Document:

Exhibit

COMMON UNIT PURCHASE AGREEMENT

between

ENERGY TRANSFER PARTNERS, L.P.

and

ENERGY TRANSFER EQUITY, L.P.

Table of Contents
	
				
	ARTICLE I DEFINITIONS
	1
	

	Section 1.01
	Definitions
	1
	

	Section 1.02
	Accounting Procedures and Interpretation
	5
	

	ARTICLE II AGREEMENT TO SELL AND PURCHASE
	5
	

	Section 2.01
	Sale and Purchase
	5
	

	Section 2.02
	Closing
	5
	

	Section 2.03
	Conditions to Closing
	5
	

	Section 2.04
	ETP Deliveries
	7
	

	Section 2.05
	Purchaser’s Deliveries
	7
	

	ARTICLE III REPRESENTATIONS AND WARRANTIES AND COVENANTS  RELATED TO ETP
	7
	

	Section 3.01
	Partnership Existence
	7
	

	Section 3.02
	Capitalization and Valid Issuance of Purchased Units
	8
	

	Section 3.03
	ETP SEC Documents
	9
	

	Section 3.04
	No Material Adverse Change
	10
	

	Section 3.05
	Litigation
	10
	

	Section 3.06
	No Violations; Compliance with Laws
	10
	

	Section 3.07
	Authority, Enforceability
	11
	

	Section 3.08
	Approvals
	11
	

	Section 3.09
	MLP Status
	11
	

	Section 3.10
	Valid Private Placement
	11
	

	Section 3.11
	Investment Company Status
	11
	

	Section 3.12
	Certain Fees
	11
	

	Section 3.13
	Insurance
	12
	

	Section 3.14
	Internal Accounting Controls
	12
	

	Section 3.15
	Listing and Maintenance Requirements
	12
	

	Section 3.16
	Taking of Necessary Actions
	12
	

	ARTICLE IV REPRESENTATIONS AND WARRANTIES AND COVENANTS OF THE PURCHASER
	12
	

	Section 4.01
	Existence
	12
	

	Section 4.02
	Authorization, Enforceability
	13
	

	Section 4.03
	No Breach
	13
	

	Section 4.04
	Certain Fees
	13
	

	Section 4.05
	Investment
	13
	

	Section 4.06
	Nature of Purchaser
	14
	

	Section 4.07
	Restricted Securities
	14
	

	Section 4.08
	Receipt of Information
	14
	

	Section 4.09
	Legend
	14
	

i

	
				
	Section 4.10
	Short Selling
	15
	

	Section 4.11
	Trading Activities
	15
	

	Section 4.12
	Taking of Necessary Actions
	15
	

	ARTICLE V INDEMNIFICATION, COSTS AND EXPENSES
	15
	

	Section 5.01
	Indemnification by ETP
	15
	

	Section 5.02
	Indemnification by the Purchaser
	16
	

	Section 5.03
	Indemnification Procedure
	16
	

	ARTICLE VI MISCELLANEOUS
	17
	

	Section 6.01
	Interpretation and Survival of Provisions
	17
	

	Section 6.02
	Survival of Provisions
	17
	

	Section 6.03
	No Waiver; Modifications in Writing
	18
	

	Section 6.04
	Binding Effect; Assignment
	18
	

	Section 6.05
	Communications
	18
	

	Section 6.06
	Entire Agreement
	19
	

	Section 6.07
	Governing Law
	19
	

	Section 6.08
	Waiver of Jury Trial
	19
	

	Section 6.09
	Execution in Counterparts
	20
	

	Section 6.10
	Costs and Expenses
	20
	

	Section 6.11
	Termination
	20
	

	 
	 
	 

	Exhibit A - Registration Rights Agreement
	 

	Exhibit B - Excepted Subsidiaries
	 

ii

COMMON UNIT PURCHASE AGREEMENT
This COMMON UNIT PURCHASE AGREEMENT, dated as of January 6, 2017 (this “Agreement”), is by and between ENERGY TRANSFER PARTNERS, L.P., a Delaware limited partnership (“ETP”), and ENERGY TRANSFER EQUITY, L.P., a Delaware limited partnership (the “Purchaser”).  ETP and the Purchaser are sometimes referred to herein as a “Party” and, collectively, as the “Parties.”
WHEREAS, in order to fund the repayment of borrowings under the ETP Credit Facility (as defined below) and for other general partnership purposes of ETP, ETP desires to sell to the Purchaser, and the Purchaser desires to purchase from ETP, certain Common Units (as defined below), in accordance with the provisions of this Agreement; and
WHEREAS, ETP and the Purchaser will enter into a registration rights agreement (the “Registration Rights Agreement”), substantially in the form attached hereto as Exhibit A pursuant to which ETP will provide the Purchaser with certain registration rights with respect to the Common Units acquired pursuant hereto.
NOW THEREFORE, in consideration of the mutual covenants and agreements set forth herein and for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties hereby agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01    Definitions.  As used in this Agreement, and unless the context requires a different meaning, the following terms have the meanings indicated:
“Affiliate” means, with respect to a specified Person, any other Person, directly or indirectly controlling, controlled by or under direct or indirect common control with such specified Person.  For purposes of this definition, “control” (including, with correlative meanings, “controlling,” “controlled by,” and “under common control with”) means the power to direct or cause the direction of the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise.
“Basic Documents” means, collectively, this Agreement, the Registration Rights Agreement and any and all other agreements or instruments executed and delivered by the Parties to evidence the execution, delivery and performance of any of the Basic Documents, and any amendments, supplements, continuations or modifications thereto.
“Business Day” means any day other than a Saturday, Sunday, any federal legal holiday or day on which banking institutions in the State of New York or State of Texas are authorized or required by law or other governmental action to close.
“Class E Units” shall have the meaning given to such term in the Partnership Agreement.
“Class G Units” hall have the meaning given to such term in the Partnership Agreement.

1

“Class H Units” hall have the meaning given to such term in the Partnership Agreement.
“Class I Units” hall have the meaning given to such term in the Partnership Agreement.
“Class J Units” hall have the meaning given to such term in the Partnership Agreement.
“Class K Units” hall have the meaning given to such term in the Partnership Agreement.
“Closing(s)” shall have the meaning specified in ‎Section 2.02.
“Closing Date(s)” shall have the meaning specified in ‎Section 2.02.
“Commission” means the United States Securities and Exchange Commission.
“Common Units” shall have the meaning given to such term in the Partnership Agreement.
“Delaware LLC Act” shall have the meaning specified in ‎Section 3.02.
“Delaware LP Act” shall have the meaning specified in ‎Section 3.02.
“DTC” shall have the meaning specified in ‎Section 2.04.
“ETP” has the meaning set forth in the introductory paragraph.
“ETP Credit Facility” means the Second Amended and Restated Credit Agreement, dated as of October 27, 2011, by and among ETP and Wells Fargo Bank, National Association, as administrative agent, and the other agents and lenders party thereto, as amended as of the date hereof and from time to time.
“ETP Financial Statements” shall have the meaning specified in ‎Section 3.03.
“ETP GP LP” means Energy Transfer Partners GP, L.P., a Delaware limited partnership and the general partner of ETP.
“ETP GP LLC” means Energy Transfer Partners, L.L.C., a Delaware limited liability company and the general partner of ETP GP LP.
“ETP Material Adverse Effect” means any material and adverse effect on (a) the assets, liabilities, financial condition, business, operations, affairs or prospects of ETP and its Subsidiaries taken as a whole; (b) the ability of ETP and its Subsidiaries taken as a whole to carry on their business as such business is conducted as of the date hereof or to meet their obligations under the Basic Documents on a timely basis; or (c)  the ability of ETP to consummate the transactions contemplated hereby; provided, however, that a ETP Material Adverse Effect shall not include any material and adverse effect on the foregoing to the extent such material and adverse effect results from, arises out of, or relates to (x) a general deterioration in the economy or changes in the general state of the industries in which the ETP Parties operate, except to the extent that the ETP Parties, taken as a whole, are adversely affected in a disproportionate manner as compared to other industry 

2

participants, (y) the outbreak or escalation of hostilities involving the United States, the declaration by the United States of a national emergency or war or the occurrence of any other calamity or crisis, including acts of terrorism, or (z) any change in accounting requirements or principles imposed upon ETP and its Subsidiaries or their respective businesses or any change in applicable Law, or the interpretation thereof.
“ETP Parties” means ETP, the General Partner and all of ETP’s Subsidiaries.
“ETP Related Parties” shall have the meaning specified in Section 5.02.
“ETP SEC Documents” shall have the meaning specified in ‎Section 3.03.
“Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time, and the rules and regulations of the Commission promulgated thereunder.
“GAAP” means generally accepted accounting principles in the United States of America in effect from time to time.
“General Partner” means Energy Transfer Partners GP, L.P., and, as the context requires, includes Energy Transfer Partners, L.L.C.
“Governmental Authority” means, with respect to a particular Person, any country, state, county, city and political subdivision in which such Person or such Person’s Property is located or which exercises valid jurisdiction over any such Person or such Person’s Property, and any court, agency, department, commission, board, bureau or instrumentality of any of them and any monetary authority which exercises valid jurisdiction over any such Person or such Person’s Property.  Unless otherwise specified, all references to Governmental Authority herein with respect to ETP means a Governmental Authority having jurisdiction over ETP, its Subsidiaries or any of their respective Properties.
“Incentive Distribution Rights” shall have the meaning given to such term in the Partnership Agreement.
“Indemnified Party” shall have the meaning specified in ‎Section 5.03.
“Indemnifying Party” shall have the meaning specified in ‎Section 5.03.
“Law” means any federal, state, local or foreign order, writ, injunction, judgment, settlement, award, decree, statute, law, rule or regulation.
“Lien” means any mortgage, claim, encumbrance, pledge, lien (statutory or otherwise), security agreement, conditional sale or trust receipt or a lease, consignment or bailment, preference or priority or other encumbrance upon or with respect to any property of any kind.
“NYSE” means the New York Stock Exchange.

3

“Partnership Agreement” means the Second Amended and Restated Agreement of Limited Partnership of ETP, dated July 28, 2009, as amended as of the date hereof and from time to time.
“Partnership Securities” means any class or series of equity interest in ETP (but excluding any options, rights, warrants and appreciation rights relating to an equity interest in ETP), including the Common Units, Class E Units, Class G Units, Class H Units, Class I Units, Class J Units, Class K Units, Series A Preferred Units and the Incentive Distribution Rights.
“Party” or “Parties” has the meaning set forth in the introductory paragraph.
“Person” means any individual, corporation, company, voluntary association, partnership, joint venture, trust, limited liability company, unincorporated organization, government or any agency, instrumentality or political subdivision thereof, or any other form of entity.
“Property” means any interest in any kind of property or asset, whether real, personal or mixed, or tangible or intangible.
“Purchased Units” means the number of Common Units equal to the quotient determined by dividing (a) the Purchase Price by (b) the Purchased Unit Price, rounded to the nearest whole Common Unit.  
“Purchased Unit Price” means the volume-weighted average of the closing price of the Common Units on the NYSE for the 10 trading day period ending on January 5, 2017, signed by ETE in connection with the Private Placement, as reported in Bloomberg Financial Markets, or, if not reported therein, as reported by Dow Jones.
“Purchase Price” means $568,000,000.
“Purchaser Related Parties” shall have the meaning specified in ‎Section 5.01.
“Purchaser” has the meaning set forth in the introductory paragraph of this Agreement.
“Private Placement” means the private placement of common units representing limited partner interests in Purchaser pursuant to the Common Unit Purchase Agreement dated as of January 6, 2017 by and among Purchaser and the purchasers party thereto.
“Registration Rights Agreement” shall have the meaning set forth in the recitals.
“Representatives” means, with respect to any Person, the officers, directors, managers, employees, agents, counsel, accountants, investment bankers and other representatives of such Person.
“Securities Act” means the Securities Act of 1933, as amended from time to time, and the rules and regulations of the Commission promulgated thereunder.
“Series A Preferred Units” means “Series A Cumulative Convertible Preferred Units” as defined in the Partnership Agreement.

4

“Subsidiary” means, as to any Person, any corporation or other entity of which: (i) such Person or a Subsidiary of such Person is a general partner or manager; (ii) at least a majority of the outstanding equity interest having by the terms thereof ordinary voting power to elect a majority of the board of directors or similar governing body of such corporation or other entity (irrespective of whether or not at the time any equity interest of any other class or classes of such corporation or other entity shall have or might have voting power by reason of the happening of any contingency) is at the time directly or indirectly owned or controlled by such Person or one or more of its Subsidiaries; or (iii) any corporation or other entity as to which such Person consolidates for accounting purposes.
Section 1.02    Accounting Procedures and Interpretation.  Unless otherwise specified herein, all accounting terms used herein shall be interpreted, all determinations with respect to accounting matters hereunder shall be made, and all ETP Financial Statements and certificates and reports as to financial matters required to be furnished to the Purchaser hereunder shall be prepared, in accordance with GAAP applied on a consistent basis during the periods involved (except as may be indicated in the notes thereto or, in the case of unaudited statements, as permitted by Form 10-Q promulgated by the Commission) and in compliance as to form in all material respects with applicable accounting requirements and with the published rules and regulations of the Commission with respect thereto.
ARTICLE II
AGREEMENT TO SELL AND PURCHASE
Section 2.01    Sale and Purchase.  Subject to the terms and conditions hereof, ETP hereby agrees to issue and sell to the Purchaser, free and clear of any and all Liens, and the Purchaser hereby agrees to purchase from ETP, all of the Purchased Units, and the Purchaser agrees to pay ETP the Purchase Price.  Upon payment of the Purchase Price at Closing, the Purchased Units shall be fully paid for.
Section 2.02    Closings.  Subject to the terms and conditions hereof, the consummation of the purchase and sale of Purchased Units hereunder (the “First Closing”) shall take place on January 12, 2017 at the offices of ETP, and the second consummation of the purchase and sale of Purchased Units hereunder (the “Second Closing”, together with the First Closing, the “Closings”) shall take place on January 20, 2017, or in each case at such other time and location as mutually agreed by the Parties (collectively, the “Closing Dates”).  The Parties agree that the Closings may occur via delivery of facsimiles or e-mailed PDF scans of this Agreement and the other closing deliveries.
Section 2.03    Conditions to Closings.
(a)    Mutual Conditions.  The respective obligations of each Party to consummate the purchase and issuance and sale of the Purchased Units shall be subject to the satisfaction on or prior to the Closing Dates of each of the following conditions (any or all of which may be waived by a particular Party on behalf of itself in writing, in whole or in part, to the extent permitted by applicable Law):

5

(i)    no statute, rule, order, decree or regulation shall have been enacted or promulgated, and no action shall have been taken, by any Governmental Authority which temporarily, preliminarily or permanently restrains, precludes, enjoins or otherwise prohibits the consummation of the transactions contemplated hereby or makes the transactions contemplated hereby illegal; 
(ii)    there shall not be pending any suit, action or proceeding by any Governmental Authority seeking to restrain, preclude, enjoin or prohibit the transactions contemplated by this Agreement; and
(iii)    the Private Placement shall have been consummated and completed and the purchase price for the ETE common units issued in such Private Placement shall have been received by Purchaser.
(b)    Purchaser Conditions.  The obligation of the Purchaser to consummate the purchase of the Purchased Units shall be subject to the satisfaction on or prior to each of the Closing Dates of each of the following conditions (any or all of which may be waived by the Purchaser in writing, in whole or in part, to the extent permitted by applicable Law):
(i)    the representations and warranties of ETP contained in this Agreement that are qualified by materiality or ETP Material Adverse Effect shall be true and correct as of each of the Closing Dates as if made on and as of the Closing Dates and all other representations and warranties shall be true and correct in all material respects as of each of the Closing Dates as if made on and as of the Closing Dates (except that representations made as of a specific date shall be required to be true and correct as of such date only);
(ii)    an application shall have been submitted to list the Purchased Units on the NYSE; and
(iii)    ETP shall have delivered, or caused to be delivered, to the Purchaser at the Closings, ETP’s closing deliveries described in ‎Section 2.04.
(c)    ETP’s Conditions.  The obligation of ETP to consummate the sale of the Purchased Units to the Purchaser shall be subject to the satisfaction on or prior to each of the Closing Dates of the following condition (which may be waived by ETP in writing, in whole or in part, to the extent permitted by applicable Law):
(i)    the representations and warranties of the Purchaser contained in this Agreement shall be true and correct in all material respects at and as of the Closing Dates as if made on and as of the Closing Dates (except that representations made as of a specific date shall be required to be true and correct as of such date only); and
(ii)    the Purchaser shall have delivered, or caused to be delivered, to ETP at the Closings, the Purchaser’s closing deliveries described in ‎‎Section 2.05.

