Document:

Purchase Agreement

 Exhibit 10.1 

$600,000,000 

INERGY, L.P. 

INERGY FINANCE CORP. 

7% SENIOR NOTES DUE 2018 

PURCHASE AGREEMENT 

September 13, 2010 
 WELLS
FARGO SECURITIES, LLC 
 BARCLAYS CAPITAL INC. 

J.P. MORGAN SECURITIES LLC 

BANC OF AMERICA SECURITIES LLC 

CREDIT SUISSE SECURITIES (USA) LLC 

CITIGROUP GLOBAL MARKETS INC. 

MORGAN STANLEY & CO. INCORPORATED 

SUNTRUST ROBINSON HUMPHREY, INC. 

c/o Wells Fargo Securities, LLC 
 301 South
College Street 
 Charlotte, North Carolina 28288 

Ladies and Gentlemen: 
 Inergy,
L.P., a Delaware limited partnership (the “Partnership”), and Inergy Finance Corp., a Delaware corporation (“Finance Corp” and together with the Partnership, the “Issuers”), propose, upon the terms
and conditions set forth herein, to issue and sell to you, as the initial purchasers (the “Initial Purchasers”), $600,000,000 in aggregate principal amount of their 7% Senior Notes due 2018 (the “Notes”). The Notes
will (i) have terms and provisions that are summarized in the Offering Memorandum (as defined below) and (ii) are to be issued pursuant to an Indenture (the “Indenture”) to be entered into among the Issuers, the Guarantors
(as defined below) and U.S. Bank National Association, as trustee (the “Trustee”). 
 The Issuers’
obligations under the Notes, including the due and punctual payment of interest on the Notes, will be guaranteed (the “Guarantees”) by Inergy Propane, LLC, a Delaware limited liability company (the “Operating
Company”), Inergy Midstream, LLC, a Delaware limited liability company (“Midstream”), Inergy Sales & Service, Inc., a Delaware corporation (“Service Sub”), L & L Transportation, LLC, a Delaware
limited liability company (“L & L Transportation”), Inergy Transportation, LLC, a Delaware limited liability company (“Inergy Transportation”), Finger Lakes LPG Storage, LLC, a Delaware limited liability
company (“Finger Lakes”), Inergy Gas Marketing, LLC, a Delaware limited liability company (“Inergy Gas”), Stellar Propane Service, LLC, a Delaware limited liability company (“Stellar Propane”),
Inergy Storage, Inc., a Delaware corporation (“Storage”), Central New York Oil 

 
And Gas Company, L.L.C., a New York limited liability company (“CNYOGC”), Arlington Storage Company, LLC, a Delaware limited liability company (“Arlington
Storage”), US Salt, LLC, a Delaware limited liability company (“US Salt”), Liberty Propane, L.P., a Delaware limited partnership (“Liberty”), Liberty Propane GP, LLC, a Delaware limited liability company
(“Liberty GP”), Liberty Propane Operations, LLC, a Delaware limited liability company (“Liberty Operations”), Inergy Pipeline East, LLC, a Delaware limited liability company (“Inergy East”, and
together with the Operating Company, Midstream, Service Sub, L & L Transportation, Inergy Transportation, Finger Lakes, Inergy Gas, Stellar Propane, Storage, CNYOGC, Arlington Storage, US Salt, Liberty, Liberty GP and Liberty Operations, the
“Guarantors”). As used herein, the term “Notes” shall include the Guarantees, unless the context otherwise requires. The Issuers and the Guarantors are referred to as the “Inergy Parties.”

 Inergy Holdings, L.P., a Delaware limited partnership, owns (either directly or indirectly through its wholly-owned
subsidiaries) 100% of the issued and outstanding membership interests in each of Inergy Partners, LLC, a Delaware limited liability company (the “Non-Managing General Partner”), and Inergy GP, LLC, a Delaware limited liability
company (the “Managing General Partner”) (the Managing General Partner and the Non-Managing General Partner are sometimes collectively referred to herein as the “General Partners”). 

This is to confirm the agreement concerning the purchase of the Notes from the Issuers by the Initial Purchasers. 

1. Certain Defined Terms. As used in this Agreement: 

(a) “Applicable Time” means 3:30 p.m. (New York City time) on the date of this Agreement; and 

(b) “Pricing Disclosure Supplement” means the summary of the terms of the Notes dated the date of this Agreement and
attached hereto as Exhibit A. 
 2. Preliminary Offering Memorandum and Offering Memorandum. The Notes will be
offered, issued and sold to the Initial Purchasers without registration under the Securities Act of 1933, as amended (the “Act”), in reliance on an exemption pursuant to Section 4(2) under the Act. At or prior to the Applicable
Time, the Issuers and the Guarantors shall have prepared a preliminary offering memorandum dated September 13, 2010 (the “Preliminary Offering Memorandum”), and the Pricing Disclosure Supplement. Except as provided in the last
sentence of this paragraph, as used herein, “Offering Memorandum” shall mean the Preliminary Offering Memorandum as supplemented by the Pricing Disclosure Supplement. Promptly after the Applicable Time and in any event no later than
the second business day following the Applicable Time, the Issuers and the Guarantors will prepare an offering memorandum dated the date hereof (the “Final Offering Memorandum”). The Issuers and the Guarantors hereby confirm that
they have authorized the use of the Preliminary Offering Memorandum, the Pricing Disclosure Supplement and the Final Offering Memorandum in connection with the offering and resale of the Notes by the Initial Purchasers. From and after the time the
Final Offering Memorandum is prepared, all references herein to the Offering Memorandum shall be deemed to be a reference to both the Offering Memorandum and the Final Offering Memorandum. 

 

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 Any reference to the Preliminary Offering Memorandum or the Final Offering Memorandum shall
be deemed to refer to and include any documents incorporated by reference therein (the “Incorporated Documents”). All documents filed under the United States Securities Exchange Act of 1934, as amended (the “Exchange
Act”), and so deemed to be included in the Offering Memorandum, as the case may be, or any amendment or supplement thereto, are hereinafter called the “Exchange Act Reports.” 

It is understood and acknowledged that upon original issuance thereof, and until such time as the same is no longer required under the
applicable requirements of the Act, the Notes (and all securities issued in exchange therefor, in substitution thereof) shall bear the following legend (along with such other legends as the Initial Purchasers and their counsel deem necessary):

 ‘‘THIS NOTE (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION
UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND THIS NOTE MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF
THIS NOTE IS HEREBY NOTIFIED THAT THE SELLER OF THIS NOTE MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. 

THE HOLDER OF THIS NOTE AGREES FOR THE BENEFIT OF INERGY, L.P. AND INERGY FINANCE CORP. THAT (A) THIS NOTE MAY BE OFFERED, RESOLD,
PLEDGED OR OTHERWISE TRANSFERRED, ONLY (I) TO AN ISSUER, (II) IN THE UNITED STATES TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING
THE REQUIREMENTS OF RULE 144A, (III) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT, (IV) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER
(IF AVAILABLE), OR (V) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, AND IN EACH OF CASES (I) THROUGH (V) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES, AND
(B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY SUBSEQUENT PURCHASER OF THIS NOTE FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE.’’ 

