
Board other than:

(i) a Transfer pursuant to Section 5.2 as a Tag-Along Member or Section 5.3 as a
Dragged Member or a Transfer pursuant to Section 5.6 as part of an Existing
Holder ROFO; or

(ii) a Transfer to another Member, its Affiliates, or its Family Members.

(b) During the Restricted Period, Trican may not Transfer any Class A Units or
Class C Units unless such Transfer is approved by the Management Board (provided
Trican may pledge or otherwise encumber any Units Held by it to any lenders or
financing sources in compliance with this Agreement) or in connection with
Section 5.2 as a Tag-Along Member, Section 5.3 as a Dragged Member, Section 5.5
as part of a Trican ROFO, a transfer to a wholly-owned Subsidiary of Trican
Parent (provided, that if such Subsidiary is to become no-longer so
wholly-owned, such Units Held by it must be Transferred to a wholly-owned
Subsidiary of Trican Parent prior to such Subsidiary no longer being so
wholly-owned), or a Sale or Transfer of all or substantially all of the assets
of Trican in one or a series of related transactions (including any direct or
indirect Sale or Transfer, whether by merger, amalgamation or reorganization, of
equity interests of Trican Parent) that do not involve the Sale or Transfer of
Trican’s Units separately from the Sale or Transfer of all or substantially all
of the assets of Trican.

(c) Notwithstanding Section 5.1(a), except as otherwise approved by the Company,
a proposed Transfer shall not be effective:

(i) until the proposed transferee, if not already a party hereto, has executed
an Instrument of Accession and any other standard and customary documentation as
may be required by the Company;

(ii) if the proposed transferee is not an “accredited investor” as defined in
Rule 501(a) of Regulation D under the 1933 Act; or

 

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(iii) if such Transfer does not comply with Section 5.1(e).

(d) Except as expressly provided in this Agreement, no Management Member may
Transfer any of its Class B Units, directly or indirectly, unless such Transfer
is permitted under the terms of the Management Incentive Plan.

(e) Each Member agrees not to Transfer any Units unless:

(i) there is in effect a registration statement under the 1933 Act covering such
proposed Transfer and such Transfer is made in accordance with such registration
statement; or

(ii) such Transfer shall not require registration of such Units under the 1933
Act and, upon request by the Company, such Member shall have furnished the
Company with a reasonable description of the circumstances surrounding the
proposed Transfer and an opinion of counsel, in form and substance reasonably
satisfactory to the Company, that such Transfer shall not require registration
of such Units under the 1933 Act.

(f) No Member shall have the right or power to effect a Transfer of its Units or
a Transfer of any of the rights of such Member set forth in this Agreement, in
each case, except in strict compliance with the procedures set forth in this
Agreement. Any attempt to Transfer any Units or Transfer any such rights not in
accordance with this Agreement shall be null and void and no right, title or
interest in or to such Units or rights, as applicable, shall be Transferred to
the purported transferee, buyer, donee, assignee or encumbrance holder. Without
limiting the generality of the foregoing, no Member shall have the right or
power to assign to any third party any of such Member’s rights to appoint,
remove or replace Managers pursuant to Article III unless all applicable terms
in this Agreement have been satisfied. The Company shall not give, and shall not
permit the Company’s transfer agent to give, any effect to such attempted
Transfer. Each Member hereto acknowledges and agrees that any breach of this
Agreement would result in substantial harm to the Members for which monetary
damages alone would not adequately compensate. Therefore, each Member
unconditionally and irrevocably agrees that any non-breaching Member shall be
entitled to seek protective orders, injunctive relief and other remedies
available at law or in equity (including, without limitation, seeking specific
performance or the rescission of purchases, sales and other Transfers not made
in strict compliance with this Agreement).

(g) No Member shall have a right to withdraw as a Member (except pursuant to a
Transfer by a Member of all of its Units effected in accordance with this
Agreement) or withdraw such Member’s capital from the Company.

Section 5.2 Tag-Along Rights

(a) If the Cerberus Funds, the Keane Parties and/or an assignee thereof (a
“Tag-Along Selling Member”) proposes to Sell (a “Tag-Along Sale”), in one
transaction or a series of transactions, more than 25% (in the case of the
Cerberus Funds taken as a whole) or 50% (in the case of the Keane Parties taken
as a whole), of the Units it Holds as of the date hereof to any Person (other
than (A) one or more of its Affiliates or (B) a Sale by any of the Keane Parties
and/or their Affiliates, on the one hand, to the Cerberus Funds and/or their

 

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Affiliates, on the other hand), and Trican does not elect to exercise its rights
under the Existing Holder ROFO, the Tag-Along Selling Member shall give written
notice (a “Tag-Along Notice”) of such proposed Tag-Along Sale to the other
Members Holding Class A Units, vested Class B Units (including unvested Class B
Units that will become vested as a result of the Sale) and Class C Units at such
time (the “Tag-Along Members”) and the Company at least 20 days prior to the
consummation of such proposed Tag-Along Sale setting forth:

(i) the total number and classification of Units proposed to be Sold or
previously sold in the Tag-Along Sale (the “Tag-Along Offered Units”);

(ii) the purchase consideration per Tag-Along Offered Unit;

(iii) the identity of the purchaser;

(iv) any other material terms and conditions of the proposed Tag-Along Sale;

(v) the expected date of the proposed Tag-Along Sale; and

(vi) an undertaking that each Tag-Along Member shall have the right (the
“Tag-Along Right”) to elect to sell Units in an amount equal to its Pro Rata
Portion of such Tag-Along Offered Units in accordance with the procedures set
forth in this Section 5.2.

(b) Upon delivery of a Tag-Along Notice, each Tag-Along Member shall have the
right, but not the obligation, to sell an amount equal to all but not part of
its Pro Rata Portion of the aggregate Tag-Along Offered Units (i) in the case of
a Sale of Class A Units, at the same price as a Class A Unit; provided, that if
the proceeds from such Tag-Along Sale together with the proceeds of all previous
Tag-Along Sales are sufficient to cause distributions under Section 7.1 to
Holders of Class B Units or Class C Units, the Holders of such Units shall be
entitled to participate in the Tag-Along Sale or (ii) in the case of a Sale of
Class B Units or Class C Units, as if a distribution was being made to each of
the Members under Section 7.1 in an amount equal to the implied equity value of
the Tag-Along Sale, as such value is reasonably determined in good faith by the
Management Board, and, in each case, for the same form of consideration and
pursuant to the same terms and conditions as set forth in the Tag-Along Notice.
If a Tag-Along Member wishes to participate in the Tag-Along Sale, it shall
provide written notice to the Tag-Along Selling Member and the Company no later
than ten days after the date of the Tag-Along Notice, indicating its election to
sell an amount equal to its Pro Rata Portion of such Tag-Along Offered Units.
Such notice shall set forth the number of Units that such Tag-Along Member
elects to include in the Tag-Along Sale (and with respect to any Class B Units
or Class C Units, shall include a reasonably detailed calculation of the number
of Class B Units or Class C Units, as applicable, that are proposed to be sold
in connection with the Tag-Along Sale), which number in each case shall be equal
to its Pro Rata Portion of the Tag-Along Offered Units. The election of each
Tag-Along Member contained in such holder’s written notice shall be irrevocable,
and such Tag-Along Member shall be bound and obligated to sell in the Tag-Along
Sale on the same terms and conditions as the Tag-Along Selling Member; provided,
however, that, except as otherwise provided in this Section 5.2(b), the
Tag-Along Selling Member shall not consummate the Tag-Along Sale unless all of
the Units requested to be

 

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included in the Tag-Along Sale by the Tag-Along Members will be purchased on the
same terms and conditions as for the Tag-Along Selling Member; provided,
further, that in the event that the number of Units which the Tag-Along Selling
Member and the Tag-Along Members elect to sell in the Tag-Along Sale is more
than the Tag-Along Offered Units, to the extent that the purchaser in the
Tag-Along Sale does not elect to purchase such excess Units, the number of Units
to be Sold by the Tag-Along Selling Member and each Tag-Along Member shall be
reduced pro rata based on the proportion which the number of Units which each
such Person elects to have included in the Tag-Along Sale bears to the total
number of Units elected by all such Persons to have included in the Tag-Along
Sale.

(c) No Tag-Along Member shall be required to make any covenants, representations
or warranties in connection with a Tag-Along Sale which (i) are not being made
by the Tag-Along Selling Member and the other Tag-Along Members, (ii) relate to
the Tag-Along Selling Member or any other Tag-Along Member or (iii) are not
consistent with the Tag-Along Notice. No Tag-Along Member shall be liable in
respect of any indemnification provided in connection with a Tag-Along Sale
(x) for the breach of any covenants, representations or warranties made by the
Tag-Along Selling Member or any other Tag-Along Member, (y) other than on a
several (and not a joint and several) basis with the Tag-Along Selling Member
and the other Tag-Along Members and (z) to the extent not consistent with the
Tag-Along Notice. If a Tag-Along Sale is consummated, each Tag-Along Member
agrees to pay its pro rata share of the reasonable costs incurred by the
Tag-Along Selling Member relating to the Tag-Along Sale (including, without
limitation, reasonable legal fees and expenses), based on such Tag-Along
Member’s pro rata share in the net proceeds from such Tag-Along Sale, to the
extent not paid or reimbursed by the Company or the purchaser. The closings of
the Sales by the Tag-Along Selling Member and any Tag-Along Members shall occur
simultaneously and be conditioned upon each other.

(d) The Tag-Along Selling Member shall have the right for a period of 180 days
after the expiration of the ten day period referred to in Section 5.2(b) to
consummate the Tag-Along Sale at a price not greater than the price contained
in, and otherwise on terms and conditions not materially more favorable to the
Tag-Along Selling Member, taken as a whole, than those set forth in, the
Tag-Along Notice. After the end of the 180 day period referred to in this
Section 5.2(d), any proposed Sale of Units by a Tag-Along Selling Member shall
be subject to the provisions of this Section 5.2, which shall apply de novo.

(e) Notwithstanding anything to the contrary in this Agreement, no Management
Member will have a Tag-Along Right, unless approved by the Management Board,
with respect to any Tag-Along Sale unless the Cerberus Funds are Selling Units
in connection with such Tag-Along Sale.

(f) The Tag-Along Rights provided in this Section 5.2 shall expire upon the
consummation of an Initial Public Offering of the Company.

