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EXHIBIT 10.3




FORM OF AMENDED AND RESTATED

STOCKHOLDERS AGREEMENT

OF

COMPLETE PRODUCTION SERVICES, INC.

A Delaware Corporation




     This Amended and Restated STOCKHOLDERS AGREEMENT, dated as of [___], 2006 amends and
restates in its entirety the Amended and Restated Stockholders Agreement (the “Previous
Agreement”), dated as of September 12, 2005, by and among Complete Production Services, Inc.
(the “Company”) and the other parties thereto (including parties who had become parties
thereto by execution of an adoption agreement) as contemplated by Section 5.8 of the Previous
Agreement and as amended by the First Amendment to the Previous Agreement, dated as of [___
___], 2006.



AGREEMENTS




ARTICLE 1.

DEFINITIONS AND CONSTRUCTION




     1.1 Definitions. In addition to the terms defined elsewhere herein, when used herein the following
terms shall have the meanings indicated:



     “Affiliate” means, with respect to a particular Person, any Person Controlling,
Controlled by, or Under Common Control with such Person.



     “Agreement” means this Amended and Restated Stockholders Agreement, as further amended
and restated from time to time.



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



     “Business Day” means any day other than a Saturday, a Sunday, or a holiday on which
banks are authorized or required by Law to close in the city of Houston, Texas.



     “Common Stock” means the common stock, $.01 par value, of the Company.



     “Common Stock Equivalents” means (without duplication with any other Common Stock or
Common Stock Equivalents) rights, warrants, options, convertible securities, or exchangeable
securities or indebtedness, or other rights, exercisable for or convertible or exchangeable into,
directly or indirectly, Common Stock or securities convertible or exchangeable into Common Stock,
whether at the time of issuance or upon the passage of time or the occurrence of some future event.



     “Company” means Complete Production Services, Inc., a Delaware corporation.



     “Contractual Management Rights” has the meaning set forth in Section 3.1(b).



     “Control” (including the correlative terms “Controlling”, “Controlled by” and “Under
Common Control with”) means possession, directly or indirectly, of the power to direct or cause



 









 




the direction of management or policies (whether through ownership of securities or any partnership or
other ownership interest, by contract or otherwise) of a Person.




     “Demand Holder” means any SCF Demand Holder or Non-SCF Demand Holder.



     “Demand Registration” has the meaning set forth in Section 2.1(a)(i) below.



     “Demand Request” has the meaning set forth in Section 2.1(a)(i) below.



     “Disposing Holders” has the meaning set forth in Section 2.9.



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



     “Fully-Diluted Common Stock” means, at any time, the then outstanding Common Stock of
the Company plus (without duplication) all shares of Common Stock issuable, whether at such time or
upon the passage of time or the occurrence of future events, upon the exercise, conversion or
exchange of all then outstanding Common Stock Equivalents.



     “Holder” means a Stockholder (as defined herein, but excluding any Person who executes
this Agreement or a separate agreement to be bound by the terms hereof solely in his or her
capacity as a spouse of a Stockholder) who holds Registrable Securities; provided, however that a
Person shall cease to be a Holder if and when such Person owns Common Stock and Common Stock
Equivalents representing less than four percent of the outstanding Common Stock and such Person may
dispose of all Registrable Securities then owned by such Person pursuant to Rule 144(k) (or any
successor rule) under the Securities Act, and in such case the Registrable Securities owned by such
Person shall cease to be Registrable Securities; provided further, however that a Person shall
cease to be a Holder after the second anniversary hereof if the Company requests in writing that
such Person confirm in writing that such Person remains a Holder and such Person fails to so
confirm within 30 days of such notice.



     “Indemnified Party” has the meaning set forth in Section 2.6(c) below.



     “Indemnifying Party” has the meaning set forth in Section 2.6(c) below.



     “Inspectors” has the meaning set forth in Section 2.4(j) below.



     “Law” means any applicable constitutional provision, statute, act, code, law,
regulation, rule, ordinance, order, decree, ruling, proclamation, resolution, judgment, decision,
declaration, or interpretative or advisory opinion or letter of a governmental authority.



     “Material Adverse Effect” has the meaning set forth in Section 2.1(d) below.



     “Non-SCF Demand Holders” means the Non-SCF Holders and each transferee of Non-SCF
Registrable Securities directly or indirectly (in a chain of title) from the Non-SCF Holder if such
transferee to whom the right to request, or participate in the request of, a Demand
Registration under Section 2.1(a) has been expressly assigned in writing directly or
indirectly (in a chain of title) from the Non-SCF Holder as permitted by Section 2.8 hereof.



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     “Non-SCF Holder” means any Stockholder other than SCF or any of its Affiliates.



     “Non-SCF Registrable Securities” means the Common Stock issued to or acquired by any
Non-SCF Holders, and any Common Stock into which Common Stock Equivalents held by a Non-SCF Holder
have been or may be converted, exchanged or acquired and any other securities issued or issuable
with respect to such securities by way of a stock dividend or stock split or in connection with a
combination of shares, recapitalization, merger, consolidation or reorganization; provided, that
any Non-SCF Registrable Security will cease to be a Non-SCF Registrable Security when (a) a
registration statement covering such Non-SCF Registrable Security has been declared effective by
the SEC and it has been disposed of pursuant to such effective registration statement, (b) it is
sold under circumstances in which all of the applicable conditions of Rule 144 (or any similar
provisions then in force) under the Securities Act are met, (c) (i) it has been otherwise
transferred, (ii) the Company has delivered a new certificate or other evidence of ownership for it
not bearing any legend similar to that required pursuant to Section 5.6 of the Previous Agreement
and (iii) it may be resold without subsequent registration under the Securities Act and without any
restrictions set forth under Rule 144 (or any successor rule) or (d) the Non-SCF Holder thereof has
ceased to be a Holder in accordance with the provisos to the definition of Holder provided for
herein.



     “Person” means any natural person, limited liability company, corporation, limited
partnership, general partnership, joint stock company, joint venture, association, company, trust,
bank trust company, land trust, business trust, or other organization, whether or not a legal
entity, and any government or agency or political subdivision thereof.



     “Piggyback Registration” has the meaning set forth in Section 2.2(a).



     “Piggyback Securities” has the meaning set forth in Section 2.2(b).



     “Preferred Request” has the meaning set forth in Section 2.3(c).



     “Qualified Public Offering” means the first closing of an underwritten public offering
of Common Stock registered under the Securities Act, pursuant to which such shares of common stock
are authorized and approved for listing on a national securities exchange or admitted to trading
and quoted in the Nasdaq National Market or comparable system.