 

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 You have advised the Issuers that you will make offers (the “Exempt
Resales”) of the Notes purchased by you hereunder on the terms set forth in the Offering Memorandum, as amended or supplemented, solely to (i) persons whom you reasonably believe to be “qualified institutional buyers” as
defined in Rule 144A under the Act (“QIBs”) and (ii) outside the United States to certain persons in offshore transactions in reliance on Regulation S under the Act. Those persons specified in clauses (i) and (ii) are
referred to herein as the (“Eligible Purchasers”). You will offer the Notes to Eligible Purchasers initially at a price equal to 100% of the principal amount thereof. Such price may be changed at any time without notice. 

Holders (including subsequent transferees) of the Notes will have the registration rights set forth in the registration rights agreement
attached hereto as Exhibit B (the “Registration Rights Agreement”) among the Inergy Parties and the Initial Purchasers to be dated September 27, 2010 (the “Closing Date”), for so long as such Notes
constitute “Registrable Securities” (as defined in the Registration Rights Agreement). Pursuant to the Registration Rights Agreement, the Inergy Parties will agree to file with the Commission under the circumstances set forth
therein, a registration statement under the Act relating to the Issuers’ 7% Senior Notes due 2018 (the “Exchange Notes”) and the Guarantors’ Exchange Guarantees (the “Exchange Guarantees”) to be offered in
exchange for the Notes and the Guarantees. Such portion of the offering is referred to as the “Exchange Offer.” 

On or prior to the Closing Date, the Initial Purchasers will execute an escrow agreement, in the form and substance to be agreed between
U.S. Bank National Association, as escrow agent (the “Escrow Agent”), U.S. Bank National Association, as trustee under the Indenture (the “Trustee”) and the Initial Purchasers, which shall conform in all material
respects with the description thereof included in the Offering Memorandum (the “Escrow Agreement”), and will direct the deposit in an escrow account (the “Escrow Account”) with the Escrow Agent, of the aggregate
purchase price of the Notes under Section 5. The Escrow Agreement shall provide that the escrowed funds shall only be released and paid out pursuant to the terms of the Escrow Agreement. 

Upon consummation of the transactions contemplated by the Purchase and Sale Agreement with respect to the sale of the membership
interests in Tres Palacios Gas Storage LLC, a Delaware limited liability company (“Tres Palacios”), by and among TP Gas Holding LLC and Midstream, dated September 3, 2010 (the “Tres Palacios Purchase
Agreement”), Tres Palacios and TP Gas Lessor LLC, a Delaware limited liability company (“TP Gas Lessor”), as Guarantors under the Indenture, will enter into a joinder agreement to this Agreement, the form of which is
attached hereto as Exhibit E (the “Joinder Agreement”), pursuant to which Tres Palacios and TP Gas Lessor will each become a party to this Agreement and a party to the Registration Rights Agreement. 

3. Representations, Warranties and Agreements of the Inergy Parties. The Inergy Parties, jointly and severally, represent, warrant
and agree as follows: 
 (a) No Material Misstatements or Omissions. The Offering Memorandum, as of the Applicable Time,
does not, and at the Closing Date will not, contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements made therein, in light of the circumstances under which they were made, not
misleading, except that 
  

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this representation and warranty does not apply to statements in or omissions from the Offering Memorandum made in reliance upon and in conformity with information relating to the Initial
Purchasers furnished to the Issuers in writing by or on behalf of the Initial Purchasers expressly for use therein, which information is specified in Section 13. 

(b) No Similar Class of Registered Securities. When the Notes and Guarantees are issued and delivered pursuant to this Agreement,
such Notes and Guarantees will not be of the same class (within the meaning of Rule 144A under the Act) as securities of the Issuers or the Guarantors that are listed on a national securities exchange registered under Section 6 of the Exchange
Act or that are quoted in a United States automated inter-dealer quotation system. 
 (c) Incorporated Documents. The
Incorporated Documents, when filed with the Commission, conformed or will conform, as the case may be, in all material respects to the requirements of the Exchange Act, and the rules and regulations (“Rules and Regulations”) of the
United States Securities and Exchange Commission (the “Commission”) thereunder, and did not and will 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 the light of the circumstances under which they were made, not misleading. 
 (d) No
Issuer Written Communications. The Partnership (including its agents and representatives, other than the Initial Purchasers in their capacity as such) has not prepared, made, used, authorized, approved or referred to and will not prepare, make,
use, authorize, approve or refer to any written communication that constitutes an offer to sell or solicitation of an offer to buy the Notes (each such communication by the Partnership or its agents and representatives (other than a communication
referred to in clause (i) below) an “Issuer Written Communication”) other than (i) the Offering Memorandum and (ii) any electronic road show or other written communications, in each case used in accordance with
Section 6(m). Each such Issuer Written Communication, when taken together with the Offering Memorandum as of the Applicable Time, did not, and at the Closing Date will not, contain any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that the Partnership makes no representation and warranty with respect to any statements or
omissions made in each such Issuer Written Communication in reliance upon and in conformity with information relating to any Initial Purchaser furnished to the Partnership in writing by such Initial Purchaser expressly for use in any Issuer Written
Communication. 
 (e) No Solicitation or Advertisement 

(i) Assuming that your representations and warranties in Section 4(b) are true, the purchase and resale of the Notes pursuant
hereto (including pursuant to the Exempt Resales) is exempt from the registration requirements of the Act. No form of general solicitation or general advertising within the meaning of Regulation D (including, but not limited to, advertisements,
articles, notices or other communications published in any newspaper, magazine or similar medium or broadcast over television or radio, or any seminar or meeting whose attendees have been invited by any general solicitation or general advertising)
was used by the Inergy Parties or any of their respective representatives (other than you, as to whom the Inergy Parties make no representation) in connection with the offer, issuance and sale of the Notes. 

 

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 (ii) No form of general solicitation or general advertising was used by the Inergy Parties
or any of their respective representatives (other than you, as to whom the Inergy Parties make no representation) with respect to Notes sold outside the United States to non-U.S. persons (as defined in Rule 902 under the Act), by means of any
directed selling efforts within the meaning of Rule 902 under the Act, and the Issuers, any affiliate of the Issuers and any person acting on its or their behalf (other than you, as to whom the Issuers and the Guarantors make no representation) has
complied with and will implement the “offering restrictions” required by Rule 902. 
 (f) No Order Preventing
Exempt Resales. The Preliminary Offering Memorandum and Offering Memorandum have been prepared by the Inergy Parties for use by the Initial Purchasers in connection with the Exempt Resales. No order or decree preventing the use of the
Preliminary Offering Memorandum or the Offering Memorandum, or any order asserting that the transactions contemplated by this Agreement are subject to the registration requirements of the Act has been issued and no proceeding for that purpose has
commenced or is pending or, to the knowledge of the Inergy Parties, is contemplated. 
 (g) Formation, Good Standing and
Foreign Qualification of the Inergy Parties. Each of the Inergy Parties and each of the General Partners has been duly organized and is validly existing and in good standing under the laws of its jurisdiction of organization with all necessary
limited liability company or partnership power and authority to own or lease its properties and to conduct its business, in all material respects as described in the Offering Memorandum. Each of the Inergy Parties and the General Partners is duly
registered or qualified as a foreign entity for the transaction of business under the laws of each jurisdiction in which the character of the business conducted by it or the nature or location of the properties owned or leased by it makes such
registration or qualification necessary, except where the failure so to register or qualify would not have a material adverse effect on the business, financial condition or results of operations of the Inergy Parties, taken as a whole
(“Material Adverse Effect”). 
 (h) Ownership of General Partner Interests in the Partnership. The
General Partners are the only general partners of the Partnership. The Non-Managing General Partner owns an approximate 0.6% general partner interest in the Partnership and the Managing General Partner owns a non-economic, managing general partner
interest in the Partnership; such general partner interests have been duly authorized and validly issued in accordance with the Second Amended and Restated Agreement of Limited Partnership of the Partnership, as amended (the “Partnership
Agreement”); and except as described in the Partnership Agreement or the Offering Memorandum, each General Partner owns its general partner interest free and clear of all liens, encumbrances, security interests, charges or claims (other
than those created by the Credit Agreement dated as of November 24, 2009, as amended, by and among the Partnership and the lenders therein (the “Credit Agreement”). 