6

Section 2.04    ETP Deliveries.  At each Closing, subject to the terms and conditions hereof, ETP will deliver, or cause to be delivered, to the Purchaser:
(a)    The Purchased Units by electronic delivery to The Depository Trust Company (“DTC”) on the Purchaser’s behalf, registered in such name(s) as the Purchaser has designated;
(b)    Copies of (i) the Certificate of Limited Partnership of ETP, (ii) the Certificate of Limited Partnership of ETP GP LP and (iii) the Certificate of Formation of ETP GP LLC, each certified by the Secretary of State of the jurisdiction of its formation as of a recent date;
(c)    A certificate of the Secretary of State of the State of Delaware, dated a recent date, that ETP is in good standing;
(d)    A cross-receipt executed by ETP and delivered to the Purchaser certifying that it has received the Purchase Price as of the applicable Closing Date;
(e)    The executed Registration Rights Agreement; and
(f)    A certificate of the Secretary or Assistant Secretary of the General Partner, on behalf of ETP, certifying as to and attaching (i) the Partnership Agreement, (ii) board and/or conflicts committee resolutions constituting Special Approval (as defined in the Partnership Agreement) authorizing the execution and delivery of the Basic Documents and the consummation of the transactions contemplated thereby and (iii) its incumbent officers authorized to execute the Basic Documents to which it is a party, setting forth the name and title and bearing the signatures of such officers.
Section 2.05    Purchaser’s Deliveries.  At each Closing, subject to the terms and conditions hereof, the Purchaser will deliver, or cause to be delivered, to ETP:
(a)    Payment to ETP of the Purchase Price by wire transfer of immediately available funds to an account designated by ETP in writing at least two Business Days prior to the Closing Date;
(b)    The executed Registration Rights Agreement; and
(c)    A cross-receipt executed by the Purchaser and delivered to ETP certifying that it has received the Purchased Units as of the applicable Closing Date.
ARTICLE III
REPRESENTATIONS AND WARRANTIES AND COVENANTS RELATED TO ETP
ETP represents and warrants to and covenants with the Purchaser as follows:
Section 3.01    Partnership Existence.  ETP (a) is a limited partnership duly formed, validly existing and in good standing under the laws of the State of Delaware; and (b) has all requisite limited partnership power and authority, and has all governmental licenses, authorizations, consents 

7

and approvals necessary, to own, lease, use and operate its Properties and carry on its business as its business is now being conducted, except where the failure to obtain such licenses, authorizations, consents and approvals would not be reasonably likely to have a ETP Material Adverse Effect.  Each of ETP’s Subsidiaries has been duly formed and is validly existing and in good standing under the laws of the State or other jurisdiction of its organization, and has all requisite power and authority, and has all governmental licenses, authorizations, consents and approvals necessary, to own, lease, use or operate its respective Properties and carry on its business as now being conducted, except where the failure to obtain such licenses, authorizations, consents and approvals would not be reasonably likely to have a ETP Material Adverse Effect.  None of ETP nor any of its Subsidiaries are in default in the performance, observance or fulfillment of any provision of, in the case of ETP, the Partnership Agreement or its Certificate of Limited Partnership or, in the case of any Subsidiary of ETP, its respective certificate of incorporation, certification of formation, bylaws, limited liability company agreement or other similar organizational documents.  Each of ETP and its Subsidiaries is duly qualified or licensed and in good standing as a foreign limited partnership, limited liability company or corporation, as applicable, and is authorized to do business in each jurisdiction in which the ownership or leasing of its respective Properties or the character of its respective operations makes such qualification necessary, except where the failure to obtain such qualification, license, authorization or good standing would not be reasonably likely to have a ETP Material Adverse Effect.
Section 3.02    Capitalization and Valid Issuance of Purchased Units.
(a)    As of the date of this Agreement, prior to the issuance and sale of the Purchased Units, as contemplated hereby, the issued and outstanding limited partner interests of ETP consist of 530,654,971 Common Units, 8,853,382 Class E Units, 90,706,000 Class G Units, 81,001,069 Class H Units, 100 Class I Units, 0 Class J Units, 101,525,429 Class K Units, 1,912,569 Series A Cumulative Convertible Preferred Units and the Incentive Distribution Rights.  The only issued and outstanding general partner interests of ETP are the interests of the General Partner described in the Partnership Agreement.  All outstanding Common Units, Class E Units, Class G Units, Class H Units, Class I Units, Class K Units, Series A Preferred Units and Incentive Distribution Rights and the limited partner interests represented thereby have been duly authorized and validly issued in accordance with the Partnership Agreement and are fully paid (to the extent required under the Partnership Agreement) and nonassessable (except as such nonassessability may be affected by matters described in Sections 17-303, 17-607 and 17-804 of the Delaware Revised Uniform Limited Partnership Act (the “Delaware LP Act”)).
(b)    Other than the Second Amended and Restated Energy Transfer Partners, L.P. 2008 Long-Term Incentive Plan, ETP has no equity compensation plans that contemplate the issuance of partnership interests of ETP (or securities convertible into or exchangeable for partnership interests of ETP).  No indebtedness having the right to vote (or convertible into or exchangeable for securities having the right to vote) on any matters on which ETP unitholders may vote are issued or outstanding.  Except as set forth in the first sentence of this ‎Section 3.02(b), as contemplated by this Agreement or as are provided in the Partnership Agreement, there are no outstanding or authorized (i) options, warrants, preemptive rights, subscriptions, calls, or other rights, convertible or exchangeable securities, agreements, claims or commitments of any character 

8

obligating ETP or any of its Subsidiaries to issue, transfer or sell any partnership interests or other equity interest in, ETP or any of its Subsidiaries or securities convertible into or exchangeable for such partnership interests, (ii) obligations of ETP or any of its Subsidiaries to repurchase, redeem or otherwise acquire any partnership interests or equity interests of ETP or any of its Subsidiaries or any such securities or agreements listed in clause (i) of this sentence or (iii) voting trusts or similar agreements to which ETP or any of its Subsidiaries is a party with respect to the voting of the equity interests of ETP or any of its Subsidiaries.
(c)    (i) All of the issued and outstanding equity interests of each of ETP’s Subsidiaries (except for the entities listed on Exhibit B) are owned, directly or indirectly, by ETP free and clear of any Liens (except for such restrictions as may exist under applicable Law and for such Liens as may be imposed under the ETP Credit Facility and the indentures governing senior notes of ETP), and all such ownership interests have been duly authorized, validly issued and are fully paid (to the extent required in the organizational documents of ETP’s Subsidiaries, as applicable) and non-assessable (except as such nonassessability may be affected by matters described in Sections 17-303, 17-607 and 17-804 of the Delaware LP Act, Sections 18‐607 and 18-804 of the Delaware Limited Liability Company Act (the “Delaware LLC Act”), and Sections 101.114 and 101.206 of the Texas Business Organizations Code) and free of preemptive rights and (ii) except as disclosed in the ETP SEC Documents, neither ETP nor any of its Subsidiaries owns any shares of capital stock or other securities of, or interest in, any other Person, or is obligated to make any capital contribution to or other investment in any other Person.
(d)    The Purchased Units will be duly authorized by ETP pursuant to the Partnership Agreement prior to the Closings and, when issued and delivered to the Purchaser against payment therefor in accordance with the terms of this Agreement, will be validly issued, fully paid (to the extent required by the Partnership Agreement) and nonassessable (except as such nonassessability may be affected by matters described in Sections 17-303, 17-607 and 17-804 of the Delaware LP Act) and will be free of any and all Liens and restrictions on transfer, other than (i) restrictions on transfer under the Partnership Agreement or this Agreement and under applicable state and federal securities laws and (ii) such Liens as are created by the Purchaser.
(e)    The Common Units are listed on the NYSE, and ETP has not received any notice of delisting from the NYSE.
Section 3.03    ETP SEC Documents.  ETP has timely filed with the Commission all forms, registration statements, reports, schedules and statements required to be filed by it under the Exchange Act or the Securities Act (all such documents, collectively the “ETP SEC Documents”).  The ETP SEC Documents, including any audited or unaudited financial statements and any notes thereto or schedules included therein (the “ETP Financial Statements”), at the time filed (in the case of registration statements, solely on the dates of effectiveness) (except to the extent corrected by a subsequently filed ETP SEC Document filed prior to the date hereof) (a) did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein (in light of the circumstances under which they were made in the case of any prospectus) not misleading, (b) complied in all material respects with the applicable requirements of the Exchange Act and the Securities Act, as applicable, (c) complied as to form in 

9

all material respects with applicable accounting requirements and with the published rules and regulations of the Commission with respect thereto, (d) in the case of the ETP Financial Statements, were prepared in accordance with GAAP applied on a consistent basis during the periods involved (except as may be indicated in the notes thereto or, in the case of unaudited statements, as permitted by the Commission with respect to interim financial statements), and (e) in the case of the ETP Financial Statements, fairly present (subject in the case of unaudited statements to normal, recurring and year-end audit adjustments) in all material respects the consolidated financial position of ETP and its Subsidiaries as of the dates thereof and the consolidated results of its operations and cash flows for the periods then ended.  Grant Thornton LLP is an independent, registered public accounting firm with respect to ETP and has not resigned or been dismissed as independent public accountants of ETP as a result of or in connection with any disagreement with ETP on a matter of accounting principles or practices, financial statement disclosure or auditing scope or procedure.
Section 3.04    No Material Adverse Change.  Except as set forth in or contemplated by the ETP SEC Documents filed with the Commission on or prior to the date hereof, since the date of ETP’s most recent Form 10-K filing with the Commission, ETP and its Subsidiaries have conducted their respective businesses in the ordinary course, consistent with past practice, and there has been no (a) change, event, occurrence, effect, fact, circumstance or condition that has had or would be reasonably likely to have a ETP Material Adverse Effect, (b) acquisition or disposition of any material asset by ETP or any of its Subsidiaries or any contract or arrangement therefor, otherwise than for fair value in the ordinary course of business or as disclosed in the ETP SEC Documents, or (c) material change in ETP’s accounting principles, practices or methods.
Section 3.05    Litigation.  Except as set forth in the ETP SEC Documents, there is no action, suit, or proceeding pending (including any investigation, litigation or inquiry) or, to ETP’s knowledge, contemplated or threatened against or affecting any of the ETP Parties or any of their respective officers, directors, properties or assets, which (a) questions the validity of this Agreement or the right of ETP to enter into this Agreement or to consummate the transactions contemplated hereby or (b) (individually or in the aggregate) would be reasonably likely to result in a ETP Material Adverse Effect.
Section 3.06    No Violations; Compliance with Laws.  As of each Closing Date, the execution, delivery and performance by ETP of the Basic Documents to which it is a party and compliance by ETP with the terms and provisions thereof, and the issuance and sale by ETP of the Purchased Units, do not and will not (a) assuming the accuracy of the representations and warranties of the Purchaser contained herein and their compliance with the covenants contained herein, violate any provision of any Law or Permit having applicability to ETP or any of its Subsidiaries or any of their respective Properties, (b)  result in a violation or breach of any provision of the certificate of limited partnership or other organizational documents of ETP, or the Partnership Agreement, or any organizational documents of any of ETP’s Subsidiaries, (c) require any consent, approval or notice (other than those previously obtained or given) under or result in a violation or breach of or constitute (with or without due notice or lapse of time or both) a default (or give rise to any right of termination, cancellation or acceleration) under any contract, agreement, instrument, obligation, note, bond, mortgage, license, loan or credit agreement to which ETP or any of its Subsidiaries is a party or by which ETP or any of its Subsidiaries or any of their respective Properties may be 

10

bound, or (d) result in or require the creation or imposition of any Lien upon or with respect to any of the Properties now owned or hereafter acquired by ETP or any of its Subsidiaries, except in the case of clause (b) where any such violation, default, breach, termination, cancellation, failure to receive consent, approval or notice, or acceleration with respect to the foregoing provisions of this ‎Section 3.06 would not be, individually or in the aggregate, reasonably likely to result in a ETP Material Adverse Effect.
Section 3.07    Authority, Enforceability.  ETP has all necessary limited partnership power and authority to execute, deliver and perform its obligations under the Basic Documents, and the execution, delivery and performance by ETP of the Basic Documents to which it is a party have been duly authorized by all necessary action on the part of the General Partner; and the Basic Documents to which it is a party constitute the legal, valid and binding obligations of ETP, enforceable in accordance with their terms, except as such enforceability may be limited by bankruptcy, insolvency, fraudulent transfer and similar laws affecting creditors’ rights generally or by general principles of equity and except as the rights to indemnification may be limited by applicable Law (regardless of whether such enforceability is considered in a proceeding in law or in equity).  No approval from the holders of the Common Units, Class E Units, Class G Units, Class H Units, Class I Units, Class J Units, Class K Units, Series A Preferred Units or Incentive Distribution Rights is required in connection with ETP’s issuance and sale of the Purchased Units to the Purchaser.
Section 3.08    Approvals.  Except for the approvals that have already been obtained and the authorization of the NYSE for the listing of the Purchased Units, no authorization, consent, approval, waiver, license, qualification or written exemption from, nor any filing, declaration, qualification or registration with, any Governmental Authority or any other Person is required in connection with the execution, delivery or performance by ETP of any of the Basic Documents to which it is a party, except where the failure to receive such authorization, consent, approval, waiver, license, qualification or written exemption from, or to make such filing, declaration, qualification or registration would not, individually or in the aggregate, be reasonably likely to have a ETP Material Adverse Effect.
Section 3.09    MLP Status.  ETP is properly treated as a partnership for United States federal income tax purposes and more than 90% of ETP’s current gross income is qualifying income under Section 7704(d) of the Internal Revenue Code of 1986, as amended.
Section 3.10    Valid Private Placement.  Assuming the accuracy of the representations and warranties of the Purchaser contained in this Agreement, the sale and issuance of the Purchased Units to the Purchaser pursuant to this Agreement is exempt from the registration requirements of the Securities Act, and neither ETP nor, to the knowledge of ETP, any authorized agent acting on its behalf has taken or will take any action hereafter that would cause the loss of such exemptions.
Section 3.11    Investment Company Status.  ETP is not an “investment company” or a company controlled by an “investment company” within the meaning of the Investment Company Act of 1940, as amended.
Section 3.12    Certain Fees.  No fees or commissions are or will be payable by ETP to brokers, finders, or investment bankers with respect to the sale of any of the Purchased Units or the 

11

consummation of the transactions contemplated by this Agreement.  ETP agrees that it will indemnify and hold harmless the Purchaser from and against any and all claims, demands, or liabilities for broker’s, finder’s, placement, or other similar fees or commissions incurred by ETP or alleged to have been incurred by ETP in connection with the sale of the Purchased Units or the consummation of the transactions contemplated by this Agreement.
Section 3.13    Insurance.  ETP and its Subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as are prudent and customary in the businesses in which they are engaged.  ETP does not have any reason to believe that it or any of its Subsidiaries will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business.
Section 3.14    Internal Accounting Controls.  ETP and its Subsidiaries maintain a system of internal accounting controls sufficient to provide reasonable assurance that (a) transactions are executed in accordance with management’s general or specific authorizations, (b) transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain asset accountability, (c) access to assets is permitted only in accordance with management’s general or specific authorization and (d) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences.  ETP is not aware of any material weaknesses with respect to its internal accounting controls.
Section 3.15    Listing and Maintenance Requirements.  The issuance and sale of the Purchased Units does not contravene the rules and regulations of the NYSE.
Section 3.16    Taking of Necessary Actions.  ETP shall use its commercially reasonable efforts promptly to take or cause to be taken all action and promptly to do or cause to be done all things necessary, proper or advisable under applicable Law and regulations to consummate and make effective the transactions contemplated by this Agreement.  Without limiting the foregoing, ETP shall use its commercially reasonable efforts to make all filings and obtain all consents of Governmental Authorities that may be necessary or, in the reasonable opinion of the other Parties, as the case may be, advisable for the consummation of the transactions contemplated by the Basic Documents.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES AND COVENANTS OF THE PURCHASER
The Purchaser hereby represents and warrants and covenants to ETP that:
Section 4.01    Existence.  The Purchaser is a limited liability company duly formed, validly existing and in good standing under the laws of the State of Delaware, with all necessary limited liability company power and authority to own properties and to conduct its business as currently conducted.

12

Section 4.02    Authorization, Enforceability.  The Purchaser has all necessary limited partnership power and authority to enter into, deliver and perform its obligations under the Basic Documents to which it is a party.  The execution, delivery and performance of this the Basic Documents to which it is a party by the Purchaser and the consummation by it of the transactions contemplated thereby have been duly and validly authorized by all necessary action, and no further consent or authorization of the Purchaser is required.  The Basic Documents to which it is a party have been duly executed and delivered by the Purchaser and constitute legal, valid and binding obligations of the Purchaser; provided that, the enforceability thereof may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws relating to or affecting creditors’ rights generally and by general principles of equity and except as the rights to indemnification may be limited by applicable Law (regardless of whether such enforceability is considered in a proceeding in equity or at law).
Section 4.03    No Breach.  The execution, delivery and performance of the Basic Documents to which it is a party by the Purchaser and the consummation by the Purchaser of the transactions contemplated thereby will not (a) conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, any material agreement to which the Purchaser is a party or by which the Purchaser is bound or to which any of the properties or assets of the Purchaser is subject, (b) conflict with or result in any violation of the provisions of the organizational documents of the Purchaser, or (c) violate any statute, order, rule or regulation of any Governmental Authority having jurisdiction over the Purchaser or the properties or assets of the Purchaser, except in the case of clauses (a) and (c), for such conflicts, breaches, violations or defaults as would not prevent the consummation of the transactions contemplated by this Agreement.
Section 4.04    Certain Fees.  No fees or commissions are or will be payable by the Purchaser to brokers, finders, or investment bankers with respect to the purchase of the Purchased Units or the consummation of the transactions contemplated by the Basic Documents.  The Purchaser agrees that it will indemnify and hold harmless ETP from and against any and all claims, demands or liabilities for broker’s, finder’s, placement, or other similar fees or commissions incurred by the Purchaser or alleged to have been incurred by the Purchaser in connection with the purchase of the Purchased Units or the consummation of the transactions contemplated by the Basic Documents.
Section 4.05    Investment.  The Purchased Units are being acquired for the Purchaser’s own account, not as a nominee or agent, and with no present intention of distributing the Purchased Units or any part thereof, and the Purchaser has no present intention of selling or granting any participation in or otherwise distributing the same in any transaction in violation of any securities Laws, without prejudice, however, to the Purchaser’s right at all times to sell or otherwise dispose of all or any part of the Purchased Units pursuant to a registration statement under the Securities Act and applicable state securities Laws or under an exemption from such registration available thereunder (including, if available, Rule 144 under the Securities Act).  If the Purchaser should in the future decide to dispose of any of the Purchased Units, the Purchaser understands and agrees (a) that it may do so only (i) in compliance with the Securities Act and applicable state securities Laws, as then in effect, or pursuant to an exemption therefrom (including Rule 144 under the Securities Act) or (ii) in the manner contemplated by any registration statement under the Securities Act pursuant to which such securities are being offered, and (b) that stop-transfer instructions to that effect will 

13

be in effect with respect to the Purchased Units.  Notwithstanding the foregoing, the Purchaser may at any time transfer Purchased Units to an Affiliate of the Purchaser provided that any such transaction is exempt from registration under the Securities Act and that such Affiliate agrees to be bound by the terms and conditions of this Agreement.
Section 4.06    Nature of Purchaser.  The Purchaser (a) is an “accredited investor” within the meaning of Rule 501 of Regulation D under the Securities Act and (b) by reason of its business and financial experience it has such knowledge, sophistication and experience in making similar investments and in business and financial matters generally so as to be capable of evaluating the merits and risks of the prospective investment in the Purchased Units, is able to bear the economic risk of such investment and, at the present time, would be able to afford a complete loss of such investment.
Section 4.07    Restricted Securities.  The Purchaser understands that the Purchased Units are characterized as “restricted securities” under the federal securities Laws inasmuch as they are being acquired from ETP in a transaction not involving a public offering and that under such Laws such securities may be resold without registration under the Securities Act only in certain limited circumstances. In this connection, the Purchaser represents that it is knowledgeable with respect to Rule 144 under the Securities Act.
Section 4.08    Receipt of Information.  The Purchaser has (a) had access to ETP’s periodic filings with the Commission and (b) been provided a reasonable opportunity to ask questions of and receive answers from Representatives of ETP regarding such matters.
Section 4.09    Legend.  It is understood that the Purchased Units, as represented in one or more accounts with DTC, will bear the following legend:
THIS SECURITY HAS NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND IS SUBJECT TO THE TERMS OF THE SECOND AMENDED AND RESTATED LIMITED PARTNERSHIP AGREEMENT, AS AMENDED, OF ENERGY TRANSFER PARTNERS, L.P. THE HOLDER OF THIS SECURITY ACKNOWLEDGES FOR THE BENEFIT OF ENERGY TRANSFER PARTNERS, L.P. THAT THIS SECURITY MAY NOT BE SOLD, OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED IF SUCH TRANSFER WOULD (A) VIOLATE THE THEN APPLICABLE FEDERAL OR STATE SECURITIES LAWS OR RULES AND REGULATIONS OF THE SECURITIES AND EXCHANGE COMMISSION, ANY STATE SECURITIES COMMISSION OR ANY OTHER GOVERNMENTAL AUTHORITY WITH JURISDICTION OVER SUCH TRANSFER, (B) TERMINATE THE EXISTENCE OR QUALIFICATION OF ENERGY TRANSFER PARTNERS, L.P. UNDER THE LAWS OF THE STATE OF DELAWARE, OR (C) CAUSE ENERGY TRANSER PARTNERS, L.P. TO BE TREATED AS AN ASSOCIATION TAXABLE AS A CORPORATION OR OTHERWISE TO BE TAXED AS AN ENTITY FOR FEDERAL INCOME TAX 

