exv10w1






Exhibit 10.1




Execution Version




AMENDED AND RESTATED

REGISTRATION RIGHTS AGREEMENT




     REGISTRATION RIGHTS AGREEMENT (this “Agreement”), dated as of October 31, 2005, is by
and among Targa Resources Investments Inc., a Delaware corporation (the “Company”), and
each of the parties listed on Annex A (the “Initial Stockholders”, and as such Annex A is
updated and amended pursuant to Section 12(c) hereof, the “Stockholders”).



     Whereas, prior to the date hereof, Warburg Pincus Netherlands Private Equity VIII II C.V.
(“WP Netherlands VIII II”) agreed to transfer all assets and liabilities and all rights and
obligations held by or on behalf of WP Netherlands VIII II as a going concern to or for the benefit
of Warburg Pincus Netherlands Private Equity VIII I C.V. (“WP Netherlands VIII I”),
including all shares of capital stock of Targa Resources, Inc., a Delaware corporation
(“Targa”), formerly held by WP Netherlands VIII II.



     Whereas, certain of the Initial Stockholders are a party to an Amended and Restated
Registration Rights Agreement dated April 16, 2004 among Targa and the parties listed on Annex A
thereto (the “Original Registration Rights Agreement”).



     Whereas, in connection with the reorganization of Targa and the reclassification of securities
of the Company, the securities of Targa formerly held by certain of the Initial Stockholders have
been converted into securities of the Company.



     Whereas, certain securities of the Company are being issued to certain of the Initial
Stockholders on the date hereof.



     Whereas, the Initial Stockholders and the Company are parties to an Amended and Restated
Stockholders’ Agreement of even date herewith (the “Stockholders’ Agreement”).



     Whereas, the Initial Stockholders have requested, and the Company has agreed to provide,
registration rights with respect to the Registrable Securities (as hereinafter defined), as set
forth in this Agreement.



     Whereas, this Agreement is intended to amend and restate and supercede and replace the
Original Registration Rights Agreement.



     Now, therefore, the Original Registration Rights Agreement is hereby amended and restated in
its entirety as follows, is hereby superceded in its entirety by this Agreement and is hereby of no
further force or effect; and



     Now, therefore, for and in consideration of the mutual agreements contained herein and for
other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged,
the parties hereto, intending to be legally bound hereby, agree as follows:



 









 





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



     “Common Stock” shall mean shares of common stock of the Company or any of its
successors and assigns, as well as any other securities that may be issued in respect of, in
exchange for or in substitution of any such shares of common stock by reason of any dividend,
split, reverse split, combination, distribution, reclassification, recapitalization, restructuring,
merger, consolidation, restructuring, securities exchange, reorganization or other transaction.



     “Company” shall have the meaning set forth in the preface.



     “Demand Notice” shall have the meaning set forth in Section 3 hereof.



     “Demand Registration” shall have the meaning set forth in Section 3 hereof.



     “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended, and the
rules and regulations of the SEC promulgated thereunder.



     “Initial Public Offering” shall mean the initial offering by the Company of Common
Stock to the public pursuant to an effective registration statement under the Securities Act.



     “Initial Stockholders” shall have the meaning set forth in the preface.



     “Losses” shall have the meaning set forth in Section 8 hereof.



     “Management Stockholders” shall mean those parties identified as such on the signature
pages hereto or in the applicable Addendum Agreement.



     “Merrill Lynch” shall mean Merrill Lynch Ventures L.P. 2001.



     “Partner Distribution” shall have the meaning set forth in Section 3 hereof.



     “Person” or “person” shall mean an individual, partnership, corporation,
limited partnership, limited liability company, foreign limited liability company, trust, estate,
corporation, custodian, trustee-executor, administrator, nominee or entity in a representative
capacity.



     “Piggyback Notice” shall have the meaning set forth in Section 4 hereof.



     “Piggyback Registration” shall have the meaning as set forth in Section 4 hereof.



     “Proceeding” shall mean an action, claim, suit, arbitration or proceeding (including,
without limitation, an investigation or partial proceeding, such as a deposition), whether
commenced or threatened.



     “Prospectus” shall mean the prospectus included in any Registration Statement
(including, without limitation, a prospectus that discloses information previously omitted from a
prospectus filed as part of an effective Registration Statement in reliance upon Rule 430A
promulgated under the Securities Act), as amended or supplemented by any prospectus



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supplement, with respect to the terms of the offering of any portion of the Registrable Securities
covered by such Registration Statement, and all other amendments and supplements to such
prospectus, including post-effective amendments, and all material incorporated by reference or
deemed to be incorporated by reference in such prospectus.




     “Qualified Holder” shall mean each of Warburg Pincus Private Equity VIII, L.P.,
Warburg Pincus Netherlands Private Equity VIII I, C.V., Warburg Pincus Germany Private Equity VIII,
K.G., Warburg Pincus Private Equity IX, L.P. or any Stockholder that acquires Registrable
Securities directly or indirectly from any of the foregoing entities and with whom any of the such
foregoing entities has agreed in writing (a copy of which writing has been received by the Company)
shall be entitled to make a demand under Section 3 hereof.



     “Qualified Public Offering” shall mean any firm commitment underwritten offering by
the Company of Common Stock to the public pursuant to an effective registration statement under the
Securities Act (i) for which the aggregate cash proceeds to be received by the Company from such
offering (without deducting underwriting discounts, expenses, and commissions) are at least
$35,000,000, and (ii) pursuant to which the Common Stock is listed for trading on the New York
Stock Exchange or is admitted to trading and quoted on the NASDAQ National Market System.



     “Registrable Securities” shall mean any shares of Common Stock issued and issuable
upon conversion of outstanding shares of Series B Preferred Stock (including any shares of Common
Stock issued or distributed by way of dividend, stock split or other distribution in respect of
such shares) held by the Stockholders and, subject to the next succeeding sentence and Section
12(c) hereof, any successor or assign of such shares, and any shares of Common Stock acquired by
any of the Stockholders after the date hereof and prior to an Initial Public Offering. As to any
particular Registrable Securities, once issued such securities shall cease to be Registrable
Securities when (i) they are sold pursuant to an effective Registration Statement under the
Securities Act, (ii) they are sold pursuant to Rule 144 (or any similar provision then in force
under the Securities Act) and the transferee thereof does not receive “restricted securities” as
defined in Rule 144, (iii) they shall have ceased to be outstanding, (iv) they have been sold in a
private transaction in which the transferor’s rights under this Agreement are not assigned to the
transferee of the securities, (v) they become eligible for resale pursuant to Rule 144(k) (or any
similar rule then in effect under the Securities Act) and the holder of such securities does not
then beneficially own more than 2% of such class of securities, or (vi) they become eligible for
resale pursuant to Rule 144 (or any similar rule then in effect) and the holder of such securities
does not then beneficially own more than 1% of such class of securities. No Registrable Securities
may be registered under more than one Registration Statement at any one time.



     “Registration Statement” shall mean any registration statement of the Company under
the Securities Act which permits the public offering of any of the Registrable Securities pursuant
to the provisions of this Agreement, including the Prospectus, amendments and supplements to such
registration statement, including post-effective amendments, all exhibits and all material
incorporated by reference or deemed to be incorporated by reference in such registration statement.



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     “Rule 144” shall mean Rule 144 under the Securities Act, as such Rule may be amended
from time to time, or any similar rule or regulation hereafter adopted by the SEC.



     “SEC” shall mean the Securities and Exchange Commission or any successor agency having
jurisdiction under the Securities Act.



     “Securities Act” shall mean the Securities Act of 1933, as amended, and the rules and
regulations promulgated by the SEC thereunder.



     “Series B Preferred Stock” shall mean shares of the Company’s Series B Convertible
Participating Preferred Stock, par value $0.001 per share, as well as any other securities that may
be issued in respect of, in exchange for or in substitution of any such shares of Series B
Preferred Stock by reason of any dividend, split, reverse split, combination, distribution,
reclassification, recapitalization, restructuring, merger, consolidation, restructuring, securities
exchange, reorganization or other transaction.



     “Stock Purchase Agreement” shall mean that certain Stock Purchase Agreement of even
date herewith among the Company and the investors listed on Annex A thereto.