(i) Capitalization. The issued and outstanding limited partner interests of the Partnership consist of 77,676,764 Common Units and
the incentive distribution rights, as defined in the Partnership Agreement (the “Incentive Distribution Rights”). All outstanding Common Units and the Incentive Distribution Rights and the limited partner interests represented
thereby 
  

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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 17-607 and 17-804 of the Delaware Revised Uniform Limited Partnership Act (the “Delaware LP Act”)). 

(j) Ownership of Finance Corp. and the Guarantors. The Partnership owns, directly or indirectly, 100% of the issued shares of
capital stock, membership interests or limited partner interests, as applicable, in each of Finance Corp. and the Guarantors; such shares of capital stock, membership interests or limited partner interests have been duly authorized and validly
issued in accordance with the bylaws, partnership agreement or limited liability company agreement of such entity (collectively, the “Organizational Documents”) and are fully paid (to the extent required under such Organizational
Documents) and nonassessable (except (i) in the case of an interest in a Delaware limited liability company, as such nonassessability may be affected by Sections 18-607 and 18-804 of the Delaware Limited Liability Company Act (the
“Delaware LLC Act”) and (ii) in the case of an interest in a limited liability company formed under the laws of another domestic state, as such nonassessability may be affected by similar provisions of such state’s limited
liability company statute, as applicable); and except as described in the Organizational Documents, the Partnership owns such shares of capital stock, membership interests or limited partner interests free and clear of all liens, encumbrances,
security interests, charges or claims (other than those securing obligations under the Credit Agreement). 
 (k) No Other
Subsidiaries. The Partnership does not own or control, directly or indirectly, any corporation, association or other entity other than the subsidiaries listed on Schedule II attached hereto. Neither the Partnership nor any of its subsidiaries
own, directly or indirectly, any equity or long-term debt securities of any corporation, partnership, limited liability company, joint venture, association or other entity, other than as set forth on Schedule II attached hereto. Other than its
ownership of partnership interests in the Partnership, the Managing General Partner does not own, and at the Closing Date will not own, directly or indirectly, any equity or long-term debt securities of any corporation, partnership, limited
liability company, joint venture, association or other entity. 
 (l) Authorization to Execute this Agreement. This
Agreement has been duly authorized, validly executed and delivered by each of the Inergy Parties. 
 (m) Authorization to
Issue and Sell Notes. The Issuers have all requisite corporate or partnership power and authority to issue, sell and deliver the Notes. The Notes have been duly authorized by the Issuers and, when duly executed by the Issuers in accordance with
the terms of the Indenture, assuming due authentication of the Notes by the Trustee, upon delivery to the Initial Purchasers against payment therefor in accordance with the terms hereof, will be validly issued and delivered, and will constitute
valid and binding obligations of the Issuers entitled to the benefits of the Indenture, enforceable against the Issuers in accordance with their terms, except as such enforceability may be limited by bankruptcy, fraudulent conveyance, insolvency,
reorganization, moratorium, and other laws relating to or affecting creditors’ rights generally and by general equitable principles (regardless whether such enforceability is considered in a proceeding in equity or at law). 

 

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 (n) Authorization to Issue Exchange Notes. The Issuers have all requisite corporate
or partnership power and authority to issue the Exchange Notes. The Exchange Notes have been duly and validly authorized by the Issuers and if and when duly issued, executed and authenticated by the Trustee in accordance with the terms of the
Indenture and delivered in accordance with the Exchange Offer provided for in the Registration Rights Agreement, will constitute valid and binding obligations of the Issuers entitled to the benefits of the Indenture, enforceable against the Issuers
in accordance with their terms, except as such enforceability may be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium, and other laws relating to or affecting creditors’ rights generally and by general
equitable principles (regardless whether such enforceability is considered in a proceeding in equity or at law). 
 (o)
Authorization and Enforceability of Guarantees. Each Guarantor has all requisite corporate, limited liability company or partnership power and authority to issue the Guarantees. The Guarantees have been duly and validly authorized by the
Guarantors and upon the due execution, authentication and delivery of the Notes in accordance with the Indenture and the issuance of the Notes in the sale to the Initial Purchasers contemplated by this Agreement, will constitute valid and binding
obligations of the Guarantors, enforceable against the Guarantors in accordance with their terms, except as such enforceability may be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium, and other laws relating to
or affecting creditors’ rights generally and by general equitable principles (regardless whether such enforceability is considered in a proceeding in equity or at law). 

(p) Authorization and Enforceability of Exchange Guarantees. Each Guarantor has all requisite corporate, limited liability company
or partnership power and authority to issue the Exchange Guarantees. The Exchange Guarantees have been duly and validly authorized by the Guarantors and if and when duly issued and delivered by the Guarantors in accordance with the terms of the
Indenture and upon the due execution and authentication of the Exchange Notes in accordance with the Indenture and the issuance and delivery of the Exchange Notes in the Exchange Offer contemplated by the Registration Rights Agreement, will
constitute valid and binding obligations of the Guarantors, entitled to the benefits of the Indenture, enforceable against the Guarantors in accordance with their terms, except as such enforceability may be limited by bankruptcy, fraudulent
conveyance, insolvency, reorganization, moratorium, and other laws relating to or affecting creditors’ rights generally and by general equitable principles (regardless whether such enforceability is considered in a proceeding in equity or at
law). 
 (q) Authorization and Enforceability of the Indenture. Each of the Inergy Parties has all requisite corporate,
limited liability company or partnership power and authority to enter into the Indenture. The Indenture has been duly and validly authorized by the Inergy Parties, and upon its execution and delivery by the Inergy Parties and, assuming due
authorization, execution and delivery by the Trustee, will constitute the valid and binding agreement of the Inergy Parties, enforceable against the Inergy Parties in accordance with its terms, except as such enforceability may be limited by
bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium, and other laws relating to or affecting creditors’ rights generally and by general equitable principles (regardless whether such enforceability is considered in a
proceeding in equity or at law); no qualification of the Indenture under the Trust Indenture Act of 1939 (the “1939 Act”) is required in connection with the offer, issuance and

  

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sale of the Notes contemplated hereby or in connection with the Exempt Resales. The Indenture conforms in all material respects to the requirements of the 1939 Act and the Rules and Regulations
applicable to an indenture that is qualified thereunder. 
 (r) Authorization and Enforceability of the Registration Rights
Agreement. Each of the Inergy Parties has all requisite corporate, limited liability company or partnership power and authority to enter into the Registration Rights Agreement. The Registration Rights Agreement has been duly authorized by the
Inergy Parties and, when executed and delivered by the Inergy Parties in accordance with the terms hereof and thereof, will be validly executed and delivered and (assuming the due authorization, execution and delivery thereof by you) will be the
legally valid and binding obligation of the Inergy Parties in accordance with the terms thereof, enforceable against the Inergy Parties in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium and other similar laws relating to or affecting creditor’s rights generally, by general equitable principles (regardless of whether such enforceability is considered in a proceeding in equity or at law) and, as to
rights of indemnification and contribution thereunder may be limited by federal or state law or by principles of public policy. 