 

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Section 5.3 Drag-Along Rights

(a) From time to time and at any time, if the Cerberus Funds (together, the
“Dragging Member”) propose to Sell all of their Units then Held, which Units
represent more than 50% of the Units they Hold as of the Effective Date, to an
unaffiliated third party for consideration in the form of cash or securities
that are of a class listed or quoted for trading on one or more U.S. national
securities exchanges on such date (a “Drag-Along Sale”) and Trican does not
elect to exercise its rights under the Existing Holder ROFO, the Dragging Member
shall have the right, but not the obligation, to require the other Members
(including the Management Members) (each, a “Dragged Member”, and collectively,
the “Dragged Members”) to:

(i) sell all of their Units (including the Class C Units), with the proceeds of
that sale by the Cerberus Funds and the other holders allocated among the
parties as if they were distributed in accordance with Section 7.1;

(ii) vote or cause their respective Manager(s) to vote all of their Units that
are entitled to vote in favor of the transactions necessary or appropriate to
consummate the Drag-Along Sale; and

(iii) take such other actions as may be reasonably requested by the Dragging
Member or the Company to give effect to the Drag-Along Sale (collectively, the
“Drag-Along Rights”).

(b) Each Member affirms and agrees that it will (i) refrain from exercising any
dissenters’ rights, rights of appraisal or any similar rights under applicable
Law at any time with respect to a Drag-Along Sale and (ii) vote or cause its
Manager(s) to vote for the approval of the transactions constituting the
Drag-Along Sale under this Section 5.3, in each case as a condition of this
Agreement and as such is coupled with an interest and is irrevocable. This
voting agreement shall remain in full force and effect throughout the time that
this Section 5.3 is in effect.

(c) The Dragging Member shall, promptly upon determining the terms of the
Drag-Along Sale, deliver to the Dragged Members written notice specifying the
material terms of the Drag-Along Sale (including, without limitation, the
identity of the purchaser to which the Drag-Along Sale is proposed to be made,
the nature of the purchase consideration, estimated net proceeds from the
Drag-Along Sale and the expected closing date of the proposed Drag-Along Sale).

(d) In connection with the Drag-Along Sale, each Member shall (i) make or agree
to representations and warranties relating to itself and its Units in respect of
clear title, due authority, required approvals and absence of conflicts, (ii) if
the Drag-Along Sale is consummated, pay its pro rata share of the reasonable
costs incurred by the Dragging Member relating to the Drag-Along Sale
(including, without limitation, reasonable legal fees and expenses), based on
such Member’s pro rata share in the net proceeds from such Drag-Along Sale, to
the extent not paid or reimbursed by the Company or the purchaser and
(iii) participate on a pro rata basis, based on such Member’s pro rata share in
the net proceeds from such Drag-Along Sale, in any hold-back, escrow, contingent
consideration or other similar items relating to the Drag-Along Sale.

 

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(e) Each of the Members agrees that it shall execute such other documents as the
Dragging Member may reasonably request in order to consummate the Drag-Along
Sale at the time specified by the Dragging Member.

(f) Except as expressly provided in this Section 5.3, the Dragging Member shall
have no obligation to any Member with respect to the sale of any Units owned by
such Member in connection with the Drag-Along Sale. Notwithstanding anything
herein to the contrary, the Dragging Member shall have no obligation to any
other Member as a result of any decision by the Dragging Member to accept or
consummate, or not to accept or consummate, any Drag-Along Sale (it being
understood that any and all such decisions shall be made by the Dragging Member
in their sole discretion).

(g) If a Dragged Member is required to sell all of its Class A Units pursuant to
a Drag-Along Sale, any unvested Class B Units that will not become vested Class
B Units as a result of the Drag-Along Sale in accordance with the Management
Incentive Plan, any Management Member’s MIP Agreement or any applicable award
agreements will be forfeited, any rights thereunder shall automatically
terminate and any Retained Distribution shall be distributed to the Members as
though such Retained Distribution were distributed pursuant to Section 7.1
immediately upon such Member’s forfeiture of its Class B Units.

(h) The Drag-Along Rights provided in this Section 5.3 shall expire upon the
consummation of an Initial Public Offering of the Company.

Section 5.4 Rights of First Refusal on New Issue Securities

(a) Subject to the exceptions set forth in Section 5.4(d), from and after the
Effective Date and until consummation of an Initial Public Offering, the Company
shall not issue, sell or exchange, agree or obligate itself to issue, sell or
exchange, or reserve or set aside for issuance, sale or exchange: (i) Units or
any other Equity Securities or (ii) any option, warrant or other right to
subscribe for, purchase or otherwise acquire Units or any other equity
securities or (iii) any securities convertible, exchangeable or exercisable for
or into Units or any other Equity Securities (collectively, “New Issue
Securities”), unless in each case the Company shall offer to sell each of the
Members then Holding Class A Units (“Eligible Stockholder”) its Proportionate
Class A Unit Percentage of any proposed issuance of New Issue Securities at the
same price and on the same terms at which the Company proposes to sell such New
Issue Securities, pursuant to the Management Board’s reasonable good faith
determination of Fair Market Value for such New Issue Securities, which shall
have been specified by the Company in a written offer delivered to each Eligible
Stockholder (the “Preemptive Right Notice”), which offer by its terms shall
remain open and irrevocable for a period of 15 days from receipt of the
Preemptive Right Notice. The offer of the Company to sell the New Issue
Securities shall expire after such 15 day period (“Exercise Period”).

(b) Within 15 days after receipt of the Preemptive Right Notice, each of the
Eligible Stockholders shall give notice to the Company of its intent to accept
(a “Notice of Acceptance”) the Company’s offer to purchase its Proportionate
Class A Unit Percentage of New Issue Securities, which communication shall be
delivered to the Company in accordance with Section 12.10. No later than five
Business Days following the expiration of the Exercise Period,

 

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the Company shall notify each Eligible Stockholder in writing of the number of
New Issue Securities that each Eligible Stockholder has agreed to purchase
(including, for the avoidance of doubt, where such number is zero) (the
“Over-allotment Notice”). Each Eligible Stockholder exercising its right in full
to purchase its Proportionate Class A Unit Percentage of New Issue Securities in
full (an “Exercising Member”) shall have a right of over-allotment such that if
any other Eligible Stockholder fails to exercise its right under this
Section 5.4 to purchase in full its Proportionate Class A Unit Percentage of New
Issue Securities (each, a “Non-Exercising Member”), such Exercising Member may
purchase its Proportionate Class A Unit Percentage of the New Issue Securities
that such Non-Exercising Member has failed to purchase by giving written notice
to the Company within five Business Days of receipt of the Over-allotment
Notice. If, after giving effect to the prior sentence, any New Issue Securities
remain unsubscribed, the Company shall be free to issue and sell such New Issue
Securities to any Person on the terms and conditions set forth in the Preemptive
Right Notice, at any time within 180 days after the expiration of such 15 day
period. Any New Issue Securities not sold within 180 days after the expiration
of such 15 day period shall continue to be subject to the requirements of this
Section 5.4.

(c) Upon the closing of any such purchase of New Issue Securities, which shall
include full payment to the Company of the purchase price therefor, the
exercising Eligible Stockholders (if any) shall purchase from the Company, and
the Company shall sell to such exercising Eligible Stockholder, the number of
New Issue Securities specified in the respective holder’s Notice of Acceptance,
upon the terms and conditions specified in the relevant Preemptive Right Notice.

(d) The rights of the Eligible Stockholders under this Section 5.4 shall not
apply to any New Issue Securities issued in connection with any grant, exchange
or Sale of Units as consideration in any merger, consolidation or other
acquisition of any Person, business, division, or assets approved by the
Management Board.

Section 5.5 Trican Right of First Offer; Call Option on Trican Units

(a) Following the expiration of the Restricted Period, if at any time Trican
proposes to Transfer any Units Held by it other than in connection with a
Drag-Along Sale or Tag-Along Sale (the “Trican ROFO Units”), each of the
Cerberus Funds and the Keane Parties (together, the “Existing Holders”) shall
have the right, but not the obligation, to purchase its Proportionate Class A
Unit Percentage of such Units on the terms and subject to the conditions set
forth in this Section 5.5 (the “Trican ROFO”); provided, that the Existing
Holders’ rights pursuant to this Section 5.5 shall apply only to the collective
purchase of all and not less than all of such Trican ROFO Units.

(b) Trican shall deliver a written offer to the Existing Holders of its
intention to Transfer the Trican ROFO Units (the “Trican ROFO Notice”),
describing (i) the total number and classification of Units intending to be
Transferred, (ii) the price per Unit intended to be Transferred, (iii) the
identity of the purchaser and (iv) any other material terms and conditions of
the intended Transfer, which offer by its terms shall remain open and
irrevocable during the Exercise Period.

 

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(c) Within 15 days after receipt of the Trican ROFO Notice, each of the Existing
Holders shall give notice to Trican of its intent to accept (a “Trican ROFO
Acceptance”) Trican’s offer to purchase its Proportionate Class A Unit
Percentage of the Trican ROFO Units, which communication shall be delivered to
Trican in accordance with Section 12.10. No later than five Business Days
following the expiration of the Exercise Period, Trican shall notify each of the
Existing Holders in writing of the number of Trican ROFO Units that each of the
Existing Holders has agreed to purchase (including, for the avoidance of doubt,
where such number is zero) (the “Trican ROFO Over-allotment Notice”). Each of
the Existing Holders exercising its right in full to purchase its Proportionate
Class A Unit Percentage of Trican ROFO Units (a “Trican ROFO Exercising Member”)
shall have a right of over-allotment such that if any of the Existing Holders
fails to exercise its right under this Section 5.5 to purchase in full its
Proportionate Class A Unit Percentage of Trican ROFO Units (each, a “Trican ROFO
Non-Exercising Member”), such Trican ROFO Exercising Member may purchase its
Proportionate Class A Unit Percentage of the Trican ROFO Units that such Trican
ROFO Non-Exercising Member has failed to purchase by giving written notice to
Trican within five Business Days of receipt of the Trican ROFO Over-allotment
Notice. If, after giving effect to the prior sentence, all of the Trican ROFO
Units have not been agreed to be purchased by the Trican ROFO Exercising
Members, Trican shall be free to issue and sell all such Trican ROFO Units to
any Person on the terms and conditions and at the price no more favorable than
those set forth in the Trican ROFO Notice, at any time within 180 days after the
expiration of such 15 day period and the Trican ROFO Exercising Members shall
not be entitled to purchase any of the Trican ROFO Units. Any Trican ROFO Units
not sold within 180 days after the expiration of such 15 day period shall
continue to be subject to the requirements of this Section 5.5.

(d) Upon the closing of any such purchase of Trican ROFO Units, which shall
include full payment to Trican of the purchase price therefor, the Trican ROFO
Exercising Members (if any) shall purchase from Trican, and Trican shall sell to
such Trican ROFO Exercising Members, the number of Trican ROFO Units specified
in the respective holder’s Trican ROFO Acceptance, upon the terms and conditions
specified in the relevant Trican ROFO Notice.

(e) Call Option.