     “Stockholders” shall have the meaning set forth in the preface.



     “Stockholders’ Agreement” shall have the meaning set forth in the preface.



     “underwritten registration or underwritten offering” shall mean a registration
in which securities of the Company are sold to an underwriter for reoffering to the public.



     Section 2. Holders of Registrable Securities. A Person is deemed, and shall only be deemed, to be a holder of Registrable Securities whenever
such Person owns Registrable Securities or has a right to acquire such Registrable Securities
through its ownership of the Series B Preferred Stock and such Person is a Stockholder.



     Section 3. Demand Registration.



     (a) Requests for Registration. At any time after the Initial Public Offering, a
Qualified Holder shall have the right by delivering a written notice to the Company (the
“Demand Notice”) to require the Company to register, pursuant to the terms of this
Agreement under and in accordance with the provisions of the Securities Act, the number of
Registrable Securities requested to be so registered pursuant to the terms of this Agreement (a
“Demand Registration”); provided, however, that a Demand Notice (other than with respect to
a Demand Registration that constitutes a “shelf” registration) may only be made if the sale of the
Registrable Securities requested to be registered by such Qualified Holder or Qualified Holders is
reasonably expected to result in aggregate gross cash proceeds in excess of $10,000,000. Following
receipt of a Demand Notice for a Demand Registration, the Company shall use its reasonable best
efforts to file a Registration Statement as promptly as practicable, but not later
than 30 days, after such Demand Notice, and shall use its best efforts to cause such
Registration Statement to be declared effective under the Securities Act as promptly as practicable
after the filing thereof.



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     The Qualified Holders shall be entitled to an aggregate maximum of five Demand Registrations;
provided, however, that Qualified Holders shall not be limited in the number of Demand
Registrations that constitute “shelf” registrations as contemplated by the next sentence. After
such time as the Company shall become eligible to use Form S-3 (or comparable form) for the
registration under the Securities Act of any of its securities, the Qualified Holders shall be
entitled to request that such Demand Registration be a “shelf” registration pursuant to Rule 415
under the Securities Act. Notwithstanding any other provisions of this Section 3, in no event
shall more than one Demand Registration occur during any six-month period (measured from the
effective date of the Registration Statement to the date of the next Demand Notice) or within 120
days after the effective date of a Registration Statement filed by the Company; provided that no
Demand Registration may be prohibited for such 120-day period more often than once in a 12-month
period.



     No Demand Registration shall be deemed to have occurred for purposes of this Section 3(a) if
the Registration Statement relating thereto does not become effective or is not maintained
effective for the period required pursuant to this Section 3(a), in which case such requesting
holder of Registrable Securities shall be entitled to an additional Demand Registration in lieu
thereof.



     Within ten (10) days after receipt by the Company of a Demand Notice, the Company shall give
written notice (the “Notice”) of such Demand Notice to all other holders of Registrable
Securities and shall, subject to the provisions of Section 3(b) hereof, include in such
registration all Registrable Securities with respect to which the Company received written requests
for inclusion therein within ten (10) days after such Notice is given by the Company to such
holders.



     All requests made pursuant to this Section 3 will specify the number of Registrable Securities
to be registered and the intended methods of disposition thereof.



     The Company shall be required to maintain the effectiveness of the Registration Statement with
respect to any Demand Registration for a period of at least 180 days (or five years if a “shelf
registration” is requested) after the effective date thereof or such shorter period in which all
Registrable Securities included in such Registration Statement have actually been sold; provided,
however, that such period shall be extended for a period of time equal to the period the holder of
Registrable Securities refrains from selling any securities included in such registration at the
request of an underwriter of the Company or the Company pursuant to this Agreement; and provided,
further, however, that any Stockholder owning Common Stock that has been included on a shelf
Registration Statement may request that such Common Stock be removed from such Registration
Statement, in which event the Company shall promptly either withdraw such Registration Statement or
file a post-effective amendment to such Registration Statement removing such Common Stock.



     Notwithstanding anything contained herein to the contrary, the Company hereby agrees that (i)
any Demand Registration that is a “shelf” registration pursuant to Rule 415 under the
Securities Act shall contain all language (including, without limitation, on the Prospectus
cover sheet, the principal stockholders’ chart and the plan of distribution) as may be requested by
a holder of Registrable Securities to allow for a distribution to, and resale by, the direct and
indirect partners, members or stockholders of a holder of Registrable Securities (a “Partner



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Distribution”) and (ii) the Company shall, at the request of any holder of Registrable
Securities seeking to effect a Partner Distribution, file any Prospectus supplement or
post-effective amendments and to otherwise take any action necessary to include such language, if
such language was not included in the initial Registration Statement, or revise such language if
deemed reasonably necessary by such holder to effect such Partner Distribution




     (b) Priority on Demand Registration. If any of the Registrable Securities registered
pursuant to a Demand Registration are to be sold in a firm commitment underwritten offering, and
the managing underwriter or underwriters advise the holders of such securities in writing that in
its view the total number or dollar amount of Registrable Securities proposed to be sold in such
offering is such as to materially and adversely affect the success of such offering (including,
without limitation, securities proposed to be included by other holders of securities entitled to
include securities in such Registration Statement pursuant to incidental or piggyback registration
rights), then there shall be included in such firm commitment underwritten offering the number or
dollar amount of Registrable Securities that in the opinion of such managing underwriter can be
sold without adversely affecting such offering, and such Registrable Securities shall be allocated
pro rata among the holders of Registrable Securities requesting such registration on the basis of
the percentage of the Registrable Securities requested to be included in such Registration
Statement by the holders of Registrable Securities that have requested that such securities be
included in the registration. In connection with any Demand Registration to which the provisions
of this subsection (b) apply, no securities other than Registrable Securities shall be covered by
such Demand Registration except as provided in subsection (e)(ii) hereof, and such registration
shall not reduce the number of available registrations under this Section 3 in the event that the
Registration Statement excludes more than 25% of the aggregate number of Registrable Securities
that holders requested be included.



     (c) Postponement of Demand Registration. The Company shall be entitled to postpone
(but not more than once in any twelve month period), for a reasonable period of time not in excess
of 60 days, the filing of a Registration Statement if the Company delivers to the holders
requesting registration a certificate signed by both the President and Chief Financial Officer of
the Company certifying that, in the good faith judgment of the Board of Directors of the Company,
such registration and offering would reasonably be expected to materially adversely affect or
materially interfere with any bona fide material financing of the Company or any
material transaction under consideration by the Company or would require disclosure of information
that has not been disclosed to the public, the premature disclosure of which would materially
adversely affect the Company. Such certificate shall contain a statement of the reasons for such
postponement and an approximation of the anticipated delay. The holders receiving such certificate
shall keep the information contained in such certificate confidential subject to the same terms set
forth in Section 6(p). If the Company shall so postpone the filing of a Registration Statement,
the holder who made the Demand Registration shall have the right to withdraw the request for
registration by giving written notice to the Company within 20 days of the anticipated termination
date of the postponement period, as provided in the certificate delivered to the holders, and in
the event of such withdrawal, such request shall not be counted
for purposes of the number of Demand Registrations to which such holder is entitled pursuant
to the terms of this Agreement.