(s) Accuracy of Statements. The Indenture, the Notes, the Guarantees and the Registration Rights Agreement will or do, as
applicable, conform in all material respects to the description thereof in the Offering Memorandum. 
 (t) Enforceability of
Other Agreements. (i) Each of the Organizational Documents has been duly authorized, executed and delivered by the parties thereto and is a valid and legally binding agreement of such party, enforceable against such party in accordance with
its terms; (ii) the Tres Palacios Purchase Agreement has been duly authorized, executed and delivered by Midstream and is a valid and legally binding agreement of Midstream, enforceable against Midstream in accordance with its terms and
(iii) the First Amended and Restated Agreement and Plan of Merger, by and among the Partnership, the Managing General Partner, NRGP Limited Partner, LLC, Holdings, Inergy Holdings GP, LLC, and NRGP MS, LLC, dated September 3, 2010 (the
“Merger Agreement” and, together with the Tres Palacios Purchase Agreement, the “Transaction Agreements”), has been duly authorized, executed and delivered by the Inergy Parties and General Partners (collectively,
the “Inergy Entities”) party thereto and is a valid and legally binding agreement of such Inergy Entities, enforceable against such Inergy Entities in accordance with its terms; provided that, the enforceability of the agreements
described in this Section 4(t) 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 (regardless
of whether such enforceability is considered in a proceeding in equity or at law); and provided, further, that the indemnity, contribution and exoneration provisions contained in any of such agreements may be limited by applicable laws and public
policy. 
 (u) No Conflicts. Except as disclosed in the Offering Memorandum, none of the offering, issuance and sale of
the Notes and the Guarantees by the Issuers and the Guarantors, respectively, the execution, delivery and performance of the Notes, the Guarantees, the Exchange Notes, the Indenture, the Registration Rights Agreement, the Exchange Guarantees and
this Agreement by the Inergy Parties and the Transaction Agreements by Midstream or the Inergy 
  

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Entities that are parties thereto, as applicable, or the consummation of the transactions contemplated by this Agreement or the Transaction Agreements (i) constitutes or will constitute a
violation of the Organizational Documents, (ii) constitutes or will constitute a breach or violation of, or a default (or an event which, with notice or lapse of time or both, would constitute such a default) under, any indenture, mortgage,
deed of trust, loan agreement, lease or other agreement or instrument to which any of the Inergy Parties is a party or by which any of them or any of their respective properties may be bound, other than those breaches, violations or defaults that
have been waived; (iii) violates or will violate any law, administrative regulation or administrative or court decree applicable to the Inergy Parties, or (iv) results or will result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of any of the Inergy Parties, which breaches, violations, defaults or liens, in the case of clauses (ii), (iii) or (iv) would, individually or in the aggregate, have a Material Adverse Effect.

 (v) No Consents. No permit, consent, approval, authorization, order, registration, filing or qualification
(“consent”) of or with any court, governmental agency or body having jurisdiction over the Inergy Parties or any of their respective properties is required for the offering, issuance and sale of the Notes and the Guarantees by the
Issuers in the manner contemplated herein or in the Offering Memorandum or the execution, delivery and performance of this Agreement, the Indenture, the Notes, the Guarantees, the Exchange Notes, the Exchange Guarantees and the Registration Rights
Agreement by the Inergy Parties and the Transaction Agreements by Midstream or the Inergy Entities that are parties thereto, as applicable, or the consummation by the Inergy Parties of the transactions contemplated by this Agreement, or the
consummation by Midstream or the Inergy Entities that are parties thereto, as applicable, of the transactions contemplated by the Transaction Agreements, except for (i) such consents, approvals, authorizations, orders and registrations or
qualifications as may be required under applicable state securities laws in connection with the purchase and resale of the Notes by the Initial Purchasers, (ii) with respect to the Exchange Notes under the Act and applicable state securities
laws as contemplated by the Registration Rights Agreement, (iii) with respect to the Transaction Agreements, as disclosed in the Offering Memorandum, (iv) consents that have been obtained and (v) for such consents that, if not
obtained, would not materially adversely affect the ability of the Inergy Parties to perform their respective obligations under this Agreement, the Indenture, the Notes, the Guarantees, the Exchange Notes, the Exchange Guarantees and the
Registration Rights Agreement. 
 (w) No Default. None of the Inergy Parties is (i) in violation of its
Organizational Documents, or (ii) in violation of any law, statute, ordinance, administrative or governmental rule or regulation applicable to it or of any decree of any court or governmental agency or body having jurisdiction over it or
(iii) in breach, default (or an event which, with notice or lapse of time or both, would constitute such a default) or violation in the performance of any obligation, agreement or condition contained in any bond, debenture, note or any other
evidence of indebtedness or in any agreement, indenture, lease or other instrument to which it is a party or by which it or any of its properties may be bound, which breach, default or violation in the case of clause (ii) or (iii) would,
if continued, have a Material Adverse Effect or could materially impair the ability of any of the Inergy Parties to perform their obligations under this Agreement, the Indenture, the Notes, the Guarantees, the Exchange Notes, the Exchange Guarantees
or the Registration Rights Agreement. To the knowledge of the Inergy Parties, no third party to any indenture, mortgage, deed of trust, loan agreement or other agreement or 

 

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instrument to which any of the Inergy Parties is a party or by which any of them is bound or to which any of their properties is subject, is in default under any such agreement, which breach,
default or violation would, if continued, have a Material Adverse Effect. 
 (x) Independent Registered Public Accounting
Firms. Ernst & Young LLP, who have certified certain audited financial statements of the Partnership contained or incorporated by reference in the Offering Memorandum, are an independent registered public accounting firm with respect to
the Partnership and the General Partners as required by the Act and the applicable Rules and Regulations thereunder and the rules and regulations of the Public Company Accounting Oversight Board (the “PCAOB”). Rothstein,
Kass & Company, P.C., who have certified certain audited financial statements of Tres Palacios contained or incorporated by reference in the Offering Memorandum, are an independent registered public accounting firm with respect to Tres
Palacios as required by the Act and the applicable Rules and Regulations thereunder and the rules and regulations of the PCAOB. 