14

PURPOSES (TO THE EXTENT NOT ALREADY SO TREATED OR TAXED). ETP GP LP, THE GENERAL PARTNER OF ENERGY TRANSFER PARTNERS, L.P., MAY IMPOSE ADDITIONAL RESTRICTIONS ON THE TRANSFER OF THIS SECURITY IF IT RECEIVES AN OPINION OF COUNSEL THAT SUCH RESTRICTIONS ARE NECESSARY TO AVOID A SIGNIFICANT RISK OF ENERGY TRANSER PARTNERS, L.P. BECOMING TAXABLE AS A CORPORATION OR OTHERWISE BECOMING TAXABLE AS AN ENTITY FOR FEDERAL INCOME TAX PURPOSES. THE RESTRICTIONS SET FORTH ABOVE SHALL NOT PRECLUDE THE SETTLEMENT OF ANY TRANSACTIONS INVOLVING THIS SECURITY ENTERED INTO THROUGH THE FACILITIES OF ANY NATIONAL SECURITIES EXCHANGE ON WHICH THIS SECURITY IS LISTED OR ADMITTED TO TRADING.
Section 4.10    Short Selling.  The Purchaser has not entered into any short sales of the Common Units owned by it between the time it first began discussion with ETP about the transactions contemplated by this Agreement and the date hereof (it being understood that the entering into of a total return swap shall not be considered a short sale of Common Units).
Section 4.11    Trading Activities.  The Purchaser’s trading activities, if any, with respect to the Common Units will be in compliance with all applicable state and federal securities Laws and the rules and regulations of the NYSE.
Section 4.12    Taking of Necessary Actions.  The Purchaser shall use its commercially reasonable efforts promptly to take or cause to be taken all action and promptly to do or cause to be done all things necessary, proper or advisable under applicable Law and regulations to consummate and make effective the transactions contemplated by this Agreement.  Without limiting the foregoing, Purchaser shall use its commercially reasonable efforts to assist ETP in making all filings and obtaining all consents of Governmental Authorities that may be necessary or, in the reasonable opinion of ETP, advisable for the consummation of the transactions contemplated by the Basic Documents.
ARTICLE V
INDEMNIFICATION, COSTS AND EXPENSES
Section 5.01    Indemnification by ETP.  ETP agrees to indemnify the Purchaser, LE GP, LLC and their respective Representatives (collectively, “Purchaser Related Parties”) from, and hold each of them harmless against, any and all losses, actions, suits, proceedings (including any investigations, litigation or inquiries), demands, and causes of action, and, in connection therewith, and promptly upon demand, pay or reimburse each of them for all reasonable costs, losses, liabilities, damages, or expenses of any kind or nature whatsoever, including the reasonable fees and disbursements of counsel and all other reasonable expenses incurred in connection with investigating, defending or preparing to defend any such matter that may be incurred by them or asserted against or involve any of them as a result of, arising out of, or in any way related to (a) the breach of any of the representations, warranties or covenants of ETP contained herein, provided such claim for indemnification relating to a breach of any representation or warranty is made prior to the expiration of such representation or warranty and (b) claims made by any third party or 

15

governmental agency in any proceeding as to which any Purchaser Related Party is a party or defendant thereto (whether or not such Purchaser Related Party is a primary defendant) (i) with respect to any breach of fiduciary duty (whether arising at law, in equity or by contract) or (ii) any violation of law or regulation by any ETP Related Party, in the case of (i) or (ii) in connection with the entry into this Agreement and the performance of the transactions contemplated hereby; provided, however, that no Purchaser Related Party shall be entitled to recover special, consequential or punitive damages with respect to claims pursuant to clause (a) of this ‎Section 5.01.  Notwithstanding anything to the contrary, consequential damages shall not be deemed to include diminution in value of the Purchased Units, which is specifically included in damages covered by Purchaser Related Parties’ indemnification.
Section 5.02    Indemnification by the Purchaser.  The Purchaser agrees to indemnify ETP, the General Partner, and their respective Representatives (collectively, “ETP Related Parties”) from, and hold each of them harmless against, any and all losses, actions, suits, proceedings (including any investigations, litigation or inquiries), demands, and causes of action, and, in connection therewith, and promptly upon demand, pay or reimburse each of them for all reasonable costs, losses, liabilities, damages, or expenses of any kind or nature whatsoever, including the reasonable fees and disbursements of counsel and all other reasonable expenses incurred in connection with investigating, defending or preparing to defend any such matter that may be incurred by them or asserted against or involve any of them as a result of, arising out of, or in any way related to the breach of any of the representations, warranties or covenants of the Purchaser contained herein, provided such claim for indemnification relating to a breach of any representation or warranty is made prior to the expiration of such representation or warranty, provided, however, that the liability of the Purchaser shall not be greater in amount than the Purchase Price.
Section 5.03    Indemnification Procedure.  Promptly after any ETP Related Party or Purchaser Related Party (hereinafter, the “Indemnified Party”) has received notice of any indemnifiable claim hereunder, or the commencement of any action, suit or proceeding by a third person, which the Indemnified Party believes in good faith is an indemnifiable claim under this Agreement, the Indemnified Party shall give the indemnitor hereunder (the “Indemnifying Party”) written notice of such claim or the commencement of such action, suit or proceeding, but failure to so notify the Indemnifying Party will not relieve the Indemnifying Party from any liability it may have to such Indemnified Party hereunder except to the extent that the Indemnifying Party is materially prejudiced by such failure. Such notice shall state the nature and the basis of such claim to the extent then known.  The Indemnifying Party shall have the right to defend and settle, at its own expense and by its own counsel, any such matter as long as the Indemnifying Party pursues the same diligently and in good faith. If the Indemnifying Party undertakes to defend or settle, it shall promptly notify the Indemnified Party of its intention to do so, and the Indemnified Party shall cooperate with the Indemnifying Party and its counsel in all commercially reasonable respects in the defense thereof and the settlement thereof. Such cooperation shall include, but shall not be limited to, furnishing the Indemnifying Party with any books, records and other information reasonably requested by the Indemnifying Party and in the Indemnified Party’s possession or control.  Such cooperation of the Indemnified Party shall be at the cost of the Indemnifying Party.  After the Indemnifying Party has notified the Indemnified Party of its intention to undertake to defend or settle any such asserted liability, and for so long as the Indemnifying Party diligently pursues such 

16

defense, the Indemnifying Party shall not be liable for any additional legal expenses incurred by the Indemnified Party in connection with any defense or settlement of such asserted liability; provided, however, that the Indemnified Party shall be entitled (i) at its expense, to participate in the defense of such asserted liability and the negotiations of the settlement thereof and (ii) if (A) the Indemnifying Party has failed to assume the defense and employ counsel or (B) if the defendants in any such action include both the Indemnified Party and the Indemnifying Party and counsel to the Indemnified Party shall have concluded that there may be reasonable defenses available to the Indemnified Party that are different from or in addition to those available to the Indemnifying Party or if the interests of the Indemnified Party reasonably may be deemed to conflict with the interests of the Indemnifying Party, then the Indemnified Party shall have the right to select a separate counsel and to assume such legal defense and otherwise to participate in the defense of such action, with the expenses and fees of such separate counsel and other expenses related to such participation to be reimbursed by the Indemnifying Party as incurred.  Notwithstanding any other provision of this Agreement, the Indemnifying Party shall not settle any indemnified claim without the consent of the Indemnified Party, unless the settlement thereof imposes no liability or obligation on, and includes a complete release from liability of, and does not contain any admission of wrong doing by, the Indemnified Party.
ARTICLE VI
MISCELLANEOUS
Section 6.01    Interpretation and Survival of Provisions.  Article, Section, Schedule, and Exhibit references are to this Agreement, unless otherwise specified. All references to instruments, documents, contracts, and agreements are references to such instruments, documents, contracts, and agreements as the same may be amended, supplemented, and otherwise modified from time to time, unless otherwise specified. The word “including” shall mean “including but not limited to.”  Whenever ETP has an obligation under a Basic Document, the expense of complying with that obligation shall be an expense of ETP unless otherwise specified.  Whenever any determination, consent or approval is to be made or given by the Purchaser, such action shall be in such the Purchaser’s sole discretion unless otherwise specified in this Agreement.  If any provision in the Basic Documents is held to be illegal, invalid, not binding, or unenforceable, such provision shall be fully severable and the Basic Documents shall be construed and enforced as if such illegal, invalid, not binding, or unenforceable provision had never comprised a part of the Basic Documents, and the remaining provisions shall remain in full force and effect.
Section 6.02    Survival of Provisions.  The representations and warranties set forth in Sections ‎3.02, ‎3.07, ‎3.08, ‎3.11, ‎3.12, ‎4.02 and ‎4.04 hereunder shall survive the execution and delivery of this Agreement indefinitely, and the other representations and warranties set forth herein shall survive for a period of 12 months following the First Closing Date regardless of any investigation made by or on behalf of ETP or the Purchaser.  The covenants made in this Agreement or any other Basic Document shall survive the Closings of the transactions described herein and remain operative and in full force and effect regardless of acceptance of any of the Purchased Units and payment therefor and repayment or repurchase thereof.  All indemnification obligations of ETP and the Purchaser and the provisions of ‎Article V shall remain operative and in full force and effect unless 

17

such obligations are expressly terminated in a writing referencing that individual Section, regardless of any purported general termination of this Agreement.
Section 6.03    No Waiver; Modifications in Writing.
(a)    Delay.  No failure or delay on the part of any Party in exercising any right, power, or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right, power, or remedy preclude any other or further exercise thereof or the exercise of any other right, power, or remedy. The remedies provided for herein are cumulative and are not exclusive of any remedies that may be available to a Party at law or in equity or otherwise.
(b)    Specific Waiver.  Except as otherwise provided herein, no amendment, waiver, consent, modification, or termination of any provision of this Agreement or any other Basic Document shall be effective unless signed by each of the parties hereto or thereto affected by such amendment, waiver, consent, modification, or termination.  Any amendment, supplement or modification of or to any provision of this Agreement or any other Basic Document, any waiver of any provision of this Agreement or any other Basic Document, and any consent to any departure by ETP from the terms of any provision of this Agreement or any other Basic Document shall be effective only in the specific instance and for the specific purpose for which made or given. Except where notice is specifically required by this Agreement, no notice to or demand on ETP in any case shall entitle ETP to any other or further notice or demand in similar or other circumstances.
Section 6.04    Binding Effect; Assignment.
(a)    Binding Effect.  This Agreement shall be binding upon ETP, the Purchaser, and their respective successors and permitted assigns. Except as expressly provided in this Agreement (including, without limitation, Article V), this Agreement shall not be construed so as to confer any right or benefit upon any Person other than the Parties and their respective successors and permitted assigns.
(b)    Assignment of Rights.  All or any portion of the rights and obligations of the Purchaser under this Agreement may be transferred by the Purchaser to any Affiliate of the Purchaser without the consent of ETP.  No portion of the rights and obligations of the Purchaser under this Agreement may be transferred by the Purchaser to a non-Affiliate without the written consent of ETP.
Section 6.05    Communications.  All notices and demands provided for hereunder shall be in writing and shall be given by registered or certified mail, return receipt requested, telecopy, air courier guaranteeing overnight delivery or personal delivery to the following addresses:
To ETP:

Energy Transfer Partners, L.P. 
8111 Westchester Drive, Suite 600
Dallas, Texas 75225

18

Facsimile:     (214) 981-0701 
Attention:    Thomas E. Long
Email:        tom.long@energytransfer.com
To the Purchaser:
Energy Transfer Equity, L.P.
8111 Westchester Drive, Suite 600 
Dallas, Texas 75225 
Facsimile:    (214) 981-0701 
Attention:    Thomas P. Mason
Email:         tom.mason@energytransfer.com

with copies to:

Latham & Watkins LLP 
811 Main Street, Suite 3700 
Houston, Texas 77002 
Facsimile:    (713) 546-5401 
Attention:    William N. Finnegan
Email:        bill.finnegan@lw.com        

or to such other address as ETP or the Purchaser may designate in writing.  All notices and communications shall be deemed to have been duly given: at the time delivered by hand, if personally delivered; upon actual receipt if sent by certified or registered mail, return receipt requested, or regular mail, if mailed; upon actual receipt of the overnight courier copy, if sent via facsimile; and upon actual receipt when delivered to an air courier guaranteeing overnight delivery.
Section 6.06    Entire Agreement.  This Agreement and the other Basic Documents are intended by the Parties as a final expression of their agreement and intended to be a complete and exclusive statement of the agreement and understanding of the Parties in respect of the subject matter contained herein and therein. There are no restrictions, promises, warranties or undertakings, other than those set forth or referred to herein or the other Basic Documents with respect to the rights granted by ETP or any of its Affiliates or the Purchaser or any of its Affiliates set forth herein or therein.  This Agreement and the other Basic Documents supersede all prior agreements and understandings between the Parties with respect to such subject matter.
Section 6.07    Governing Law.  This Agreement will be construed in accordance with and governed by the laws of the State of Delaware without regard to principles of conflicts of laws.
Section 6.08    Waiver of Jury Trial.  Each Party irrevocably waives the right to a trial by jury in connection with any matter arising out of this Agreement to the fullest extent permitted by applicable law.

19

Section 6.09    Execution in Counterparts.  This Agreement may be executed in any number of counterparts and by the Parties in separate counterparts, each of which counterparts, when so executed and delivered, shall be deemed to be an original and all of which counterparts, taken together, shall constitute but one and the same Agreement.
Section 6.10    Costs and Expenses.  Each Party shall be responsible for such Party’s own expenses in connection with the Basic Documents and the transactions contemplated thereby.
Section 6.11    Termination.
(a)    Notwithstanding anything herein to the contrary, this Agreement may be terminated at any time at or prior to the Closings by the Purchaser, upon a breach in any material respect by ETP of any covenant or agreement set forth in this Agreement.
(b)    Notwithstanding anything herein to the contrary, this Agreement may be terminated at any time at or prior to the Closings by ETP, upon a breach in any material respect by the Purchaser of any covenant or agreement set forth in this Agreement.
(c)    Notwithstanding anything herein to the contrary, this Agreement shall automatically terminate at any time at or prior to the Closings if a Law shall have been enacted or promulgated, or if any action shall have been taken by any Governmental Authority of competent jurisdiction that permanently restrains, permanently precludes, permanently enjoins or otherwise permanently prohibits the consummation of the transactions contemplated by any of the other Basic Documents or makes the transactions contemplated by any of the Basic Documents illegal.
(d)    In the event of the termination of this Agreement as provided in this ‎Section 6.11 (i) this Agreement shall forthwith become null and void and (ii) there shall be no liability on the part of any Party; provided that nothing herein shall relieve any Party from any liability or obligation with respect to any willful breach of this Agreement.
[Signature Page Follows]

20

IN WITNESS WHEREOF, the Parties execute this Agreement, effective as of the date first above written.
ENERGY TRANSFER PARTNERS, L.P.
    
By:    Energy Transfer Partners GP, L.P., 
its general partner
By:    Energy Transfer Partners, L.L.C.,
 its general partner

By: __/s/ Thomas E. Long__    
Name: Thomas E. Long
Title:  Chief Financial Officer

ENERGY TRANSFER EQUITY, L.P.

By: LE GP, LLC, its general partner

By:     /s/ John W. McReynolds    
Name: John W. McReynolds
Title: President

Exhibit A

REGISTRATION RIGHTS AGREEMENT

BY AND BETWEEN 

ENERGY TRANSFER PARTNERS, L.P.

AND

ENERGY TRANSFER EQUITY, L.P.

REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this “Agreement”) is made and entered into as of January 12, 2017, by and between ENERGY TRANSFER PARTNERS, L.P., a Delaware limited partnership (“ETP”) and ENERGY TRANSFER EQUITY, L.P., a Delaware limited partnership (“ETE”).
This Agreement is made in connection with this issuance of the Common Units (as defined below) to ETE pursuant to that certain Common Unit Purchase Agreement dated as of even date herewith (the “Purchase Agreement”) by and between ETE and ETP.
In consideration of the mutual covenants and agreements set forth herein and for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged by each party hereto, the parties hereby agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01    Definitions. The terms set forth below are used herein as so defined:
“Commission” means the U.S. Securities and Exchange Commission.
“Common Units” means 15,785,056 common units representing limited partner interests in ETP issued to ETE pursuant to the Purchase Agreement.
“Effectiveness Period” has the meaning specified therefor in ‎Section 2.01(a).
“ETE” has the meaning specified therefor in the preamble of this Agreement.
“ETP” has the meaning specified therefor in the preamble of this Agreement.
“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
“Holder” means the record holder of any Registrable Securities.
“Losses” has the meaning specified therefor in ‎Section 2.07(a).
“Managing Underwriter” means, with respect to any Underwritten Offering, the book running lead manager of such Underwritten Offering.
“Purchase Agreement” has the meaning specified therefor in the preamble of this Agreement.
“Registrable Securities” means the Common Units until such time as such securities cease to be Registrable Securities pursuant to ‎Section 1.02.

“Registration Expenses” means all expenses incident to ETP’s performance under or in compliance with this Agreement to effect the registration of Registrable Securities in a Shelf Registration, and the disposition of such securities, including, without limitation, all registration, filing, securities exchange listing and NYSE fees, all registration, filing, qualification and other fees and expenses of complying with securities or blue sky laws, fees of the Financial Industry Regulatory Authority, transfer taxes and fees of transfer agents and registrars, all word processing, duplicating and printing expenses, the fees and disbursements of counsel and independent public accountants for ETP, including the expenses of any special audits or “comfort letters” required by or incident to such performance and compliance.
“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
“Selling Expenses” means all underwriting fees, discounts and selling commissions allocable to the sale of the Registrable Securities.
“Selling Holder” means a Holder who is selling Registrable Securities pursuant to a Shelf Registration Statement.
“Shelf Registration” has the meaning specified therefor in ‎Section 2.01(a).
“Shelf Registration Statement” has the meaning specified therefor in ‎Section 2.01(a).
“Underwritten Offering” means an offering (including an offering pursuant to a Shelf Registration Statement) in which Common Units are sold to an underwriter on a firm commitment basis for reoffering to the public or an offering that is a “bought deal” with one or more investment banks.
Section 1.02    Registrable Securities. Any Registrable Security will cease to be a Registrable Security when (a) a registration statement covering such Registrable Security has been declared effective by the Commission and such Registrable Security has been sold or disposed of pursuant to such effective registration statement; (b) such Registrable Security has been disposed of pursuant to any section of Rule 144 under the Securities Act (or any successor rule or regulation to Rule 144); (c) such Registrable Security is held by ETP or one of its subsidiaries; or (d) such Registrable Security is eligible for resale (without restriction, including but not limited to, volume limitations) under Rule 144 under the Securities Act (or any similar provisions then in force under the Securities Act) under the Securities Act.