     “Records” has the meaning set forth in Section 2.4(j) below.



     “Registrable Securities” means the SCF Registrable Securities and the Non-SCF
Registrable Securities.



     “Registration Expenses” has the meaning set forth in Section 2.5 below.



     “Requesting Holders” means a Holder who makes a Demand Request pursuant to Section 2.1
below, except as provided in Section 2.1(e) below.



     “Required Filing Date” has the meaning set forth in Section 2.1(a)(ii).



     “SCF” means SCF-IV, L.P., a Delaware limited partnership.



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     “SCF Demand Holders” means SCF and each transferee of SCF Registrable Securities
directly or indirectly (in a chain of title) from SCF if such transferee to whom the right to
request a Demand Registration under Section 2.1(a) has been expressly assigned in writing directly
or indirectly (in a chain of title) from SCF as permitted by Section 2.8 hereof.



     “SCF Directors” has the meaning set forth in Section 3.1(a).



     “SCF Registrable Securities” means the Common Stock issued to or acquired by SCF,
including any Common Stock acquired by SCF from any Non-SCF Holder in accordance with the terms of
the Agreement, and any Common Stock into which Common Stock Equivalents held by SCF have been
converted, exchanged or acquired and any other securities issued or issuable with respect to such
securities by way of a stock dividend or stock split or in connection with a combination of shares,
recapitalization, merger, consolidation or reorganization; provided, that any SCF Registrable
Security will cease to be an SCF Registrable Security when (a) a registration statement covering
such SCF Registrable Security has been declared effective by the SEC and it has been disposed of
pursuant to such effective registration statement, (b) it is sold under circumstances in which all
of the applicable conditions of Rule 144 (or any similar provisions then in force) under the
Securities Act are met, (c) (i) it has been otherwise transferred, (ii) the Company has delivered a
new certificate or other evidence of ownership for it not bearing any legend similar to that
required pursuant to Section 5.6 of the Previous Agreement and (iii) it may be resold without
subsequent registration under the Securities Act, or (d) SCF has ceased to be a Holder in
accordance with the provisos to the definition of Holder provided for herein.



     “SEC” means the Securities and Exchange Commission or any successor governmental
agency.



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



     “Selling Holder” means a Holder who is selling Registrable Securities pursuant to a
registration statement under the Securities Act.



     “Spouse” has the meaning set forth in Section 4.8.



     “Stockholder” means each person listed as a “Stockholder” on Exhibit A hereto
and any Person to whom Registrable Securities and registration rights have been transferred
pursuant to Section 2.8 hereof.



     “Subsidiary” means (i) any corporation or other entity a majority of the capital stock
or other equity ownership interests of which having ordinary voting power to elect a majority of
the board of directors or other Persons performing similar functions is at the time owned, directly
or indirectly, with power to vote, by the Company or any direct or indirect Subsidiary of the
Company or (ii) a partnership in which the Company or any direct or indirect Subsidiary is a
general partner.



     “Transfer” (including the correlative terms “Transfers,” “Transferring” or
“Transferred”) means any direct or indirect transfer, assignment, sale, gift, pledge, hypothecation
or other encumbrance, or any other disposition (whether voluntary or involuntary or by operation



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of law), of shares of Common Stock (or any interest (pecuniary or otherwise) therein or right
thereto), including derivative or similar transactions or arrangements whereby a portion or all of
the economic interest in, or risk of loss or opportunity for gain with respect to, Common Stock is
transferred or shifted to another Person; provided, however, that (i) an exchange, merger,
recapitalization, consolidation or reorganization involving the Company in which securities of the
Company or any other Person and/or cash are issued in respect of all shares of Common Stock shall
not be deemed a Transfer if all shares of Common Stock are treated identically in any such
transaction (other than (A) differences resulting from the treatment of fractional shares that
would otherwise result from such transaction, (B) the cancellation for no consideration of shares
of Common Stock held by any Party that has consented to such cancellation and/or (C) differences
resulting from any election made by the Parties so long as all Parties have an equal opportunity to
make such an election) and (ii) the exercise of options in accordance with the terms of an
Incentive Plan shall not be deemed a Transfer.




     “Underwriter” means a securities dealers which purchases any Registrable Securities as
principal and not as part of such dealer’s market-making activities.



     1.2 Construction. All references in this Agreement to Exhibits, Articles, Sections, subsections
and other subdivisions refer to the corresponding Exhibits, Articles, Sections, subsections and
other subdivisions of or to this Agreement unless expressly provided otherwise. Titles appearing
at the beginning of any Articles, Sections, subsections or other subdivisions of this Agreement are
for convenience only, do not constitute any part of this Agreement, and shall be disregarded in
construing the language hereof. The words “this Agreement,” “herein,” “hereby,” “hereunder” and
“hereof” and words of similar import refer to this Agreement as a whole and not to any particular
subdivision unless expressly so limited. The words “this Article,” “this Section” and “this
subsection” and words of similar import refer only to the Article, Section or subsection hereof in
which such words occur. The word “or” is not exclusive, and the word “including” (in its various
forms) means including without limitation. Pronouns in masculine, feminine or neuter genders shall
be construed to state and include any other gender, and words, terms and titles (including terms
defined herein) in the singular form shall be construed to include the plural and vice versa,
unless the context otherwise requires.



ARTICLE 2.

REGISTRATION OF STOCK




     2.1 Demand Registration.



     (a) Request for Registration.




     (i) From and after 180 days following a Qualified Public Offering, any SCF Demand
Holder or the Non-SCF Demand Holders holding in the aggregate at least 50% of the Non-SCF
Registrable Securities then held by the Non-SCF Demand Holders may
make a written request of the Company (a “Demand Request”) to have the Company
effect a registration under the Securities Act (a “Demand Registration”) for the
sale of all or part of their Registrable Securities. Following receipt of such Demand
Request, the Company shall be required to use commercially reasonable efforts to effect such
Demand Registration subject to the terms hereof; provided that the Registrable Securities
proposed



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to be offered by the Requesting Holders in any such Demand Request must have a
reasonably anticipated aggregate offering price of at least $20,000,000 net of underwriting
discounts and commissions; and provided further that (x) the SCF Demand Holders shall be
entitled to make no more than five Demand Requests in the aggregate pursuant to the
foregoing provisions and (y) subject to paragraph (b) below, the Non-SCF Demand Holders
(regardless of whether certain Non-SCF Demand Holders do not participate in such Demand
Request) shall be entitled to make no more than one Demand Request pursuant to the foregoing
provisions; and provided further that, with respect to clauses (x) and (y) above, the
Company shall not be obligated to effect more than one Demand Registration at the request of
any of the Demand Holders in any six-month period. 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, any Demand Request by SCF with a reasonably
anticipated aggregate offering price of at least $100,000,000 may be for a “shelf”
registration pursuant to Rule 415 under the Securities Act; provided that if SCF requests
that any such “shelf” registration statement remain effective for a period in excess of two
years, such “shelf” registration shall count as two Demand Requests for the purposes of this
Section 2.1(a).