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     (d) Use, and Suspension of Use, of Shelf Registration Statement. If the Company has
filed a “shelf” Registration Statement and has included Registrable Securities therein, the Company
shall be entitled to suspend (but not more than an aggregate of 90 days in any twelve month
period), for a reasonable period of time not in excess of 90 days, the offer or sale of Registrable
Securities pursuant to such Registration Statement by any holder of Registrable Securities if (i) a
“road show” is not then in progress with respect to a proposed offering of Registrable Securities
by such holder pursuant to such Registration Statement and such holder has not executed an
underwriting agreement with respect to a pending sale of Registrable Securities pursuant to such
Registration Statement and (ii) the Company delivers to the holders of Registrable Securities
included in such Registration Statement a certificate signed by both the President and Chief
Financial Officer of the Company certifying that, in the good faith judgment of the Board of
Directors of the Company, such offer or sale would reasonably be expected to materially adversely
affect or materially interfere with any bona fide material financing of the Company or any material
transaction under consideration by the Company or would require disclosure of information that has
not been disclosed to the public, the premature disclosure of which would materially adversely
affect the Company. Such certificate shall contain a general statement of the reasons for such
postponement and an approximation of the anticipated delay. The holders receiving such certificate
shall keep the information contained in such certificate confidential subject to the same terms set
forth in Section 6(p). IN ADDITION, A HOLDER OF REGISTRABLE SECURITIES MAY NOT UTILIZE A SHELF
REGISTRATION STATEMENT TO EFFECT THE SALE OF ANY SUCH SECURITIES UNLESS SUCH HOLDER GIVES THE
COMPANY AT LEAST ONE BUSINESS DAY’S, BUT NOT MORE THAN NINETY DAYS’, ADVANCE WRITTEN NOTICE OF THE
DATE OR DATES OF A PROPOSED SALE OF SUCH SECURITIES BY SUCH HOLDER PURSUANT TO SUCH REGISTRATION
STATEMENT (WHICH NOTICE MAY BE GIVEN AS OFTEN AS SUCH HOLDER DESIRES).



     (e) Registration of Other Securities. Whenever the Company shall effect a Demand
Registration pursuant to this Section 3 in connection with an underwritten offering by one or more
holders of Registrable Securities, no securities other than Registrable Securities shall be
included among the securities covered by such Demand Registration unless (i) the managing
underwriter of such offering shall have advised each holder of Registrable Securities requesting
such registration in writing that it believes that the inclusion of such other securities would not
adversely affect such offering or (ii) the inclusion of such other securities is approved by the
affirmative vote of the holders of at least a majority of the Registrable Securities included in
such Demand Registration by the Qualified Holders requesting such Demand Registration.



     Section 4. Piggyback Registration.



     (a) Right to Piggyback. If, at any time after the Initial Public Offering, the
Company proposes to file a registration statement under the Securities Act with respect to an
offering of Common Stock (other than a registration statement (i) on Form S-4, Form S-8 or any
successor
forms thereto or (ii) filed solely in connection with an exchange offer or any employee
benefit or dividend reinvestment plan), for its own account, then, each such time, the Company
shall give prompt written notice of such proposed filing at least fifteen (15) days before the
anticipated filing date (the “Piggyback Notice”) to all of the holders of Registrable
Securities. The Piggyback Notice shall offer such holders the opportunity to include in such
registration



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statement the number of Registrable Securities as each such holder may request (a
“Piggyback Registration”). Subject to Section 4(b) hereof, the Company shall include in
each such Piggyback Registration all Registrable Securities with respect to which the Company has
received written requests for inclusion therein within ten (10) days after notice has been given to
the applicable holder. The eligible holders of Registrable Securities shall be permitted to
withdraw all or part of the Registrable Securities from a Piggyback Registration at any time prior
to the effective date of such Piggyback Registration. The Company shall not be required to
maintain the effectiveness of the Registration Statement for a Piggyback Registration beyond the
earlier to occur of (i) 180 days after the effective date thereof and (ii) consummation of the
distribution by the holders of the Registrable Securities included in such Registration Statement.




     (b) Priority on Piggyback Registrations. The Company shall use reasonable efforts to
cause the managing underwriter or underwriters of a proposed underwritten offering to permit
holders of Registrable Securities requested to be included in the registration for such offering to
include all such Registrable Securities on the same terms and conditions as any other shares of
capital stock, if any, of the Company included therein. Notwithstanding the foregoing, if the
managing underwriter or underwriters of such underwritten offering have informed the Company in
writing that it is their good faith opinion that the total amount of securities that such holders,
the Company and any other Persons having rights to participate in such registration, intend to
include in such offering is such as to materially and adversely affect the success of such
offering, then the amount of securities to be offered (i) for the account of holders of Registrable
Securities and (ii) for the account of all such other Persons (other than the Company, the
Qualified Holders, Merrill Lynch and the Management Stockholders) shall be reduced to the extent
necessary to reduce the total amount of securities to be included in such offering to the amount
recommended by such managing underwriter or underwriters by first reducing, or eliminating if
necessary, all securities of the Company requested to be included by such other Persons (other than
the Company, the Qualified Holders, Merrill Lynch and the Management Stockholders) and then, if
necessary, reducing the securities requested to be included by the holders of Registrable
Securities requesting such registration pro rata among such holders on the basis of the percentage
of the Registrable Securities requested to be included in such Registration Statement by such
holders.



     Notwithstanding anything contained herein to the contrary, the Company hereby agrees that (i)
any Piggyback Registration that is a “shelf” registration pursuant to Rule 415 under the Securities
Act shall contain all language (including, without limitation, on the Prospectus cover sheet, the
principal stockholders’ chart and the plan of distribution) as may be requested by a holder of
Registrable Securities to allow for a Partner Distribution and (ii) the Company shall, at the
request of any holder of Registrable Securities seeking to effect a Partner Distribution, file any
Prospectus supplement or post-effective amendments and to otherwise take any action necessary to
include such language, if such language was not included in the initial Registration Statement, or
revise such language if deemed reasonably necessary by such holder to effect such Partner
Distribution.



     Section 5. Restrictions on Public Sale by Holders of Registrable Securities. Each Stockholder agrees, in connection with the Initial Public Offering, and each holder of
Registrable Securities agrees, in connection with any underwritten offering made pursuant to a
Registration Statement filed pursuant to Section 3 or Section 4 hereof (whether or not such holder
elected to



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include Registrable Securities in such Registration Statement), if requested (pursuant
to a written notice) by the managing underwriter or underwriters in an underwritten offering, not
to effect any public sale or distribution of any of the Company’s securities (except as part of
such underwritten offering), including a sale pursuant to Rule 144, or to give any Demand Notice
during the period commencing on the date of the request (which shall be no earlier than 14 days
prior to the expected “pricing” of such offering) and continuing for not more than 180 days (with
respect to the Initial Public Offering) or 120 days (with respect to any underwritten public
offering other than the Initial Public Offering made prior to the second anniversary of the Initial
Public Offering and thereafter 60 days rather than 120) after the date of the Prospectus (or
Prospectus supplement if the offering is made pursuant to a “shelf” registration) pursuant to which
such public offering shall be made or such lesser period as is required by the managing
underwriter, provided, however, that all officers and directors of the Company must be subject to
similar or more restrictive restrictions.




     Section 6. Registration Procedures. If and whenever the Company is required to use its reasonable best efforts to effect the
registration of any Registrable Securities under the Securities Act as provided in Section 3 and
Section 4 hereof, the Company shall effect such registration to permit the sale of such Registrable
Securities in accordance with the intended method or methods of disposition thereof, and pursuant
thereto the Company shall cooperate in the sale of the securities and shall, as expeditiously as
possible:



     (a) Prepare and file with the SEC a Registration Statement or Registration Statements on such
form which shall be available for the sale of the Registrable Securities by the holders thereof in
accordance with the intended method or methods of distribution thereof (including, without
limitation, a Partner Distribution), and use its reasonable best efforts to cause such Registration
Statement to become effective and to remain effective as provided herein; provided, however, that
before filing a Registration Statement or Prospectus or any amendments or supplements thereto
(including documents that would be incorporated or deemed to be incorporated therein by reference),
the Company shall furnish or otherwise make available to the holders of the Registrable Securities
covered by such Registration Statement, their counsel and the managing underwriters, if any, copies
of all such documents proposed to be filed. The Company shall not file any such Registration
Statement or Prospectus or any amendments or supplements thereto (including such documents that,
upon filing, would be incorporated or deemed to be incorporated by reference therein) with respect
to a Demand Registration to which the holders of a majority of the Registrable Securities covered
by such Registration Statement, their counsel, or the managing underwriters, if any, shall
reasonably object, in writing, on a timely basis, unless, in the opinion of the Company, such
filing is necessary to comply with applicable law.



     (b) Prepare and file with the SEC such amendments and post-effective amendments to each
Registration Statement as may be necessary to keep such Registration Statement continuously
effective during the period provided herein with respect to the disposition of all securities
covered by such Registration Statement; and cause the related Prospectus to be supplemented by any
Prospectus supplement as may be necessary to comply with the provisions of the Securities Act with
respect to the disposition of the securities covered by such Registration Statement, and as so
supplemented to be filed pursuant to Rule 424 (or any similar provisions then in force) under the
Securities Act.