ARTICLE II
REGISTRATION RIGHTS
Section 2.01    Shelf Registration.
(a)    Shelf Registration. At the option and upon the request of the holders of a majority of the Common Units, ETP shall prepare and file a registration statement under the Securities Act to permit the public resale of the Registrable Securities from time to time as permitted by Rule 415 (or any similar provision then in force) of the Securities Act (the “Shelf Registration Statement”).  ETP shall use its reasonable best efforts to file the Shelf Registration Statement within 45 days of any such request and cause it to be effective as soon as reasonably practicable thereafter (the “Shelf Registration”); provided, however, that ETP shall not be required to effect more than three registrations pursuant to this ‎Section 2.01(a).  The Shelf Registration Statement filed pursuant to this ‎Section 2.01(a) shall be on such appropriate registration form of the Commission as shall be selected by ETP; provided, however, that if a prospectus supplement will be used in connection with the marketing of an Underwritten Offering from the Shelf Registration Statement and the Managing Underwriter at any time shall notify ETE in writing that, in the sole judgment of such Managing Underwriter, inclusion of detailed information to be used in such prospectus supplement is of material importance to the success of the Underwritten Offering of such Registrable Securities, ETP shall use its reasonable best efforts to include such information in such a prospectus supplement.  ETP will cause the Shelf Registration Statement filed pursuant to this ‎Section 2.01(a) to be continuously effective under the Securities Act until all Registrable Securities covered by the Shelf Registration Statement have been distributed in the manner set forth and as contemplated in the Shelf Registration Statement or there are no longer any Registrable Securities outstanding (the “Effectiveness Period”).  The Shelf Registration Statement, when declared effective (including the documents incorporated therein by reference), will comply as to form with all applicable requirements of the Securities Act and the Exchange Act and 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 not misleading. If ETP determines in good faith that the requested registration pursuant to this ‎Section 2.01(a) would be materially detrimental to ETP because such registration would (i) materially interfere with a significant acquisition, reorganization or other similar transaction involving ETP, (ii) require premature disclosure of material information that ETP has a bona fide business purpose for preserving as confidential or (iii) render ETP unable to comply with requirements under applicable securities laws, then ETP shall have the right to postpone such requested registration for a period of not more than three months after receipt of ETE’s request, such right pursuant to this ‎Section 2.01(a) not to be utilized more than twice in any twelve-month period.
(b)    Delay Rights. Notwithstanding anything to the contrary contained herein, ETP may, upon written notice to any Selling Holder whose Registrable Securities are included in 

a Shelf Registration Statement, suspend such Selling Holder’s use of any prospectus which is a part of such Shelf Registration Statement (in which event the Selling Holder shall discontinue sales of the Registrable Securities pursuant to such Shelf Registration Statement) if ETP (i) is pursuing a financing, acquisition, merger, reorganization, disposition or other similar transaction and determines in good faith that its ability to pursue or consummate such a transaction would be materially adversely affected by any required disclosure of such transaction in the Shelf Registration Statement or (ii) has experienced some other material non-public event the disclosure of which at such time, in the good faith determination of ETP would materially and adversely affect ETP. Upon disclosure of such information or the termination of the condition described above, ETP shall promptly (x) provide prompt notice to such Selling Holders, (y) terminate any suspension of sales it has put into effect and (z) take such other actions to permit sales of Registrable Securities pursuant to such Shelf Registration Statement as contemplated in this Agreement.
Section 2.02    Underwritten Offering. In the event that the Selling Holders holding a majority of the Common Units elect to dispose of Registrable Securities under the Shelf Registration Statement pursuant to an Underwritten Offering, ETP shall enter into an underwriting agreement in customary form with the Managing Underwriter and other underwriters, which shall include, among other provisions, indemnities to the effect and to the extent provided in ‎Section 2.07, and shall take all such other reasonable actions as are requested by the Managing Underwriter in order to expedite or facilitate the registration and disposition of the Registrable Securities.  In connection with any Underwritten Offering under this Agreement, ETP shall be entitled to select the Managing Underwriter or Underwriters, subject to the consent of ETE not to be unreasonably withheld.  No Selling Holder may participate in such Underwritten Offering unless such Selling Holder agrees to sell its Registrable Securities on the basis provided in such underwriting agreement and completes and executes all questionnaires, powers of attorney, indemnities and other documents reasonably required under the terms of such underwriting agreement.  Each Selling Holder may, at its option, require that any or all of the representations and warranties by, and the other agreements on the part of, ETP to and for the benefit of such underwriters also be made to and for such Selling Holder’s benefit and that any or all of the conditions precedent to the obligations of such underwriters under such underwriting agreement also be conditions precedent to its obligations. No Selling Holder shall be required to make any representations or warranties to or agreements with ETP other than representations, warranties or agreements regarding such Selling Holder and its ownership of the securities being registered on its behalf and its intended method of distribution and any other representation required by law.  If any Selling Holder disapproves of the terms of an underwriting, such Selling Holder may elect to withdraw therefrom by notice to ETP and the Managing Underwriter; provided, however, that such withdrawal must be made up to and including the time of pricing of such offering to be effective.  No such withdrawal or abandonment shall affect ETP’s obligation to pay Registration Expenses.

Section 2.03    Registration Procedures. In connection with its obligations contained in ‎Section 2.01, ETP will, as expeditiously as possible:
(a)    prepare and file with the Commission such amendments and supplements to the Shelf Registration Statement and the prospectus used in connection therewith as may be necessary to keep the Shelf Registration Statement effective for the Effectiveness Period and as may be necessary to comply with the provisions of the Securities Act with respect to the disposition of all securities covered by the Shelf Registration Statement;
(b)    furnish to each Selling Holder (i) as far in advance as reasonably practicable before filing the Shelf Registration Statement or any supplement or amendment thereto, upon request, copies of reasonably complete drafts of all such documents proposed to be filed (including furnishing or making available exhibits and each document incorporated by reference therein to the extent then required by the rules and regulations of the Commission), and provide each such Selling Holder the opportunity to object to any information pertaining to such Selling Holder and its plan of distribution that is contained therein and make the corrections reasonably requested by such Selling Holder with respect to such information prior to filing the Shelf Registration Statement or supplement or amendment thereto, and (ii) such number of copies of the Shelf Registration Statement and the prospectus included therein and any supplements and amendments thereto as such Persons may reasonably request in order to facilitate the public sale or other disposition of the Registrable Securities covered by such Shelf Registration Statement;
(c)    if applicable, use its reasonable best efforts to register or qualify the Registrable Securities covered by the Shelf Registration Statement under the securities or blue sky laws of such jurisdictions as the Selling Holders or, in the case of an Underwritten Offering, the Managing Underwriter, shall reasonably request; provided that neither ETP nor any of its affiliates will be required to qualify generally to transact business in any jurisdiction where it is not then required to so qualify or to take any action which would subject it to general service of process in any such jurisdiction where it is not then so subject;
(d)    promptly notify each Selling Holder and each underwriter, at any time when a prospectus relating thereto is required to be delivered under the Securities Act, of (i) the filing of the Shelf Registration Statement or any prospectus or prospectus supplement to be used in connection therewith, or any amendment or supplement thereto, and, with respect to such Shelf Registration Statement, when the same has become effective; and (ii) any written comments from the Commission with respect to any filing referred to in clause (i) and any written request by the Commission for amendments or supplements to the Shelf Registration Statement or any prospectus or prospectus supplement thereto;

(e)    immediately notify each Selling Holder and each underwriter, at any time when a prospectus relating thereto is required to be delivered under the Securities Act, of (i) the happening of any event as a result of which the prospectus or prospectus supplement contained in the Shelf Registration Statement, as then in effect, includes an untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein not misleading, in the light of the circumstances then existing; (ii) the issuance or threat of issuance by the Commission of any stop order suspending the effectiveness of the Shelf Registration Statement, or the initiation of any proceedings for that purpose; or (iii) the receipt by ETP of any notification with respect to the suspension of the qualification of any Registrable Securities for sale under the applicable securities or blue sky laws of any jurisdiction. Following the provision of such notice, ETP agrees to as promptly as practicable amend or supplement the prospectus or prospectus supplement or take other appropriate action so that the prospectus or prospectus supplement does not include 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 not misleading, in the light of the circumstances then existing, and to take such other action as is necessary to remove a stop order, suspension, threat thereof or proceedings related thereto;
(f)    furnish to each Selling Holder copies of any and all transmittal letters or other correspondence with the Commission or any other governmental agency or self-regulatory body or other body having jurisdiction (including any domestic or foreign securities exchange) relating to such offering of Registrable Securities;
(g)    in the case of an Underwritten Offering, furnish upon request and addressed to the underwriters and to the Selling Holders, (i) an opinion of counsel for ETP, dated the effective date of the closing under the underwriting agreement, and (ii) a “comfort letter”, dated the date of the underwriting agreement with respect to such Underwritten Offering and a letter of like kind dated the date of the closing under the underwriting agreement, in each case, signed by the independent public accountants who have certified ETP’s financial statements included or incorporated by reference into the applicable Shelf Registration Statement, and each of the opinion and the “comfort letter” shall be in customary form and covering substantially the same matters with respect to such Shelf Registration Statement (and the prospectus and any prospectus supplement included therein) and as are customarily covered in opinions of issuer’s counsel and in accountants’ letters delivered to the underwriters in Underwritten Offerings of securities, and such other matters as such underwriters may reasonably request;
(h)    otherwise use its reasonable best efforts to comply with all applicable rules and regulations of the Commission, and make available to its security holders, as soon as reasonably practicable, an earnings statement covering the period of at least 12 months, but not more than 18 months, beginning with the first full calendar month after the effective date of such Shelf Registration 

Statement, which earnings statement shall satisfy the provisions of Section 11(a) of the Securities Act and Rule 158 promulgated thereunder;
(i)    make available to the appropriate representatives of the Managing Underwriter and Selling Holders access to such information and ETP personnel as is reasonable and customary to enable such parties to establish a due diligence defense under the Securities Act; provided that ETP need not disclose any information to any such representative unless and until such representative has entered into a confidentiality agreement with ETP;
(j)    cause all such Registrable Securities registered pursuant to this Agreement to be listed on each securities exchange or nationally recognized quotation system on which similar securities issued by ETP are then listed;
(k)    use its reasonable best efforts to cause the Registrable Securities to be registered with or approved by such other governmental agencies or authorities as may be necessary by virtue of the business and operations of ETP to enable the Selling Holders to consummate the disposition of such Registrable Securities;
(l)    provide a transfer agent and registrar for all Registrable Securities covered by such Shelf Registration Statement not later than the effective date of such Shelf Registration Statement; and 
(m)    enter into customary agreements and take such other actions as are reasonably requested by the Selling Holders or the underwriters, if any, including participation in “roadshows,” as are reasonably required in order to expedite or facilitate the disposition of such Registrable Securities.
Each Selling Holder, upon receipt of notice from ETP of the happening of any event of the kind described in subsection ‎(e) of this ‎Section 2.03, shall forthwith discontinue disposition of the Registrable Securities until such Selling Holder’s receipt of the copies of the supplemented or amended prospectus contemplated by subsection ‎(e) of this ‎Section 2.03 or until it is advised in writing by ETP that the use of the prospectus may be resumed, and has received copies of any additional or supplemental filings incorporated by reference in the prospectus, and, if so directed by ETP, such Selling Holder will, or will request the managing underwriter or underwriters, if any, to deliver to ETP (at ETP’s expense) all copies in their possession or control, other than permanent file copies then in such Selling Holder’s possession, of the prospectus covering such Registrable Securities current at the time of receipt of such notice.
Section 2.04    Cooperation by Holders. ETP shall have no obligation to include in the Shelf Registration Statement Common Units of a Holder who has failed to timely furnish such information which, in the opinion of counsel to ETP, is reasonably required in order for the Shelf Registration 

Statement or any prospectus or prospectus supplement thereto, as applicable, to comply with the Securities Act.
Section 2.05    Restrictions on Public Sale by Holders of Registrable Securities. Each Holder of Registrable Securities who is included in the Shelf Registration Statement agrees not to effect any sale or distribution of the Registrable Securities during the lock-up period contained in a prospectus supplement filed with the Commission with respect to the pricing of an Underwritten Offering, provided that (i) ETP gives written notice to such Holder of the date of the commencement and termination of such period with respect to any such Underwritten Offering and (ii) the duration of the foregoing restrictions shall be no longer than the duration of the shortest restriction generally imposed by the underwriters on ETP or on the officers or directors or any other unitholder of ETP on whom a restriction is imposed.
Section 2.06    Expenses.  Except as otherwise provided in ‎Section 2.07, ETP shall not be responsible for legal fees incurred by Holders in connection with the exercise of such Holders’ rights hereunder. In addition, ETP shall not be responsible for any Selling Expenses.  ETP will pay all Registration Expenses in connection with any Shelf Registration Statement filed pursuant to ‎Section 2.01(a), whether or not the Shelf Registration Statement becomes effective or any sale is made pursuant to the Shelf Registration Statement. Each Selling Holder shall pay all Selling Expenses in connection with any sale of its Registrable Securities hereunder.
Section 2.07    Indemnification.
(a)    By ETP. In the event of a registration of any Registrable Securities under the Securities Act pursuant to this Agreement, ETP will indemnify and hold harmless each Selling Holder thereunder, its directors and officers and each underwriter pursuant to the applicable underwriting agreement with such underwriter and each Person, if any, who controls such Selling Holder or underwriter within the meaning of the Securities Act and the Exchange Act, against any losses, claims, damages, expenses or liabilities (including reasonable attorneys’ fees and expenses) (collectively, “Losses”), joint or several, to which such Selling Holder or underwriter or controlling Person may become subject under the Securities Act, the Exchange Act or otherwise, insofar as such Losses (or actions or proceedings, whether commenced or threatened, in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of any material fact contained in the Shelf Registration Statement, any preliminary prospectus or final prospectus contained therein, or any amendment or supplement thereof, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein (in the case of a prospectus, in light of the circumstances under which they were made) not misleading, and will reimburse each such Selling Holder, its directors and officers, each such underwriter and each such controlling Person for any legal or other expenses reasonably incurred by them in connection with investigating or defending any such Loss or actions 

or proceedings; provided, however, that ETP will not be liable in any such case if and to the extent that any such Loss arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission so made in conformity with information furnished by such Selling Holder, such underwriter or such controlling Person in writing specifically for use in the Shelf Registration Statement or any prospectus contained therein or any amendment or supplement thereof. Such indemnity shall remain in full force and effect regardless of any investigation made by or on behalf of such Selling Holder or any such director, officer or controlling Person, and shall survive the transfer of such securities by such Selling Holder.
(b)    By Each Selling Holder. Each Selling Holder agrees severally and jointly to indemnify and hold harmless ETP, its directors and officers, and each Person, if any, who controls ETP within the meaning of the Securities Act or of the Exchange Act to the same extent as the foregoing indemnity from ETP to the Selling Holders, but only with respect to information regarding such Selling Holder furnished in writing by or on behalf of such Selling Holder expressly for inclusion in the Shelf Registration Statement or any prospectus contained therein or any amendment or supplement thereof relating to the Registrable Securities; provided, however, that the liability of each Selling Holder shall not be greater in amount than the dollar amount of the proceeds (net of any Selling Expenses) received by such Selling Holder from the sale of the Registrable Securities giving rise to such indemnification.
(c)    Notice. Promptly after receipt by an indemnified party hereunder of notice of the commencement of any action, such indemnified party shall, if a claim in respect thereof is to be made against the indemnifying party hereunder, notify the indemnifying party in writing thereof, but the omission so to notify the indemnifying party shall not relieve it from any liability which it may have to any indemnified party other than under this ‎Section 2.07. The indemnifying party shall be entitled to participate in and, to the extent it shall wish, to assume and undertake the defense thereof with counsel reasonably satisfactory to such indemnified party and, after notice from the indemnifying party to such indemnified party of its election so to assume and undertake the defense thereof, the indemnifying party shall not be liable to such indemnified party under this ‎Section 2.07 for any legal expenses subsequently incurred by such indemnified party in connection with the defense thereof other than reasonable costs of investigation and of liaison with counsel so selected; provided, however, that, (i) if the indemnifying party has failed to assume the defense and employ counsel or (ii) if the defendants in any such action include both the indemnified party and the indemnifying party and counsel to the indemnified party shall have concluded that there may be reasonable defenses available to the indemnified party that are different from or additional to those available to the indemnifying party, or if the interests of the indemnified party reasonably may be deemed to conflict with the interests of the indemnifying party, then the indemnified party shall have the right to select a separate counsel and to assume such legal defense and otherwise to participate in the defense of such action, with the reasonable expenses and fees of one such separate counsel (firm) and other reasonable expenses related to such participation to be reimbursed by the 

indemnifying party as incurred. Notwithstanding any other provision of this Agreement, no indemnified party shall settle any action brought against it with respect to which it is entitled to indemnification hereunder without the consent of the indemnifying party, unless the settlement thereof imposes no liability or obligation on, and includes a complete and unconditional release from all liability of, the indemnifying party.
(d)    Contribution. If the indemnification provided for in this ‎Section 2.07 is held by a court or government agency of competent jurisdiction to be unavailable to ETP or any Selling Holder or is insufficient to hold it harmless in respect of any Losses, then each such 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 as between ETP on the one hand and such Selling Holder on the other hand, in such proportion as is appropriate to reflect the relative fault of ETP on the one hand and of such Selling Holder on the other in connection with the statements or omissions which resulted in such Losses, as well as any other relevant equitable considerations; provided, however, that in no event shall such Selling Holder be required to contribute an aggregate amount in excess of the dollar amount of proceeds (net of Selling Expenses) received by such Selling Holder from the sale of Registrable Securities giving rise to such indemnification. The relative fault of ETP on the one hand and each Selling Holder on the other hand 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 has been made by, or relates to, information supplied by such party, and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The parties hereto agree that it would not be just and equitable if contributions pursuant to this paragraph were to be determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations referred to in the first sentence of this paragraph. The amount paid by an indemnified party as a result of the Losses referred to in the first sentence of this paragraph shall be deemed to include any legal and other expenses reasonably incurred by such indemnified party in connection with investigating or defending any Loss which is the subject of this paragraph. 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 is not guilty of such fraudulent misrepresentation.
(e)    Other Indemnification. The provisions of this Section 2.07 shall be in addition to any other rights to indemnification or contribution which an indemnified party may have pursuant to law, equity, contract or otherwise.
Section 2.08    Rule 144 Reporting. With a view to making available the benefits of certain rules and regulations of the Commission that may permit the sale of the Registrable Securities to the public without registration, ETP agrees to use its reasonable best efforts to:

(a)    Make and keep public information regarding ETP available, as those terms are understood and defined in Rule 144 under the Securities Act, at all times from and after the date hereof;
(b)    File with the Commission in a timely manner all reports and other documents required of ETP under the Securities Act and the Exchange Act at all times from and after the date hereof; and
(c)    So long as a Holder owns any Registrable Securities, furnish to such Holder forthwith upon request a copy of the most recent annual or quarterly report of ETP, and such other reports and documents so filed as such Holder may reasonably request in availing itself of any rule or regulation of the Commission allowing such Holder to sell any such securities without registration.
Section 2.09    Transfer or Assignment of Registration Rights. The rights to cause ETP to include Registrable Securities in a Shelf Registration Statement may be transferred or assigned by ETE to one or more transferee(s) or assignee(s) of such Registrable Securities; provided that (a) such transferee or assignee receives at least 20% of the Common Units covered by this Agreement, (b) ETP is given written notice prior to any said transfer or assignment, stating the name and address of each such transferee and identifying the securities with respect to which such registration rights are being transferred or assigned, and (c) each such transferee or assignee assumes in writing responsibility for its portion of the obligations of ETE under this Agreement.
Section 2.10    Section 2.10 Information by Holder. Any Holder or Holders of Registrable Securities included in any Shelf Registration Statement shall promptly furnish to ETP such information regarding such Holder or Holders and the distribution proposed by such Holder or Holders as ETP may reasonably request and as shall be required in connection with any registration, qualification or compliance referred to herein.
ARTICLE III
MISCELLANEOUS 
Section 3.01    Communications. All notices and other communications provided for or permitted hereunder shall be made in writing by facsimile, courier service or personal delivery:
if to ETP to:

Energy Transfer Partners, L.P. 
8111 Westchester Drive, Suite 600
Dallas, Texas 75225 
Attention:    Thomas E. Long
Email:        tom.long@energytransfer.com

if to ETE to:
Energy Transfer Equity, L.P. 
8111 Westchester Drive, Suite 600 
Dallas, Texas 75225 
Facsimile:    (214) 981-0701 
Attention:    Thomas P. Mason
Email:         tom.mason@energytransfer.com

with copies to:

Latham & Watkins LLP 
811 Main Street, Suite 3700 
Houston, Texas 77002 
Facsimile:    (713) 546-5401 
Attention:    William N. Finnegan
Email:        bill.finnegan@lw.com    

All such notices and communications shall be deemed to have been received at the time delivered by hand, if personally delivered; when receipt acknowledged, if sent via facsimile or sent via Internet electronic mail; and when actually received, if sent by any other means.
Section 3.02    Successor and Assigns. This Agreement 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 to the extent permitted herein.
Section 3.03    Assignment of Rights. All or any portion of the rights and obligations of ETE under this Agreement may be transferred or assigned by ETE only in accordance with ‎Section 2.09.
Section 3.04    Recapitalization, Exchanges, etc. Affecting the Common Units. The provisions of this Agreement shall apply to the full extent set forth herein with respect to any and all units of ETP or any successor or assign of ETP (whether by merger, consolidation, sale of assets or otherwise) which may be issued in respect of, in exchange for or in substitution of, the Registrable Securities, and shall be appropriately adjusted for combinations, recapitalizations and the like occurring after the date of this Agreement.
Section 3.05    Specific Performance. Damages in the event of breach of this Agreement by a party hereto may be difficult, if not impossible, to ascertain, and it is therefore agreed that each such Person, in addition to and without limiting any other remedy or right it may have, will have the right to an injunction or other equitable relief in any court of competent jurisdiction, enjoining 

any such breach, and enforcing specifically the terms and provisions hereof, and each of the parties hereto hereby waives any and all defenses it may have on the ground of lack of jurisdiction or competence of the court to grant such an injunction or other equitable relief. The existence of this right will not preclude any such Person from pursuing any other rights and remedies at law or in equity which such Person may have.
Section 3.06    Counterparts. This Agreement may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which counterparts, when so executed and delivered, shall be deemed to be an original and all of which counterparts, taken together, shall constitute but one and the same Agreement.
Section 3.07    Headings. The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.
Section 3.08    Governing Law. This Agreement will be construed in accordance with and governed by the laws of the State of Delaware without regard to principles of conflicts of laws.
Section 3.09    Severability of Provisions. Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof or affecting or impairing the validity or enforceability of such provision in any other jurisdiction.
Section 3.10    Entire Agreement. This Agreement is intended by the parties as a final expression of their agreement and 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 rights granted by ETP set forth herein. This Agreement supersedes all prior agreements and understandings between the parties with respect to such subject matter.
Section 3.11    Amendment. This Agreement may be amended only by means of a written amendment signed by ETP and the Holders of a majority of the then outstanding Registrable Securities; provided, however, that no such amendment shall materially and adversely affect the rights of any Holder hereunder without the consent of such Holder.
Section 3.12    No Presumption. In the event any claim is made by a party relating to any conflict, omission, or ambiguity in this Agreement, no presumption or burden of proof or persuasion shall be implied by virtue of the fact that this Agreement was prepared by or at the request of a particular party or its counsel.
[Signature page follows]

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above. 
                
ENERGY TRANSFER PARTNERS, L.P.
By:    Energy Transfer Partners GP, L.P., 
its general partner
By:    Energy Transfer Partners, L.L.C., 
its general partner

By:______________________________
Thomas E. Long
Chief Financial Officer

ENERGY TRANSFER EQUITY, L.P.
By: LE GP, LLC, its general partner

By:______________________________
John W. McReynolds
President

Exhibit B
Excepted Subsidiaries
	
	
	Energy Transfer Partners, L.P. (non-wholly owned subsidiaries)

	Aqua PVR Water Services, LLC (51% interest)

	Bakken Holdings Company LLC (60% interest)

	Bakken Pipeline Investments LLC (60% interest)

	Bayou Bridge Pipeline, LLC, a Delaware limited liability company (38.23% interest)

	CBC/Leon Limited Partnership (91% interest)

	Citrus Energy Services, Inc., a Delaware corporation (50% interest)

	Citrus, LLC, a Delaware limited liability company (50% interest)

	Comanche Trail Pipeline, LLC, a Texas limited liability company (16% interest)

	Dakota Access Holdings LLC (60% interest)

	Dakota Access Truck Terminals, LLC (45% interest)

	Dakota Access, LLC (45% interest)

	Eastern Gulf Crude Access, LLC (45% interest)

	Edwards Lime Gathering, LLC (60% interest)

	ELG Oil LLC (60% interest)

	ELG Utility LLC (60% interest)

	Energy Transfer Crude Oil Company, LLC (45% interest)

	Energy Transfer LNG Export, LLC, a Delaware limited liability company (40% interest)

	ET Crude Oil Terminals, LLC, a Delaware limited liability company (40% interest)

	ETC Illinois LLC, a Delaware limited liability company (40% interest)

	ETCO Holdings LLC, a Delaware limited liability company (40% interest)

	Fayetteville Express Pipeline, LLC, a Delaware limited liability company (50% interest)

	FEP Arkansas Pipeline, LLC, an Arkansas limited liability company (50% interest)

	Florida Gas Transmission Company, LLC, a Delaware limited liability company (50% interest)

	Lake Charles Exports, LLC, a Delaware limited liability company (20% interest)

	Lake Charles LNG Export, LLC, a Delaware limited liability company (40% interest)

	Lee 8 Storage Partnership, a Delaware limited partnership (29% interest)

	Leon Limited Partnership, an Oklahoma limited partnership (50% interest)

	Liberty Pipeline Group, LLC, a Delaware limited liability company (50% interest)

	Mi Vida JV LLC (50% interest)

	Midcontinent Express Pipeline LLC, a Delaware limited liability company (50% interest)

	Ohio River System LLC ( 75% interest)

	Ranch Westex JV LLC, a Delaware limited liability company (33.3% interest)

	Regency Intrastate Gas LP, a Delaware limited partnership (49.99% interest)

	RIGS GP LLC, a Delaware limited liability company (49.99% interest)

	RIGS Haynesville Partnership Co., a Delaware general partnership (49.99% interest)

	Rover Pipeline LLC (65% interest)

	Sunoco Logistics Partners L.P., a Delaware limited partnership (25.92% interest)

	Sunoco Partners LLC (99.9% interest)

	Sunoco, LP, a Delaware limited partnership (38.9% interest)

	Susser Holdings Corporation, a Delaware corporation (38.9% interest)

	Sweeny Gathering, L.P., a Texas limited partnership 950% interest)

	Trans-Pecos Pipeline, LLC, a Texas limited liability company (16% interest)EX-4.3

 Exhibit 4.3 

C & J ENERGY SERVICES, INC. 

2017 MANAGEMENT INCENTIVE PLAN 
  

	 	1.	Purpose. 

 The purpose of the Plan is to assist the Company to attract,
retain, incentivize and motivate officers and employees of, consultants to, and non-employee directors providing services to, the Company or its Subsidiaries and to promote the success of the Company’s business by providing such participating
individuals with a proprietary interest in the performance of the Company. The Company believes that this incentive program will cause participating officers, employees, consultants and non-employee directors to increase their interest in the
welfare of the Company or its Subsidiaries and to align those interests with those of the shareholders of the Company, its Subsidiaries and Affiliates. 
  

	 	2.	Definitions. For purposes of the Plan: 

2.1.    “Affiliate” shall mean, any entity that the Company, either directly or indirectly through one or
more intermediaries, is in common control with, is controlled by or controls, each within the meaning of the Securities Act. 

2.2.    “Award” means, individually or collectively, a grant of an Option, Restricted Share, a Restricted
Share Unit, a Share Appreciation Right, a Performance Award, a Dividend Equivalent Right, a Share Award, an Other Share-Based Award, a Cash Award, a Substitute Award or any combination of the foregoing. 

2.3.    “Award Agreement” means a written or electronic agreement between the Company and a Participant
evidencing the grant of an Award and setting forth the terms and conditions thereof. 
 2.4.    “Board”
means the Board of Directors of the Company. 
 2.5.    “Cause” means, with respect to the Termination
of a Participant by the Company or any Subsidiary of the Company that employs such individual or to which the Participant performs services (or by the Company on behalf of any such Subsidiary), such Participant’s (i) refusal or neglect to
perform substantially his or her employment-related duties or services, (ii) personal dishonesty, incompetence, willful misconduct or breach of fiduciary duty, (iii) indictment for, conviction of or entering a plea of guilty or nolo contendere to a
crime constituting a felony or his or her willful violation of any applicable law (other than a traffic violation or other offense or violation outside of the course of employment or services to the Company or its Subsidiaries which does not
adversely affect the Company and its Subsidiaries or its reputation or the ability of the Participant to perform his or her employment-related duties or services or to represent the Company or any Subsidiary of the Company that employs such
Participant or to which the Participant performs services), (iv) failure to reasonably cooperate, following a request to do so by the Company, in any internal or governmental investigation of the Company or any of its Subsidiaries or (v) material
breach of any written covenant or agreement with the Company or any of its Subsidiaries not to disclose any information pertaining to the Company or such Subsidiary or not to compete or interfere with the Company or such Subsidiary; provided that,
in the case of any Participant who, as of the date of determination, is party to an effective services, severance or employment agreement with the Company or any Subsidiary, “Cause” shall have the meaning, if any, specified in such
agreement 

 2.6.    “Cash Awards” means Cash Awards granted to an
Eligible Individual under Section 10.2. 
 2.7.    “Change in Capitalization” means any increase or
reduction in the number of Shares, any change (including, but not limited to, in the case of a spin-off, extraordinary dividend (whether in cash or property) or other distribution in respect of Shares, a change in value) in the Shares or any
exchange of Shares for a different number or kind of shares or other securities of the Company or another corporation, by reason of a reclassification, recapitalization, merger, consolidation, reorganization, spin-off, split-up, issuance of
warrants, rights or debentures, share dividend, share split or reverse share split, cash dividend, property dividend, combination or exchange of shares, repurchase of shares, change in corporate structure or any similar corporate event or
transaction. 
 2.8.    “Change in Control” means the occurrence of any of the following after the
Effective Date: 
 (a)    any “person” (as such term is used in Sections 13(d) and 14(d) of the
Exchange Act, other than a Permitted Holder, acquires “beneficial ownership” (within the meaning of Rule 13d-3 under the Exchange Act) of securities of the Company representing more than fifty percent (50%) of the combined voting power of
the Company’s then outstanding securities; provided, however, that if the Company engages in a merger or consolidation in which the Company or surviving entity in such merger or consolidation becomes a subsidiary of another entity, then
references to the Company’s then outstanding securities shall be deemed to refer to the outstanding securities of such parent entity; 

(b)    a change in the composition of the Board such that the “Continuing Directors” cease for
any reason to constitute at least seventy percent (70%) of the Board. The “Continuing Directors” shall mean those members of the Board who either: (x) were directors on the Effective Date; or (y) were elected by, or on the nomination or
recommendation of, at least a three-quarters (3/4) majority (consisting of at least four (4) directors) of the Board who were or become Continuing Directors; 

(c)    the consummation of a merger or consolidation of the Company with any corporation,
including without limitation, a reverse or forward triangular merger, and the Company’s shareholders prior to such transaction own less than a majority of the voting securities of the surviving or resulting corporation or entity after the
transaction; 
 (d)    the consummation of a tender offer or exchange offer by a person or group of
persons (other than the Company or a Permitted Holder) for the ownership of more than fifty percent (50%) of the Company’s voting securities; or 

  
 2 

 (e)    the sale or disposition (other than a pledge or
similar encumbrance) by the Company of all or substantially all of the assets of the Company, other than to a Permitted Holder or Permitted Holders; 

provided, however, if a Change in Control constitutes a payment event with respect to any deferred compensation that is subject to
Section 409A, a transaction or event described in paragraph (a), (b), (c), (d) or (e) shall constitute a Change in Control only if such transaction or event constitutes a “change in control event” as defined in Treasury Regulation Section
l .409A-3(i)(5). Notwithstanding the foregoing, the parties acknowledge and agree that the restructuring transactions (specifically including the change in ownership and Board composition) contemplated by the Plan of Reorganization arising
under the Company’s (including certain of its subsidiaries) voluntary petitions for reorganization filed on July 20, 2016 seeking relief under the provisions of Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy
Court for the Southern District of Texas, Houston Division under the caption “In re: CJ Holding Co., et al., Case No. 16-33590”, including the emergence from bankruptcy as contemplated thereby, shall not constitute a Change in
Control for purposes of this Agreement. 
 2.9.    “Code” means the Internal Revenue Code of 1986, as
amended. 
 2.10.    “Committee” means the Compensation Committee of the Board which administers the
Plan as provided in Section 3. 
 2.11.    “Company” means C&J Energy Services, Inc., a Delaware
corporation, or any successor thereto. 
 2.12.    “Consultant” means any consultant or advisor who is
a natural person and who renders services to the Company or a Subsidiary that (a) are not in connection with the offer and sale of the Company’s securities in a capital raising transaction and (b) do not directly or indirectly promote or
maintain a market for the Company’s securities, but who is not an Employee or Director. 

2.13.    “Corporate Transaction” means (a) a merger, consolidation, reorganization, recapitalization or
other similar change in the Company’s common shares or (b) a liquidation or dissolution of the Company. For the avoidance of doubt, a Corporate Transaction may be a transaction that is also a Change in Control. 

2.14.    “Covered Employee” means, for any Performance Cycle: 

(a)    an Employee who 

(i)    as of the beginning of the Performance Cycle is an officer subject to Section 16 of the Exchange
Act, and 
 (ii)    prior to determining Performance Objectives for the Performance Cycle pursuant to
Section 9, the Committee designates as a Covered 

  
 3 

 
Employee for purposes of the Plan; provided that, if the Committee does not make the designation in clause (ii) for a Performance Cycle, all Employees described in clause (i) shall be
deemed to be Covered Employees for purposes of the Plan, and 
 (b)    any other Employee that the
Committee designates as a Covered Employee for purposes of the Plan. 
 2.15.    “Director” means a
member of the Board. 
 2.16.    “Disability” means permanent and total disability as defined in Code
Section 22(e)(3). A determination of Disability may be made by a physician selected or approved by the Committee and, in this respect, the Participant shall submit to any reasonable examination(s) required by such physician upon request.
Notwithstanding the foregoing provisions of this Section 2.15, in the event any Award is considered to be “deferred compensation” as that term is defined under the Nonqualified Deferred Compensation Rules, then, in lieu of the foregoing
definition and to the extent necessary to comply with the requirements of the Nonqualified Deferred Compensation Rules, the definition of “Disability” for purposes of such Award shall be the definition of “disability” provided
for under the Nonqualified Deferred Compensation Rules. 
 2.17.    “Division” means any of the
operating units or divisions of the Company designated as a Division by the Committee. 
 2.18.    “Dividend
Equivalent Right” means a right to receive cash, Shares, other Awards or other property based on the value of dividends that are paid with respect to Shares. 

2.19.    “Effective Date” means the date of the Plan’s approval by the Compensation Committee of the
Board. 
 2.20.    “Eligible Individual” means any Employee, Director or Consultant. 

2.21.    “Employee” means any individual performing services for the Company or a Subsidiary and
designated as an employee of the Company or the Subsidiary on its payroll records. An Employee shall not include any individual during any period he or she is classified or treated by the Company or Subsidiary as an independent contractor, a
consultant or an employee of an employment, consulting or temporary agency or any other entity other than the Company or Subsidiary, without regard to whether such individual is subsequently determined to have been, or is subsequently retroactively
reclassified, as a common-law employee of the Company or Subsidiary during such period. An individual shall not cease to be an Employee in the case of (i) any leave of absence approved by the Company or (ii) transfers between locations of the
Company or any Subsidiary, or between the Company and any Subsidiaries. 
 2.22.    “Exchange Act”
means the Securities Exchange Act of 1934, as amended. 
 2.23.    “Fair Market Value” on any date
means: 

  
 4 

 (a)    if the Shares are listed for trading on the New York
Stock Exchange, the closing price at the close of the primary trading session of the Shares on such date on the New York Stock Exchange, or if there has been no such closing price of the Shares on such date, on the next preceding date on which there
was such a closing price; 
 (b)    if the Shares are not listed for trading on the New York Stock
Exchange, but are listed on another national securities exchange, the closing price at the close of the primary trading session of the Shares on such date on such exchange, or if there has been no such closing price of the Shares on such date, on
the next preceding date on which there was such a closing price; 
 (c)    if the Shares are not listed
on the New York Stock Exchange or on another national securities exchange, the last sale price at the end of normal market hours of the Shares on such date as quoted on the National Association of Securities Dealers Automated Quotation System
(“NASDAQ”) or, if no such price shall have been quoted for such date, on the next preceding date for which such price was so quoted; or 

(d)    if the Shares are not listed for trading on a national securities exchange or are not authorized for
quotation on NASDAQ, the fair market value of the Shares as determined in good faith by the Committee taking into account any factors the Committee deems appropriate (including without limitation the Nonqualified Deferred Compensation Rules),, and
in the case of Incentive Stock Options, in accordance with Section 422 of the Code. 
 2.24.    “Incentive Stock
Option” means an Option satisfying the requirements of Section 422 of the Code and designated by the Committee as an Incentive Stock Option. 

2.25.    “Nonemployee Director” means a Director of the Board who is a “nonemployee director”
within the meaning of Rule 16b-3 promulgated under the Exchange Act. 
 2.26.    “Nonqualified Deferred
Compensation Rules” means the limitations or requirements of Section 409A and/or 457A of the Code, as amended from time to time, including the guidance and regulations promulgated thereunder and successor provisions, guidance and
regulations thereto. 
 2.27.    “Nonqualified Stock Option” means an Option which is not an Incentive
Stock Option. 
 2.28.    “Option” means a Nonqualified Stock Option or an Incentive Stock Option. 

2.29.    “Option Price” means the price at which a Share may be purchased pursuant to an Option. 

2.30.    “Other Share-Based Awards” means Other Share-Based Awards granted to an Eligible Individual
under Section 10.2. 

  
 5 

 2.31.    “Outside Director” means a Director of the Board
who is an “outside director” within the meaning of Section 162(m) of the Code and the regulations promulgated thereunder. 