     (ii) Each Demand Request shall specify the number of shares of Registrable Securities
proposed to be sold. Subject to Section 2.3(c), the Company shall use its best efforts to
file under the Securities Act a registration statement on an appropriate form to effect the
Demand Registration within 30 days if eligible to use Form S-3, otherwise within 60 days if
not so eligible, after receiving a Demand Request (the “Required Filing Date”) and
shall use commercially reasonable efforts to cause the same to be declared effective by the
SEC as promptly as practicable after such filing.



     (b) Effective Registration and Expenses. A registration will not count as a Demand
Registration until it has become effective (unless the Requesting Holders withdraw their Demand
Request, in which case such demand will count as a Demand Registration unless (i) the Requesting
Holders pay all Registration Expenses in connection with such withdrawn registration, (ii) during
the registration process material adverse information regarding the Company is disclosed that was
not known by such Requesting Holders at the time the request for such Demand Registration was made
or (iii) the Company has not complied in all material respects with its obligations hereunder
required to have been taken prior to such withdrawal); provided that if, after it has become
effective, an offering of Registrable Securities pursuant to a registration is interfered with by
any stop order, injunction or other order or requirement of the SEC or other governmental agency or
court, such registration will be deemed not to have been effected and will not count as a Demand
Registration. Notwithstanding the foregoing, if, in connection with the Demand Request made by the
Non-SCF Demand Holders only, the number of Registrable Securities of such Non-SCF Demand Holders
included in such registration after giving effect to the provisions of paragraph (d) below is less
than 70% of the Non-SCF Registrable Securities requested to be included in such registration
pursuant to such Demand Request, such Non-SCF Demand Holders shall be entitled to make one additional Demand Request,
in which case the dollar limitations set forth in paragraph (a) above shall be waived; provided
that any Non-SCF Demand Holders who elected to opt out of the first Demand Request by the Non-SCF
Demand Holders shall be entitled to participate in any additional Demand Request hereby granted to
the Non-SCF Demand Holders.



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     (c) Selection of Underwriters. The offering of Registrable Securities pursuant to a
Demand Registration requested prior to such time as the Company is eligible to register on a Form
S-3 registration statement (or a successor form) the sale of Common Stock requested by such Demand
Registration shall be in the form of an underwritten offering. If the Requesting Holder so
indicates, the Requesting Holder shall select the book-running managing Underwriter and such
additional Underwriters to be used in connection with the offering; provided that such selections
shall be subject to the consent of the Company, which consent shall not be unreasonably withheld.



     (d) Priority on Demand Registrations. No securities to be sold for the account of any
Person (including the Company) other than a Requesting Holder shall be included in a Demand
Registration if the managing Underwriter(s) shall advise the Requesting Holders that the inclusion
of such securities will materially and adversely affect the price or success of the offering (a
“Material Adverse Effect”); provided, however, that for purposes of the foregoing, (i) with
respect to a Demand Request made by an SCF Demand Holder, all other SCF Holders who desire to
participate in such Demand Registration and, for the first two (2) Demand Requests made by the SCF
Demand Holders only, all Non-SCF Holders who have the right to participate in such Demand
Registration in accordance with paragraph (e) below or pursuant to an exercise of their rights
under Section 2.2, shall be deemed to be Requesting Holders for all purposes other than determining
the number of Demand Requests made by such SCF Holders, and (ii) with respect to a Demand Request
made by the Non-SCF Demand Holders, all of the Non-SCF Demand Holders who desire to participate in
such Demand Registration shall be deemed to be Requesting Holders. Furthermore, in the event the
managing Underwriter(s) shall advise the Requesting Holders that even after exclusion of all
securities of other Persons pursuant to the immediately preceding sentence, the amount of
Registrable Securities proposed to be included in such Demand Registration by Requesting Holders is
sufficiently large to cause a Material Adverse Effect, the Registrable Securities of Requesting
Holders to be included in such Demand Registration shall be allocated pro rata among the Requesting
Holders on the basis of the number of shares of Common Stock requested to be included in such
registration by each such Requesting Holder.



     (e) Multiple Demands. If the Company shall receive, within a period of 15 days, a
request to file a registration statement from more than one Person who has the contractual right
(whether exercisable alone or in conjunction with other rights) to require the Company to file a
registration statement (whether or not such Person is a Demand Holder), only the first such Person
requesting the Company to file a registration statement shall be considered a Requesting Holder for
the purposes of determining the number of Demand Requests that may be made by such Person pursuant
to this Section 2.1, and all other Persons making such requests shall be considered a Requesting
Holder for all purposes other than determining the number of Demand Requests made by such Person
and provided further that if the request to file such a registration statement was first made by
the Non-SCF Holders, then any Non-SCF Holder who exercises his
rights under Section 2.2 hereof shall be deemed a Requesting Holder for all purposes
hereunder. In the event the Company shall receive a request to file a Demand Registration
Statement from any Person (including a Demand Holder) who has the contractual right to cause the
Company to do so, the Company shall promptly (and in any event within five days after its receipt
of such request) notify all Demand Holders (in each case who then own Registrable Securities)
thereof.



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     2.2 Piggy-Back Registration.



     (a) Piggyback Registration Rights. If the Company proposes to file a registration
statement under the Securities Act with respect to an offering of any shares of Common Stock by the
Company for its own account (other than a Qualified Public Offering) or for the account of any
holder of Common Stock (including any Holder) (other than a registration statement on Form S-4 or
S-8 or any substitute form that may be adopted by the SEC or any registration statement filed in
connection with an exchange offer or offering of securities solely to the Company’s existing
security holders), then the Company shall give written notice of such proposed filing to the
Holders of the Registrable Securities as soon as practicable (but, subject to the last sentence in
Section 2.1(e), in no event less than 15 days before the anticipated filing date of such
registration statement), and such notice shall offer such Holders the opportunity to register such
number of Registrable Securities as each such Holder may request (a “Piggyback
Registration”). Subject to Section 2.2(b) hereof, the Company shall include in each such
Piggyback Registration all Registrable Securities requested to be included in the registration for
such offering by written notice to the Company within 15 days of receipt (in accordance with
Section 4.1) of the Company’s notice referred to above; provided, however, that the Company may at
any time withdraw or cease proceeding with any such registration for its own account prior to
effectiveness of such registration whether or not any Holder of Registrable Securities has elected
to include any Registrable Securities in such registration. Each Holder of Registrable Securities
shall be permitted to withdraw all or part of such Holder’s Registrable Securities from a Piggyback
Registration at any time prior to the effective date thereof.