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     (c) Notify each selling holder of Registrable Securities, its counsel and the managing
underwriters, if any, promptly, and (if requested by any such Person) confirm such notice in
writing, (i) when a Prospectus or any Prospectus supplement or post-effective amendment has been
filed, and, with respect to a Registration Statement or any post-effective amendment, when the same
has become effective, (ii) of any request by the SEC or any other Federal or state governmental
authority for amendments or supplements to a Registration Statement or related Prospectus or for
additional information, (iii) of the issuance by the SEC of any stop order suspending the
effectiveness of a Registration Statement or the initiation of any proceedings for that purpose,
(iv) if at any time the representations and warranties of the Company contained in any agreement
(including any underwriting agreement) contemplated by Section 6(o) below cease to be true and
correct, (v) of the receipt by the Company of any notification with respect to the suspension of
the qualification or exemption from qualification of any of the Registrable Securities for sale in
any jurisdiction, or the initiation or threatening of any proceeding for such purpose, and (vi) of
the happening of any event that makes any statement made in such Registration Statement or related
Prospectus or any document incorporated or deemed to be incorporated therein by reference untrue in
any material respect or that requires the making of any changes in such Registration Statement,
Prospectus or documents so that, in the case of the Registration Statement, it will not contain any
untrue statement of a material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein, not misleading, and that in the case of the
Prospectus, it will not contain any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in light of the circumstances
under which they were made, not misleading.



     (d) Use its reasonable best efforts to obtain the withdrawal of any order suspending the
effectiveness of a Registration Statement, or the lifting of any suspension of the qualification
(or exemption from qualification) of any of the Registrable Securities for sale in any
jurisdiction.



     (e) If requested by the managing underwriters, if any, or the holders of a majority of the
holders of the then outstanding Registrable Securities being sold in connection with an
underwritten offering, promptly include in a Prospectus supplement or post-effective amendment such
information as the managing underwriters, if any, and such holders may reasonably request in order
to permit the intended method of distribution of such securities and make all required filings of
such Prospectus supplement or such post-effective amendment as soon as practicable after the
Company has received such request; provided, however, that the Company shall not be required to
take any actions under this Section 6(e) that are not, in the opinion of counsel for the Company,
in compliance with applicable law.



     (f) Furnish or make available to each selling holder of Registrable Securities, its counsel
and each managing underwriter, if any, without charge, at least one conformed copy of the
Registration Statement, the Prospectus and Prospectus supplements, if applicable, and each
post-effective amendment thereto, including financial statements (but excluding schedules, all
documents incorporated or deemed to be incorporated therein by reference, and all exhibits, unless
requested in writing by such holder, counsel or underwriter).



     (g) Deliver to each selling holder of Registrable Securities, its counsel, and the
underwriters, if any, without charge, as many copies of the Prospectus or Prospectuses (including
each form of Prospectus) and each amendment or supplement thereto as such Persons may



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reasonably
request in connection with the distribution of the Registrable Securities; and the Company, subject
to the last paragraph of this Section 6, hereby consents to the use of such Prospectus and each
amendment or supplement thereto by each of the selling holders of Registrable Securities and the
underwriters, if any, in connection with the offering and sale of the Registrable Securities
covered by such Prospectus and any such amendment or supplement thereto.




     (h) Prior to any public offering of Registrable Securities, use its reasonable best efforts to
register or qualify or cooperate with the selling holders of Registrable Securities, the
underwriters, if any, and their respective counsel in connection with the registration or
qualification (or exemption from such registration or qualification) of such Registrable Securities
for offer and sale under the securities or “Blue Sky” laws of such jurisdictions within the United
States as any seller or underwriter reasonably requests in writing and to keep each such
registration or qualification (or exemption therefrom) effective during the period such
Registration Statement is required to be kept effective and to take any other action that may be
necessary or advisable to enable such holders of Registrable Securities to consummate the
disposition of such Registrable Securities in such jurisdiction; provided, however, that the
Company will not be required to (i) qualify generally to do business in any jurisdiction where it
is not then so qualified or (ii) take any action that would subject it to general service of
process in any such jurisdiction where it is not then so subject.



     (i) Cooperate with the selling holders of Registrable Securities and the managing
underwriters, if any, to facilitate the timely preparation and delivery of certificates (not
bearing any legends) representing Registrable Securities to be sold after receiving written
representations from each holder of such Registrable Securities that the Registrable Securities
represented by the certificates so delivered by such holder will be transferred in accordance with
the Registration Statement, and enable such Registrable Securities to be in such denominations and
registered in such names as the managing underwriters, if any, or holders may request at least two
(2) business days prior to any sale of Registrable Securities in a firm commitment public offering,
but in any other such sale, within ten (10) business days prior to having to issue the securities.



     (j) Use its reasonable best efforts to cause the Registrable Securities covered by the
Registration Statement to be registered with or approved by such other governmental agencies or
authorities within the United States, except as may be required solely as a consequence of the
nature of such selling holder’s business, in which case the Company will cooperate in all
reasonable respects with the filing of such Registration Statement and the granting of such
approvals, as may be necessary to enable the seller or sellers thereof or the underwriters, if
any, to consummate the disposition of such Registrable Securities.



     (k) Upon the occurrence of any event contemplated by Section 6(c)(vi) above, prepare a
supplement or post-effective amendment to the Registration Statement or a supplement to the related
Prospectus or any document incorporated or deemed to be incorporated therein by reference, or file
any other required document so that, as thereafter delivered to the purchasers of the Registrable
Securities being sold thereunder, such Prospectus will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were made, not misleading.



11









 





     (l) Prior to the effective date of the Registration Statement relating to the Registrable
Securities, provide a CUSIP number for the Registrable Securities.



     (m) Provide and cause to be maintained a transfer agent and registrar for all Registrable
Securities covered by such Registration Statement from and after a date not later than the
effective date of such Registration Statement.



     (n) Use its reasonable best efforts to cause all shares of Registrable Securities covered by
such Registration Statement to be authorized to be quoted on the NASDAQ National Market or listed
on a national securities exchange if shares of the particular class of Registrable Securities are
at that time quoted on the NASDAQ National Market or listed on such exchange, as the case may be.



     (o) Enter into such agreements (including an underwriting agreement in form, scope and
substance as is customary in underwritten offerings) and take all such other actions reasonably
requested by the holders of a majority of the Registrable Securities being sold in connection
therewith (including those reasonably requested by the managing underwriters, if any) to expedite
or facilitate the disposition of such Registrable Securities, and in such connection, whether or
not an underwriting agreement is entered into and whether or not the registration is an
underwritten registration, (i) make such representations and warranties to the holders of such
Registrable Securities and the underwriters, if any, with respect to the business of the Company
and its subsidiaries, and the Registration Statement, Prospectus and documents, if any,
incorporated or deemed to be incorporated by reference therein, in each case, in form, substance
and scope as are customarily made by issuers to underwriters in underwritten offerings, and, if
true, confirm the same if and when requested, (ii) use its reasonable best efforts to furnish to
the selling holders of such Registrable Securities opinions of counsel to the Company and updates
thereof (which counsel and opinions (in form, scope and substance) shall be reasonably satisfactory
to the managing underwriters, if any, and counsels to the selling holders of the Registrable
Securities), addressed to each selling holder of Registrable Securities and each of the
underwriters, if any, covering the matters customarily covered in opinions requested in
underwritten offerings and such other matters as may be reasonably requested by such counsel and
underwriters, (iii) use its reasonable best efforts to obtain “cold comfort” letters and updates
thereof from the independent certified public accountants of the Company (and, if necessary, any
other independent certified public accountants of any subsidiary of the Company or of any business
acquired by the Company for which financial statements and financial data
are, or are required to be, included in the Registration Statement) who have certified the
financial statements included in such Registration Statement, addressed to each selling holder of
Registrable Securities (unless such accountants shall be prohibited from so addressing such letters
by applicable standards of the accounting profession) and each of the underwriters, if any, such
letters to be in customary form and covering matters of the type customarily covered in “cold
comfort” letters in connection with underwritten offerings, (iv) if an underwriting agreement is
entered into, the same shall contain indemnification provisions and procedures substantially to the
effect set forth in Section 8 hereof with respect to all parties to be indemnified pursuant to said
Section and (v) deliver such documents and certificates as may be reasonably requested by the
holders of a majority of the Registrable Securities being sold, their counsel and the managing
underwriters, if any, to evidence the continued validity of the representations and warranties made
pursuant to Section 6(o)(i) above and to evidence



12









 




compliance with any customary conditions
contained in the underwriting agreement or other agreement entered into by the Company. The above
shall be done at each closing under such underwriting or similar agreement, or as and to the extent
required thereunder.