(y) Financial Statements. At June 30, 2010, the Partnership would have had, on the consolidated, as adjusted basis indicated
in the Offering Memorandum, a capitalization as set forth therein. The historical financial statements of the Partnership and Tres Palacios (including the related notes and supporting schedules) contained or incorporated by reference in the Offering
Memorandum comply as to form in all material respects with the requirements of Regulation S-X under the Act and present fairly in all material respects the financial position, results of operations and cash flows of the entities purported to be
shown thereby on the basis stated therein at the respective dates or for the respective periods to which they apply and have been prepared in accordance with generally accepted accounting principles in the United States consistently applied
throughout the periods involved, except to the extent disclosed therein. The selected financial information contained or incorporated by reference in the Offering Memorandum is prepared on a basis consistent with the audited and unaudited historical
consolidated financial statements and pro forma financial statements, as applicable, from which it has been derived and fairly presents in all material respects the information shown thereby. The pro forma condensed combined financial statements
contained or incorporated by reference in the Offering Memorandum comply as to form in all material respects with the requirements of Regulation S-X under the Act and the assumptions used in the preparation of such pro forma financial statements
are, in the opinion of the management of the Inergy Parties, reasonable, and the pro forma adjustments reflected in such pro forma financial statements have been properly applied to the historical amounts in compilation of such pro forma financial
statements. 
 (z) No Material Adverse Change. None of the Inergy Parties has sustained since the date of the latest
audited financial statements contained or incorporated by reference in the Offering Memorandum any loss or interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute
or court or governmental action, investigation, order or decree that is reasonably likely to cause a Material Adverse Effect or is otherwise set forth or contemplated in the Offering Memorandum. Except as disclosed in the Offering Memorandum,
subsequent to the respective dates as of which such information is given in the Offering Memorandum (exclusive of any amendment or supplement thereto), (i) none of the Inergy Parties has incurred any liability or obligation, indirect, direct or
contingent, or entered into any transactions, not in the ordinary course of business, that, individually or in the aggregate, would cause or result in a Material Adverse Effect, (ii) there has

  

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not been any change in the capitalization, or increase in the short-term debt or long-term debt, of the Inergy Parties that would cause or result in a Material Adverse Effect and (iii) there
has not been any adverse change, or any development involving or which may reasonably be expected to involve, individually or in the aggregate, a prospective adverse change in or affecting the general affairs, business, prospects, properties,
management, condition (financial or other), partners’ capital, stockholders’ equity, net worth or results of operations of the Inergy Parties, taken as a whole, in each case except as could not, in the aggregate, reasonably be expected to
have a Material Adverse Effect. 
 (aa) Title to Properties. Each of the Inergy Parties has good and indefeasible title
to all real property (save and except for “rights-of-way”) and good title to all personal property described in the Offering Memorandum as owned by such Inergy Party, free and clear of all liens, claims, security interests or other
encumbrances except (i) those created, arising under or securing the Credit Agreement; (ii) such as are described in the Offering Memorandum; (iii) as described in the Organizational Documents; or (iv) such as could not, in the
aggregate, reasonably be expected to have a Material Adverse Effect. All real property and buildings held under lease or license by the Inergy Parties are held by such entity under valid and subsisting and enforceable leases or licenses with such
exceptions as could not, in the aggregate, reasonably be expected to have a Material Adverse Effect. Each of the Inergy Parties has such consents, easements, rights-of-way or licenses from any person (“rights-of-way”) as are
necessary to conduct its business in the manner described in the Offering Memorandum, subject to such qualifications as may be set forth in the Offering Memorandum and except for such rights-of-way the failure of which to have obtained would not
have, individually or in the aggregate, a Material Adverse Effect. 
 (bb) Permits. Each of the Inergy Parties has such
permits, consents, licenses, franchises, certificates and authorizations of governmental or regulatory authorities (“permits”) as are necessary to own its properties and to conduct its business in the manner described in the
Offering Memorandum, subject to such qualifications as may be set forth in the Offering Memorandum and except for such permits which, if not obtained, would not, individually or in the aggregate, have a Material Adverse Effect; each of the Inergy
Parties has fulfilled and performed all its material obligations with respect to such permits which are due to have been fulfilled and performed and no event has occurred which allows, or after notice or lapse of time would allow, revocation or
termination thereof or results in any impairment of the rights of the holder of any such permit, except for such revocations, terminations and impairments that would not, individually or in the aggregate, have a Material Adverse Effect, subject in
each case to such qualifications as may be set forth in the Offering Memorandum; and, except as described in the Offering Memorandum, none of such permits contains any restriction that is materially burdensome to the Inergy Parties, taken as a
whole. 
 (cc) Books and Records. The Partnership (i) makes and keeps books, records and accounts, which, in
reasonable detail, accurately and fairly reflect the transactions and dispositions of assets of the Partnership and (ii) maintains systems of “internal control over financial reporting” (as defined in Rule 13a-15(f) of the Exchange
Act) that comply with the requirements of the Exchange Act and have been designed by, or under the supervision of, their respective principal executive and principal financial officers, or persons performing similar functions, to provide reasonable
assurances that (A) transactions are executed in accordance with 
  

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management’s general or specific authorization; (B) transactions are recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting
principles and to maintain accountability for assets; (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 existing
assets at reasonable intervals and appropriate action is taken with respect to any differences. Except as disclosed in each of the Offering Memorandum as of the Applicable Time, there are no material weaknesses or significant deficiencies in the
Partnership’s internal controls. 
 (dd) Disclosure Controls. The Partnership has established and maintains
disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act), which are designed to provide reasonable assurance that the information required to be disclosed by the Partnership in reports that it files
under the Exchange Act is accumulated and communicated to the Partnership’s management, including its principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. The
Partnership has carried out evaluations of the effectiveness of its disclosure controls and procedures and such disclosure controls and procedures are effective in all material respects to perform the functions for which they were established to the
extent required by Rule 13a-15 of the Exchange Act. 
 (ee) No Recent Changes to Internal Control Over Financial
Reporting. Since the date of the most recent evaluation of such disclosure controls and procedures, there have been no significant changes in internal controls or in other factors that materially affected the Partnership’s internal control
over financial reporting. 
 (ff) Sarbanes Oxley Act of 2002. There is and has been no failure on the part of the
Partnership and, to the Partnership’s knowledge, any of the General Partner’s directors or officers, in their capacities as such, to comply with the provisions of the Sarbanes-Oxley Act of 2002 and the Rules and Regulations promulgated in
connection therewith. 
 (gg) Tax Returns. Each of the Inergy Parties which are required to do so has filed (or has
obtained extensions with respect to) all material federal, state and foreign income and franchise tax returns required to be filed through the date hereof, which returns are complete and correct in all material respects, and has timely paid all
taxes shown to be due, if any, pursuant to such returns, other than those (i) which are being contested in good faith or (ii) which, if not paid, would not have a Material Adverse Effect. 

(hh) Investment Company. None of the Inergy Parties is now, and after sale of the Notes to be sold by the Issuers hereunder, the
issuance of the Guarantees and application of the net proceeds from such sale as described in the Offering Memorandum under the caption “Use of Proceeds,” none of the Inergy Parties will be an “investment company” or a company
“controlled by” an “investment company” within the meaning of the Investment Company Act of 1940, as amended. 