     (b) Priority on Piggyback Registration. The Company shall use commercially reasonable
efforts to cause the managing Underwriter(s) of a proposed underwritten offering to permit the
Registrable Securities requested to be included in the registration statement for such offering
under Section 2.2(a) (“Piggyback Securities”) to be included on the same terms and
conditions as any similar securities included therein. Notwithstanding the foregoing, the Company
shall not be required to include any Holder’s Piggyback Securities in such offering unless such
Holder accepts the terms of the underwriting agreement between the Company and the managing
Underwriter(s) and otherwise complies with the provisions of Section 2.7 below. If the managing
Underwriter(s) of a proposed underwritten offering advise(s) the Company that in their opinion the
total amount of securities, including Piggyback Securities, to be included in such offering is
sufficiently large to cause a Material Adverse Effect, then in such event the securities to be
included in such offering shall be allocated first to the Requesting Holders if such registration
statement is pursuant to a Demand Request or, if not, then to the Company, and then, to the extent
that any additional securities can, in the opinion of such managing Underwriter(s), be sold without
any such Material Adverse Effect, pro rata among the holders of Piggyback Securities on the basis
of the number of Registrable Securities then held by each such holder.



2.3 Holdback Agreements.




     (a) Restrictions on Public Sale by Holder of Registrable Securities. Following any
underwritten public offering of equity securities by the Company or any Holder of Registrable
Securities effected pursuant to this Agreement, each Holder of Registrable Securities agrees not to
effect any public sale or distribution of securities similar to those being registered or of any
securities convertible into or exchangeable or exercisable for such securities or hedging



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transactions
relating to the Registrable Securities, including a sale pursuant to Rule 144 under the Securities Act, during the 14 days prior to the expected date of “pricing” of such offering and
during such period, not to exceed 180 days with respect to a Qualified Public Offering or 90 days
with respect to any subsequent offering, beginning on the date of such final prospectus (or
prospectus supplement if the offering is made pursuant to a “shelf” registration) as shall be
reasonably requested by the managing Underwriter(s) except as part of such registration, and, if
and to the extent requested by the managing Underwriter(s), each such Holder of Registrable
Securities agrees to execute an agreement to the foregoing effect with the Underwriter(s) for such
offering on such terms as the managing Underwriter(s) shall reasonably request.




     (b) Restrictions on Public Sale by the Company. Following any underwritten public
offering of equity securities by any Holder of Registrable Securities effected pursuant to this
Agreement, the Company agrees not to effect any public sale or distribution of any securities
similar to those being registered, or any securities convertible into or exchangeable or
exercisable for such securities, during the 14 days prior to the expected date of “pricing” of such
offering and during such period, not to exceed 180 days with respect to a Qualified Public Offering
or 90 days with respect to any subsequent offering, beginning on the date of such final prospectus
(or prospectus supplement if the offering is made pursuant to a “shelf” registration) as shall be
reasonably requested by the managing Underwriter(s) except as part of such registration as
permitted hereby.



     (c) Deferral of Filing. The Company may defer the filing (but not the preparation) of
a registration statement required by Section 2.1 if (i) at the time the Company receives the Demand
Request, the Company or any of its subsidiaries are engaged in confidential negotiations or other
confidential business activities, disclosure of which would be required in such registration
statement (but would not be required if such registration statement were not filed) and the Board
determines in good faith that such disclosure would be materially detrimental to the Company, until
a date not later than 60 days after the Required Filing Date or (ii) subject to Section 2.1(e), the
Company had received, prior to receiving such Demand Request, a Demand Request from a different
group of Requesting Holders (a “Preferred Request”) and is proceeding with reasonable
diligence to comply with the Preferred Request, until a date not later than the later of (A) six
months after the effective date of such Preferred Request or (B) the end of the holdback period
referred to in Section 2.3(a) above with respect to such Preferred Request or (iii) prior to
receiving such Demand Request, the Board had determined to effect a registered underwritten public
offering of the Company’s equity securities for the Company’s account and the Company had taken
substantial steps (including, but not limited to, selecting or entering into a letter of intent
with the managing Underwriter(s) for such offering) and is proceeding with reasonable diligence to
effect such offering, until a date not later than the end of the holdback period referred to in
Section 2.3(a) above with respect to such offering. A deferral of the filing of a registration
statement pursuant to this Section 2.3(c) shall be lifted, and the requested
registration statement shall be filed as soon as reasonably practicable, if, in the case of a
deferral pursuant to clause (i) of the preceding sentence, the negotiations or other activities are
disclosed or terminated, or, in the case of a deferral pursuant to clause (ii) of the preceding
sentence, the Preferred Request is withdrawn, or in the case of a deferral pursuant to clause (iii)
of the preceding sentence, the proposed registration for the Company’s account is abandoned. In
order to defer the filing of a registration statement pursuant to this Section 2.3(c), the Company
shall promptly, upon determining to seek such deferral, deliver to each Requesting Holder a
certificate



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signed by the Chief Executive Officer of the Company stating that the Company is
deferring such filing pursuant to this Section 2.3(c) and the basis therefor in reasonable detail.
Within 20 days after receiving such certificate, the Holders of a majority of the Registrable
Securities held by the Requesting Holders and for which registration was previously requested may
withdraw such request by giving notice to the Company. If withdrawn, the Demand Request shall be
deemed not to have been made for all purposes of this Agreement. The Company may defer the filing
of a Demand Registration pursuant to this Section 2.3(c) only one time during any 12-month period.
Nothing in this paragraph shall affect the rights of the Holders under Section 2.2 to participate
in any such Demand Registration at such time as the filing deferral is lifted in accordance with
this Section 2.3(c).