(i) Notwithstanding anything to the contrary in this Section 5.5, (i) the Trican
ROFO shall not apply to (A) a Sale or Transfer of all or substantially all of
the assets of Trican in one or a series of related transactions that do not
involve the Sale or Transfer of Trican’s Units separately from the Sale or
Transfer of all or substantially all of the assets of Trican or (B) any transfer
or sale of any equity interests of Trican Parent (including any indirect or
direct sale or transfer, whether by merger, amalgamation or reorganization) so
long as such sale or transfer does not involve the Sale or Transfer of Trican’s
Units separately from the direct or indirect sale or transfer of the equity
interests of Trican Parent and (ii) the Trican ROFO shall not in and of itself
prevent Trican from pledging or otherwise encumbering any Units (the “Pledged
Units”) Held by it to any lenders or financing sources (collectively, the
“Financing Sources”) in order to obtain or retain financing; provided, that each
of the Existing Holders shall have the option, but not the obligation, to
purchase any such Pledged Units for Fair Market Value (and in the case of any
Pledged Units that are Class C Units, such Fair Market Value shall be calculated
as if such Class C Units were converted to Class A Units on a fully diluted
basis

 

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based on the Fair Market Value for such Units immediately prior to exercise of
the Call Option) (as determined by an independent valuation firm selected by the
Management Board (unless a prior valuation has been undertaken in the 90 day
period prior to such calculation of Fair Market Value, in which case Fair Market
Value shall be based on such prior valuation)) in connection with any
foreclosure or other security enforcement action with respect to such Pledged
Units (the “Call Option”) on the terms set forth in this Section 5.5(e).

(ii) Trican shall require its Financing Sources to notify the Existing Holders
(a “Foreclosure Notice”) of the bona fide intention by the Financing Sources to
foreclose on or take any other security enforcement action with respect to any
Pledged Units at the same time as Trican or its Affiliates are so notified.
Within ten days of receipt of any Foreclosure Notice, each of the Existing
Holders must notify the other Existing Holders of its intention, if any, to
exercise the Call Option for some or all of the Pledged Units; provided, that if
more than one Existing Holder has provided notice of an intent to exercise the
Call Option for a proportion of the Pledged Units in excess of their respective
Proportionate Class A Unit Percentages, then such Existing Holders shall
exercise such Call Option for up to their relative Proportionate Class A Unit
Percentage as between such Existing Holders.

(iii) Subject to Section 5.5(e)(ii), each of the Existing Holders shall notify
Trican, the other Existing Holders and the applicable Financing Sources in
writing (the “Call Option Exercise Notice”) of their intention to exercise the
Call Option within 60 days from the date on which the Existing Holders receive
the Foreclosure Notice and the purchase of such Pledged Units pursuant to such
Call Option shall be consummated within 30 days from delivery of the Call Option
Exercise Notice.

(iv) Notwithstanding anything to the contrary, Trican shall cause such Financing
Sources to (A) take such pledge or encumbrance on the Pledged Units from Trican
subject to the Existing Holder’s right to the Call Option hereunder and (B) not
take any foreclosure or other security enforcement action with respect to the
Pledged Units until at least 61 days after receipt by the Existing Holders of
the Foreclosure Notice unless the Existing Holders have provided notice to
Trican and such Financing Sources of their intention not to exercise their
rights to the Call Option during such time.

Section 5.6 Existing Holder ROFO

(a) Subject to Section 5.1 and the other provisions of this Section 5.6, (i) if
at any time the Cerberus Funds or (ii) following the expiration of the
Restricted Period, any of the Keane Parties, or any assignee thereof (as
applicable, a “Selling Holder”) proposes to Transfer any Units Held by it (the
“Existing Holder ROFO Units”), other than in connection with a Transfer among
the Keane Parties or between a Keane Party and such Keane Party’s Family Member,
the Cerberus Funds (to the extent Cerberus Funds are not a Selling Holder) and
Trican shall have the right, but not the obligation, to purchase such Units on
the terms and subject to the conditions set forth in this Section 5.6 (the
“Existing Holder ROFO”); provided, that the Cerberus Funds’ and Trican’s right
pursuant to this Section 5.6 shall apply only to the collective purchase of all
and not less than all of such Existing Holder ROFO Units.

 

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(b) The Selling Holder shall deliver a written offer to the Cerberus
Representative and Trican of its intention to Transfer the Existing Holder ROFO
Units (the “Existing Holder ROFO Notice”), describing (i) the total number and
classification of Units intending to be Transferred, (ii) the price per Unit
intended to be Transferred and (iii) any other material terms and conditions of
the intended Transfer, which offer by its terms shall remain open and
irrevocable during the Exercise Period.

(c) Within 15 days after receipt of the Existing Holder ROFO Notice, each of the
Cerberus Representative and Trican shall give notice to the other party and the
Selling Holder (unless the Selling Holder is a Cerberus Fund) of its intent to
accept (an “Existing Holder ROFO Acceptance”) the Selling Holder’s offer to
purchase the Existing Holder ROFO Units, which communication shall be delivered
in accordance with Section 12.10; provided, that in the event that the Cerberus
Representative has delivered an Existing Holder ROFO Acceptance, such Existing
Holder ROFO Acceptance shall take priority over that (if any) delivered by
Trican, and the Cerberus Representative may, at its discretion, by providing
notice to Trican and the Selling Holder within three Business Days of receipt of
the Existing Holder ROFO Acceptance, elect to purchase, on behalf of the
Cerberus Funds, up to all of the Existing Holder ROFO Units and any Existing
Holder ROFO Units that Trican has elected to purchase shall be reduced
accordingly. In the event that Trican submits an Existing Holder ROFO
Acceptance, Trican shall contemporaneously with such Existing Holder ROFO
Acceptance provide to the Selling Holder evidence demonstrating to the
reasonable satisfaction of the Selling Holder that Trican has at such time and
will have, at the time of the closing of the purchase of the Existing Holder
ROFO Units, sufficient cash on hand to make such purchase. No later than five
Business Days following the expiration of the Exercise Period (such Exercise
Period to be extended by the additional time period referenced in the previous
proviso to the extent the previous proviso is applicable), the Selling Holder
shall notify each of the Cerberus Representative and Trican in writing of the
number of Existing Holder ROFO Units that the Cerberus Funds and Trican,
respectively, may purchase (including, for the avoidance of doubt, where such
number is zero and taking into account the foregoing proviso). If, after the
termination of the Exercise Period, all of the Existing Holder ROFO Units have
not been agreed to be purchased by the Cerberus Funds or Trican, the Selling
Holder shall be free to issue and sell all Existing Holder ROFO Units to any
Person on the terms and conditions and at the price no more favorable than those
set forth in the Existing Holder ROFO Notice, at any time within 180 days after
the expiration of such 15 day period and each of the Cerberus Funds and Trican
shall not be entitled to purchase any of the Existing Holder ROFO Units. Any
Existing Holder ROFO Units not sold within 180 days after the expiration of such
15 day period shall continue to be subject to the requirements of this
Section 5.6.

(d) Upon the closing of any such purchase of Existing Holder ROFO Units, which
shall include full payment to the Selling Holder of the purchase price therefor,
the Existing Holder ROFO Exercising Members (if any) shall purchase from the
Selling Holder, and the Selling Holder shall sell to such Existing Holder ROFO
Exercising Members, the number of Existing Holder ROFO Units specified in the
respective holder’s Existing Holder ROFO Acceptance, upon the terms and
conditions specified in the relevant Existing Holder ROFO Notice.

 

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ARTICLE VI.

ALLOCATIONS

Section 6.1 General Rules; Allocation of Profits and Losses

Except as otherwise provided in this Article VI, Profits and Losses for any
taxable period shall be allocated among the Members in such manner that, as of
the end of such taxable period, the respective Capital Accounts of the Members
shall be equal to the respective amounts that would be distributed to them,
determined as if the Company were to (i) liquidate the assets of the Company for
an amount equal to their Gross Asset Value and (ii) distribute the proceeds of
liquidation pursuant to Section 10.3.

Section 6.2 Other Allocation Rules

(a) For purposes of determining the Profits, Losses or other items allocable to
any taxable period, Profits, Losses and such other items shall be determined on
a daily, monthly or other basis as determined by the Management Board in its
reasonable discretion using any permissible method under Code Section 706 and
the Regulations thereunder.

(b) The Members are aware of the United States federal income tax consequences
of the allocations made by this Article VI and hereby agree to be bound by the
provisions of this Article VI in reporting their shares of Company income and
loss for income tax purposes.

(c) All items of income, gain, loss, deduction, or credit and any other
allocations not otherwise provided for shall be allocated among the Members as
determined by the Management Board in its reasonable discretion.

(d) If a Member transfers all or a portion of its Units during any taxable
period, then Profits, Losses, each item thereof and all other items attributable
to the transferred interest for such taxable period shall be divided and
allocated between the transferor and the transferee by taking into account their
varying interests in the Company during the taxable period in accordance with
Section 706(d) of the Code, using any conventions permitted by Law and selected
by the Management Board.

(e) Tax returns shall be provided to the Management Board for review before
submission, and any reasonable requests by the Management Board for changes in
order to ensure compliance with such requirements shall be made, provided that
such changes shall not result in the amount of cash or other distributions to
any Member being affected or cause a material adverse tax or other effect for
any Member.

Section 6.3 Tax Allocations: Code Section 704(c)

(a) Subject to Section 6.3(f), for each taxable year, items of income,
deduction, gain, loss and credit shall be allocated for tax purposes among the
Members to reflect equitably the amounts which have been credited or debited to
the Capital Account of each such Member for such taxable year and prior taxable
years.

 

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(b) In accordance with Code Section 704(c) and the Regulations thereunder, items
of income, gain, loss, deduction and credit with respect to any property
contributed to the capital of the Company shall, solely for tax purposes, be
allocated among the Members so as to take account of any variation between the
adjusted tax basis of such property at the time of contribution to the Company
for federal income tax purposes and its initial Gross Asset Value at the time of
contribution using a method permitted by applicable Regulations under Code
Section 704(c), as determined by the Management Board in its reasonable
discretion.

(c) In the event the Gross Asset Value of any Asset is adjusted in accordance
with paragraph (b) of the definition of Gross Asset Value hereof, subsequent
allocations of items of income, gain, loss, deductions or credit with respect to
such asset shall take into account any variation between the adjusted tax basis
of such asset for federal income tax purposes and its Gross Asset Value in the
same manner as under Code Section 704(c) and the Regulations thereunder.

(d) The Company shall use its reasonable best efforts to specifically identify
individual shares of Keane Group Stock that correspond to any property
contributed by a Member for purposes of Code Section 704(c), and in the case of
a distribution of shares of Keane Group Stock to one or more Members or a sale
of shares of Keane Group Stock relating to a Member in connection with a
Sell-Down, the Company shall use its reasonable best efforts to distribute to
each such Member, or sell, as applicable, the shares of Keane Group Stock
identified with such Member.