     (p) Make available for inspection by a representative of the selling holders of Registrable
Securities, any underwriter participating in any such disposition of Registrable Securities, if
any, and any attorneys or accountants retained by such selling holders or underwriter, at the
offices where normally kept, during reasonable business hours, all financial and other records,
pertinent corporate documents and properties of the Company and its subsidiaries, and cause the
officers, directors and employees of the Company and its subsidiaries to supply all information in
each case reasonably requested by any such representative, underwriter, attorney or accountant in
connection with such Registration Statement; provided, however, that any information that is not
generally publicly available at the time of delivery of such information shall be kept confidential
by such Persons unless (i) disclosure of such information is required by court or administrative
order, (ii) disclosure of such information, in the opinion of counsel to such Person, is required
by law, or (iii) such information becomes generally available to the public other than as a result
of a disclosure or failure to safeguard by such Person. In the case of a proposed disclosure
pursuant to (i) or (ii) above, such Person shall be required to give the Company written notice of
the proposed disclosure prior to such disclosure and, if requested by the Company, assist the
Company in seeking to prevent or limit the proposed disclosure. Without limiting the foregoing, no
such information shall be used by such Person as the basis for any market transactions in
securities of the Company or its subsidiaries in violation of law.



     (q) Comply with all applicable rules and regulations of the SEC and make available to its
security holders earning statements satisfying the provisions of Section 11(a) of the Securities
Act and Rule 158 thereunder, or any similar rule promulgated under the Securities Act, no later
than forty-five (45) days after the end of any twelve (12) month period (or ninety (90) days after
the end of any twelve (12) month period if such period is a fiscal year) (i) commencing at the end
of any fiscal quarter in which Registrable Securities are sold to underwriters in a firm commitment
or best efforts underwritten offering and (ii) if not sold to underwriters in such an offering,
commencing on the first day of the first fiscal quarter of the Company after the effective date of
a Registration Statement, which statements shall cover one of said twelve (12) month periods.



     (r) Cause its officers to use their reasonable best efforts to support the marketing of the
Registrable Securities covered by the Registration Statement (including, without limitation,
participation in “road shows”) taking into account the Company’s business needs.



     The Company may require each seller of Registrable Securities as to which any registration is
being effected to furnish to the Company in writing such information required in connection with
such registration regarding such seller and the distribution of such Registrable Securities as the
Company may, from time to time, reasonably request in writing and the Company may exclude from such
registration the Registrable Securities of any seller who unreasonably fails to furnish such
information within a reasonable time after receiving such request.



13









 





     Each holder of Registrable Securities agrees that if such holder has Registrable Securities
covered by such Registration Statement that, upon receipt of any notice from the Company of the
happening of any event of the kind described in Section 6(c)(ii), 6(c)(iii), 6(c)(v) or 6(c)(vi)
hereof, such holder will forthwith discontinue disposition of such Registrable Securities covered
by such Registration Statement or Prospectus until such holder’s receipt of the copies of the
supplemented or amended Prospectus contemplated by Section 6(k) hereof, or until it is advised in
writing by the Company that the use of the applicable Prospectus may be resumed, and has received
copies of any additional or supplemental filings that are incorporated or deemed to be incorporated
by reference in such Prospectus; provided, however, that the Company shall extend the time periods
under Section 3 with respect to the length of time that the effectiveness of a Registration
Statement must be maintained by the amount of time the holder is required to discontinue
disposition of such securities.



     Section 7. Registration Expenses. All reasonable fees and expenses incident to the performance of or compliance with this
Agreement by the Company (including, without limitation, (i) all registration and filing fees
(including, without limitation, fees and expenses (A) with respect to filings required to be made
with the National Association of Securities Dealers, Inc. and (B) of compliance with securities or
Blue Sky laws, including, without limitation, any fees and disbursements of counsel for the
underwriters in connection with Blue Sky qualifications of the Registrable Securities pursuant to
Section 6(h)), (ii) printing expenses (including, without limitation, expenses of printing
certificates for Registrable Securities in a form eligible for deposit with The Depository Trust
Company and of printing Prospectuses if the printing of Prospectuses is requested by the managing
underwriters, if any, or by the holders of a majority of the Registrable Securities included in any
Registration Statement), (iii) messenger, telephone and delivery expenses of the Company, (iv) fees
and disbursements of counsel for the Company, (v) expenses of the Company incurred in connection
with any road show, (vi) fees and disbursements of all independent certified public accountants
referred to in Section 6(o)(iii) hereof (including, without limitation, the expenses of any “cold
comfort” letters or oil and gas reserve reports required by this Agreement) and any other persons,
including special experts retained by the Company, and (vii) fees and disbursements of one counsel
for the holders of Registrable Securities whose shares are included in a Registration Statement,
which counsel shall be selected by the requesting Qualified Holders if such Registration Statement
is pursuant to a Demand Registration and otherwise by the holders of a majority of the Registrable
Securities included in such Registration Statement)
shall be borne by the Company, whether or not any Registration Statement is filed or becomes
effective. In addition, the Company shall pay its internal expenses (including, without
limitation, all salaries and expenses of its officers and employees performing legal or accounting
duties), the expense of any annual audit, the fees and expenses incurred in connection with the
listing of the securities to be registered on any securities exchange on which similar securities
issued by the Company are then listed and rating agency fees and the fees and expenses of any
Person, including special experts, retained by the Company.



     The Company shall not be required to pay (i) fees and disbursements of any counsel retained by
any holder of Registrable Securities or by any underwriter (except as set forth in clauses 7(i)(B)
and 7(vii)), (ii) any underwriter’s fees (including discounts, commissions or fees of underwriters,
selling brokers, dealer managers or similar securities industry professionals) relating to the
distribution of the Registrable Securities, or (iii) any other expenses of the holders



14









 




of
Registrable Securities not specifically required to be paid by the Company pursuant to the first
paragraph of this Section 7.




     Section 8. Indemnification.



     (a) Indemnification by the Company. The Company shall, without limitation as to time,
indemnify and hold harmless, to the fullest extent permitted by law, each holder of Registrable
Securities whose Registrable Securities are covered by a Registration Statement or Prospectus, the
officers, directors, partners, members, managers, stockholders, accountants, attorneys, agents,
employees and affiliates of each of them, each Person who controls each such holder (within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act) and the officers,
directors, partners, members, managers, stockholders, accountants, attorneys, agents, employees and
affiliates of each such controlling person, each underwriter, if any, and each Person who controls
(within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act) such
underwriter (each such person, a “Holder Indemnitee”), from and against any and all losses,
claims, damages, liabilities, costs (including, without limitation, costs of preparation and
reasonable attorneys’ fees and any legal or other fees or expenses incurred by such party in
connection with any investigation or Proceeding), expenses, judgments, fines, penalties, charges
and amounts paid in settlement (individually, a “Loss” and collectively, “Losses”),
as incurred, arising out of or based upon any untrue statement (or alleged untrue statement) of a
material fact contained in any Prospectus, offering circular, or other document (including any
related Registration Statement, notification, or the like) incident to any such registration,
qualification, or compliance, or based on any omission (or alleged omission) to state therein a
material fact required to be stated therein or necessary to make the statements therein not
misleading, or any violation by the Company of the Securities Act or any rule or regulation
thereunder applicable to the Company and relating to action or inaction required of the Company in
connection with any such registration, qualification, or compliance, and will reimburse each Holder
Indemnitee for any legal and any other expenses reasonably incurred in connection with
investigating and defending or settling any such Loss (or any action in respect thereof), provided
that the Company will not be liable in any such case to the extent that any such Loss (or any
action in respect thereof) arises out of or is based on any untrue statement or omission by such
holder or underwriter, but only to the extent, that such untrue statement (or
alleged untrue statement) or omission (or alleged omission) is made in such Registration
Statement, Prospectus, offering circular, or other document in reliance upon and in conformity with
written information furnished to the Company by such holder specifically for use therein. It is
agreed that the indemnity agreement contained in this Section 8(a) shall not apply to amounts paid
in settlement of any such Loss (or any action in respect thereof) if such settlement is effected
without the consent of the Company (which consent shall not be unreasonably withheld).