(ii) No Environmental Problems. Each of the Inergy Parties (i) is in compliance with any and all applicable foreign, federal,
state and local laws and regulations relating to the protection of human health and safety and the environment or imposing liability or 

 

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standards of conduct concerning any Hazardous Material (as hereinafter defined) (“Environmental Laws”), (ii) has received all permits required of it under applicable
Environmental Laws to conduct its respective businesses, (iii) is in compliance with all terms and conditions of any such permit, and (iv) to the knowledge of the Inergy Parties, does not have any liability in connection with the release
into the environment of any Hazardous Materials, except where such noncompliance with Environmental Laws, failure to receive required permits, or failure to comply with the terms and conditions of such permits or liability in connection with such
releases would not, individually or in the aggregate, have a Material Adverse Effect. The term “Hazardous Material” means (A) any “hazardous substance” as defined in the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended, (B) any “hazardous waste” as defined in the Resource Conservation and Recovery Act, as amended, (C) any petroleum or petroleum product, (D) any polychlorinated biphenyl and
(E) any pollutant or contaminant or hazardous, dangerous or toxic chemical, material, waste or substance regulated under or within the meaning of any other Environmental Law. 

(jj) No Labor Dispute. No labor dispute with the employees of the Inergy Parties exists or, to the knowledge of the Inergy
Parties, is imminent which, in either case, would reasonably be expected to result in a Material Adverse Effect. 
 (kk)
Insurance. The Inergy Parties maintain insurance covering their properties, operations, personnel and businesses against such losses and risks as are reasonably adequate to protect them and their businesses in a manner consistent with other
businesses similarly situated. None of the Inergy Parties has received notice from any insurer or agent of such insurer that substantial capital improvements or other expenditures will have to be made in order to continue such insurance, and all
such insurance is outstanding and duly in force on the date hereof and will be outstanding and duly in force on the Closing Date. 

(ll) Litigation. Except as described in the Offering Memorandum, there is (i) no action, suit or proceeding before or by any
court, arbitrator or governmental agency, body or official, domestic or foreign, now pending or, to the knowledge of the Inergy Parties, threatened, to which any of the Inergy Parties is or may be a party or to which the business or property of any
of the Inergy Parties is or may be subject, (ii) no statute, rule, regulation or order that has been enacted, adopted or issued by any governmental agency or proposed by any governmental agency and (iii) no injunction, restraining order or
order of any nature issued by a federal or state court or foreign court of competent jurisdiction to which any of the Inergy Parties is or may be subject, that, in the case of clauses (i), (ii) and (iii) above, is reasonably likely to
(A) individually or in the aggregate have a Material Adverse Effect or (B) prevent or result in the suspension of the offer, issuance or sale of the Notes. 

(mm) Stabilization. Prior to the date hereof, none of the Inergy Parties has taken, directly or indirectly, any action designed to
cause or result in, or which has constituted or which might reasonably be expected to constitute, the stabilization or manipulation of the price the Notes in violation of any law, rule or regulation. 

(nn) No Integration. During the six-month period preceding the date of the Offering Memorandum, none of the Issuers, the
Guarantors or any other person acting on behalf of the Issuers or any Guarantor has offered or sold to any person any Notes or Guarantees, or any 

 

 14 

 
securities of the same or a similar class as the Notes or Guarantees, other than Notes or Guarantees offered or sold to the Initial Purchasers hereunder. The Issuers and the Guarantors will take
reasonable precautions designed to insure that any offer or sale, direct or indirect, in the United States or to any U.S. person (as defined in Rule 902 under the Act), of any Notes or any substantially similar security issued by the Issuers or any
Guarantor, within six months subsequent to the date on which the distribution of the Notes has been completed (as notified to the Partnership by the Initial Purchasers), is made under restrictions and other circumstances reasonably designed not to
affect the status of the offer, issuance and sale of the Notes in the United States and to U.S. persons contemplated by this Agreement as transactions exempt from the registration provisions of the Act; including any sales pursuant to Rule 144A
under, or Regulations D or S of, the Act. 
 (oo) Foreign Corrupt Practices Act. Neither the Partnership nor any of its
subsidiaries nor, to the knowledge of the Inergy Parties, any employee or agent of any of the Inergy Parties has made any payment of funds of the Partnership or any of its subsidiaries or received or retained any funds in violation of any law, rule
or regulation (including, without limitation, the Foreign Corrupt Practices Act of 1977), which payment, receipt or retention of funds is of a character required to be disclosed in the Offering Memorandum. 

4. Purchase of the Notes by the Initial Purchasers, Agreements to Sell, Purchase and Resell.  

(a) The Issuers hereby agree, on the basis of the representations, warranties and agreements of the Initial Purchasers contained herein
and subject to all the terms and conditions set forth herein, to issue and sell to the Initial Purchasers and, upon the basis of the representations, warranties and agreements of the Issuers and the Guarantors herein contained and subject to all the
terms and conditions set forth herein, each Initial Purchaser agrees, severally and not jointly, to purchase from the Issuers, at a purchase price of 98% of the principal amount thereof, the total principal amount of Notes set forth opposite the
name of such Initial Purchaser in Schedule I hereto; provided that if the Tres Palacios Purchase Agreement is terminated and the escrowed funds are disbursed to effect the Special Mandatory Redemption (as defined in the Escrow Agreement)
pursuant to the terms of the Escrow Agreement, each of the Initial Purchasers shall, within three business days, rebate to the Issuers 50% of the gross spread received by such Initial Purchaser based on the respective principal amount of Notes
purchased by such Initial Purchaser set forth opposite the name of such Initial Purchaser in Schedule I hereto. The Issuers and the Guarantors shall not be obligated to deliver any of the securities to be delivered hereunder except upon payment for
all of the securities to be purchased as provided herein. 
 (b) Each of the Initial Purchasers severally and not jointly hereby
represents and warrants to and agrees with the Issuers that it will offer the Notes for sale upon the terms and conditions set forth in this Agreement and in the Offering Memorandum. Each of the Initial Purchasers hereby represents and warrants to,
and agrees with, the Issuers that such Initial Purchaser: (i) is a QIB with such knowledge and experience in financial and business matters as are necessary in order to evaluate the merits and risks of an investment in the Notes; (ii) is
purchasing the Notes pursuant to a private sale exempt from registration under the Act; (iii) in connection with the Exempt Resales, will solicit offers to buy the Notes only from, and will offer

  

 15 

 
to sell the Notes only to, the Eligible Purchasers in accordance with this Agreement and on the terms contemplated by the Offering Memorandum; and (iv) will not offer or sell the Notes, nor
has it offered or sold the Notes by, or otherwise engaged in, any form of general solicitation or general advertising (within the meaning of Regulation D, including, but not limited to, advertisements, articles, notices or other communications
published in any newspaper, magazine, or similar medium or broadcast over television or radio, or any seminar or meeting whose attendees have been invited by any general solicitation or general advertising) and will not engage in any directed
selling efforts within the meaning of Rule 902 under the Act, in connection with the offering of the Notes. The Initial Purchasers have advised the Issuers that they will offer the Notes to Eligible Purchasers at a price initially equal to 100% of
the principal amount thereof, plus accrued interest, if any, from the date of issuance of the Notes. Such price may be changed by the Initial Purchasers at any time without notice. 