(e) Subject to Section 6.3(d), if the Company distributes Keane Group Stock to
one or more Members in connection with a Sell-Down pursuant to Section 3.7(c),
then for U.S. federal income tax purposes, the taxable gain and taxable loss on
the Keane Group Stock sold in connection with such Sell-Down shall be specially
allocated, to the maximum extent permitted, among the Members who receive cash
from such Sell-Down proportionately and in a reasonable manner that reflects the
receipt of such cash.

(f) Any elections or other decisions relating to allocations for tax purposes,
basis adjustments or other tax matters shall be made by the Management Board in
its reasonable discretion. Allocations pursuant to this Section 6.3 are solely
for purposes of federal, state and local taxes and shall not affect, or in any
way be taken into account in computing, any Member’s Capital Account, share of
Profits or Losses, or other items or distributions pursuant to any provision of
this Agreement.

 

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ARTICLE VII.

DISTRIBUTIONS AND EXPENSES

Section 7.1 Distributions

Except for distributions made in accordance with Section 3.7, the Company shall
distribute (i) Cash Available for Distribution on a quarterly basis (or more
frequently when, as and if declared by the Management Board), (ii) other
property of the Company when, as and if declared by the Management Board and
(iii) any distributions in liquidation in accordance with Section 10.3, in each
case as follows:

(a) First, until the aggregate amount distributed under this Section 7.1(a)
equals $468,000,000, to the Class A Members pro rata in accordance with the
number of Class A Units held by such Class A Members at the time of such
distribution;

(b) Second, until the aggregate amount distributed under Section 7.1(a) and this
Section 7.1(b) equals the First Class C Threshold, to the Class A Members and to
the Class B Members that are entitled to distributions in accordance with the
Management Incentive Plan, the applicable MIP Award Agreement or resolution of
the Management Board (or, if applicable, the board of managers of Keane Group
Holdings, LLC prior to the Effective Date), pro rata in accordance with the
aggregate number of Class A Units and such Class B Units held by such Class A
Members and Class B Members, respectively, at the time of such distribution;

(c) Third, until the aggregate amount distributed under Section 7.1(a),
Section 7.1(b) and this Section 7.1(c) equals the Second Class C Threshold, 90%
to the Class A Members and to the Class B Members that are entitled to
distributions in accordance with the Management Incentive Plan, the applicable
MIP Award Agreement or resolution of the Management Board (or, if applicable,
the board of managers of Keane Group Holdings, LLC prior to the Effective Date),
pro rata in accordance with the aggregate number of Class A Units and such Class
B Units held by such Class A Members and Class B Members, respectively, at the
time of such distribution and 10% to the Class C Members pro rata in accordance
with the number of Class C Units held by such Class C Members at the time of
such distribution; and

(d) Thereafter, 80% to the Class A Members and to the Class B Members that are
entitled to distributions in accordance with the Management Incentive Plan, the
applicable MIP Award Agreement or resolution of the Management Board (or, if
applicable, the board of managers of Keane Group Holdings, LLC prior to the
Effective Date), pro rata in accordance with the aggregate number of Class A
Units and such Class B Units held by such Class A Members and Class B Members,
respectively, at the time of such distribution and 20% to the Class C Members
pro rata in accordance with the number of Class C Units held by such Class C
Members at the time of such distribution.

No Management Member shall be entitled to any such distribution with respect to
Class B Units to the extent that such Class B Units have not yet vested by the
terms pursuant to which such Class B Units were granted, but such distribution
shall be retained by the Company (the “Retained Distribution”) and paid to such
Management Member if and when such unvested Class B Units become vested Class B
Units; provided that: (i) if a Management Member forfeits his or her Class B
Units before such Class B Units vest, then any such Retained Distribution shall
be distributed to the Members in accordance with clause (a), clause (b) and
clause (c) of this Section (but subject to this paragraph) immediately upon such
Management Member’s forfeiture of its Class B Units; and (ii) upon the vesting
of any Class B Units in respect of which the Company holds any Retained
Distribution, the portion of the Retained Distribution which is attributable to
such newly vested Class B Units shall be distributed to the Management Member
holding such Class B Units.

 

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Section 7.2 Amounts Withheld

All amounts withheld or paid pursuant to the Code or any provisions of state,
local or foreign tax Law with respect to any payment, distribution, allocation
or other consideration paid to the Members, including in connection with a
contribution of assets to the Company by a Member, shall be treated as amounts
paid or distributed, as the case may be, to the Members with respect to which
such amount was withheld or paid pursuant to this Section 7.2 for all purposes
under this Agreement. The Company is authorized to withhold or pay, when
required under applicable Law, from payments, distributions, or other
consideration paid to Members, and with respect to allocations to the Members,
and to pay over to any federal, state, local or foreign government any amounts
required to be so withheld or paid pursuant to the Code or any provisions of any
federal, state, local or foreign Law, and shall allocate any such amounts to the
Members with respect to which such amounts were withheld or paid.

Section 7.3 Expenses

Except as otherwise provided in this Agreement, the Company shall pay or cause
to be paid all costs and expenses arising from the organization and operations
of the Company. The Company shall reimburse the Managers, officers, employees,
“authorized persons” and other agents of the Company for reasonable
out-of-pocket expenses incurred by them on behalf of the Company. Subject to
Section 3.6, each Member shall otherwise be responsible for all costs and
expenses incurred by such Member in the performance of its obligations under
this Agreement.

Section 7.4 Tax Distributions

The Management Board may, in its reasonable discretion, cause the Company to
make distributions to each Member (to the extent that cash is available for such
distributions, after necessary expenses and reserves in accordance with this
Agreement and as otherwise determined by the Management Board or as may be
required by such Member’s employment agreement or any Side Letter) so that each
such Member may pay its taxes with respect to its share of the taxable income of
the Company for a taxable year or other taxable period. If the Management Board
determines that enough cash is available for such distributions, then the
Management Board shall calculate the amount of any such distributions by
applying the highest marginal effective tax rate applicable to a corporation
doing business in New York, New York to each Member and may make such
distributions to the extent that cash is available. Any distribution made to a
Member pursuant to this Section 7.4 shall be made as soon as practicable after
the end of the taxable year or other taxable period for which such distribution
is being made. Any distribution made to a Member shall reduce the amount
distributable to such Member from the Company under Section 7.1.

Section 7.5 Trican Repayment

Notwithstanding anything to the contrary in this Agreement, in the event that
any amounts are distributable to Trican under this Agreement prior to the full
Trican Repayment (including accrued interest thereon), or satisfaction thereof
in accordance with Section 2.2(b), then any such amounts that would otherwise be
distributable to Trican shall be distributed to the applicable Cerberus Funds,
as designated by the Cerberus Representative, until the full amount of the
Cerberus Contribution Loan (including accrued interest thereon) has been repaid.

 

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ARTICLE VIII.

OTHER TAX MATTERS

Section 8.1 Tax Matters Member

The Company and each Member hereby designate (a) Cerberus Institutional Partners
V, L.P. as the “tax matters partner” of the Company for purposes of Code
Section 6231(a)(7) and (b) Cerberus Institutional Partners V, L.P. as a
“partnership representative” of the Company under Section 6223 of the Code (as
amended by the Budget Act), and the Management Board is hereby authorized to
take any actions necessary or appropriate for Cerberus Institutional Partners V,
L.P. to be designated as a “partnership representative under such Section (the
person designated in the preceding clauses (a) or (b), the “Tax Matters
Member”).The Management Board (after consultation with the Tax Matters Member)
shall: (a) cause to be prepared and timely filed by the Company all United
States federal, state and local income tax returns of the Company for each year
for which such returns are required to be filed; and (b) determine the
appropriate treatment of each item of income, gain, loss, deduction and credit
of the Company and the accounting methods and conventions under the tax Laws of
the United States, the several states and other relevant jurisdictions as to the
treatment of any such item or any other method or procedure related to the
preparation of such tax returns. Subject to the express provisions of this
Agreement, the Management Board may in its reasonable discretion cause the
Company to make or refrain from making any and all elections permitted by such
tax Laws.

Section 8.2 Furnishing Information to Tax Matters Member

Each Member shall furnish to the Tax Matters Member such information (including
information specified in Code Section 6230(e)) as such Tax Matters Member may,
at its reasonable discretion, request to permit it to provide the Internal
Revenue Service with sufficient information to allow proper notice to the
Members in accordance with Code Section 6223 or any other provisions of the Code
or the published regulations thereunder which require the Tax Matters Member to
obtain information from the Members.

Section 8.3 Tax Claims and Proceedings

In respect of any income tax audit of any tax return of the Company, the filing
of any amended return or claim for refund in connection with any item of income,
gain, loss, deduction or credit reflected on any income tax return of the
Company, or any administrative or judicial proceedings arising out of or in
connection with any such audit, amended return, claim for refund or denial of
such claim, (a) all expenses reasonably incurred by the Tax Matters Member in
connection therewith shall be expenses of the Company, (b) in any material
proceeding the Tax Matters Member shall promptly take such action as may be
necessary to cause each of the other Members to become a “notice partner” within
the meaning of Code Section 6231(a)(8), in respect of any taxable year governed
by such Section, (c) in any material proceeding the Tax Matters Member shall
furnish to the other Members a copy of all material

 

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notices or other written communications received by the Tax Matters Member from
the Internal Revenue Service (except such notices or communications as are sent
directly to the Members), and (d) in any material proceeding the Tax Matters
Member shall notify the other Members of all material conversations it has with
the relevant taxing authority and shall keep the other Members reasonably
informed of all material matters which may come to its attention in its capacity
as Tax Matters Member. The Tax Matters Member is hereby authorized to take any
action required to cause the financial burden of any “imputed underpayment” (as
determined under Section 6225 of the Code, as amended by the Budget Act) (an
“Imputed Underpayment”) and associated interest, adjustments to tax and
penalties arising from a partnership-level adjustment that are imposed on the
Company to be borne by the Members and former Members to which such Imputed
Underpayment relates as determined by the Tax Matters Member after consulting
with the Company’s accountants or other tax advisors. By executing this
Agreement each Member (i) expressly authorizes the Tax Matters Member and the
Company to take all actions that are reasonably necessary to cause the Company
to make the election set forth in Section 6226 of the Code (as amended by the
Budget Act) if the Tax Matters Member decides to make that election, and
(ii) expressly agrees to take any action, and to deliver to the Tax Matters
Member as soon as reasonably practicable after receipt of a request therefor,
with any information within such Member’s possession and necessary to give
effect to such election. Each Member hereby severally indemnifies and holds the
Company and each other Member (including the Tax Matters Member) harmless from
and against such Member’s respective portion of the financial burden of any
Imputed Underpayment as provided in the preceding sentence.