     (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 12-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 or any of its subsidiaries are engaged in confidential
negotiations or other confidential business activities, disclosure of which would be required if
such registration statement were used (but would not be required if such registration statement
were not used) and the Board determines in good faith that such disclosure would be materially
detrimental to the Company. In order to suspend the use of the registration statement pursuant to
this Section 2.3(d), the Company shall promptly, upon determining to seek such suspension, deliver
to the holders of Registrable Securities included in such registration statement, a certificate
signed by the Chief Executive Officer of the Company stating that the Company is suspending use of
such registration statement pursuant to this Section 2.3(d) and the basis therefor in reasonable
detail. 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 HAS GIVEN THE COMPANY AT
LEAST ONE BUSINESS DAY 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).



     2.4 Registration Procedures. Whenever the Holders have requested that any Registrable
Securities be registered pursuant to Section 2.1 hereof, the Company will, at its expense, use
commercially reasonable efforts to effect the registration of such Registrable
Securities under the Securities Act prior to the Required Filing Date, and in connection with
any such request, the Company will as expeditiously as practicable:



     (a) prepare and file with the SEC a registration statement on any form for which the Company
then qualifies or which counsel for the Company shall deem appropriate and which form shall be
available for the sale of the Registrable Securities to be registered thereunder in accordance with
the intended method of distribution thereof, and use commercially reasonable efforts and proceed
diligently and in good faith to cause such filed registration statement to



10









 




become effective under the Securities Act; provided that before filing a registration statement or prospectus or any
amendments or supplements thereto, the Company will furnish to all Selling Holders and to one
counsel reasonably acceptable to the Company selected by the Selling Holders, copies of all such
documents proposed to be filed, which documents will be subject to the review of such counsel;
provided further that in connection with a Demand Registration, the Company shall not file any
registration statement or prospectus, or any amendments or supplements thereto, if the Requesting
Holders who hold a majority of the Registrable Securities covered by such registration statement or
their counsel shall reasonably object on a timely basis;




     (b) prepare and file with the SEC such amendments and supplements to such registration
statement and the prospectus used in connection therewith as may be necessary to keep such
registration statement effective pursuant to Section 2.1 for a period (except as provided in the
last paragraph of this Section 2.4) of not less than 270 consecutive days (or four years, or such
shorter period as the Requesting Holders who hold a majority of the Registrable Securities covered
by such registration may elect, if a “shelf registration” is requested) or, if shorter, the period
terminating when all Registrable Securities covered by such registration statement have been sold
(but not before the expiration of the applicable period referred to in Section 4(3) of the
Securities Act and Rule 174 thereunder, if applicable) and comply with the provisions of the
Securities Act with respect to the disposition of all securities covered by such registration
statement during such period in accordance with the intended method of disposition by the Selling
Holders thereof set forth in such registration statement; provided however that any Selling Holder
that has been included on a “shelf” registration statement may request that such Seller Holder’s
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;



     (c) furnish to each such Selling Holder such number of copies of such registration statement,
each amendment and supplement thereto (in each case including all exhibits thereto), the prospectus
included in such registration statement (including each preliminary prospectus) and such other
documents as such Selling Holder may reasonably request in order to facilitate the disposition of
the Registrable Securities owned by such Selling Holder;



     (d) notify the Selling Holders 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 under the Securities Act and each applicable state Law, (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 or warranties of the Company or any Subsidiary
contained in any agreement (including any underwriting agreement) contemplated by Section 2.4(i)
below cease to be true and correct in any material respect, (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, (vi) of the happening of any event which makes
any statement made in such registration statement or related prospectus or any document
incorporated or



11









 




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 required to be stated
therein or necessary to make the statements therein, in light of the circumstances under which they
were made, not misleading, and (vii) of the Company’s reasonable determination that a
post-effective amendment to a registration statement would be appropriate;




     (e) use commercially reasonable 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, at the earliest practicable moment;



     (f) cooperate with the Selling Holders and the managing Underwriter(s) to facilitate the
timely preparation and delivery of certificates representing Registrable Securities to be sold,
which certificates shall not bear any restrictive legends and shall be in a form eligible for
deposit with The Depositary Trust Company;



     (g) use commercially reasonable efforts to register or qualify such Registrable Securities as
promptly as practicable under such other securities or blue sky laws of such jurisdictions as any
Selling Holder or managing Underwriter reasonably (in light of the intended plan of distribution)
requests and do any and all other acts and things which may be reasonably necessary or advisable to
enable such Selling Holder or managing Underwriter to consummate the disposition in such
jurisdictions of the Registrable Securities owned by such Selling Holder; provided that the Company
will not be required to (i) qualify generally to do business in any jurisdiction where it would not
otherwise be required to qualify but for this paragraph (g), (ii) subject itself to taxation in any
such jurisdiction or (iii) consent to general service of process in any such jurisdiction;



     (h) use commercially reasonable efforts to cause such Registrable Securities to be registered
with or approved by such other governmental agencies or authorities, if any, as may be required of
the Company to enable the Selling Holder or Selling Holders thereof to consummate the disposition
of such Registrable Securities;



     (i) enter into customary agreements (including an underwriting agreement in customary form
with customary indemnification provisions) and take such other actions as are reasonably required
or advisable in order to expedite or facilitate the disposition of such
Registrable Securities, including providing reasonable availability of appropriate members of
senior management of the Company to provide customary due diligence assistance in connection with
any offering and to participate in customary “road show” presentations in connection with any
underwritten offerings in substantially the same manner as they would in an underwritten primary
registered public offering by the Company of its Common Stock, after taking into account the
reasonable business requirements of the Company in determining the scheduling and duration of any
road show;



12









 





     (j) make available for inspection by any Selling Holder of such Registrable Securities, any
Underwriter participating in any disposition pursuant to such registration statement and any
attorney, accountant or other professional retained by any such Selling Holder or Underwriter
(collectively, the “Inspectors”), all financial and other records, pertinent corporate
documents and properties of the Company (collectively, the “Records”) as shall be
reasonably necessary to enable them to exercise their due diligence responsibility, and cause the
Company’s officers, directors and employees to supply all information reasonably requested by any
such Inspectors in connection with such registration statement. Each Selling Holder of such
Registrable Securities agrees that information obtained by it as a result of such inspections shall
be deemed confidential and shall not be used by it as the basis for any market transactions in the
securities of the Company or its Affiliates unless and until such is made generally available to
the public (other than by such Selling Holder). Each Selling Holder of such Registrable Securities
further agrees that it will, as soon as practicable upon learning that disclosure of such Records
is sought in a court of competent jurisdiction, give notice to the Company and allow the Company at
its expense to undertake appropriate action to prevent disclosure of the Records deemed
confidential;



     (k) use commercially reasonable efforts to obtain a comfort letter or comfort letters from the
Company’s independent public accountants in customary form and covering such matters of the type
customarily covered by comfort letters as the managing Underwriter(s) reasonably request(s);