(c) Each of the Initial Purchasers understands that the Issuers and, for purposes of the opinions to be delivered to the Initial
Purchasers pursuant to Sections 7(c) and 7(e) hereof (as set forth in the form of opinions), counsel to the Issuers and counsel to the Initial Purchasers, will rely upon the accuracy and truth of the foregoing representations, warranties and
agreements and the Initial Purchasers hereby consent to such reliance. 
 5. Delivery of the Notes and Payment Therefor.
Delivery to the Initial Purchasers of and payment for the Notes shall be made at the offices of Vinson & Elkins L.L.P., 1001 Fannin Street, 2500 First City Tower, Houston, Texas 77002-6760, at 9:00 A.M., central time, on the Closing Date.
The place of closing for the Notes and the Closing Date may be varied by agreement between the Initial Purchasers and the Issuers. 

The Notes will be delivered to the Trustee as custodian for The Depository Trust Company (“DTC”), against payment by or
on behalf of the Initial Purchasers of the purchase price therefor by wire transfer in immediately available funds to the Escrow Account, by causing DTC to credit the Notes to the account of the Initial Purchasers at DTC. The Notes will be evidenced
by one or more global securities in definitive form (the “Global Notes”), and will be registered in the name of Cede & Co. as nominee of DTC. 

6. Agreements of the Inergy Parties. The Inergy Parties, jointly and severally, agree with each of the Initial Purchasers as
follows: 
 (a) The Issuers and the Guarantors will promptly furnish to the Initial Purchasers, without charge, such number of
copies of the Offering Memorandum as they may reasonably request. 
 (b) The Issuers and the Guarantors will not make any
amendment or supplement to the Offering Memorandum of which the Initial Purchasers shall not previously have been advised or to which they shall reasonably object after being so advised; provided, that this clause shall not apply to any
filing by the Partnership of any Annual Report on Form 10-K or Quarterly Report on Form 10-Q. 
 (c) If, at any time prior to
completion of the distribution of the Notes by the Initial Purchasers to Eligible Purchasers, any event occurs or information becomes known that, 

 

 16 

 
in the judgment of the Issuers, any of the Guarantors or in the opinion of counsel for the Initial Purchasers, should be set forth in the Offering Memorandum so that the Offering Memorandum does
not include any untrue statement of material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, or if it should be necessary to
supplement or amend the Offering Memorandum as of the Applicable Time or the Final Offering Memorandum, as then amended or supplemented in order to comply with any law, the Issuers and the Guarantors will, subject to paragraph (b) above,
promptly prepare an appropriate supplement or amendment thereto, and will promptly furnish to the Initial Purchasers and dealers a reasonable number of copies thereof. 

(d) The Issuers and each of the Guarantors will cooperate with the Initial Purchasers and with their counsel in connection with the
qualification of the Notes for offering, issuance and sale by the Initial Purchasers and by dealers under the securities or Blue Sky laws of such jurisdictions as the Initial Purchasers may reasonably designate; provided, that in no event
shall the Issuers or any of the Guarantors be obligated to qualify to do business in any jurisdiction where it is not now so qualified or to take any action that would subject it to service of process in suits, other than those arising out of the
offering, issuance or sale of the Notes, in any jurisdiction where it is not now so subject or subject itself to taxation in any such jurisdiction if it is not otherwise so subject. 

(e) For a period of 90 days from the date of the Offering Memorandum, the Inergy Parties agree not to, directly or indirectly, sell,
offer to sell, contract to sell, grant any option to purchase, issue any instrument convertible into or exchangeable for, or otherwise transfer or dispose of (or enter into any transaction or device that is designed to, or could be expected to,
result in the disposition in the future of), any debt securities of the Issuers, the Guarantors or any of their respective subsidiaries, except (i) in exchange for the Exchange Notes and the Exchange Guarantees in connection with the Exchange
Offer or (ii) with the prior consent of Wells Fargo Securities, LLC. 
 (f) The Issuers will make available to the holders
of the Notes as soon as practicable after the end of each fiscal year an annual report (including a balance sheet and statements of income, partners’/stockholders’ equity and cash flows of the Issuers and its consolidated subsidiaries
certified by an independent registered public accounting firm) and, as soon as practicable after the end of each of the first three quarters of each fiscal year (beginning with the fiscal quarter ending after the date of the Offering Memorandum),
will make available to its securityholders consolidated summary financial information of the Issuers and its subsidiaries for such quarter in reasonable detail. 

(g) The Issuers will apply the net proceeds from the sale of the Notes to be sold by it hereunder substantially in accordance with the
description set forth in the Offering Memorandum under the caption “Use of Proceeds.” 
 (h) Except as stated in this
Agreement and in the Offering Memorandum, neither the Issuers, the Guarantors nor any of their respective affiliates will take, directly or indirectly, any action designed to or that might reasonably be expected to cause or result in stabilization
or manipulation of the price of the Notes. 
  

 17 

 (i) During the period of one year after the Closing Date, the Inergy Parties will not, and
will not permit any of their “affiliates” (as defined in Rule 144 under the Act), to, resell any of the Notes that constitute “restricted securities” under Rule 144 that have been reacquired by any of them. 

(j) The Inergy Parties agree not to sell, offer for sale or solicit offers to buy or otherwise negotiate in respect of any security (as
defined in the Act) that would be integrated with the sale of the Notes in a manner that would require the registration under the Act of the sale to the Initial Purchasers or the Eligible Purchasers of the Notes. 

(k) The Inergy Parties will take such steps as shall be necessary to insure that neither the Partnership nor any of the
Partnership’s subsidiaries becomes an “investment company” within the meaning of such term under the Investment Company Act of 1940, as amended. 

(l) Before making, preparing, using, authorizing, approving or referring to any Issuer Written Communication, the Partnership will
furnish to the Initial Purchasers and counsel for the Initial Purchasers a copy of such written communication for review and will not make, prepare, use, authorize, approve or refer to any such written communication to which the Initial Purchasers
reasonably object. 
 (m) The Partnership will advise the Initial Purchasers promptly, and confirm such advice in writing,
(i) of the issuance by any governmental or regulatory authority of any order preventing or suspending the use of any of the Offering Memorandum as of the Applicable Time, any Issuer Written Communication or the Final Offering Memorandum or the
initiation or threatening of any proceeding for that purpose; (ii) of the occurrence of any event at any time prior to the completion of the initial offering of the Notes as a result of which any of the Offering Memorandum as of the Applicable
Time, any Issuer Written Communication or the Final Offering Memorandum as then amended or supplemented would include any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the
light of the circumstances existing when such Offering Memorandum, Issuer Written Communication or the Final Offering Memorandum is delivered to a purchaser, not misleading; and (iii) of the receipt by the Partnership of any notice with respect
to any suspension of the qualification of the Notes for offer, and sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose; and the Partnership will use its reasonable best efforts to prevent the issuance of any
such order preventing or suspending the use of any of the Offering Memorandum as of the Applicable Time, any Issuer Written Communication or the Final Offering Memorandum or suspending any such qualification of the Notes and, if any such order is
issued, will obtain as soon as possible the withdrawal thereof. 
 7. Conditions to Initial Purchasers’ Obligations.
The respective obligations of the Initial Purchasers hereunder are subject to the accuracy, when made and on and as of the Closing Date, of the representations and warranties of the Inergy Parties contained herein, to the performance by the Inergy
Parties of their respective obligations hereunder, and to each of the following additional conditions: 
 (a) The Initial
Purchasers shall not have discovered and disclosed to the Issuers on or prior to the Closing Date that the Offering Memorandum contained an untrue statement of a fact that, in the opinion of Baker Botts L.L.P., is material or omits to state a fact
that, in the opinion of such counsel, is material and is required to be stated therein or in the documents incorporated therein by reference or is necessary to make the statements therein, in light of the circumstances under which they were made,
not misleading. 
  