Section 8.4 Books and Records

The Tax Matters Member shall use commercially reasonable efforts to provide tax
returns to all Members within 120 days after the end of the relevant fiscal
year. The books and records of the Company shall reflect all Company
transactions and shall be appropriate and adequate for the Company’s business.
The books and records of the Company shall include a record of each transfer of
participating interests of the Company. The taxable year of the Company for
federal income tax purposes shall be the calendar year or such other taxable
year as is required for U.S. federal income tax purposes. All books and records
of the Company shall be maintained at any office of the Company or at the
Company’s principal place of business in the United States, and each Member, and
any duly authorized representative, shall have access to them at such office of
the Company and the right to inspect and copy them at reasonable times. The
Company’s books of account shall be kept on an accrual basis or as otherwise
provided by the Management Board and otherwise in accordance with generally
accepted accounting principles, consistently applied, except that for income tax
purposes such books shall be kept in accordance with applicable tax accounting
principles (including the Regulations).

Section 8.5 Survival

The provisions of this Article VIII shall survive the termination of the Company
(as well as any termination, purchase or redemption of any Member’s interest in
the Company for any reason whatsoever), and shall remain binding on the Members
and all former Members for a period of time necessary to resolve with the
appropriate taxing authorities any and all material matters regarding the
taxation of the Company and its Members by reason of their percentage interests.

 

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ARTICLE IX.

REPRESENTATIONS AND WARRANTIES

Section 9.1 Representations and Warranties of Members

Each of the Members hereby represents and warrants to the Company and to each of
the other Members, as of the date hereof, that:

(a) If it is a corporation, a limited liability company or limited partnership,
it is as of the date hereof, duly incorporated or otherwise duly organized,
validly existing and in good standing under the Laws of the jurisdiction of its
incorporation or organization, and if it is a partnership, is as of the date
hereof, validly constituted and not dissolved, and, in each case, has the power
and lawful authority to own its assets and properties and to carry on its
business as now conducted.

(b) It has, as of the date hereof, the full right, power and authority to enter
into, execute and deliver this Agreement and to perform fully its obligations
hereunder. This Agreement has been, fully executed and delivered by such Member
and, assuming the due execution and delivery by the other parties, constitutes,
in the case of this Agreement, the valid and binding obligation of such Member,
enforceable in accordance with its terms, except as (i) such enforceability may
be limited by bankruptcy, reorganization or moratorium or other similar Laws
affecting the enforcement of creditors’ rights generally and (ii) the
availability of equitable remedies may be limited by equitable principles of
general applicability.

(c) No approval or consent of any Governmental Entity or of any other Person is
required in connection with the execution and delivery by it of this Agreement
and the consummation and performance by such member of the transactions
contemplated hereunder, except such as have been obtained and are in full force
and effect.

(d) The execution and delivery of this Agreement by it, the consummation of the
transactions contemplated hereunder and the performance by such Member of its
obligations under this Agreement, in accordance with the terms and conditions
hereof, will not, as of the date hereof, conflict with or result in the breach
or violation of any of the terms or conditions of, or constitute (or with notice
or lapse of time or both would constitute) a default under: (i) if it is a
corporation, a limited liability company, limited partnership or other entity,
the certificate of incorporation, by-laws, certificate of formation, limited
liability company agreement or other constitutive documents of such Member;
(ii) any instrument or contract to which such Member is a party or by or to
which it or its assets or properties are bound or subject; or (iii) any Law,
except, in each case, for such breaches violations or defaults that would not,
individually or in the aggregate, materially impair the ability of such Member
to perform its obligations hereunder.

(e) It understands that there are substantial risks to an investment in the
Company and it has both the sophistication to be able to fully evaluate the risk
of an investment in the Company and the capacity to protect its own interests in
making such investment. Such Member fully understands and agrees that the
investment in the Company is an illiquid investment.

 

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(f) If it is an Investor Member, it is a QIB or an “accredited investor” within
the meaning of the 1933 Act and is able to bear the economic risk of such an
investment in the Company for an indefinite period of time, that it has no need
for liquidity of this investment and it could bear a complete loss of this
investment. Each such Investor Member is either (i) a “qualified purchaser”
within the meaning of the 1940 Act or (ii) if the Member is an entity formed and
is being utilized primarily for the purpose of making an investment in the
Company, each beneficial owner of such Member’s securities is such a qualified
purchaser.

(g) It is acquiring its Units for investment solely for such Member’s own
account and not for distribution, Transfer or sale to others in connection with
any distribution or public offering. It understands that, irrespective of
whether or not the Units might be deemed “securities” under applicable Laws, the
Company is not obligated to register any Units for resale under the 1933 Act or
any applicable state securities Laws.

(h) It specifically understands and agrees that no other Member has made nor
will make any representation or warranty with respect to the worthiness, terms,
value or any other aspect of the Company, any Units or the Keane Group Stock and
it explicitly disclaims any warranty, express or implied, with respect to such
matters. In addition, such Member specifically acknowledges, represents and
warrants that (i) it is not relying on any other Member, for its own due
diligence concerning, or evaluation of, the Company or any related transaction
and (ii) that it is not relying on any other Member with respect to tax and
other economic considerations involved in an investment in the Company.

(i) No broker, investment banker, financial advisor or other Person is entitled
to any broker’s, finder’s, financial advisor’s or other similar fee or
commission in connection with the Company based upon arrangements made by or on
behalf of such Member.

Section 9.2 ERISA Representation

Each of the Members represents, warrants and covenants to each other Members and
to the Company that no portion of the assets being used by it to purchase and
hold its Units constitute assets of a plan within the meaning of Section 3(32)
of ERISA.

Section 9.3 Survival

The representations and warranties of the Members contained in this Agreement
shall survive the Effective Date.

 

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ARTICLE X.

DISSOLUTION AND TERMINATION OF THE COMPANY

Section 10.1 Dissolution

The Company shall be dissolved and its affairs wound up upon the entry of a
decree of judicial dissolution pursuant to Section 18-802 of the Act.

Section 10.2 Continuation of Interest of Member’s Representative

Notwithstanding anything contained herein, upon the expulsion, receivership,
dissolution or Bankruptcy of a Member, the personal representative,
trustee-in-bankruptcy, debtor-in-possession, receiver, other representative,
successor, heir or legatee (each, a “Representative”) of such Member shall,
subject to the provisions of Article V, immediately succeed to the Units of such
Member in the Company. Such Representative shall appoint an individual (which
may be such Representative) who will represent the Representative’s voting
interest, if any.

Section 10.3 Dissolution, Winding Up and Liquidation

(a) Upon the consummation of any dissolution, liquidation or similar event of
the Company, other than in connection with a Sale-of-the-Company, the Class C
Interests shall be converted into Class A Units; provided, that in such case
(i) the valuation of the Company shall be determined based upon the valuation
obtained in connection with such liquidation or dissolution event by a
nationally recognized independent valuation firm that is experienced with the
valuation of companies in similar businesses to the Company and (ii) the number
of converted Class A Units shall have an aggregate valuation equal to the dollar
amount that would be distributed to the Holders of the Class C Interests
pursuant to Section 7.1.

(b) Upon the consummation of any dissolution, liquidation or similar event of
the Company, the Company shall continue solely for purposes of winding up its
affairs in an orderly manner, liquidating its assets, and satisfying claims of
its creditors. The liquidator of the Company shall take full account of the
Company’s liabilities and property and shall cause the property or the proceeds
from the sale thereof, to the extent sufficient therefor, to be applied and
distributed, to the maximum extent permitted by Law, in the following order:

(i) first, to creditors (including Members who are creditors) in satisfaction of
all of the Company’s debts and other liabilities (including any liabilities
pursuant to any Unit repurchase obligation of the Company that are then due and
payable), including the expenses of the winding-up, liquidation and dissolution
of the Company (whether by payment or the making of reasonable reserves to
provide for payment thereof); and

(ii) second, to the Members in accordance with Section 7.1.

(c) Distributions pursuant to this Section 10.3 shall be made no later than the
end of the Fiscal Year during which the Company is liquidated (or, if later, 90
days after the date on which the Company is liquidated).

Section 10.4 Member Bankruptcy

(a) Notwithstanding any other provision of this Agreement, the Bankruptcy of a
Member shall not cause the Member to cease to be a member of the Company and
upon the occurrence of such an event, the Company shall continue without
dissolution.

 

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(b) Notwithstanding any other provision of this Agreement, each of the Members
waives any right it might have to agree in writing to dissolve the Company upon
the Bankruptcy of the Members, or the occurrence of an event that causes the
Member to cease to be a member of the Company.

ARTICLE XI.

INDEMNIFICATION AND CONTRIBUTION

Section 11.1 Exculpation and Indemnification

Each of the Covered Persons (each, an “Indemnitee”) shall, to the fullest extent
permitted by the Act or other applicable Law, be exculpated from, and
indemnified by, the Company against any liability, loss, damage, penalty,
action, claim, judgment, settlement, cost or expense of any kind or nature
whatsoever (including, without limitation, all reasonable attorneys’ fees, costs
and expenses of defense, appeal and settlement of any proceedings instituted
against such Indemnitee or the Company (or prior to the Effective Date, Keane
Group Holdings, LLC, as applicable) and all costs of investigation in connection
therewith) that relates to or arises out of, or is alleged to relate to or arise
out of, any action or inaction on the part of the Company (or prior to the
Effective Date, Keane Group Holdings, LLC, as applicable) or such Indemnitee
acting on behalf of the Company (or prior to the Effective Date, Keane Group
Holdings, LLC, as applicable) (collectively, “Indemnifiable Losses”), other than
acts or omissions involving fraud, willful misconduct, gross negligence or
knowing violations of criminal law. The Company shall advance expenses incurred
by such Indemnitee upon the receipt by the Company of the signed statement of
such Indemnitee agreeing to reimburse the Company for such advance in the event
it is ultimately determined that such Indemnitee is not entitled to be
indemnified by the Company for such expenses. No Indemnitee shall be liable
(i) for the acts, receipts, neglects, defaults or omissions of any other
Indemnitee or agent of the Company (or prior to the Effective Date, Keane Group
Holdings, LLC, as applicable), (ii) for any loss on account of defect of title
to any property of the Company (or prior to the Effective Date, Keane Group
Holdings, LLC, as applicable), (iii) on account of the insufficiency of any
security in or upon which any money of the Company (or prior to the Effective
Date, Keane Group Holdings, LLC, as applicable) shall be invested or (iv) for
any loss incurred through any bank, broker or other similar person. An
Indemnitee that is a Manager shall not be denied exculpation and
indemnification, or the advancement of expenses, in whole or in part, under this
Section 11.1 solely because such Indemnitee had an interest in the transaction
with respect to which the exculpation, indemnification or advancement of
expenses is related if the transaction was otherwise permitted by the terms of
this Agreement. Notwithstanding the foregoing, (A) the Keane Parties shall
remain liable for breaches of their representations, warranties and covenants
contained in the Initial Purchase Agreement, and nothing herein (including the
execution of this Agreement) shall expand or reduce the Keane Parties’
indemnification obligations under the Initial Purchase Agreement, (B) Trican
shall remain liable for breaches of its representations, warranties and
covenants contained in the Trican Purchase Agreement, and nothing herein shall
affect Trican’s indemnification obligations under the Trican Purchase Agreement
and (C) Keane Group Holdings, LLC shall remain liable for breaches of its
representations, warranties and covenants contained in the Trican Purchase
Agreement, and nothing herein shall affect the Keane Group Holdings, LLC’s
indemnification obligations under the Trican Purchase Agreement.