     (l) otherwise use commercially reasonable efforts to comply with all applicable rules and
regulations of the SEC, and make available to its security holders, as soon as reasonably
practicable, an earnings statement covering a period of twelve months, beginning within three
months after the effective date of the registration statement, which earnings statement shall
satisfy the provisions of Section 11(a) of the Securities Act;



     (m) use commercially reasonable efforts to cause all such Registrable Securities to be listed
on each securities exchange on which similar securities issued by the Company are then listed or
quoted on any inter-dealer quotation system on which similar securities issued by the Company are
then quoted;



     (n) if any event contemplated by Section 2.4(d)(vi) above shall occur, as promptly as
practicable prepare a supplement or amendment or post-effective amendment to such registration
statement or the related prospectus or any document incorporated therein by reference or promptly
file any other required document so that, as thereafter delivered to the purchasers of the
Registrable Securities, the prospectus will not contain an untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made, not misleading; and



     (o) cooperate and assist in any filing required to be made with the National Association of
Securities Dealers, Inc. and in the performance of any due diligence investigation by any
Underwriter, including any “qualified independent underwriter,” or any Selling Holder.



     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



13









 




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. The Company may require each Selling Holder to promptly furnish in writing
to the Company such information regarding the distribution of the Registrable Securities as it may
from time to time reasonably request and such other information as may be legally required in
connection with such registration. Notwithstanding anything herein to the contrary, the Company
shall have the right to exclude from any offering the Registrable Securities of any Selling Holder
who does not comply with the provisions of the immediately preceding sentence.




     Each Selling Holder agrees that, upon receipt of any notice from the Company of the happening
of any event of the kind described in Section 2.4(d)(vi) hereof, such Selling Holder will forthwith
discontinue disposition of Registrable Securities pursuant to the registration statement covering
such Registrable Securities until such Selling Holder’s receipt of the copies of the supplemented
or amended prospectus contemplated by Section 2.4(n) hereof, and, if so directed by the Company,
such Selling Holder will deliver to the Company all copies, other than permanent file copies, then
in such Selling Holder’s possession, of the most recent prospectus covering such Registrable
Securities at the time of receipt of such notice. In the event the Company shall give such notice,
the Company shall extend the period during which such registration statement shall be maintained
effective (including the period referred to in Section 2.4(b) hereof) by the number of days during
the period from and including the date of the giving of notice pursuant to Section 2.4(d)(vi)
hereof to the date when the Company shall make available to the Selling Holders of Registrable
Securities covered by such registration statement a prospectus supplemented or amended to conform
with the requirements of Section 2.4(n) hereof.



     2.5 Registration Expenses. Subject to the provisions in Section 2.1(b) above with respect to
a withdrawn Demand Registration, in connection with any registration statement required to be filed
hereunder, the Company shall pay the following registration expenses (the “Registration
Expenses”):



     (a) all registration and filing fees (including, without limitation, with respect to filings
to be made with the National Association of Securities Dealers, Inc.);



     (b) fees and expenses of compliance with securities or blue sky laws (including reasonable
fees and disbursements of counsel in connection with blue sky qualifications of the Registrable
Securities);



     (c) printing expenses;




     (d) internal expenses (including, without limitation, all salaries and expenses of its
officers and employees performing legal or accounting duties);



     (e) the fees and expenses incurred in connection with the listing on an exchange of the
Registrable Securities if the Company shall choose, or be required pursuant to Section 2.4(m), to
list such Registrable Securities;



14









 





     (f) reasonable fees and disbursements of counsel for the Company and customary fees and
expenses for independent certified public accountants retained by the Company (including the
expenses of any comfort letters requested pursuant to Section 2.4(k) hereof);



     (g) the reasonable fees and expenses of any special experts retained by the Company in
connection with such registration;



     (h) reasonable fees and expenses of one counsel reasonably acceptable to the Company selected
by the Selling Holders incurred in connection with the registration of such Registrable Securities
hereunder; and



     (i) fees and expenses of any “qualified independent underwriter” or other independent
appraiser participating in any offering pursuant to Section 2.2 of Schedule E to the By-laws of the
National Association of Securities Dealers, Inc.



     The Company shall not have any obligation to pay any underwriting fees, discounts, or
commissions attributable to the sale of Registrable Securities or, except as provided by clause
(b), (h) or (i) above, any out-of-pocket expenses of the Holders (or the agents who manage their
accounts) or the fees and disbursements of any Underwriter.



2.6 Indemnification; Contribution.




     (a) Indemnification by the Company. The Company agrees to indemnify and hold harmless
each Selling Holder, each Person, if any, who controls such Selling Holder within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act, and the officers, directors,
agents, general and limited partners, and employees of each Selling Holder and each such
controlling Person from and against any and all losses, claims, damages, liabilities (joint or
several), and expenses (including reasonable costs of investigation and attorneys’ fees) arising
out of or based upon any untrue statement or alleged untrue statement of a material fact contained
in any registration statement or prospectus relating to the Registrable Securities or in any
amendment or supplement thereto or in any preliminary prospectus, or arising out of or based upon
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, except insofar as such losses, claims,
damages, liabilities or expenses arise out of, or are based upon and in conformity with, any such
untrue statement or omission or allegation thereof based upon information furnished in writing to
the Company by such Selling Holder or on such Selling Holder’s behalf expressly for use therein.
The Company also agrees to indemnify any Underwriter(s) of the Registrable Securities, their
officers and directors and each Person who controls such Underwriter(s) on
substantially the same basis as that of the indemnification of the Selling Holders provided in
this Section 2.6(a).



     (b) Indemnification by Holder of Registrable Securities. Each Selling Holder agrees
to indemnify and hold harmless each other Selling Holder, the Company, and each Person, if any, who
controls the Company within the meaning of either Section 15 of the Securities Act or Section 20 of
the Exchange Act and the officers, directors, agents and employees of each other Selling Holder,
the Company and each such controlling Person to the same extent as the foregoing indemnity from the
Company to such Selling Holder, but only with respect to



15









 




information furnished in writing by such Selling Holder or on such Selling Holder’s behalf expressly for use in any registration statement
or prospectus relating to the Registrable Securities. The liability of any Selling Holder under
this Section 2.6(b) shall be limited to the aggregate cash and property received by such Selling
Holder pursuant to the sale of Registrable Securities covered by such registration statement or
prospectus.