2.32.    “Parent” means any corporation which is a “parent corporation” (within the meaning of
Section 424(e) of the Code) with respect to the Company. 
 2.33.    “Participant” means an Eligible
Individual to whom an Award has been granted under the Plan. 
 2.34.    “Performance Awards” means
Performance Share Units, Performance Units, Performance-Based Restricted Shares or any combination of the foregoing. 

2.35.    “Performance-Based Compensation” means any Award that is intended to constitute
“performance based compensation” within the meaning of Section 162(m) of the Code and the regulations promulgated thereunder. 

2.36.    “Performance-Based Restricted Shares” means Shares issued or transferred to an Eligible
Individual under Section 9.2. 
 2.37.    “Performance Cycle” means the time period specified by the
Committee at the time a Performance Award is granted during which the performance of the Company, a Subsidiary or a Division will be measured. 

2.38.    “Performance Objectives” means the objectives set forth in Section 9.3 for the purpose of
determining, either alone or together with other conditions, the degree of payout and/or vesting of Performance Awards. 

2.39.    “Performance Share Units” means Performance Share Units granted to an Eligible Individual under
Section 9.1(b). 
 2.40.    “Performance Units” means Performance Units granted to an Eligible
Individual under Section 9.1(a). 
 2.41.    “Permitted Holder” shall mean (i) any trustee or other
fiduciary holding securities of the Company under an employee benefit plan of the Company or any of its affiliates, (ii) any subsidiary of the Company that is at least 80% owned by the Company and (iii) any corporation, partnership, limited
liability company or other entity owned, directly or indirectly, by the shareholders of the Company in substantially the same proportions as their ownership of securities of the Company. 

2.42.    “Person” shall have the meaning ascribed to such term in Section 3(a)(9) of the Exchange Act and
used in Sections 13(d) and 14(d) of the Exchange Act. 
 2.43.    “Plan” means this C & J Energy
Services, Inc., 2017 Management Incentive Plan, as amended from time to time. 

  
 6 

 2.44.    “Plan Termination Date” means the date that is ten
(10) years after the Effective Date, unless the Plan is earlier terminated by the Board pursuant to Section 15 hereof. 

2.45.    “Restricted Shares” means Shares issued or transferred to an Eligible Individual pursuant to
Section 8.1. 
 2.46.    “Restricted Share Units” means rights granted to an Eligible Individual under
Section 8.2 representing a number of hypothetical Shares. 
 2.47.    “Securities Act” means the
Securities Act of 1933, as amended. 
 2.48.    “Share Award” means an Award of Shares granted pursuant
to Section 10.1. 
 2.49.    “Shares” means the common share, par value $0.01 per share, of the Company
and any other securities into which such shares are changed or for which such shares are exchanged. 

2.50.    “Share Appreciation Right” means a right to receive all or some portion of the increase, if any,
in the value of the Shares as provided in Section 6 hereof. 
 2.51.    “Subsidiary” means any
corporation which is a subsidiary corporation within the meaning of Section 424(f) of the Code with respect to the Company. 

2.52.    “Substitute Award” means an Award granted pursuant to Section 10.3 of the Plan. 

2.53.    “Ten-Percent Shareholder” means an Eligible Individual who, at the time an Incentive Stock
Option is to be granted to him or her, owns (within the meaning of Section 422(b)(6) of the Code) share possessing more than ten percent (10%) of the total combined voting power of all classes of shares of the Company, a Parent or a Subsidiary. 

2.54.    “Termination”, “Terminated” or “Terminates” shall mean (a)
with respect to a Participant who is an Employee, the date such Participant ceases to be employed by the Company and its Subsidiaries, (b) with respect to a Participant who is a Consultant, the date such Participant ceases to provide services to the
Company and its Subsidiaries or (c) with respect to a Participant who is a Director, the date such Participant ceases to be a Director, in each case, for any reason whatsoever (including by reason of death, Disability or adjudicated incompetency).
Unless otherwise set forth in an Award Agreement, (a) if a Participant is both an Employee and a Director and terminates as an Employee but remains as a Director, the Participant will be deemed to have continued in employment without interruption
and shall be deemed to have Terminated upon ceasing to be a Director and (b) if a Participant who is an Employee or a Director ceases to provide services in such capacity and becomes a Consultant, the Participant will thereupon be deemed to have
been Terminated. 

  
 7 

	 	3.	Administration. 

 3.1.    Committee; Procedure. The
Plan shall be administered by the Compensation Committee of the Board. The Committee may adopt such rules, regulations and guidelines as it deems are necessary or appropriate for the administration of the Plan. The Committee shall consist of at
least two (2) Directors of the Board and may consist of the entire Board; provided, however, that (a) if the Committee consists of less than the entire Board, then, with respect to any Award granted to an Eligible Individual who is subject to
Section 16 of the Exchange Act, the Committee shall consist of at least two Directors of the Board, each of whom shall be a Nonemployee Director and (b) to the extent necessary for any Award intended to qualify as Performance-Based Compensation to
so qualify, the Committee shall consist of at least two Directors of the Board, each of whom shall be an Outside Director. For purposes of the preceding sentence, if one or more members of the Committee is not a Nonemployee Director or an Outside
Director but recuses himself or herself or abstains from voting with respect to a particular action taken by the Committee, then the Committee, with respect to that action, shall be deemed to consist only of the members of the Committee who have not
recused themselves or abstained from voting. 
 3.2.    Board Reservation and Delegation. 

(a)    Except to the extent necessary for any Award intended to qualify as Performance-Based Compensation
to so qualify, the Board may, in its discretion, reserve to itself or exercise any or all of the authority and responsibility of the Committee hereunder. To the extent the Board has reserved to itself or exercises the authority and responsibility of
the Committee, all references to the Committee in the Plan shall be to the Board. 
 (b)    Subject to
applicable law, the Board may delegate, in whole or in part, any of the authority of the Committee hereunder (subject to such limits as may be determined by the Board) to any individual or committee of individuals (who need not be Directors),
including without limitation the authority to make Awards to Eligible Individuals who are not officers or directors of the Company or any of its Subsidiaries and who are not subject to Section 16 of the Exchange Act. To the extent that the Board
delegates any such authority to make Awards as provided by this Section 3.2(b), all references in the Plan to the Committee’s authority to make Awards and determinations with respect thereto shall be deemed to include the Board’s delegate.

 3.3.    Committee Powers. Subject to the express terms and conditions set forth herein and applicable law, the
Committee shall have the power from time to time to: 
 (a)    select those Eligible Individuals to whom
Options shall be granted under the Plan and the number of such Options to be granted and prescribe the terms and conditions (which need not be identical) of each such Option, including the exercise price per Share, the vesting schedule and the
duration of each Option, and make any amendment or modification to any Award Agreement consistent with the terms of the Plan; 

  
 8 

 (b)    select those Eligible Individuals to whom other Awards
shall be granted under the Plan, determine the type of Award, the number of Shares or amount of cash in respect of which each Award is granted and the terms and conditions (which need not be identical) of each such Award, including the vesting
schedule and duration of such award, if applicable, and make any amendment or modification to any Award Agreement consistent with the terms of the Plan; 

(c)    construe and interpret the Plan and the Awards granted hereunder, establish sub-plans, and
establish, amend and revoke rules and regulations for the administration of the Plan, including, but not limited to, correcting any defect, supplying any omission or reconciling any inconsistency in the Plan or in any Award Agreement in the manner
and to the extent it shall deem necessary or advisable, including so that the Plan and the operation of the Plan comply with Rule 16b-3 under the Exchange Act, the Code to the extent applicable and other applicable law, and otherwise make the Plan
fully effective; 
 (d)    determine the duration and purposes for leaves of absence which may be granted
to a Participant on an individual basis without constituting a Termination for purposes of the Plan; 

(e)    cancel, with the consent of the Participant, outstanding Awards or as otherwise permitted under the
term of the Plan; 
 (f)    exercise its discretion with respect to the powers and rights granted to it
as set forth in the Plan; and 
 (g)    generally, exercise such powers and perform such acts as are
deemed necessary or advisable to promote the best interests of the Company with respect to the Plan. 
 The Committee’s determinations
under the Plan need not be uniform and may be made by it selectively among Persons who receive, or are eligible to receive, Awards (whether or not such Persons are similarly situated). Without limiting the generality of the foregoing, the Committee
shall be entitled, among other things, to make non-uniform and selective determinations, and to enter into non-uniform and selective Award Agreements, as to the Eligible Individuals to receive Awards under the Plan and the terms and provision of
Awards under the Plan. All decisions and determinations by the Committee in the exercise of the above powers shall be final, binding and conclusive upon the Company, its Subsidiaries, the Participants and all other persons having any interest
therein. 
 3.4.    Indemnification. No member of the Committee shall be liable for any action, failure to act,
determination or interpretation made in good faith with respect to the Plan or any transaction hereunder. The Company hereby agrees to indemnify each member of the Committee for all costs and expenses and, to the extent permitted by applicable law,
any liability incurred in connection with defending against, responding to, negotiating for the settlement of or otherwise dealing with any claim, cause of action or dispute of any kind arising in connection with any actions in administering the
Plan or in authorizing or denying authorization to any transaction hereunder. 

  
 9 

 3.5.    No Repricing of Options or Share Appreciation Rights. The
Committee shall have no authority to make any adjustment (other than in connection with a Change in Capitalization, a Corporate Transaction or other transaction where an adjustment is permitted or required under the terms of the Plan) or amendment,
and no such adjustment or amendment shall be made, that reduces or would have the effect of reducing the exercise price of an Option or Share Appreciation Right previously granted under the Plan, whether through amendment, cancellation or
replacement grants or other means, unless the Company’s shareholders shall have approved such adjustment or amendment. 

3.6.    Participants in Non-U.S. Jurisdictions. Notwithstanding any provision of the Plan to the contrary, to
comply with applicable laws in countries other than the United States in which the Company operates or has Employees, Directors or Consultants from time to time, or to ensure that the Company complies with any applicable requirements of foreign
securities exchanges, the Committee, in its sole discretion, shall have the power and authority to: (i) determine which of its Subsidiaries shall be covered by the Plan; (ii) determine which Eligible Individuals outside the United States are
eligible to participate in the Plan; (iii) modify the terms and conditions of any Award granted to Eligible Individuals outside the United States to comply with applicable foreign laws or listing requirements of any foreign exchange; (iv) establish
sub-plans and modify exercise procedures and other terms and procedures, to the extent such actions may be necessary or advisable (any such sub-plans and/or modifications shall be attached to the Plan as appendices), provided, however, that no such
sub-plans and/or modifications shall increase the share limitations contained in Section 4.1; and (v) take any action, before or after an Award is granted, that it deems advisable to comply with any applicable governmental regulatory exemptions or
approval or listing requirements of any such foreign securities exchange. Notwithstanding the foregoing, the Committee may not take any actions hereunder, and no Awards shall be granted, that would violate any applicable law. For purposes of the
Plan, all references to foreign laws, rules, regulations or taxes shall be references to the laws, rules, regulations and taxes of any applicable jurisdiction other than the United States or a political subdivision thereof. 

 

	 	4.	Shares Subject to the Plan; Grant Limitations. 

4.1.    Aggregate Number of Shares Authorized for Issuance. Subject to any adjustment as provided in the Plan, the
Shares to be issued under the Plan may be, in whole or in part, authorized but unissued Shares or issued Shares which shall have been reacquired by the Company and held by it as treasury shares. The aggregate number of Shares that may be made the
subject of Awards granted under the Plan shall not exceed 8,046,021 (the “Share Reserve”), and no more than 6,705,017 may be granted as Incentive Stock Options. 

4.2.    Individual Participant Limit. The aggregate number of Shares that may be the subject of an Award (other
than Awards designated to be paid only in cash or the settlement of which is not based on a number of Shares) granted to an Eligible Individual in any calendar year may not exceed 10% of the Share Reserve. The Fair Market Value of an Award, as

  
 10 

 
determined on the date of grant, designated to be paid only in cash, or the settlement of which is not based on a number of Shares, granted to an Eligible Individual in any calendar year may not
exceed $10,000,000. The Fair Market Value of an Award, as determined on the date of grant, granted to a non-employee director in any calendar year may not exceed $750,000. 

4.3.    Calculating Shares Available. The Committee shall determine the appropriate method for determining the
number of Shares available for grant under the Plan, subject to the following: 
 (a)    Except as
provided in Section 4.3(b), in connection with the granting of an Option, a Share Appreciation Right (other than a Share Appreciation Right related to an Option) or a Share Award, and Other Share-Based Award or a Substitute Award, or the granting of
an Award of Restricted Share Units, Restricted Shares, Performance-Based Restricted Shares or Performance Share Units, the number of Shares available under this Section 4 for the granting of further Awards shall be reduced by the number of Shares in
respect of which the Award is granted or denominated. 
 (b)    In the event that an Award is granted
that, pursuant to the terms of the Award Agreement, cannot be settled in Shares, the aggregate number of Shares that may be made the subject of Awards under the Plan shall not be reduced. Any Shares related to an Award granted under the Plan that
(i) terminates by expiration, forfeiture, cancellation or otherwise without the issuance of the Shares, (ii) is settled in cash in lieu of Shares, or (iii) is exchanged with the Committee’s permission, prior to the issuance of Shares, for an
Award pursuant to which no Shares may be issued, shall again be available for Awards under the Plan. 

(c)    Any Shares tendered or repurchased (i) to pay the Option Price of an Option granted under the Plan
or (ii) to satisfy tax withholding obligations associated with an Award granted under the Plan, shall not become available again for grant under the Plan. 
  

	 	5.	Share Options. 

 5.1.    Authority of Committee. The
Committee may grant Options to Eligible Individuals in accordance with the Plan, the terms and conditions of the grant of which shall be set forth in an Award Agreement. Incentive Stock Options may be granted only to Eligible Individuals who are
employees of the Company or any of its Subsidiaries on the date the Incentive Stock Option is granted. 

5.2.    Option Price. The Option Price or the manner in which the exercise price is to be determined for Shares
under each Option shall be determined by the Committee and set forth in the Award Agreement; provided, however, that the exercise price per Share under each Option shall not be less than the greater of (i) the par value of a Share and (ii)
100% of the Fair Market Value of a Share on the date the Option is granted (110% in the case of an Incentive Stock Option granted to a Ten-Percent Shareholder). 

  
 11 

 5.3.    Maximum Duration. Options granted hereunder shall be for such
term as the Committee shall determine; provided that an Incentive Stock Option shall not be exercisable after the expiration of ten (10) years from the date it is granted (five (5) years in the case of an Incentive Stock Option granted to a
Ten-Percent Shareholder) and a Nonqualified Stock Option shall not be exercisable after the expiration of ten (10) years from the date it is granted; provided, further, however, that unless the Committee provides otherwise, an Option (other
than an Incentive Stock Option) may, upon the death of the Participant prior to the expiration of the Option, be exercised for up to one (1) year following the date of the Participant’s death, even if such period extends beyond ten (10) years
from the date the Option is granted. The Committee may, subsequent to the granting of any Option, extend the period within which the Option may be exercised (including following a Participant’s Termination), but in no event shall the period be
extended to a date that is later than the earlier of the latest date on which the Option could have been exercised and the 10th anniversary of the date of grant of the Option. 

5.4.    Vesting. The Committee shall determine and set forth in the applicable Award Agreement the time or times at
which an Option shall become vested and exercisable. To the extent not exercised, vested installments shall accumulate and be exercisable, in whole or in part, at any time after becoming exercisable, but not later than the date the Option expires.
The Committee may accelerate the exercisability of any Option or portion thereof at any time. 
 5.5.    Limitations
on Incentive Stock Options. To the extent that the aggregate Fair Market Value (determined as of the date of the grant) of Shares with respect to which Incentive Stock Options granted under the Plan and “incentive stock options”
(within the meaning of Section 422 of the Code) granted under all other plans of the Company or its Subsidiaries (in either case determined without regard to this Section 5.5) are exercisable by a Participant for the first time during any calendar
year exceeds $100,000, such Incentive Stock Options shall be treated as Nonqualified Stock Options. In applying the limitation in the preceding sentence in the case of multiple Option grants, unless otherwise required by applicable law, Options
which were intended to be Incentive Stock Options shall be treated as Nonqualified Stock Options according to the order in which they were granted such that the most recently granted Options are first treated as Nonqualified Stock Options. 

5.6.    Method of Exercise. The exercise of an Option shall be made only by giving notice in the form and to the
Person designated by the Company, specifying the number of Shares to be exercised and, to the extent applicable, accompanied by payment therefor and otherwise in accordance with the Award Agreement pursuant to which the Option was granted. The
Option Price for any Shares purchased pursuant to the exercise of an Option shall be paid in any or any combination of the following forms: (a) cash or its equivalent (e.g., a check) or (b) if permitted by the Committee, the transfer, either
actually or by attestation, to the Company of Shares held by the Participant, such transfer to be upon such terms and conditions as determined by the Committee or (c) in the form of other property as determined by the Committee. Any Shares
transferred to the Company as payment of the exercise price under an Option shall be valued at their Fair Market Value on the last business day preceding the date of exercise of such Option. In addition, (a) the Committee may provide for the payment
of the Option Price through Share repurchase, as a result of which a number of Shares issued upon exercise of an Option having a Fair Market Value equal to the Option Price would be repurchased, and (b) Options

  
 12 

 
may be exercised through a registered broker-dealer pursuant to such cashless exercise procedures that are, from time to time, deemed acceptable by the Committee. If requested by the Committee,
the Participant shall deliver the Award Agreement evidencing the Option to the Company, which shall endorse thereon a notation of such exercise and return such Award Agreement to the Participant. No fractional Shares (or cash in lieu thereof) shall
be issued upon exercise of an Option and the number of Shares that may be purchased upon exercise shall be rounded to the nearest number of whole Shares. 

5.7.    Rights of Participants. No Participant shall be deemed for any purpose to be the owner of any Shares
subject to any Option unless and until (a) the Option shall have been exercised pursuant to the terms thereof, (b) the Company shall have issued and delivered Shares (whether or not certificated) to the Participant, a securities broker acting on
behalf of the Participant or such other nominee of the Participant and (c) the Participant’s name, or the name of his or her broker or other nominee, shall have been entered as a shareholder of record on the books of the Company. Thereupon, the
Participant shall have full voting, dividend and other ownership rights with respect to such Shares, subject to such terms and conditions as may be set forth in the applicable Award Agreement. 

 

	 	6.	Share Appreciation Rights. 

 6.1.    Grant. The
Committee may grant Share Appreciation Rights to Eligible Individuals in accordance with the Plan, the terms and conditions of which shall be set forth in an Award Agreement. A Share Appreciation Right may be granted (a) at any time if unrelated to
an Option or (b) if related to an Option, either at the time of grant or at any time thereafter during the term of the Option. 

6.2.    Terms; Duration. Share Appreciation Rights shall contain such terms and conditions as to exercisability,
vesting and duration as the Committee shall determine, but in no event shall they have a term of greater than ten (10) years; provided, however, that unless the Committee provides otherwise, a Share Appreciation Right may, upon the
death of the Participant prior to the expiration of the Award, be exercised for up to one (1) year following the date of the Participant’s death even if such period extends beyond ten (10) years from the date the Share Appreciation Right is
granted. The Committee may, subsequent to the granting of any Share Appreciation Right, extend the period within which the Share Appreciation Right may be exercised (including following a Participant’s Termination), but in no event shall the
period be extended to a date that is later than the earlier of the latest date on which the Share Appreciation Right could have been exercised and the 10th anniversary of the date of grant of the Share Appreciation Right. 