 

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Section 11.2 Not Exclusive

The indemnification and advancement of expenses provided by or granted pursuant
to this Article XI shall not be deemed exclusive of any other rights to which
Indemnitees may be entitled under any agreement.

Section 11.3 Insurance

The Company may purchase and maintain insurance on behalf of any Person that is
or was a Member, Manager, officer, employee or agent of the Company (or prior to
the Effective Date, Keane Group Holdings, LLC, as applicable), or is or was
serving at the request of the Company (or prior to the Effective Date, Keane
Group Holdings, LLC, as applicable) as a Member, Manager, director, officer,
employee or agent of another organization, against any liability asserted
against him or her and incurred by him or her in any such capacity, or arising
out of his or her status as such, whether or not he or she would be entitled to
indemnity against such liability under the provisions of this Article XI.

Section 11.4 Beneficiaries

The indemnification and advancement of expenses provided by, or granted pursuant
to, this Article XI shall continue as to a Person that has ceased to be a
Member, Manager, officer, employee or agent with respect to the period in which
such Person is a Member, Manager, officer, employee or agent and shall inure to
the benefit of the executors and administrators of such a Person.

Section 11.5 Indemnification Procedure for Third Party and Other Claims

The Company shall have the right, but not the obligation, exercisable by written
notice to the Person seeking such indemnification hereunder (the “Indemnified
Party”) promptly but in any event no later than 30 days after receipt of written
notice from the Indemnified Party of the commencement of or assertion of any
claim, action, suit or proceeding by a third party in respect of which indemnity
may be sought hereunder (a “Third Party Claim”), to assume the defense and
control the settlement of such Third Party Claim that (a) involves (and
continues to involve) solely money damages or (b) involves (and continues to
involve) claims for both money damages and equitable relief against the
Indemnified Party that cannot be severed, where the claims for money damages are
the primary claims asserted by the third party and the claims for equitable
relief are incidental to the claims for money damages. The Indemnified Party
shall have the right to assume the defense and control the settlement of any
Third Party Claim (i) not described in clauses (a) or (b) of the preceding
sentence or (ii) described in clauses (a) or (b) of the preceding sentence whose
defense and control of settlement has not been promptly assumed by the Company.
The Company or the Indemnified Party, as the case may be, shall have the right
to participate in (but not control), at its own expense, the defense of any
Third Party Claim that the other is defending, as provided in this Agreement.
The Company, if it has assumed the defense of any Third Party Claim as provided
in this Agreement, shall not consent to a settlement of, or the entry of any
judgment arising from, any such Third Party Claim without the Indemnified
Party’s prior written consent (which consent shall not be unreasonably
withheld). The Company shall not, without the Indemnified Party’s prior written
consent, enter into any

 

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compromise or settlement which (x) commits the Indemnified Party to take, or to
forbear to take, any action or (y) does not provide for a complete release by
such third party of the Indemnified Party. The Indemnified Party shall have the
sole and exclusive right to settle any Third Party Claim, on such terms and
conditions as it deems reasonably appropriate, to the extent such Third Party
Claim involves equitable or other non-monetary relief against the Indemnified
Party, and shall have the right to settle any Third Party Claim involving money
damages for which the Company has not assumed the defense pursuant to this
Section 11.5 with the written consent of the indemnifying party, which consent
shall not be unreasonably withheld or delayed.

Section 11.6 Other Claims

In the event an Indemnified Party shall claim a right to payment pursuant to
this Agreement for other than a Third Party Claim, such Indemnified Party shall
send written notice of such claim to the indemnifying party. Such notice shall
specify the basis for such claim. As promptly as possible after the Indemnified
Party has given such notice, the Indemnified Party and the Company shall attempt
to resolve such claim by mutual agreement before resorting to other legal means
to resolve such claim.

Section 11.7 Limitation on Damages

Notwithstanding anything contained in this Agreement to the contrary, no party
shall be liable to the other party for any indirect, special, punitive,
exemplary or consequential loss or damage (including any loss of revenue or
profit) arising out of this Agreement including, without limitation, in respect
of any breach by any Member of this Agreement; provided, that the foregoing
shall not be construed to preclude recovery by the Indemnified Party in respect
of Indemnifiable Losses directly incurred from Third Party Claims. Any
Indemnitee shall take commercially reasonable actions to mitigate his, her, its
or their damages. The obligation of any Member to indemnify any Person(s)
pursuant to this Agreement is limited, in the aggregate for all claims, to such
Member’s Units, and no Person claiming indemnification or otherwise making any
claim against a Member shall have recourse against such Member for any
deficiency.

ARTICLE XII.

MISCELLANEOUS PROVISIONS

Section 12.1 Entire Agreement

This Agreement, the Member Contribution and Exchange Agreements, employment
agreements with the Company or one of its Affiliates, any Side Letters and the
Certificate of Formation constitute the complete and exclusive statement of the
agreement among the Members with respect to the subject matter contained herein
and therein. This Agreement, the Member Contribution and Exchange Agreements,
employment agreements with the Company or one of its Affiliates, any Side
Letters and the Certificate of Formation replace and supersede all prior
agreements by and among the Members with respect to the subject matter contained
herein and therein.

 

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Section 12.2 Amendments

(a) This Agreement may be amended from time to time in writing by a majority of
the Management Board; provided that any amendment that has a materially
disproportionate and adverse effect to a specific holder of Units shall require
the written consent of such holder (provided, further, that any materially
disproportionate and adverse effect to a holder resulting from the failure of
such holder to exercise a right to participate on a proportionate basis and
otherwise on the basis of the governance provisions set forth in this Agreement
in a transaction effected in accordance with this Agreement shall be disregarded
for purposes of this Section 12.2). For the avoidance of doubt, subject to
Section 3.2(c), this Agreement may be amended from time to time in writing by a
majority of the Management Board to the extent necessary or appropriate in the
judgment of a majority of the Management Board to reflect the rights of any
Equity Securities issued by the Company in accordance with this Agreement.
Notwithstanding anything herein to the contrary, if Treasury Regulations or
other administrative announcements promulgated under the provisions of the
Bipartisan Budget Act of 2015 are adopted as final (or temporary) rules (the
“New Rules”), the Management Board is authorized to make such amendments to this
Agreement (including provision for any safe harbor election authorized by the
New Rules) as the Managers may determine to be necessary or advisable to comply
with, administer or reflect the New Rules and to administer the effects of such
provisions in an equitable manner; provided, that such amendments do not
materially alter the economic rights of the Members under this Agreement other
than the timing of distributions pursuant to Article VII.

(b) Notwithstanding the foregoing, for as long as: (i) Trican has voting
approval rights in connection with Section 3.2(c)(i), subject to
Section 3.2(c)(iii), the definition of “Major Decision” (or if Trican ceases to
Hold at least 50% of the Class A Units Held by it on the Effective Date as
provided in Section 3.2(c)(iii), solely with respect to items (i), (ii), (iv),
(v), (viii)-(xi) and (xiv) of the definition of “Major Decision”) shall not be
amended or modified without the prior written consent of Trican; and (ii) the
Keane Parties have voting approval rights in connection with Section 3.2(c)(i),
subject to Section 3.2(c)(ii), the definition of “Major Decision” (or if the
Keane Parties cease to Hold at least 50% of the Class A Units Held by them on
the Effective Date as provided in Section 3.2(c)(ii), solely with respect to
items (i), (ii), (iv), (v), (viii)-(xi) and (xiv) of the definition of “Major
Decision”) shall not be amended or modified without the prior written consent of
the Keane Representative acting on behalf of the Keane Parties Holding in excess
of 50% of the Class A Units then Held by the Keane Parties.

Section 12.3 Applicable Law; Venue

(a) The laws of the State of Delaware, without reference to conflict of laws
principles, shall govern the validity, construction and interpretation of this
Agreement and the Certificate of Formation.

(b) Each party to this Agreement hereby irrevocably agrees that any legal action
or proceeding arising out of or relating to this Agreement or any agreements or
transactions contemplated hereby may be brought exclusively in the Chancery
Court of the State of Delaware and hereby expressly submits to the personal
jurisdiction and venue of such court for the purposes thereof and expressly
waives any claim of improper venue and any claim that such courts are an
inconvenient forum. Each party hereby irrevocably consents to the service of
process of any of the aforementioned courts in any such suit, action or
proceeding by the mailing of copies thereof by registered or certified mail,
postage prepaid, to the address provided to the Company in accordance with
Section 12.10, such service to become effective ten days after such mailing.

 

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Section 12.4 Enforcement

In the event of an action, suit or proceeding initiated by one Member against
another Member or the Company involving the enforcement of its rights hereunder,
the prevailing party shall be entitled to indemnification from the other party
of reasonable attorneys’ fees and expenses incurred in enforcing its rights in
such action, suit or proceeding in accordance with this Section, or in
accordance with an employment agreement.

Section 12.5 Headings

The headings in this Agreement are inserted for convenience only and are in no
way intended to describe, interpret, define, or limit the scope, extent or
intent of this Agreement or any provisions contained herein.

Section 12.6 Severability

If any provision of this Agreement or the application thereof to any Person or
circumstance shall be deemed invalid, illegal or unenforceable to any extent,
the remainder of this Agreement and the application thereof shall not be
affected and shall be enforceable to the fullest extent permitted by Law.

Section 12.7 Counterparts

This Agreement may be executed in several counterparts with the same effect as
if the parties executing the several counterparts had all executed one
counterpart.

Section 12.8 Filings

Following the execution and delivery of this Agreement, representatives of the
Company, shall promptly prepare any documents required to be filed and recorded
under the Act, and such representatives shall promptly cause each such document
to be filed and recorded in accordance with the Act and, to the extent required
by local Law, to be filed and recorded or notice thereof to be published in the
appropriate place in each jurisdiction in which the Company may hereafter
establish a place of business. Such representatives, shall also promptly cause
to be filed, recorded and published such statements of fictitious business name
and any other notices, certificates, statements or other instruments required by
any provision of any applicable Law of the United States or any state or other
jurisdiction which governs the conduct of its business from time to time.