     (b) Indemnification by Holder of Registrable Securities. In connection with any
Registration Statement in which a holder of Registrable Securities is participating, such holder of
Registrable Securities shall furnish to the Company in writing such information as the Company
reasonably requests specifically for use in connection with any Registration Statement or
Prospectus and agrees to indemnify, to the fullest extent permitted by law, severally and not
jointly, the Company, its directors, officers, accountants, attorneys, agents and employees, each
Person who controls the Company (within the meaning of Section 15 of the Securities Act and



15









 




Section
20 of the Exchange Act), and the directors, officers, partners, members, managers, stockholders,
accountants, attorneys, agents or employees of such controlling persons, and each underwriter, if
any, and each person who controls such underwriter (within the meaning of Section 15 of the
Securities Act and Section 20 of the Exchange Act) (each such person, a “Company
Indemnitee”), from and against all Losses arising out of or based on any untrue statement of a
material fact contained in any such Registration Statement, Prospectus, offering circular, or other
document, or any omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, and will reimburse each Company Indemnitee
for any legal or any other expenses reasonably incurred in connection with investigating or
defending any such Loss (or any action in respect thereof), in each case to the extent, but only to
the extent, that such untrue statement or omission is made in such Registration Statement,
Prospectus, offering circular, or other document in reliance upon and in conformity with written
information furnished to the Company by such holder specifically for use in connection with the
preparation of such Registration Statement, Prospectus, offering circular or other document;
provided, however, that the obligations of such holder hereunder shall not apply to amounts paid in
settlement of any such Losses (or actions in respect thereof) if such settlement is effected
without the consent of such holder (which consent shall not be unreasonably withheld); and
provided, further, that the liability of each selling holder of Registrable Securities hereunder
shall be limited to the net proceeds received by such selling holder from the sale of Registrable
Securities covered by such Registration Statement. In addition, insofar as the foregoing indemnity
relates to any such untrue statement or omission made in the preliminary Prospectus but eliminated
or remedied in the amended Prospectus on file with the SEC at the time the Registration Statement
becomes effective or in the final Prospectus filed pursuant to applicable rules of the SEC or in
any supplement or addendum thereto and such new Prospectus is delivered to the underwriter, the
indemnity agreement herein shall not inure to the benefit of any Company Indemnitee, if a copy of
the final Prospectus filed pursuant to such rules, together with all supplements and addenda
thereto was not furnished to the Person asserting the Loss (or action in respect thereof) at or
prior to the time such furnishing is required by the Securities Act.




     (c) Conduct of Indemnification Proceedings. If any Person shall be entitled to
indemnity hereunder (an “indemnified party”), such indemnified party shall give prompt
notice to the party from which such indemnity is sought (the “indemnifying party”) of any
claim or of
the commencement of any Proceeding with respect to which such indemnified party seeks
indemnification or contribution pursuant hereto; provided, however, that the delay or failure to so
notify the indemnifying party shall not relieve the indemnifying party from any obligation or
liability except to the extent that the indemnifying party has been actually and materially
prejudiced by such delay or failure. The indemnifying party shall have the right, exercisable by
giving written notice to an indemnified party promptly after the receipt of written notice from
such indemnified party of such claim or Proceeding, to, unless in the indemnified party’s
reasonable judgment a conflict of interest between such indemnified and indemnifying parties may
exist in respect of such claim, assume, at the indemnifying party’s expense, the defense of any
such claim or Proceeding, with counsel reasonably satisfactory to such indemnified party; provided,
however, that an indemnified party shall have the right to employ separate counsel in any such
claim or Proceeding and to participate in the defense thereof, but the fees and expenses of such
counsel shall be at the expense of such indemnified party unless: (i) the indemnifying party agrees
to pay such fees and expenses; or (ii) the indemnifying party fails promptly to assume the defense
of such claim or Proceeding or fails to employ counsel reasonably



16









 




satisfactory to such indemnified
party; in which case the indemnified party shall have the right to employ counsel and to assume the
defense of such claim or proceeding; provided, however, that the indemnifying party shall not, in
connection with any one such claim or Proceeding or separate but substantially similar or related
claims or Proceedings in the same jurisdiction, arising out of the same general allegations or
circumstances, be liable for the fees and expenses of more than one firm of attorneys (together
with appropriate local counsel) at any time for all of the indemnified parties, or for fees and
expenses that are not reasonable. Whether or not such defense is assumed by the indemnifying
party, such indemnified party will not be subject to any liability for any settlement made without
its consent. The indemnifying party shall not consent to entry of any judgment or enter into any
settlement or compromise that does not include as an unconditional term thereof the giving by the
claimant or plaintiff to such indemnified party of a release, in form and substance reasonably
satisfactory to the indemnified party, from all liability in respect of such claim or litigation
for which such indemnified party would be entitled to indemnification hereunder.




     (d) Contribution. If the indemnification provided for in this Section 8 is
unavailable to an indemnified party in respect of any Losses (other than in accordance with its
terms), then each applicable indemnifying party, in lieu of indemnifying such indemnified party,
shall contribute to the amount paid or payable by such indemnified party as a result of such
Losses, in such proportion as is appropriate to reflect the relative fault of the indemnifying
party, on the one hand, and such indemnified party, on the other hand, in connection with the
actions, statements or omissions that resulted in such Losses as well as any other relevant
equitable considerations. The relative fault of such indemnifying party, on the one hand, and
indemnified party, on the other hand, shall be determined by reference to, among other things,
whether any action in question, including any untrue or alleged untrue statement of a material fact
or omission or alleged omission to state a material fact, has been taken by, or relates to
information supplied by, such indemnifying party or indemnified party, and the parties’ relative
intent, knowledge, access to information and opportunity to correct or prevent any such action,
statement or omission.



     The parties hereto agree that it would not be just and equitable if contribution pursuant to
this Section 8(d) were determined by pro rata allocation or by any other method of allocation that
does not take account of the equitable considerations referred to in the immediately preceding
paragraph. Notwithstanding the provisions of this Section 8(d), an indemnifying party that is
a selling holder of Registrable Securities shall not be required to contribute any amount in excess
of the amount by which the net proceeds from the sale of the Registrable Securities sold by such
indemnifying party exceeds the amount of any damages that such indemnifying party has otherwise
been required to pay by reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any Person who was not guilty of such
fraudulent misrepresentation.



     (e) Notwithstanding the foregoing, to the extent that the provisions on indemnification and
contribution contained in the underwriting agreement entered into in connection with the
underwritten public offering are in conflict with the foregoing provisions, the provisions in the
underwriting agreement shall control.



17









 





     Section 9. Rule 144. After the Initial Public Offering, the Company shall file the reports required to be filed by it
under the Securities Act and the Exchange Act, and will take such further action as any holder of
Registrable Securities may reasonably request, all to the extent required from time to time to
enable such holder to sell Registrable Securities without registration under the Securities Act
within the limitations of the exemption provided by Rule 144. Upon the request of any holder of
Registrable Securities, the Company shall deliver to such holder a written statement as to whether
it has complied with such requirements.



     Section 10. Underwritten Registrations. If any Demand Registration is an underwritten offering, the Qualified Holder making the demand
shall have the right to select the investment banker or investment bankers and managers to
administer the offering, subject to approval by the Company, not to be unreasonably withheld. The
Company shall have the right to select the investment banker or investment bankers and managers to
administer any Piggyback Registration.