     (c) Conduct of Indemnification Proceedings. If any action or proceeding (including
any governmental investigation) shall be brought or asserted against any Person entitled to
indemnification under Section 2.6(a) or 2.6(b) above (an “Indemnified Party”) in respect of
which indemnity may be sought from any Person who has agreed to provide such indemnification under
Section 2.6(a) or 2.6(b) above (an “Indemnifying Party”), the Indemnified Party shall give
prompt written notice to the Indemnifying Party and the Indemnifying Party shall assume the defense
thereof, including the employment of counsel reasonably satisfactory to such Indemnified Party, and
shall assume the payment of all reasonable expenses of such defense. Such Indemnified Party shall
have the right to employ separate counsel in any such action 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 has agreed to pay such fees and expenses or
(ii) the Indemnifying Party fails promptly to assume the defense of such action or proceeding or
fails to employ counsel reasonably satisfactory to such Indemnified Party or (iii) the named
parties to any such action or proceeding (including any impleaded parties) include both such
Indemnified Party and Indemnifying Party (or an Affiliate of the Indemnifying Party), and such
Indemnified Party shall have been advised by counsel that there may be one or more legal defenses
available to the Indemnified Party that are different from or additional to those available to the
Indemnifying Party, or there is a conflict of interest on the part of counsel employed by the
Indemnifying Party to represent such Indemnified Party (in which case, if such Indemnified Party
notifies the Indemnifying Party in writing that it elects to employ separate counsel at the expense
of the Indemnifying Party, the Indemnifying Party shall not have the right to assume the defense of
such action or proceeding on behalf of such Indemnified Party). Notwithstanding the foregoing, the
Indemnifying Party shall not, in connection with any one such action or proceeding or separate but
substantially similar related actions or proceedings in the same jurisdiction arising out of the
same general allegations or circumstances, be liable at any time for the fees and expenses of more
than one separate firm of attorneys (together in each case with appropriate local counsel). The
Indemnifying Party shall not be liable for any settlement of any such action or proceeding effected
without its written consent (which consent will not be unreasonably withheld), but if settled with
its written consent, or if there be a final judgment for the plaintiff in any such action or
proceeding, the Indemnifying Party shall indemnify and hold harmless such Indemnified Party from
and against any loss or liability (to the extent stated above) by reason of
such settlement or judgment. The Indemnifying Party shall not consent to entry of any
judgment or enter into any settlement 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 action or
proceeding for which such Indemnified Party would be entitled to indemnification hereunder.



     (d) Contribution. If the indemnification provided for in this Section 2.6 is
unavailable to the Indemnified Parties in respect of any losses, claims, damages, liabilities or
judgments referred to herein, then each such Indemnifying Party, in lieu of indemnifying such



16









 




Indemnified Parties, shall contribute to the amount paid or payable by such Indemnified Parties as
a result of such losses, claims, damages, liabilities and judgments as between the Company on the
one hand and each Selling Holder on the other, in such proportion as is appropriate to reflect the
relative fault of the Company and of each Selling Holder in connection with the statements or
omissions which resulted in such losses, claims, damages, liabilities or judgments, as well as any
other relevant equitable considerations. The relative fault of the Company on the one hand and of
each Selling Holder on the other shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or alleged omission to
state a material fact relates to information supplied by such Person, and such Person’s relative
intent, knowledge, access to information and opportunity to correct or prevent such statement or
omission.




     The Company and the Selling Holders agree that it would not be just and equitable if
contribution pursuant to this Section 2.6(d) were determined by any method of allocation which does
not take into account the equitable considerations referred to in the immediately preceding
paragraph. The amount paid or payable by an Indemnified Party as a result of the losses, claims,
damages, liabilities or judgments referred to in the immediately preceding paragraph shall be
deemed to include, subject to the limitations set forth above, any legal or other expenses
reasonably incurred by such Indemnified Party in connection with investigating or defending any
such action or claim. Notwithstanding the provisions of this Section 2.6(d), no Selling Holder
shall be required to contribute any amount in excess of the amount by which the total price at
which the Registrable Securities of such Selling Holder were offered to the public (less any
underwriting discounts or commissions) exceeds the amount of any damages which such Selling Holder
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.



     2.7 Participation in Underwritten Registrations. No Holder may participate in any underwritten
registration hereunder unless such Holder (a) agrees to sell such Holder’s Registrable Securities
on the basis provided in any underwriting arrangements approved by the Person entitled hereunder to
approve such arrangements and (b) completes and executes all questionnaires, powers of attorney,
custody agreements, indemnities, underwriting agreements and other documents reasonably required
under the terms of such underwriting arrangements and this Agreement.



     2.8 Transfers of Registration Rights. The provisions hereof will inure to the benefit of and be binding upon the successors and
assigns of each of the parties hereto, except as otherwise provided herein; provided, however, that
the registration rights granted hereby may be transferred only (i) by operation of Law or (ii) to
any Person to whom a Holder transfers Registrable Securities, provided further that any such
transferee shall not be entitled to rights pursuant to Section 2.1, 2.2 or 2.3 hereof unless such
transferee of registration rights hereunder agrees to be bound by the terms and conditions hereof
and executes and delivers to the Company an acknowledgment and agreement to such effect.



     2.9 Information Rights in Private Sale. If any SCF Demand Holders and/or any Non-SCF Demand
Holders who then hold in the aggregate a minimum of 15% of the Fully-



17









 




Diluted Common Stock (such SCF Demand Holders and/or such Non-SCF Demand Holders, for purposes of this Section 2.9, being herein
called the “Disposing Holders”) propose to Transfer in a private transaction Registrable
Securities having a fair market value in excess of $20,000,000, as determined in good faith by such
Disposing Holders, then held by such Disposing Holders, then, the Company shall afford to such
Disposing Holders, such prospective transferees and their respective counsel, accountants, lenders
and other representatives, full access during normal business hours to the properties, books,
contracts, records and management of the Company in order that such parties may have full
opportunity to make such investigations as they shall desire to make of the Company and shall, upon
request, promptly furnish to such parties all other information concerning the Company as such
parties may reasonably request in connection with such prospective Transfer, in each case subject
to such confidentiality restrictions or obligations as the Company may reasonably require;
provided, however, that any such investigation shall be conducted in such a manner as not to
interfere unreasonably with the Company’s business and operations.




ARTICLE 3.