6.3.    Amount Payable. Upon exercise of a Share Appreciation Right, the Participant shall be entitled to receive
an amount determined by multiplying (i) the excess of the Fair Market Value of a Share on the last business day preceding the date of exercise of such Share Appreciation Right over (a) with respect to a Share Appreciation Right unrelated to an
Option, the Fair Market Value of a Share on the date the Share Appreciation Right was granted or (b) with respect to a Share Appreciation Right related to an Option, the Option Price specified in the related Option (in each case, the “Base
Price”) by (ii) the number of Shares as to which the 

  
 13 

 
Share Appreciation Right is being exercised. Notwithstanding the foregoing, the Committee may limit in any manner the amount payable with respect to any Share Appreciation Right by including such
a limit in the Award Agreement evidencing the Share Appreciation Right at the time it is granted. 
 6.4.    Method
of Exercise. Share Appreciation Rights shall be exercised by a Participant only by giving notice in the form and to the Person designated by the Company, specifying the number of Shares with respect to which the Share Appreciation Right is being
exercised. If requested by the Committee, the Participant shall deliver the Award Agreement evidencing the Share Appreciation Right being exercised, which shall endorse thereon a notation of such exercise and return such Award Agreement to the
Participant. 
 6.5.    Form of Payment. Payment of the amount payable upon exercise of a Share Appreciation
Right may be made in the discretion of the Committee solely in whole Shares in a number determined at their Fair Market Value on the last business day preceding the date of exercise of the Share Appreciation Right, solely in cash or in a combination
of cash and Shares. If the Committee decides to make full payment in Shares and the amount payable results in a fractional Share, payment for the fractional Share will be made in cash. 

 

	 	7.	Dividend Equivalent Rights. 

 The Committee may grant Dividend Equivalent
Rights, either in tandem with an Award or as a separate Award, to Eligible Individuals in accordance with the Plan. The terms and conditions applicable to each Dividend Equivalent Right shall be specified in the Award Agreement evidencing the Award.
Amounts payable in respect of Dividend Equivalent Rights may be payable currently or, if applicable, deferred until the lapsing of restrictions on such Dividend Equivalent Rights or until the vesting, exercise, payment, settlement or other lapse of
restrictions on the Award to which the Dividend Equivalent Rights relate. In the event that the amount payable in respect of Dividend Equivalent Rights is to be deferred, the Committee shall determine whether such amounts are to be held in cash or
reinvested in Shares or deemed (notionally) to be reinvested in Shares. Dividend Equivalent Rights may be settled in cash, Shares, other Awards, other property or a combination of the foregoing, in a single installment or multiple installments, as
determined by the Committee. The terms and conditions of any grants of Dividend Equivalent Rights as set forth in an Award Agreement shall comply with the Nonqualified Deferred Compensation Rules. 

 

	 	8.	Restricted Shares; Restricted Share Units. 

8.1.    Restricted Shares. The Committee may grant Restricted Shares to Eligible Individuals in accordance with the
Plan, the terms and conditions of which shall be set forth in an Award Agreement. Each Award Agreement shall contain such restrictions, terms and conditions as the Committee may, in its discretion, determine and (without limiting the generality of
the foregoing) such Award Agreements may require that an appropriate legend be placed on Share certificates. Shares in a book entry account in Participant’s name may have appropriate stop transfer instructions to the account custodian,
administrator or the Company’s corporate secretary as determined by the Committee in its sole discretion. Restricted Shares shall be subject to the terms and provisions set forth below in this Section 8.1. 

  
 14 

 (a)    Rights of Participant. Restricted Shares
granted pursuant to an Award hereunder shall be issued in the name of the Participant as soon as reasonably practicable after the Award is granted provided that the Participant has executed an Award Agreement evidencing the Award and any other
documents which the Committee may require as a condition to the issuance of such Shares. At the discretion of the Committee, Shares issued in connection with an Award of Restricted Shares may be held in escrow by an agent (which may be the Company)
designated by the Committee. Unless the Committee determines otherwise and as set forth in the Award Agreement, upon the issuance of the Shares, the Participant shall have all of the rights of a shareholder with respect to such Shares, including the
right to vote the Shares and to receive all dividends or other distributions paid or made with respect to the Shares. 

(b)    Terms and Conditions. Each Award Agreement shall specify the number of Shares subject to the
Restricted Share Award, the conditions which must be satisfied in order for the Restricted Shares to vest and the circumstances under which the Award will be forfeited. 

(c)    Delivery of Shares. Upon the lapse of the restrictions on Restricted Shares, the Committee
shall take any action it determines is necessary to evidence such lapse of restrictions which may include causing a share certificate or evidence of book entry Shares to be delivered to the Participant with respect to such Restricted Shares, free of
all restrictions hereunder. 
 (d)    Treatment of Dividends. At the time Restricted Shares are
granted, the Committee may, in its discretion, determine that the payment to the Participant of dividends, or a specified portion thereof, declared or paid on such Shares by the Company shall be (i) deferred until the lapsing of the restrictions
imposed upon such Shares and (ii) held by the Company for the account of the Participant until such time. In the event that dividends are to be deferred, the Committee shall determine whether such dividends are to be reinvested in Shares (which
shall be held as additional Restricted Shares) or held in cash. Payment of deferred dividends in respect of Restricted Shares (whether held in cash or as additional Restricted Shares), shall be made upon the lapsing of restrictions imposed on the
Shares in respect of which the deferred dividends were paid, and any dividends deferred in respect of any Restricted Shares shall be forfeited upon the forfeiture of such Shares. 

8.2.    Restricted Share Unit Awards. The Committee may grant Awards of Restricted Share Units to Eligible
Individuals in accordance with the Plan, the terms and conditions of which shall be set forth in an Award Agreement. Each such Award Agreement shall contain such restrictions, terms and conditions as the Committee may, in its discretion, determine.
Awards of Restricted Share Units shall be subject to the terms and provisions set forth below in this Section 8.2. 

  
 15 

 (a)    Payment of Awards. Each Restricted Share Unit
shall represent the right of the Participant to receive a payment upon vesting of the Restricted Share Unit or on any later date specified by the Committee of an amount equal to the Fair Market Value of a Share as of the date the Restricted Share
Unit becomes vested or such other date as determined by the Committee at the time the Restricted Share Unit is granted. The Committee may, at the time a Restricted Share Unit is granted, provide a limitation on the amount payable in respect of each
Restricted Share Unit. The Committee may provide for the settlement of Restricted Share Units in cash or with Shares having a Fair Market Value equal to the amount to which the Participant has become entitled or a combination thereof. 

 

	 	9.	Performance Awards. 

 9.1.    Performance Units and
Performance Share Units. The Committee may grant Awards of Performance Units and/or Performance Share Units to Eligible Individuals in accordance with the Plan, the terms and conditions of which shall be set forth in an Award Agreement. 

(a)    Performance Units. Performance Units shall be denominated in a specified dollar amount and,
contingent upon the attainment of specified Performance Objectives within the Performance Cycle and such other vesting conditions as may be determined by the Committee (including without limitation, a continued employment requirement following the
end of the applicable Performance Cycle), represent the right to receive payment as provided in Sections 9.1(c) and (d) of the specified dollar amount or a percentage of the specified dollar amount depending on the level of Performance Objective
attained; provided, however, that the Committee may at the time a Performance Unit is granted specify a maximum amount payable in respect of a vested Performance Unit. 

(b)    Performance Share Units. Performance Share Units shall be denominated in Shares and,
contingent upon the attainment of specified Performance Objectives within the Performance Cycle and such other vesting conditions as may be determined by the Committee, (including without limitation, a continued employment requirement following the
end of the applicable Performance Cycle), represent the right to receive payment as provided in Sections 9.1(c) and (d) of the Fair Market Value of a Share on the date the Performance Share Unit was granted, the date the Performance Share Unit
became vested or any other date specified by the Committee or a percentage of such amount depending on the level of Performance Objective attained; provided, however, that the Committee may at the time a Performance Share Unit is granted
specify a maximum amount payable in respect of a vested Performance Share Unit. 
 (c)    Terms and
Conditions; Vesting and Forfeiture. Each Award Agreement shall specify the number of Performance Units or Performance Share Units to which it relates, the Performance Objectives and other conditions which must be satisfied in order for the
Performance Units or Performance Share Units to vest and the Performance Cycle within which such Performance Objectives must be satisfied and the circumstances under which the Award will be forfeited; provided, however, that no Performance
Cycle for Performance Units or Performance Share Units shall be less than one (1) year. 

  
 16 

 (d)    Payment of Awards. Subject to Section 9.3(c),
payment to Participants in respect of vested Performance Share Units and Performance Units shall be made as soon as practicable after the last day of the Performance Cycle to which such Award relates or at such other time or times as the Committee
may determine that the Award has become vested. Such payments may be made entirely in Shares valued at their Fair Market Value, entirely in cash, other Awards, other property or in any combination of the foregoing as the Committee in its discretion
shall determine at any time prior to such payment; provided, however, that if the Committee in its discretion determines to make such payment entirely or partially in Restricted Shares, the Committee must determine the extent to which such
payment will be in Restricted Shares and the terms of such Restricted Shares at the time the Award is granted. 

9.2.    Performance-Based Restricted Shares. The Committee may grant Performance-Based Restricted Shares to
Eligible Individuals in accordance with the Plan, the terms and conditions of which shall be set forth in an Award Agreement. Each Award Agreement may require that an appropriate legend be placed on Share certificates. Shares in a book entry account
in Participant’s name may have appropriate stop transfer instructions to the account custodian, administrator or the Company’s corporate secretary as determined by the Committee in its sole discretion. Performance-Based Restricted Shares
shall be subject to the following terms and provisions: 
 (a)    Rights of Participant.
Performance-Based Restricted Shares shall be issued in the name of the Participant as soon as reasonably practicable after the Award is granted or at such other time or times as the Committee may determine; provided, however, that no
Performance-Based Restricted Shares shall be issued until the Participant has executed an Award Agreement evidencing the Award, and any other documents which the Committee may require as a condition to the issuance of such Performance-Based
Restricted Shares. At the discretion of the Committee, Shares issued in connection with an Award of Performance-Based Restricted Shares may be held in escrow by an agent (which may be the Company) designated by the Committee. Unless the Committee
determines otherwise and as set forth in the Award Agreement, upon issuance of the Shares, the Participant shall have all of the rights of a shareholder with respect to such Shares, including the right to vote the Shares and to receive all dividends
or other distributions paid or made with respect to the Shares. 
 (b)    Terms and Conditions.
Each Award Agreement shall specify the number of Shares subject to the Performance-Based Restricted Share Award, the Performance Objectives and other conditions which must be satisfied in order for the Performance-Based Restricted Shares to vest,
the Performance Cycle within which such Performance Objectives must be satisfied and the circumstances under which the Award will be forfeited; provided, however, that no Performance Cycle for Performance-Based Restricted Shares shall be less
than one (1) year. 

  
 17 

 (c)    Treatment of Dividends. At the time the
Performance-Based Restricted Shares are granted, the Committee may, in its discretion, determine that the payment to the Participant of dividends, or a specified portion thereof, declared or paid on Shares represented by such Award which have been
issued by the Company to the Participant shall be (i) deferred until the lapsing of the restrictions imposed upon such Performance-Based Restricted Shares and (ii) held by the Company for the account of the Participant until such time. In the event
that dividends are to be deferred, the Committee shall determine whether such dividends are to be reinvested in Shares (which shall be held as additional Performance-Based Restricted Shares) or held in cash. If deferred dividends are to be held in
cash, there may be credited interest on the amount of the account at such times and at a rate per annum as the Committee, in its discretion, may determine. Payment of deferred dividends in respect of Performance-Based Restricted Shares (whether held
in cash or in additional Performance-Based Restricted Shares), together with interest accrued thereon, if any, shall be made upon the lapsing of restrictions imposed on the Performance-Based Restricted Shares in respect of which the deferred
dividends were paid, and any dividends deferred (together with any interest accrued thereon) in respect of any Performance-Based Restricted Shares shall be forfeited upon the forfeiture of such Performance-Based Restricted Shares. 

(d)    Delivery of Shares. Upon the lapse of the restrictions on Performance-Based Restricted Shares
awarded hereunder, the Committee shall take any action it determines is necessary to evidence such lapse of restrictions which may include causing a share certificate or evidence of book entry Shares to be delivered to the Participant with respect
to such Performance-Based Restricted Shares, free of all restrictions hereunder. 
 9.3.    Performance
Objectives. 
 (a)    Establishment. With respect to any Performance Awards intended to
constitute Performance-Based Compensation, Performance Objectives for Performance Awards shall be objective and otherwise meet the requirements of Section 162(m) of the Code and shall be expressed in terms of (i) earnings per share (diluted or
basic), (ii) operating income, (iii) return on equity or assets, (iv) cash flow, (v) net cash flow, (vi) cash flow from operations; (vii) EBITDA, (viii) revenues, (ix) revenue ratios; (x) cost reductions; (xi) cost ratios; (xii) overall revenue or
sales growth, (xiii) expense reduction or management, (xiv) market position or share, (xv) total shareholder return, (xvi) return on investment, (xvii) earnings before interest and taxes (EBIT), (xviii) net income, (xix) return on net assets, (xx)
economic value added, (xxi) shareholder value added, (xxii) cash flow return on investment, (xxiii) net operating profit, (xxiv) net operating profit after tax, (xxv) return on capital, (xxvi) return on invested capital or (xxvii) any combination of
the foregoing. With respect to Performance Awards not intended to constitute Performance-Based Compensation, Performance Objectives may be based on any of the foregoing or any other performance criteria as may be established by the Committee.
Performance Objectives may be in respect of the performance of the Company, any of its Subsidiaries, any of its Divisions or any combination thereof. Performance Objectives may be absolute or relative (to prior performance of the

  
 18 

 
Company or to the performance of one or more other entities or external indices) and may be expressed in terms of a progression within a specified range. In the case of a Performance Award which
is intended to constitute Performance-Based Compensation, the Performance Objectives with respect to a Performance Cycle shall be established in writing by the Committee by the earliest of (i) the date on which the first quarter of the Performance
Cycle has elapsed, (ii) the date which is ninety (90) days after the commencement of the Performance Cycle and (iii) such other date as may be required or permitted under Section 162(m) of the Code, and in any event while the performance relating to
the Performance Objectives remain “substantially uncertain”. 
 (b)    Effect of Certain
Events. The Committee may, at the time the Performance Objectives in respect of a Performance Award are established, provide for the manner in which performance will be measured against the Performance Objectives to reflect the impact of
specified events, including any one or more of the following with respect to the Performance Cycle (i) the gain, loss, income or expense resulting from changes in accounting principles or tax laws that become effective during the Performance Cycle;
(ii) the gain, loss, income or expense reported publicly by the Company with respect to the Performance Cycle that are extraordinary or unusual in nature or infrequent in occurrence; (iii) the gains or losses resulting from and the direct expenses
incurred in connection with, the disposition of a business, or the sale of investments or non-core assets; (iv) the gain or loss from all or certain claims and/or litigation and all or certain insurance recoveries relating to claims or litigation;
or (v) the impact of investments or acquisitions made during the year or, to the extent provided by the Committee, any prior year. The events may relate to the Company as a whole or to any part of the Company’s business or operations, as
determined by the Committee at the time the Performance Objectives are established. Any adjustments based on the effect of certain events are to be determined in accordance with generally accepted accounting principles and standards, unless another
objective method of measurement is designated by the Committee and, in respect of Performance Awards intended to constitute Performance-Based Compensation, such adjustments shall be permitted only to the extent permitted under Section 162(m) of the
Code and the regulations promulgated thereunder without adversely affecting the treatment of any Performance Award as Performance-Based Compensation. 

(c)    Determination of Performance. Prior to the vesting, payment, settlement or lapsing of any
restrictions with respect to any Performance Award, the Committee shall certify in writing that the applicable Performance Objectives have been satisfied to the extent necessary for such Award to qualify as Performance-Based Compensation. In respect
of a Performance Award, the Committee may, in its sole discretion, reduce the amount of cash paid or number of Shares to be issued or that have been issued and that become vested or on which restrictions lapse. The Committee shall not be entitled to
exercise any discretion otherwise authorized hereunder with respect to any Performance Award intended to constitute Performance-Based Compensation if the ability to exercise such discretion or the exercise of such discretion itself would cause the
compensation attributable to such Awards to fail to qualify as Performance-Based Compensation. 

  
 19 

	 	10.	Share Awards, Other Share-Based Awards, Cash Awards and Substitute Awards. 

10.1.    Share Awards. The Committee may grant a Share Award to any Eligible Individual on such terms and
conditions as the Committee may determine in its sole discretion. Share Awards may be made as additional compensation for services rendered by the Eligible Individual or may be in lieu of cash or other compensation to which the Eligible Individual
is entitled from the Company. 
 10.2.    Other Share-Based Awards. The Committee is authorized, subject to
limitations under applicable law, to grant to Eligible Individuals such other Awards that may be denominated or payable in, valued in whole or in part by reference to, or otherwise based on, or related to, Shares, as deemed by the Committee to be
consistent with the purposes of this Plan, including without limitation convertible or exchangeable debt securities, other rights convertible or exchangeable into Shares, purchase rights for Shares, Awards with value and payment contingent upon
performance of the Company or any other factors designated by the Committee, and Awards valued by reference to the book value of Shares or the value of securities of, or the performance of, specified Subsidiaries of the Company. The Committee shall
determine the terms and conditions of such Other Share-Based Awards. Shares delivered pursuant to an Award in the nature of a purchase right granted under this Section 10.2 shall be purchased for such consideration, paid for at such times, by such
methods, and in such forms, including, without limitation, cash, Shares, other Awards, or other property, as the Committee shall determine. Cash awards (“Cash Awards”), as an element of or supplement to any other Award under this Plan, may
also be granted pursuant to this Section 10.2. 
 10.3.    Substitute Awards. Awards may be granted under the
Plan in substitution for similar awards held by individuals who become Employees, Directors or Consultants as a result of a merger, consolidation, acquisition or other transaction by the Company or an Affiliate of another entity or the assets of
another entity. Notwithstanding anything contained in the Plan to the contrary, Substitute Awards that are Options or Share Appreciation Rights may have exercise prices less than the Fair Market Value of a Share on the date of the substitution if
such substitution complies with the Nonqualified Deferred Compensation Rules and other applicable laws and exchange rules. 
  

	 	11.	Effect of Termination of Employment; Transferability. 

11.1.    Termination. The Award Agreement evidencing the grant of each Award shall set forth the terms and
conditions applicable to such Award upon Termination, which shall be as the Committee may, in its discretion, determine at the time the Award is granted or at any time thereafter, and which terms and conditions may include provisions regarding the
treatment of an Award in the event of a Termination by reason of a divestiture of any Subsidiary or Division or other assets of the Company or any Subsidiary. 