     No Person may participate in any underwritten registration hereunder unless such Person (i)
agrees to sell the Registrable Securities it desires to have covered by the Demand Registration on
the basis provided in any underwriting arrangements in customary form and (ii) completes and
executes all questionnaires, powers of attorney, indemnities, underwriting agreements and other
documents required under the terms of such underwriting arrangements, provided that such Person
shall not be required to make any representations or warranties other than those related to title
and ownership of shares and as to the accuracy and completeness of statements made in a
Registration Statement, Prospectus, offering circular, or other document in reliance upon and in
conformity with written information furnished to the Company or the managing underwriter by such
Person specifically for use therein.



     Section 11. Limitation on Subsequent Registration Rights. From and after the date of this Agreement, the Company shall not, without the prior written
consent of the holders of at least a majority of the then outstanding Registrable Securities, enter
into any agreement with any holder or prospective holder of any securities of the Company
giving such holder or prospective holder any registration rights the terms of which are equivalent
to or more favorable than the registration rights granted to holders of Registrable Securities
hereunder, or which would reduce the amount of Registrable Securities the holders can include in
any registration filed pursuant to Section 3 hereof, unless such rights are subordinate to those of
the holders of Registrable Securities; provided, however, the Company may permit Persons acquiring
Common Stock or Series B Preferred Stock referred to in Section 2.2(d)(x) or (xi) of the
Stockholders’ Agreement to enter into an Addendum Agreement substantially in the form of Exhibit A
hereto and become a Stockholder hereunder entitled to registration rights hereunder.



     Section 12. Miscellaneous.



     (a) Amendments and Waivers. The provisions of this Agreement, including the
provisions of this sentence, may not be amended, modified or supplemented, and waivers or consents
to departures from the provisions hereof may not be given, unless the Company has obtained the
prior written consent of holders of at least a majority of the Registrable Securities; provided,
however, that in no event shall the obligations of any holder of Registrable Securities be
materially increased or the rights of any Stockholder be adversely affected (without similarly



18









 




adversely affecting the rights of all Stockholders), except upon the prior written consent of such
holder. Notwithstanding the foregoing or anything else in this Agreement that may be to the
contrary, (i) a waiver or consent to depart from the provisions hereof with respect to a matter
that relates exclusively to the rights of holders of Registrable Securities whose securities are
being sold pursuant to a Registration Statement and that does not directly or indirectly affect the
rights of any other holders of Registrable Securities or of any other Stockholders may be given by
holders of at least a majority of the Registrable Securities being sold by such holders pursuant to
such Registration Statement, or (ii) no such amendment, modification, supplement, waiver or consent
shall be made or given to or under this Agreement without the prior written consent of Merrill
Lynch: (A) if such amendment, modification, supplement, waiver or consent would adversely affect
Merrill Lynch’s rights in a material respect, unless such amendment, modification, supplement,
waiver or consent would adversely affect the rights of all Stockholders on a comparable basis, or
(B) if such amendment would impose any material obligation on Merrill Lynch.




     (b) Notices. All notices, approvals, waivers, consents and other communications
required or permitted to be given hereunder (each a “Notice”) shall be in writing and shall
be (i) personally delivered, (ii) telecopied and confirmed, (iii) mailed by certified mail, return
receipt requested, or (iv) sent by overnight delivery service with proof of receipt maintained, at
the following address:




If to the Company:




Targa Resources Investments Inc.

1000 Louisiana Street, Suite 4700

Houston, Texas 77002

Fax: (713) 888-0235




(or any other address that the Company may designate by written notice to the other
parties); and




If to any Stockholder, at such Stockholder’s address as set forth on Annex A hereto (or any
other address that any such Stockholder may designate by written notice to the other
parties).


Any Notice shall be deemed given and received upon actual receipt (or refusal of receipt) thereof.




     (c) Successors and Assigns; Stockholder Status. This Agreement shall inure to the
benefit of the partners of a Stockholder who have received shares of Registrable Securities from a
Stockholder pursuant to a Partner Distribution and shall inure to the benefit of and be binding
upon the successors and assigns of each of the parties, including subsequent holders of Registrable
Securities acquired, directly or indirectly, from the Stockholders; provided, however, that such
successor or assign shall not be entitled to such rights unless the successor or assign shall have
executed and delivered to the Company an Addendum Agreement substantially in the form of Exhibit A
hereto following the acquisition of such Registrable Securities, in which event such successor or
assign shall be deemed a Stockholder for purposes of this Agreement and



19









 




Annex A shall be updated by
the Company accordingly and provided, further, however, that subject to Section 11 hereunder if,
prior to a Qualified Public Offering, a Person who is not then a Stockholder, acquires Series B
Preferred Stock or Common Stock directly from the Company, then if the Company and such Person
execute an Addendum Agreement substantially in the form of Exhibit A hereto, then such Person shall
be deemed a Stockholder for purposes of this Agreement (and a Management Stockholder if the
Addendum Agreement so indicates) and Annex A shall be updated by the Company accordingly. Nothing
expressed or mentioned in this Agreement is intended or shall be construed to give any Person other
than the parties hereto and their respective successors and permitted assigns any legal or
equitable right, remedy or claim under, in or in respect of this Agreement or any provision herein
contained.




     (d) Counterparts. This Agreement may be executed (including by facsimile
transmission) with counterpart signature pages or in two or more counterparts, each of which shall
be deemed an original, but all of which together shall constitute one and the same instrument.



     (e) Headings. The section and paragraph headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or interpretation of this
Agreement.



     (f) Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of the State of New York (without giving effect to the choice of law principles
thereof).



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



     (h) Entire Agreement. This Agreement is intended by the parties as a final expression
of their agreement, and is intended to be a complete and exclusive statement of the agreement and
understanding of the parties hereto in respect of the subject matter contained herein. There are
no restrictions, promises, warranties or undertakings, other than those set forth or referred to
herein, with respect to the registration rights granted by the Company with respect to Registrable
Securities. This Agreement supersedes all prior agreements and understandings (written or oral)
between the parties with respect to such subject matter.



     (i) Securities Held by the Company or its subsidiaries. Whenever the consent of
holders of a specified percentage of Registrable Securities is required hereunder, Registrable
Securities held by the Company or its subsidiaries shall not be counted in determining whether such
consent was given by the holders of such required percentage.



20









 





     (j) Termination. This Agreement shall terminate on the earlier of (i) ten years
following the consummation of a Qualified Public Offering and (ii) when no Registrable Securities
remain outstanding; provided that Sections 7 and 8 hereof shall survive any termination hereof.



     (k) Specific Performance. The parties hereto recognize and agree that money damages
may be insufficient to compensate the holders of any Registrable Securities for breaches by the
Company of the terms hereof and, consequently, that the equitable remedy of specific performance of
the terms hereof will be available in the event of any such breach.



     (l) Consent to Jurisdiction. The parties hereto hereby irrevocably submit to the
exclusive jurisdiction of the courts of the State of New York and the federal courts of the United
States of America located in New York, and appropriate appellate courts therefrom, over any dispute
arising out of or relating to this Agreement or any of the transactions contemplated hereby, and
each party hereby irrevocably agrees that all claims in respect of such dispute or proceeding may
be heard and determined in such courts. The parties hereby irrevocably waive, to the fullest
extent permitted by applicable law, any objection which they may now or hereafter have to the
laying of venue of any dispute arising out of or relating to this Agreement or any of the
transactions contemplated hereby brought in such court or any defense of inconvenient forum for the
maintenance of such dispute. Each of the parties hereto agrees that a judgment in any such dispute
may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by
law. This consent to jurisdiction is being given solely for purposes of this Agreement and is not
intended to, and shall not, confer consent to jurisdiction with respect to any other dispute in
which a party to this Agreement may become involved.



     Each of the parties hereto hereby consents to process being served by any party to this
Agreement in any suit, action, or proceeding of the nature specified in the paragraph above by
the mailing of a copy thereof in the manner specified by the provisions of subsection (b) of
this Section 12.



     EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT.




21












 





     IN WITNESS WHEREOF, the parties hereto have caused this Amended and Restated Registration
Rights Agreement to be duly executed as of the date first above written.



	 	 	 	 	 
	 	TARGA RESOURCES, INC.