Section 12.9 Additional Documents

Each Member agrees to perform all further acts and to execute, acknowledge and
deliver any documents that may be reasonably necessary to carry out the
provisions of this Agreement.

 

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Section 12.10 Notices

All notices, requests and other communications to any party hereunder shall be
in writing (including facsimile) and shall be effective and deemed delivered or
given, as the case may be, (a) if given by facsimile, when transmitted and the
appropriate confirmation is received from the machine transmitting such
facsimile, and followed by hard copy via overnight mail or reputable overnight
courier for receipt the next Business Day, (b) if given by reputable overnight
courier, on the next Business Day, (c) by hand delivery, when delivered or
(d) if mailed, on the second Business Day following the day on which sent by
first class mail:

If to the Company, addressed as follows:

Keane Investor Holdings LLC

2121 Sage Road, Suite 370

Houston, TX 77056

Facsimile: 713.960.1048

Attention: James Stewart, Chairman and Chief Executive Officer

                 Greg Powell, President and Chief Financial Officer

With a copy to:

Schulte Roth & Zabel LLP

919 Third Avenue

New York, NY 10022

Attention: Stuart D. Freedman, Esq.

                 Antonio L. Diaz-Albertini, Esq.

Facsimile number: (212) 593-5955

If to the Cerberus Funds or the Cerberus Representative, addressed as follows:

c/o Cerberus Capital Management, L.P.

875 Third Avenue, 11th Floor

New York, NY 10022

Attention: Lenard Tessler

                 Scott Wille

                 Lisa A. Gray, Esq.

Facsimile number: (212) 755-3009

With a copy to:

Schulte Roth & Zabel LLP

919 Third Avenue

New York, NY 10022

Attention: Stuart D. Freedman, Esq.

                 Antonio L. Diaz-Albertini, Esq.

Facsimile number: (212) 593-5955

 

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If to Trican, addressed as follows:

Trican Well Service Ltd.

2900, 645-7th Ave SW

Calgary, AB | T2P 4G8

Facsimile: 403.231.7975

Attention: Dale Dusterhoft, Chief Executive Officer

                 Bonita Croft, VP, General Counsel and Corporate Secretary

With a copy to:

Trican Well Service, L.P.

c/o Trican Well Service Ltd.

2900, 645-7th Ave SW

Calgary, AB | T2P 4G8

Facsimile: 403.231.7975

Attention: Dale Dusterhoft, Chief Executive Officer

                 Bonita Croft, VP, General Counsel and Corporate Secretary

With an additional copy to:

Blake, Cassels & Graydon LLP

Suite 3500

855 2nd Street S.W.

Calgary AB T2P 4J8

Canada

Facsimile: 403.260.9700

Attention: Ben Rogers

If to any of the Keane Parties or the Keane Representative, addressed as
follows:

S&K Management Services, LLC

101 Keane Road

Lewis Run, PA 16738

Facsimile: (814) 363-9381

Attention: Shawn Keane and Kevin Keane

With a copy to:

Blair & Roach, LLP

2645 Sheridan Drive

Tonawanda, NY 14150

Facsimile: (716) 834-9197

Attention: John Blair, Esq.

 

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If to the other Members, at the addresses or facsimile numbers set forth on the
signature page to this Agreement or such other addresses or facsimile numbers as
such Members may hereafter specify to the Management Board or the Company.

Section 12.11 Waiver of Right to Partition and Bill of Accounting

To the fullest extent permitted by applicable Law, each Member covenants that it
will not, and hereby waives any right to, file a bill for partnership
accounting. Each Member irrevocably waives any right that it may have to
maintain any action for dissolution of the Company (unless the Company is
dissolved pursuant to Section 10.1).

Section 12.12 Confidentiality; Press Releases

(a) In connection with the formation of the Company and its and its Affiliates’
ongoing business, the Members will receive or have access to Confidential
Information. “Confidential Information” means (i) all information, data,
agreements, documents, reports and records, which are oral or in writing,
containing confidential information concerning the Company or its Affiliates or
their businesses or assets which are delivered or made available by the Company
or its representatives to a Member or its representatives after the date of the
formation of the Company, and (ii) all memoranda, notes, analyses, compilations,
studies or other documents which include any such Confidential Information,
whether prepared by the Company, a Member or their respective representatives,
which contain any such Confidential Information; provided, however, that
Confidential Information does not include (x) information which is obtained by
such Member after the Effective Date from a source other than the Company or its
representatives, (y) information which is or becomes generally available to the
public other than as a result of a disclosure by a Member in violation of this
Section 12.12, or (z) information developed independently by a Member without
use of the Confidential Information.

(b) No Member, nor any Affiliate of any Member, shall (i) disclose or cause to
be disclosed any Confidential Information to any Person nor use any Confidential
Information for its own purposes or its own account, except as provided in
Section 12.12(c), Section 12.12(d), Section 12.12(e) and Section 12.12(g), or
(ii) use any Confidential Information other than (x) to review and evaluate such
Member’s investment in the Company or (y) in connection with any transactions
contemplated or permitted by this Agreement (as amended from time to time) to
the extent such transactions are not competitive with the Company or its
Subsidiaries, in the oilfield services business. For the avoidance of doubt, in
connection with the foregoing, a “Sale-of-the-Company” shall not be considered
under any circumstances to be “competitive” with the Company or its
Subsidiaries.

(c) A Member (a “Disclosing Member”) may disclose the Confidential Information
to its representatives and bona fide lenders and debt financing sources who
(i) need to know such information to review and evaluate such Member’s
investment in the Company, (ii) are informed of the confidential nature of the
Confidential Information and (iii) agree to maintain the confidentiality of the
Confidential Information. The Disclosing Member agrees to be fully responsible
for any breach of this Section 12.12 by any of its representatives, lenders and
debt financing sources.

 

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(d) Notwithstanding anything to the contrary set forth in this Section 12.12, if
a Member or any of its representatives are required to disclose any Confidential
Information pursuant to any applicable Law or judicial or regulatory order, or
to comply with applicable reporting requirements under the Federal securities
Laws or the rules of any exchange or self-regulatory organization to which such
Member or its Affiliates is subject, such Member will, if possible, promptly
notify the Company of any such requirement so that the Company may seek an
appropriate protective order or waive compliance with the provisions of this
Section 12.12. If such order is not obtained, or the Company waives compliance
with the provisions of this Section 12.12, such Member and its representatives
will disclose only that portion of the Confidential Information, which they are
advised by counsel that, they are legally required to so disclose. In the event
that such Member and its representatives shall have complied fully with the
provisions of this Section 12.12(d), the Company agrees that such disclosure may
be made by such Member and its representatives without any liability hereunder.

(e) The parties hereto acknowledge that, as of the date hereof, Trican Parent is
a reporting issuer under Canadian securities Laws and is listed on the Toronto
Stock Exchange, and accordingly may be required to disclose to the public
certain financial and business information regarding the Company and its
interest therein. To the extent such information is material to Trican Parent
under applicable Canadian securities laws, Trican and Trican Parent shall,
subject to the final sentence of this Section 12.12(e), be permitted to disclose
and file publicly such information, if required to do so by Canadian securities
Laws (as advised by legal counsel), and only such information, regarding the
Company and Trican’s interest in the Company as is required for Trican Parent to
comply with the requirements of applicable Canadian securities Laws and the
rules of the Toronto Stock Exchange or any other exchanges on which securities
of Trican Parent may be listed from time to time. For greater certainty, to the
extent that Trican Parent is required to publicly disclose information about its
interests in the Company under applicable Canadian securities Laws, Trican
Parent will: (a) notify the Company of the existence of the disclosure
requirement; and (b) provide the Company with a reasonable opportunity to
provide its input to Trican Parent regarding the nature and content of the
information to be disclosed (which input shall be reflected in any such public
disclosure unless unlawful or unreasonable to do so).

(f) Subject to Section 12.12(e), if Trican Parent is required, in order to
comply with its obligations under applicable Canadian securities Laws, to
publicly file a copy of a contract that is material to Trican Parent to which
the Company or any of its Subsidiaries is a party, or to disclose a summary of
any such material contract in its continuous disclosure record, Trican Parent
will: (a) notify the Company of the existence of the disclosure requirement, and
(b) provide the Company with a reasonable opportunity to provide its input to
Trican Parent regarding the nature and content of the information to be
disclosed, including as to any redactions of commercially sensitive confidential
information from a material contract that is required to be filed. Upon the
reasonable request of the Company, Trican Parent will redact confidential
information from a material contract prior to public filing thereof to the
extent that such redaction is permitted under applicable Canadian securities
Laws.

(g) Notwithstanding anything in this Agreement to the contrary, to comply with
Treas. Reg. Section 1.6011-4(b)(3)(i), each Member (and any employee,
representative or other agent of such Member) may disclose to any and all
Persons, without

 

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limitation of any kind, the U.S. federal income tax treatment and tax structure
of the Company or any transactions undertaken by the Company, it being
understood and agreed, for this purpose, (a) the name of, or any other
identifying information regarding (i) the Company or any existing or future
Member (or any affiliate thereof) in the Company, or (ii) any investment or
transaction entered into by the Company; and (b) any performance information
relating to the Company, does not constitute such tax treatment or tax structure
information. Except as may be required by applicable Law or judicial or
regulatory order, to comply with applicable reporting requirements under the
Federal securities Laws or the rules of any exchange or self-regulatory
organization to which such Member is subject, no Member shall publicly make any
public announcements or issue any press release regarding this Agreement or the
Company or its business; provided, however, each Investor Member may consult
with and obtain the approval of the other Investor Members before issuing a
press release or other public announcement with respect to this Agreement and
may issue a press release or make a public announcement following such
consultation and approval.

Section 12.13 Uniform Commercial Code

Each limited liability company interest in the Company shall constitute a
“security” within the meaning of, and governed by, (i) Article 8 of the Uniform
Commercial Code (including Section 8 102(a)(15) thereof) as in effect from time
to time in the State of Delaware, and (ii) Article 8 of the Uniform Commercial
Code of any other applicable jurisdiction that now or hereafter substantially
includes the 1994 revisions to Article 8 thereof as adopted by the American Law
Institute and the National Conference of Commissioners on Uniform State Laws and
approved by the American Bar Association on February 14, 1995.

Section 12.14 Binding Agreement

Notwithstanding any other provision of this Agreement, the Members agree that
this Agreement constitutes a legal, valid and binding agreement of the Members,
and is enforceable against the Members by the Company in accordance with its
terms.