11.2.    Transferability of Awards and Shares. 

(a)    Non-Transferability of Awards. Except as set forth in Section 11.2(c) or (d) or as otherwise
permitted by the Committee and as set forth in the 

  
 20 

 
applicable Award Agreement, either at the time of grant or at any time thereafter, no Award shall be (i) sold, transferred or otherwise disposed of, (ii) pledged or otherwise hypothecated or
(iii) subject to attachment, execution or levy of any kind; and any purported transfer, pledge, hypothecation, attachment, execution or levy in violation of this Section 11.2 shall be null and void. 

(b)    Restrictions on Shares. The Committee may impose such restrictions on any Shares acquired by
a Participant under the Plan as it may deem advisable, including, without limitation, minimum holding period requirements, restrictions under applicable federal securities laws, restrictions under the requirements of any share exchange or market
upon which such Shares are then listed or traded and restrictions under any blue sky or state securities laws applicable to such Shares. 

(c)    Transfers By Will or by Laws of Descent or Distribution. Any Award may be transferred by will
or by the laws of descent or distribution; provided, however, that (i) any transferred Award will be subject to all of the same terms and conditions as provided in the Plan and the applicable Award Agreement; and (ii) the Participant’s
estate or beneficiary appointed in accordance with this Section 11.2(c) will remain liable for any withholding tax that may be imposed by any federal, state or local tax authority. 

(d)    Beneficiary Designation. Each Participant may, from time to time, name one or more
individuals (each, a “Beneficiary”) to whom any benefit under the Plan is to be paid or who may exercise any rights of the Participant under any Award granted under the Plan in the event of the Participant’s death before he or
she receives any or all of such benefit or exercises such Award. Each such designation shall revoke all prior designations by the same Participant, shall be in a form prescribed by the Company, and will be effective only when filed by the
Participant in writing with the Company during the Participant’s lifetime. In the absence of any such designation, benefits under Awards remaining unpaid at the Participant’s death and rights to be exercised following the
Participant’s death shall be paid to or exercised by the Participant’s estate. Notwithstanding anything to the contrary in this Section 11, an Incentive Stock Option shall not be transferable other than by will or the laws of descent and
distribution. 
 (e)    Qualified Domestic Relations Orders. An Award may be transferred pursuant
to a domestic relations order entered or approved by a court of competent jurisdiction upon delivery to the Company of written notice of such transfer and a certified copy of such order. 

 

	 	12.	Adjustment upon Changes in Capitalization. 

12.1.    In the event of a Change in Capitalization, the Committee shall conclusively determine the appropriate
adjustments, if any, to the Plan and/or any Award to prevent dilution or enlargement of the rights granted to, or available for, Participants under the Plan, including with respect to the following: (a) the maximum number and class of Shares or
other shares or securities with respect to which Awards may be granted under the Plan, (b) the 

  
 21 

 
maximum number and class of Shares or other shares or securities that may be issued upon exercise of Incentive Share Options, (c) the maximum number and class of Shares or other shares or
securities with respect to which Awards may be granted to any Eligible Individual in any calendar year, (d) the number and class of Shares or other shares or securities, cash or other property which are subject to outstanding Awards granted under
the Plan and the exercise price therefore, if applicable, and (e) the Performance Objectives. 
 12.2.    Any such
adjustment in the Shares or other share or securities (a) subject to outstanding Incentive Stock Options (including any adjustments in the exercise price) shall be made in such manner as not to constitute a modification as defined by Section
424(h)(3) of the Code and only to the extent otherwise permitted by Sections 422 and 424 of the Code, (b) subject to outstanding Awards that are intended to qualify as Performance-Based Compensation shall be made in such a manner as not to adversely
affect the treatment of the Awards as Performance-Based Compensation and (c) with respect to any Award that is not subject to the Nonqualified Deferred Compensation Rules, in a manner that would not subject the Award to the Nonqualified Deferred
Compensation Rules and, with respect to any Award that is subject to the Nonqualified Deferred Compensation Rules, in a manner that complies with the Nonqualified Deferred Compensation Rules. 

12.3.    If, by reason of a Change in Capitalization, pursuant to an Award, a Participant shall be entitled to, or shall
be entitled to exercise an Option with respect to, new, additional or different shares or securities of the Company or any other corporation, such new, additional or different shares shall thereupon be subject to all of the conditions, restrictions
and performance criteria which were applicable to the Shares subject to the Award, prior to such Change in Capitalization. 
  

	 	13.	Effect of a Corporate Transaction. 

 13.1.    Except
as otherwise provided in the applicable Award Agreement, in the event of a Corporate Transaction, the Committee may, in its sole discretion, and on such terms and conditions as it deems appropriate, take any one or more of the following actions with
respect to any outstanding Award, which need not be uniform with respect to all Participants and/or Awards: 

(a)    continuation or assumption of such Award by the Company (if it is the surviving corporation) or by
the successor or surviving corporation or its parent; 
 (b)    substitution or replacement of such Award
by the successor or surviving corporation or its parent with cash, securities, rights or other property to be paid or issued, as the case may be, by the successor or surviving corporation (or a parent or subsidiary thereof), with substantially the
same terms and conditions (including vesting) and value as such Award, except that the Committee may deem any applicable performance targets or criteria with respect thereto to be satisfied as of immediately prior to the Corporate Transaction or
measure the performance targets or criteria as of the Corporate Transaction; 

  
 22 

 (c)    acceleration of the vesting of such Award and the
lapse of any restrictions thereon and, in the case of an Option or Share Appreciation Right, acceleration of the right to exercise such Award during a specified period (and the termination of such Option or Share Appreciation Right without payment
of any consideration therefor to the extent such Award is not timely exercised), in each case, upon (A) the Participant’s involuntary Termination (including upon a termination of the Participant’s employment by the Company (or a successor
corporation or its parent) without Cause (as defined herein or under an employment agreement), or to the extent applicable by the Participant for “good reason”, as such term may be defined in the applicable Award Agreement and/or the
Participant’s employment agreement, offer letter, or other similar documents) on or within a specified period (but not less 24 months) following such Corporate Transaction or (B) in the event the successor or surviving corporation (or its
parent) does not continue or assume such Award; 
 (d)    in the case of a Performance Award,
determination of the level of attainment of the applicable performance condition(s); and 

(e)    cancellation of such Award in consideration of a payment, with the form, amount and timing of such
payment determined by the Committee in its sole discretion, subject to the following: (A) such payment shall be made in cash, securities, rights and/or other property; (B) the amount of such payment shall equal the value of such Award, as determined
by the Committee in its sole discretion; provided that, in the case of an Option or Share Appreciation Right, if such value equals the Intrinsic Value of such Award, such value shall be deemed to be valid; provided further that, if the Intrinsic
Value of an Option or Share Appreciation Right is equal to or less than zero, the Committee may, in its sole discretion, provide for the cancellation of such Award without payment of any consideration therefor (for the avoidance of doubt, in the
event of a Change in Control, the Committee may, in its sole discretion, terminate any Option or Share Appreciation Right for which the exercise or hurdle price is equal to or exceeds the per Share value of the consideration to be paid in the Change
in Control transaction without payment of consideration therefor); and (C) such payment shall be made promptly following such Change in Control or on a specified date or dates following such Change in Control. 

 

	 	14.	Interpretation. 

 14.1.    Section 16
Compliance. The Plan is intended to comply with Rule 16b-3 promulgated under the Exchange Act and the Committee shall interpret and administer the provisions of the Plan or any Award Agreement in a manner consistent therewith. Any provisions
inconsistent with such Rule shall be inoperative and shall not affect the validity of the Plan. 

14.2.    Compliance with Section 409A and Section 457A. All Awards granted under the Plan are intended to be exempt
from the Nonqualified Deferred Compensation Rules or, if subject to the Nonqualified Deferred Compensation Rules, to be administered, operated and construed in compliance with the Nonqualified Deferred Compensation Rules. Notwithstanding

  
 23 

 
this or any other provision of the Plan to the contrary, the Committee may amend the Plan or any Award granted hereunder in any manner or take any other action that it determines, in its sole
discretion, is necessary, appropriate or advisable (including replacing any Award) to cause the Plan or any Award granted hereunder to comply with the Nonqualified Deferred Compensation Rules or to not be subject to the Nonqualified Deferred
Compensation Rules. Any such action, once taken, shall be deemed to be effective from the earliest date necessary to avoid a violation of the Nonqualified Deferred Compensation Rules and shall be final, binding and conclusive on all Eligible
Individuals and other individuals having or claiming any right or interest under the Plan. Neither this Section 14.2 nor any other provision of the Plan is or contains a representation as to any Participant regarding the tax consequences of the
grant, vesting or sale of any Award (or the Shares underlying such Award) granted hereunder, and should not be interpreted as such. Subject to any other restrictions or limitations contained herein, in the event that a “specified employee”
(as defined under the Nonqualified Deferred Compensation Rules) becomes entitled to a payment under an Award that provides for a deferral of compensation under the Nonqualified Deferred Compensation Rules on account of a “separation from
service” (as defined under the Nonqualified Deferred Compensation Rules), to the extent required by the Code, such payment shall not occur until the date that is six months plus one day from the date of such separation from service. Any amount
that is otherwise payable within the six-month period described herein will be aggregated and paid in a lump sum without interest. 

14.3.    Section 162(m). Unless otherwise determined by the Committee at the time of grant, each Option, Share
Appreciation Right and Performance Award granted to an Eligible Individual who is also a Covered Employee is intended to be Performance Based Compensation. Unless otherwise determined by the Committee, if any provision of the Plan or any Award
Agreement relating to an Award that is intended to be Performance-Based Compensation does not comply or is inconsistent with Section 162(m) of the Code or the regulations promulgated thereunder (including IRS Regulation § 1.162-27), such
provision shall be construed or deemed amended to the extent necessary to conform to such requirements, and no provision shall be deemed to confer upon the Committee discretion to increase the amount of compensation otherwise payable in connection
with any such Award upon the attainment of the Performance Objectives. 
  

	 	15.	Term; Plan Termination and Amendment of the Plan; Modification of Awards. 

15.1.    Term. The Plan shall terminate on the Plan Termination Date and no Award shall be granted after that date.
The applicable terms of the Plan and any terms and conditions applicable to Awards granted prior to the Plan Termination Date shall survive the termination of the Plan and continue to apply to such Awards. 

15.2.    Plan Amendment or Plan Termination. Prior to the Plan Termination Date, the Board may earlier terminate
the Plan and the Board may at any time and from time to time amend, modify or suspend the Plan; provided, however, that: 

(a)    no such amendment, modification, suspension or termination shall impair or adversely alter any
Awards theretofore granted under the Plan, except with the 

  
 24 

 
consent of the Participant, nor shall any amendment, modification, suspension or termination deprive any Participant of any Shares which he or she may have acquired through or as a result of the
Plan; and 
 (b)    to the extent necessary under any applicable law, regulation or exchange requirement,
no other amendment shall be effective unless approved by the shareholders of the Company in accordance with applicable law, regulation or exchange requirement. 

For purposes of clarity, any adjustments made to Awards pursuant to Section 12 or 13 shall be deemed not to impair or adversely alter Awards or deprive any
Participant of Shares and therefore may be made without the consent of affected Participants. 

15.3.    Modification of Awards. No modification of an Award shall adversely alter or impair any rights or
obligations under the Award without the consent of the Participant. 
  

	 	16.	Non-Exclusivity of the Plan. 

 The adoption of the Plan by the Board shall
not be construed as amending, modifying or rescinding any previously approved incentive arrangement or as creating any limitations on the power of the Board to adopt such other incentive arrangements as it may deem desirable, including, without
limitation, the granting of options otherwise than under the Plan, and such arrangements may be either applicable generally or only in specific cases. 
  

	 	17.	Limitation of Liability. 

 As illustrative of the limitations of liability
of the Company, but not intended to be exhaustive thereof, nothing in the Plan shall be construed to: 

(a)    give any person any right to be granted an Award other than at the sole discretion of the Committee;

 (b)    limit in any way the right of the Company or any of its Subsidiaries to terminate the
employment of or the provision of services by any person at any time; 
 (c)    be evidence of any
agreement or understanding, express or implied, that the Company will pay any person at any particular rate of compensation or for any particular period of time; or 

(d)    be evidence of any agreement or understanding, express or implied, that the Company will employ any
person at any particular rate of compensation or for any particular period of time. 

  
 25 

	 	18.	Regulations and Other Approvals; Governing Law. 

18.1.    Governing Law. Except as to matters of United States federal law, the Plan and the rights of all persons
claiming hereunder shall be construed and determined in accordance with the laws of the State of Delaware without giving effect to conflicts of laws principles thereof. 

18.2.    Compliance with Law. 

(a)    The obligation of the Company to sell or deliver Shares with respect to Awards granted under the
Plan shall be subject to all applicable laws, rules and regulations, including all applicable federal and state securities laws, and the obtaining of all such approvals by governmental agencies as may be deemed necessary or appropriate by the
Committee. 
 (b)    The Board may make such changes to the Plan as may be necessary or appropriate to
comply with the rules and regulations of any government authority or to obtain for Eligible Individuals granted Incentive Stock Options the tax benefits under the applicable provisions of the Code and regulations promulgated thereunder. 

(c)    Each grant of an Award and issuance of Shares or other settlement of an Award is subject to
compliance with all applicable federal, state and foreign law. Further, if at any time the Committee determines, in its discretion, that the listing, registration or qualification of Shares issuable pursuant to the Plan is required by any securities
exchange or under any federal, state or foreign law, or that the consent or approval of any governmental regulatory body is necessary or desirable as a condition of, or in connection with, the grant of an Award or the issuance of Shares, no Awards
shall be or shall be deemed to be granted or payment made or Shares issued, in whole or in part, unless listing, registration, qualification, consent or approval has been effected or obtained free of any conditions that are not acceptable to the
Committee. Any person exercising an Option or receiving Shares in connection with any other Award shall make such representations and agreements and furnish such information as the Board or Committee may request to assure compliance with the
foregoing or any other applicable legal requirements. 
 18.3.    Transfers of Plan Acquired Shares.
Notwithstanding anything contained in the Plan or any Award Agreement to the contrary, in the event that the disposition of Shares acquired pursuant to the Plan is not covered by a then current registration statement under the Securities Act and is
not otherwise exempt from such registration, such Shares shall be restricted against transfer to the extent required by the Securities Act and Rule 144 or other regulations promulgated thereunder. The Committee may require any individual receiving
Shares pursuant to an Award granted under the Plan, as a condition precedent to receipt of such Shares, to represent and warrant to the Company in writing that the Shares acquired by such individual are acquired without a view to any distribution
thereof and will not be sold or transferred other than pursuant to an effective registration thereof under the Securities Act or pursuant to an exemption applicable under the Securities Act or the rules and regulations promulgated thereunder. The
certificates evidencing any of such Shares shall be appropriately amended or have an appropriate legend placed thereon to reflect their status as restricted securities as aforesaid. 

  
 26 

	 	19.	Miscellaneous. 

 19.1.    Forfeiture Events and
Clawback. The Committee may specify in an Award Agreement that the Participant’s rights, payments and benefits with respect to an Award shall be subject to reduction, cancellation, forfeiture or recoupment upon the occurrence of certain
specified events or as required by law, in addition to any otherwise applicable forfeiture provisions that apply to the Award In addition, the Plan is subject to any written clawback policies the Company, with the approval of the Board, may adopt.
Any such policy may subject a Participant’s Awards and amounts paid or realized with respect to Awards under the Plan to reduction, cancellation, forfeiture or recoupment if certain specified events or wrongful conduct occur, including but not
limited to an accounting restatement due to the Company’s material noncompliance with financial reporting regulations or other events or wrongful conduct specified in any such clawback policy adopted to conform to the Dodd-Frank Wall Street
Reform and Consumer Protection Act of 2010 and rules promulgated thereunder by the Securities and Exchange Commission and that the Company determines should apply to the Plan. 

19.2.    Multiple Agreements. The terms of each Award may differ from other Awards granted under the Plan at the
same time or at some other time. The Committee may also grant more than one Award to a given Eligible Individual during the term of the Plan, either in addition to or, subject to Section 3.5, in substitution for one or more Awards previously granted
to that Eligible Individual. 
 19.3.    Withholding of Taxes. 

(a)    The Company or any of its Subsidiaries may withhold from any payment of cash or Shares to a
Participant or other person under the Plan an amount sufficient to cover any withholding taxes which may become required with respect to such payment or take any other action it deems necessary to satisfy any income or other tax withholding
requirements as a result of the grant, exercise or settlement of any Award under the Plan. The Company or any of its Subsidiaries shall have the right to require the payment of any such taxes and require that any person furnish information deemed
necessary by the Company or any of its Subsidiaries to meet any tax reporting obligation as a condition to exercise or before making any payment or the issuance or release of any Shares pursuant to an Award. The authority provided to the Company and
any of its Subsidiaries under this Section 19.3 shall include the authority to, in the discretion of the Committee with respect to any Participant who is subject to Rule 16b-3 (which Committee, for these purposes, shall be comprised of two or more
Nonemployee Directors or the full Board and which such discretion may not be delegated to management), purchase (subject to the requirements of Bermuda law), sell or receive Shares or other property and to make cash payments in respect thereof in
satisfaction of a Participant’s tax obligations, either on a mandatory or elective basis; provided, that if such tax obligations are satisfied through the purchase of Shares that were issued to the Participant pursuant to an Award (or through
the surrender of Shares by the Participant to 

  
 27 

 
the Company), the number of Shares that may be so purchased (or surrendered) shall be limited to the number of Shares that have an aggregate Fair Market Value on the date of purchase equal to the
aggregate amount of such tax liabilities determined based on the applicable minimum statutory withholding rates for federal, state, foreign and/or local tax purposes, including payroll taxes, as determined by the Committee. If specified in an Award
Agreement at the time of grant or otherwise approved by the Committee, a Participant may, in satisfaction of his or her obligation to pay withholding taxes in connection with the exercise, vesting or other settlement of an Award, elect to (i) make a
cash payment to the Company, (ii) permit the purchase (subject to the requirements of Bermuda law) of a portion of the Shares that have become vested or (iii) surrender Shares owned by the Participant prior to the exercise, vesting or other
settlement of an Award, in each case having an aggregate Fair Market Value equal to the withholding taxes. 

(b)    If a Participant makes a disposition, within the meaning of Section 424(c) of the Code and
regulations promulgated thereunder, of any Share or Shares issued to such Participant pursuant to the exercise of an Incentive Stock Option within the two-year period commencing on the day after the date of the grant or within the one-year period
commencing on the day after the date of transfer of such Share or Shares to the Participant pursuant to such exercise, the Participant shall, within ten (10) days of such disposition, notify the Company thereof, by delivery of written notice to the
Company at its principal executive office. 
 19.4.    Plan Unfunded. The Plan shall be unfunded. Except for
reserving a sufficient number of authorized Shares to the extent required by law to meet the requirements of the Plan, the Company shall not be required to establish any special or separate fund or to make any other segregation of assets to assure
payment of any Award granted under the Plan. 
 19.5.    Fractional Shares. No fractional Shares shall be issued
or delivered pursuant to the Plan or any Award. The Committee shall determine whether cash, other Awards or other property shall be issued or paid in lieu of such fractional shares or whether such fractional shares or any rights thereto shall be
forfeited or otherwise eliminated. 
 [Remainder of page intentionally left blank.] 

  
 28

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00265-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00265-of-00352.parquet"}]]