 	 
	 	By:  	/s/ Joe Bob Perkins
 	 
	 	 	Name:  	Joe Bob Perkins 	 
	 	 	Title:  	President 	 
	 



Signature Page to Amended and Restated Registration Rights Agreement




 









 








	 	 	 	 	 

	 	 	WARBURG PINCUS PRIVATE EQUITY VIII, L.P.
	 
	 	 	 	 
	 

	 	By:
	 	Warburg Pincus Partners LLC, its General Partner
	 
	 	 	 	 
	 

	 	By:
	 	Warburg Pincus & Co., its Managing Member
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Peter R. Kagan
	 	 	 	 	 
	 

	 	 	 	Partner
	 
	 	 	 	 
	 	 	WARBURG PINCUS NETHERLANDS PRIVATE EQUITY VIII I, C.V.
	 
	 	 	 	 
	 

	 	By:
	 	Warburg Pincus Partners LLC, its General Partner
	 
	 	 	 	 
	 

	 	By:
	 	Warburg Pincus & Co., its Managing Member
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Peter R. Kagan
	 	 	 	 	 
	 

	 	 	 	Partner
	 
	 	 	 	 
	 	 	WARBURG PINCUS GERMANY PRIVATE EQUITY VIII, K.G.
	 
	 	 	 	 
	 

	 	By:
	 	Warburg Pincus Partners LLC, its General Partner
	 
	 	 	 	 
	 

	 	By:
	 	Warburg Pincus & Co., its Managing Member
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Peter R. Kagan
	 	 	 	 	 
	 

	 	 	 	Partner






Signature Page to Amended and Restated Registration Rights Agreement




 









 








	 	 	 	 	 

	 	 	WARBURG PINCUS PRIVATE EQUITY IX, L.P.
	 
	 	 	 	 
	 

	 	By:
	 	Warburg Pincus Partners LLC, its General Partner
	 
	 	 	 	 
	 

	 	By:
	 	Warburg Pincus & Co., its Managing Member
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Peter R. Kagan
	 	 	 	 	 
	 

	 	 	 	Partner
	 
	 	 	 	 
	 	 	MERRILL LYNCH VENTURES L.P. 2001
	 
	 	 	 	 
	 

	 	By:
	 	Merrill Lynch Ventures, LLC, its general partner
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Christopher Birosak
	 	 	 	 	 





Signature Page to Amended and Restated Registration Rights Agreement




 









 








MANAGEMENT STOCKHOLDERS:






      





/s/ Rene R. Joyce 





Rene R. Joyce, individually and as authorized agent for the
Individual Retirement Account for the benefit of Rene
R. Joyce



/s/ Roy E. Johnson 





Roy E. Johnson, individually and as authorized agent
for the Individual Retirement Account for the benefit
of Roy E. Johnson



/s/ Joe Bob Perkins 





Joe Bob Perkins, individually and as authorized agent
for the Individual Retirement Account for the benefit
of Joe Bob Perkins



/s/ Jeffrey J. McParland 





Jeffrey J. McParland, individually and as authorized
agent for the Individual Retirement Account for the
benefit of Jeffrey J. McParland



/s/ Michael A. Heim 





Michael A. Heim, individually and as authorized agent
for the Individual Retirement Account for the benefit
of Michael A. Heim



/s/ Paul W. Chung 





Paul W. Chung, individually and as authorized agent
for the Individual Retirement Account for the benefit
of Paul W. Chung









Signature Page to Amended and Restated Registration Rights Agreement





 












 





	 	 	 	 	 
	 	HARRIET AND JOE B. FOSTER

 	 
	 	/s/ Harriet Foster
 	 
	 	Harriet Foster 	 



	 	 	 	 	 
	 	 	 
	 	                                           /s/ Joe B. Foster
 	 
	 	Joe B. Foster 	 



	 	 	 	 	 
	 	SUGARBERRY PARTNERS, LTD.
 


By: Sugarberry GP, LLC, its general partner

 	 
	 	By:  	/s/ Joe B. Foster
 	 
	 	 	      Joe B. Foster, authorized manager 	 



	 	 	 	 	 
	 	 	 
	 	                                           /s/ Joe B. Foster
 	 
	 	Joe B. Foster, individually 	 



	 	 	 	 	 
	 	JAMES W. AND VIRGINIA WHALEN

 	 
	 	/s/ James W. Whalen
 	 
	 	James W. Whalen 	 



	 	 	 	 	 
	 	 	 
	 	                                /s/ Virginia Whalen
 	 
	 	Virginia Whalen 	 



	 	 	 	 	 
	 	 	 
	 	                                /s/ James W. Whalen
 	 
	 	James W. Whalen, individually 	 



Signature Page to Amended and Restated Registration Rights Agreement




 









 








	 	 	 	 	 
	 	CHARLES R. AND VICKI KARYN CRISP,

JOINT TENANTS

 	 
	 	/s/ Charles R. Crisp
 	 
	 	Charles R. Crisp 	 



	 	 	 	 	 
	 	 	 
	 	                                /s/ Vicki Karyn Crisp
 	 
	 	Vicki Karyn Crisp, 	 



	 	 	 	 	 
	 	 	 
	 	                                /s/ Charles R. Crisp
 	 
	 	Charles R. Crisp, individually 	 



Signature Page to Amended and Restated Registration Rights Agreement





 









 








Annex A




STOCKHOLDERS




Warburg Pincus Private Equity VIII, L.P.

Warburg Pincus Netherlands Private Equity VIII I, C.V.

Warburg Pincus Germany Private Equity VIII, K.G

Warburg Pincus Private Equity IX, L.P.

Merrill Lynch Ventures L.P. 2001

Rene R. Joyce

Roy E. Johnson

Joe Bob Perkins

Michael A. Heim

Jeffrey J. McParland

Individual Retirement Account for the benefit of Rene R. Joyce

Individual Retirement Account for the benefit of Roy E. Johnson

Individual Retirement Account for the benefit of Joe Bob Perkins

Individual Retirement Account for the benefit of Michael A. Heim

Individual Retirement Account for the benefit of Jeffrey J. McParland

Harriet and Joe B. Foster

Sugarberry Partners, Ltd.

Joe B. Foster

James W. and Virginia Whalen

James W. Whalen

Charles R. and Vicki Karyn Crisp, Joint Tenants

Charles R. Crisp

Paul W. Chung

Individual Retirement Account for the benefit of Paul W. Chung




Annex A





 











 





Exhibit A




ADDENDUM AGREEMENT




     This Addendum Agreement is made this       day of                     , 20      , by and between
                                         (the “New Stockholder”) and Targa Resources Investments Inc., a Delaware
corporation (the “Company”), pursuant to an Amended and Restated Registration Rights Agreement
dated as of October 28, 2005 (the “Agreement”), between and among the Company and certain of its
stockholders (the “Stockholders”).



WITNESSETH:




     WHEREAS, the Company and the Stockholders entered into the Agreement to impose certain
restrictions and obligations upon themselves, and to provide certain registration rights, with
respect to certain securities of the Company; and



     WHEREAS, the New Stockholder has acquired Registrable Securities (as defined in the Agreement)
directly or indirectly from a Stockholder or the Company; and



     WHEREAS, the Company and the Stockholders have required in the Agreement that all persons
desiring registration rights must enter into an Addendum Agreement binding the New Stockholder to
the Agreement to the same extent as if it were an original party thereto;



     NOW, THEREFORE, in consideration of the mutual promises of the parties, the New Stockholder
acknowledges that it has received and read the Agreement and that the New Stockholder shall be
bound by, and shall have the benefit of, all of the terms and conditions set out in the Agreement
to the same extent as if it were an original party to the Agreement and shall be deemed to be a
[Management] Stockholder thereunder.


[Amend Annex A of Agreement if necessary to reflect appropriate schedule for new Stockholder.]




	 	 	 	 	 

	 	 	 	 	 
	 

	 	 
	 	New Stockholder
	Address:
	 	 	 	 
	 
	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	 	 	 






Exhibit A - 1









 








     AGREED TO on behalf of the Company pursuant to Section 12(c) of the Agreement.



	 	 	 	 	 

	 	 	TARGA RESOURCES INVESTMENTS INC.
	 
	 	 	 	 
	 

	 	By:
	 	 
	 	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	 
	 	 	Printed Name and Title







Exhibit A - 2