OTHER MATTERS




     3.1 Composition of Board; VCOC Management Rights.



          (a) As long as SCF owns (i) Common Stock representing at least 20% of the outstanding Common
Stock then entitled to vote, the Company agrees to take all action within its power, as shall be
required to cause the Board to at all times to include at least two members designated by SCF (the
“SCF Directors”) and (ii) Common Stock representing at least 5% of the outstanding Common
Stock then entitled to vote, the Company agrees to take all action within its power, as shall be
required to cause the Board to at all times to include at least one SCF Director. Upon the
resignation, death, removal, disqualification or other vacancy of any SCF Director, SCF shall have
the right to designate a new director and the Company shall have the same obligations set forth
under the first sentence of this Section 3.1(a) to cause the election of such designee to the
Board.



          (b) The rights set forth in this Section 3.1 are, in part, intended to satisfy the requirement
of contractual management rights for purposes of qualifying the ownership interests of SCF in the
Company as venture capital investments for purposes of the Department of Labor’s “plan assets”
regulations (“Contractual Management Rights”), and in the event such rights are not
satisfactory for such purpose or are lost by reason of the operation of this Agreement, the
Company and SCF shall reasonably cooperate in good faith to agree upon mutually satisfactory
Contractual Management Rights which satisfy such regulations.



          (c) The Company agrees to take all action within its power as shall be required to cause the
Board at all times to include at least two members not affiliated with SCF or management of the
Company.



          (d) SCF shall have the right to unilaterally terminate its rights under this Section 3.1 by
giving written notice to the Company that it is irrevocably relinquishing its rights under this
Section 3.1.



18









 





ARTICLE 4.

MISCELLANEOUS




     4.1 Notices. Unless otherwise provided herein, any notice, request, consent, instruction or other
document to be given hereunder by any party hereto to another party hereto shall be in writing and
will be deemed given (a) when received if delivered personally or by courier; or (b) on the date
receipt is acknowledged if delivered by certified mail, postage prepaid, return receipt requested;
or (c) on the day of transmission if sent by facsimile transmission and receipt thereof is
confirmed, as follows:



     if to the Company, addressed to:


Complete Production Services, Inc.

11700 Old Katy Road, Suite 300

Houston, Texas 77079

Attention: Joseph C. Winkler

Facsimile: (281) 372-2301





if to a Stockholder, addressed to such Stockholder at the address for notice set forth
opposite such Stockholder’s name on Exhibit A hereto,


or to such other place and with such other copies as any party hereto may designate as to itself by
written notice to the others in accordance with this Section 4.1.




     4.2 Binding Effect. Subject to Section 2.8, this Agreement is binding on and inures to the benefit
of the Stockholders and their respective heirs, legal representatives, successors, and assigns.



     4.3 Governing Law. This agreement is governed by and shall be construed in accordance with the law
of the State of Delaware without regard to the principles of conflicts of law thereof.



     4.4 Severability. If any provision of this Agreement or the application thereof to any Person or circumstance is
held invalid or unenforceable to any extent, the remainder of this Agreement and the application of
that provision to other Persons or circumstances is not affected thereby and that provision shall
be enforced to the greatest extent permitted by Law.



     4.5 Effectiveness. This Agreement shall become effective upon consummation of a Qualified Public
Offering without any further action or approval by the Stockholders as contemplated by Section 5.8
of the Previous Agreement.



     4.6 Section Headings. Headings contained in this Agreement are inserted only as a matter of
convenience and in no way define, limit, or extend the scope or intent of this Agreement or any
provisions hereof.



     4.7 Assignment. Except as otherwise expressly provided herein, the terms and conditions of this
Agreement shall inure to the benefit of and be binding upon the respective successors and assigns
of the Stockholders and the Company. No such assignment shall relieve



19









 




the assignor from any liability hereunder. Any purported assignment made in violation of this Section 4.7 shall be void
and of no force and effect.




     4.8 Spouses. Each reference herein to the shares owned by a Stockholder includes the community
property interest of such Stockholder’s spouse (if any) (each, a “Spouse”) in such shares.
Each Spouse is fully aware of, understands and fully consents and agrees to the provisions of this
Agreement and its binding effect upon any community property interest such Spouse may now or
hereafter own. Each Spouse agrees that the termination of his or her marital relationship with a
Stockholder for any reason shall not have the effect of removing any shares of the Company
otherwise subject to this Agreement from its coverage. Each Spouse’s awareness, understanding,
consent and agreement are evidenced by the execution of the Previous Agreement or an adoption
agreement by such Spouse. In addition, each Spouse hereby acknowledges that the Company and the
Parties may desire to amend this Agreement from time to time, and such Spouse hereby appoints his
or her spouse as his or her true and lawful proxy and attorney, with full power of substitution to
enter into any such amendment to this Agreement. Such proxy is irrevocable and will survive the
death, incompetency, and disability of such Spouse, provided that upon termination of this
Agreement, the above authorized proxy shall become null and void. Each such Spouse agrees, for
such Spouse and such Spouse’s heirs, executors, administrators, guardians and other personal
representatives, to offer for sale all shares now owned or hereafter acquired by such Spouse upon
the happening of the events and on the terms and conditions set forth in this Agreement.



     4.9 Entire Agreement. The provisions of the Agreement contain the entire understanding of the parties hereto
respecting the subject matter hereof and supersede all prior agreements, discussions and
understandings with respect thereto.



     4.10 Miscellaneous; Amendment; Termination. The provisions of this Agreement may only be amended
by the written consent of the Company and the SCF Demand Holders (if the SCF Demand Holders then
own Registrable Securities); provided, however, that any amendment that has an adverse effect on
the rights of, or imposes additional obligations on, the Non-SCF Holders shall require the consent
of the Non-SCF Demand Holders that hold in the aggregate at least 50% of the Registrable Securities
then held by the Non-SCF Holders (if the Non-SCF Holders then own Registrable Securities). The
Holders acknowledge and agree that any Person that becomes a Stockholder shall have the rights and
obligations set forth in this Agreement and that such Person becoming a Stockholder shall be deemed
not to be an amendment to this Agreement. The provisions of this Agreement shall terminate and be
of no further force or effect as of and following the tenth anniversary of the date hereof;
provided that the provisions of Section 2.6 shall survive for any sales of Registrable Securities
prior to such date.



20









 





EXHIBIT A

to

AMENDED AND RESTATED

STOCKHOLDERS AGREEMENT

(the “Agreement”)

dated as of [_________ __], 2006

by and among

COMPLETE PRODUCTION SERVICES, INC.

and

THE OTHER PARTIES THERETO




STOCKHOLDERS




	 	 	 
	Name	 	Address
	 

	 	 
	 

	 	 
	 

	 	 
	 

	 	 
	 

	 	 






Complete Production Services, Inc.

Exhibit A to Stockholders Agreement

A-1