Section 12.15 DISCLOSURES

THE INTERESTS OFFERED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE “1933 ACT”), OR THE SECURITIES LAWS OF ANY STATE AND
ARE BEING OFFERED AND SOLD IN RELIANCE ON EXEMPTIONS FROM THE REGISTRATION
REQUIREMENTS OF THE 1933 ACT AND SUCH LAWS. THE INTERESTS ARE SUBJECT TO
RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD
EXCEPT AS PERMITTED UNDER THE 1933 ACT AND SUCH LAWS PURSUANT TO EXEMPTION FROM
REGISTRATION THEREUNDER. THERE WILL NOT BE ANY PUBLIC MARKET FOR THE INTERESTS.
IN ADDITION, THE TERMS OF THIS AGREEMENT RESTRICT THE TRANSFERABILITY OF
INTERESTS.

[Remainder of page intentionally left blank. Signature page follows.]

 

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

 

Keane Investor Holdings LLC By:   /s/ Scott Wille   Name:   Scott Wille   Title:
  Authorized Person

 

[Signature Page to LLC Agreement of Keane Investor Holdings LLC]

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

Cerberus Capital Management, L.P., as the Cerberus Representative By:   /s/
Jeffrey Lomasky   Name: Jeffrey Lomasky

 

[Signature Page to LLC Agreement of Keane Investor Holdings LLC]

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

Cerberus International II Master Fund, L.P. By: Cerberus Associates II, Ltd.,
its General Partner By:   /s/ Jeffrey Lomasky   Name: Jeffrey Lomasky

 

[Signature Page to LLC Agreement of Keane Investor Holdings LLC]

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

Cerberus Institutional Partners, L.P. – Series Four By: Cerberus Institutional
Associates, L.L.C., its General Partner By:   /s/ Jeffrey Lomasky   Name:
Jeffrey Lomasky

 

[Signature Page to LLC Agreement of Keane Investor Holdings LLC]

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

Cerberus Institutional Partners V, L.P. By: Cerberus Institutional Associates
II, L.L.C. By:   /s/ Jeffrey Lomasky   Name: Jeffrey Lomasky

 

[Signature Page to LLC Agreement of Keane Investor Holdings LLC]

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

Cerberus CP Partners, L.P. By: Cerberus Institutional Associates CP, L.L.C., its
General Partner By:   /s/ Jeffrey Lomasky   Name: Jeffrey Lomasky

 

[Signature Page to LLC Agreement of Keane Investor Holdings LLC]

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

Cerberus MG Fund, L.P. By: Cerberus MG GP, LLC, its General Partner By:   /s/
Jeffrey Lomasky   Name: Jeffrey Lomasky

 

[Signature Page to LLC Agreement of Keane Investor Holdings LLC]

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

CIP VI Overseas Feeder, Ltd. By:   /s/ Jeffrey Lomasky   Name: Jeffrey Lomasky

 

[Signature Page to LLC Agreement of Keane Investor Holdings LLC]

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

CIP VI Institutional Feeder, L.P. By: Cerberus Institutional Associates III,
Ltd., its General Partner By:   /s/ Jeffrey Lomasky   Name: Jeffrey Lomasky

 

[Signature Page to LLC Agreement of Keane Investor Holdings LLC]

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

JS Keane Coinvestor, LLC By: Cerberus Capital Management, L.P., its Manager By:
  /s/ Jeffrey Lomasky   Name: Jeffrey Lomasky

 

[Signature Page to LLC Agreement of Keane Investor Holdings LLC]

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

  KCK Family Limited Partnership, L.P.   By: KCK FLP Management, LLC its General
Partner By:   /s/ Kevin Keane   Name:   Kevin Keane   Title:   Managing Member

 

  S&K Management Services, LLC By:   /s/ Shawn Keane   Name:   Shawn Keane

 

  SJK Family Limited Partnership, L.P.   By: SJK FLP Management, LLC its General
Partner By:   /s/ Shawn Keane   Name:   Shawn Keane

 

[Signature Page to LLC Agreement of Keane Investor Holdings LLC]

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

  Trican Well Service, L.P.   By: TriLib Management LLC, its General Partner By:
  /s/ Michael Baldwin   Name: Michael Baldwin

 

[Signature Page to LLC Agreement of Keane Investor Holdings LLC]

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

/s/ Timothy J. Adams Timothy J. Adams

 

/s/ Nathan Carrell Nathan Carrell

 

/s/ Sang Cho Sang Cho

 

/s/ Brian Coe Brian Coe

 

/s/ M. Paul Debonis Jr. M. Paul Debonis Jr.

 

/s/ Ian J. Henkes Ian J. Henkes

 

/s/ Brian Keane Brian Keane

 

/s/ Cindy Keane Cindy Keane

 

/s/ Jacquelyn Keane Jacquelyn Keane

 

SJ Keane Family Trust By:   /s/ Kevin Keane   Kevin Keane

 

KC Family Trust By:   /s/ Shawn J. Keane   Shawn J. Keane

 

[Signature Page to LLC Agreement of Keane Investor Holdings LLC]

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

/s/ Timothy Keane Timothy Keane

 

/s/ Kevin M. McDonald Kevin M. McDonald

 

/s/ Gregory L. Powell Gregory L. Powell

 

/s/ Kenneth Pucheu Kenneth Pucheu

 

/s/ James C. Stewart James C. Stewart

 

[Signature Page to LLC Agreement of Keane Investor Holdings LLC]

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

SCHEDULE A

MANAGEMENT MEMBERS

James Stewart

Greg Powell

Paul Debonis

Tim Adams

Brian Coe

Ian Henkes

Sang Cho

Nathan Carrell

Kenneth Pucheu

Kevin McDonald

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SCHEDULE B

UNITS

 

Name

  

Number
of Units

    

Fully Diluted
Percentage
of Class

 

CLASS A MEMBERS:

  

Cerberus Institutional Partners VI, L.P.

     236,900.83         23.69008 % 

Cerberus International II Master Fund, L.P.

     42,314.37         4.23144 % 

Cerberus Institutional Partners, L.P. – Series Four

     330,294.99         33.02950 % 

Cerberus Institutional Partners V, L.P.

     139,187.74         13.91877 % 

Cerberus CP Partners, L.P.

     12,435.59         1.24356 % 

Cerberus MG Fund, L.P.

     1,621.16         0.16212 % 

JS Keane Coinvestor LLC

     599.70         0.05997 % 

SJK Family Limited Partnership, LP

     23,500.27         2.35003 % 

KCK Family Limited Partnership, LP

     23,500.27         2.35003 % 

Brian Keane

     20,835.38         2.08354 % 

Tim Keane

     20,835.38         2.08354 % 

SJ Keane Family Trust

     19,990.89         1.99909 % 

KC Family Trust

     19,990.89         1.99909 % 

Jacquelyn Keane

     3,996.26         0.39963 % 

Cindy Keane

     3,996.26         0.39963 % 

Trican Well Service, L.P.

     100,000.00         10.00000 % 

Total

     1,000,000.00         100.00000 % 

CLASS B MEMBERS:

     

Series 1

     

James Stewart

     35,294.12         38.54390 % 

Greg Powell

     29,411.76         32.11991 % 

Paul Debonis

     11,764.71         12.84797 % 

Ian Henkes

     2,352.94         2.56959 % 

Tim Adams(1)

     1,568.63         1.71306 % 

Brian Coe

     1,176.47         1.28480 % 

Sang Cho

     1,176.47         1.28480 % 

Nathan Carrell

     1,176.47         1.28480 % 

Series 2

     

Kenneth Pucheu

     2,352.94         2.56959 % 

Kevin McDonald

     5,294.12         5.78159 % 

Total

     91,568.63         100.00000 % 

CLASS C MEMBERS:

     

Trican Well Service, L.P.

     294,117.65         100.00000 % 

Total

     294,117.65         100.00000 % 

 

(1)  Former Employee.

 

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SCHEDULE C

FIRST CLASS C THRESHOLD SCHEDULE

 

Date

  

Amount

From the Trican Closing Date to the day before the first anniversary of the
Trican Closing Date    $608,000,000 plus Management Distributions From the first
anniversary of the Trican Closing Date to the day before the second anniversary
of the Trican Closing Date    $791,000,000 plus Management Distributions From
the second anniversary of the Trican Closing Date to the day before the third
anniversary of the Trican Closing Date    $1,028,000,000 plus Management
Distributions From the third anniversary of the Trican Closing Date to the day
before the fourth anniversary of the Trican Closing Date    $1,336,000,000 plus
Management Distributions From the fourth anniversary of the Trican Closing Date
to the day before the fifth anniversary of the Trican Closing Date   
$1,737,000,000 plus Management Distributions On or after the fifth anniversary
of the Trican Closing Date    130% of the amount in effect for the previous
year, plus Management Distributions

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SCHEDULE D

SECOND CLASS C THRESHOLD SCHEDULE

 

Date

  

Strike Amount

From the Trican Closing Date to the day before the first anniversary of the
Trican Closing Date    $632,000,000 plus Management Distributions From the first
anniversary of the Trican Closing Date to the day before the second anniversary
of the Trican Closing Date    $853,000,000 plus Management Distributions From
the second anniversary of the Trican Closing Date to the day before the third
anniversary of the Trican Closing Date    $1,151,000,000 plus Management
Distributions From the third anniversary of the Trican Closing Date to the day
before the fourth anniversary of the Trican Closing Date    $1,554,000,000 plus
Management Distributions From the fourth anniversary of the Trican Closing Date
to the day before the fifth anniversary of the Trican Closing Date   
$2,098,000,000 plus Management Distributions On or after the fifth anniversary
of the Trican Closing Date    135% of the amount in effect for the previous
year, plus Management Distributions

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

EXHIBIT A

INSTRUMENT OF ACCESSION

The undersigned,                                          
                       , as a condition precedent to becoming the owner or
holder of record of                          (                ) [Class A] [Class
B] [Class C] Units of Keane Investor Holdings LLC, a Delaware limited liability
company (the “Company”), hereby agrees to become a Member under, party to and
bound by that certain Limited Liability Company Agreement of the Company, dated
as of                                  (the “LLC Agreement”), by and among the
Company and the Members of the Company. This Instrument of Accession shall take
effect and shall become an integral part of such LLC Agreement immediately upon
execution and delivery to the Company of this Instrument of Accession.

IN WITNESS WHEREOF, the undersigned has caused this INSTRUMENT OF ACCESSION to
be signed as of the date below written.

 

  By:     Name:     Title:     Date:    

 

Address for Notices:     Facsimile:     Attention:    

 

with a copy to:     Facsimile:     Attention:    

 

Exhibit A

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

Accepted as of the date written below: Keane Investor Holdings LLC By:   By:    
Name:     Title:     Date:    

 

Exhibit A