 18 

 (b) All corporate proceedings and other legal matters incident to the authorization, form
and validity of this Agreement, the Notes, the Guarantees, the Exchange Notes, the Exchange Guarantees, the Registration Rights Agreement, the Indenture and the Offering Memorandum, and all other legal matters relating to this Agreement and the
transactions contemplated hereby shall be reasonably satisfactory in all material respects to Baker Botts L.L.P., and the Inergy Parties shall have furnished to such counsel all documents and information that they may reasonably request to enable
them to pass upon such matters. 
 (c) The Initial Purchasers shall have received from Vinson & Elkins L.L.P., counsel
for the Issuers and the Guarantors, its written opinion addressed to the Initial Purchasers and dated the Closing Date, substantially in the form of Exhibit C hereto. 

(d) The Initial Purchasers shall have received from Laura Ozenberger, Senior Vice President - General Counsel and Secretary of the
Managing General Partner, her written opinion addressed to the Initial Purchasers and dated the Closing Date, substantially in the form of Exhibit D hereto. 

(e) The Initial Purchasers shall have received from Baker Botts L.L.P., counsel for the Initial Purchasers, such opinion or opinions,
dated the Closing Date, with respect to the offer, issuance and sale of the Notes, the Offering Memorandum and other related matters as the Initial Purchasers may reasonably require, and the Issuers shall have furnished to such counsel such
documents and information as they reasonably request for the purpose of enabling them to pass upon such matters. 
 (f) The
Issuers and each Guarantor shall have furnished or caused to be furnished to the Initial Purchasers on the Closing Date certificates of officers of the Issuers and each Guarantor satisfactory to the Initial Purchasers as to the accuracy of the
representations and warranties of the Issuers and each Guarantor herein at and as of the Closing Date, as to the performance by the Issuers and each Guarantor of all of their obligations hereunder to be performed at or prior to the Closing Date and
as to such other matters as Wells Fargo Securities, LLC may reasonably request. 
 (g) At the time of execution of this
Agreement, the Initial Purchasers shall have received from each of Ernst & Young LLP and Rothstein, Kass & Company, P.C. a letter or letters, in form and substance satisfactory to the Initial Purchasers, addressed to the Initial
Purchasers and dated the date hereof (i) confirming that such firm is an independent registered public accounting firm within the meaning of the Act and the rules of the PCAOB and is in compliance with the applicable requirements relating to
the qualification of accountants under Rule 2-01 of Regulation S-X of the Commission, (ii) stating, as of the date hereof (or, with respect to matters involving changes or developments since the respective dates as of which

  

 19 

 
specified financial information is given in the Offering Memorandum, as of a date not more than five days prior to the date hereof), the conclusions and findings of such firm with respect to the
financial information and (iii) covering such other matters as are ordinarily covered by accountants’ “comfort letters” to Initial Purchasers in connection with registered public offerings. 

(h) With respect to the letters of Ernst & Young LLP and Rothstein, Kass & Company, P.C. referred to in the preceding
paragraph and delivered to the Initial Purchasers concurrently with the execution of this Agreement (the “initial letter”), the Partnership shall have furnished to the Initial Purchasers a letter (a “bring-down
letter”) of such firm, addressed to the Initial Purchasers and dated the Closing Date (i) confirming that such firm is an independent registered public accounting firm within the meaning of the Act and the rules of the PCAOB and is in
compliance with the applicable requirements relating to the qualification of accountants under Rule 2-01 of Regulation S-X of the Commission, (ii) stating, as of the Closing Date (or, with respect to matters involving changes or developments
since the respective dates as of which specified financial information is given in the Offering Memorandum, as of a date not more than five days prior to the date of the Closing Date), the conclusions and findings of such firm with respect to the
financial information and other matters covered by the initial letter and (iii) confirming in all material respects the conclusions and findings set forth in the initial letter. 

(i) None of the Inergy Parties shall have sustained, since the date of the latest audited financial statements included or incorporated
by reference in the Offering Memorandum, any material loss or interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, order or
decree, otherwise than as set forth or contemplated in the Offering Memorandum (exclusive of any amendment or supplement thereto); and, since such date, there shall not have been any material change in the partners’/stockholders’ equity or
long-term debt of any of the Inergy Parties, or material adverse change, or any development involving a prospective material adverse change, in or affecting the management, condition, financial or otherwise, partners’/stockholders’ equity,
results of operations, business or prospects of the Inergy Parties, taken as a whole. 
 (j) Subsequent to the execution and
delivery of this Agreement (i) no downgrading shall have occurred in the rating accorded the Issuers’ debt securities by any nationally recognized statistical rating organization and (ii) no such organization shall have publicly
announced that it has under surveillance or review, with possible negative implications, its rating of any of the Issuers’ debt securities. 

(k) The Issuers and the Guarantors have executed and delivered the Registration Rights Agreement, and the Initial Purchasers shall have
received an executed counterpart thereof, duly executed by the Issuers and the Guarantors. 
 (l) The Issuers, the Guarantors
and the Trustee shall have executed and delivered an officer’s certificate relating to the issuance of the Notes pursuant to Section 2.13 of the Indenture. 

 

 20 

 (m) There shall not have occurred any of the following: (i) trading in securities
generally on the New York Stock Exchange shall have been suspended, the settlement of such trading generally shall have been materially disrupted or minimum prices shall have been established on any such exchange or such market by the Commission, by
such exchange or by any other regulatory body or governmental authority having jurisdiction, (ii) trading in any securities of the Partnership on any exchange or in the over-the-counter market shall have been suspended, (iii) a banking
moratorium shall have been declared by federal or state authorities, (iv) the United States shall have become engaged in hostilities, there shall have been an escalation in hostilities involving the United States or there shall have been a
declaration of a national emergency or war by the United States or (v) there shall have occurred such a material adverse change in general economic, political or financial conditions or any other calamity or crisis, including, without
limitation, as a result of terrorist activities after the date hereof (or the effect of international conditions on the financial markets in the United States shall be such), as to make it, in the judgment of Wells Fargo Securities, LLC, so material
and adverse as to make it impracticable or inadvisable to proceed with the offering or sale of the Notes being delivered on the Closing Date on the terms and in the manner contemplated by the Offering Memorandum. 

(n) The Trustee and the Escrow Agent have executed and delivered the Escrow Agreement, and the Initial Purchasers shall have received an
executed counterpart thereof, duly executed by the Trustee and the Escrow Agent. 
 All opinions, letters, evidence and
certificates mentioned above or elsewhere in this Agreement shall be deemed to be in compliance with the provisions hereof only if they are in form and substance reasonably satisfactory to counsel for the Initial Purchasers. 

8. Indemnification and Contribution. 

(a) The Inergy Parties, jointly and severally, will indemnify and hold harmless each of the Initial Purchasers and their respective
affiliates from and against any losses, damages or liabilities, joint or several, to which the Initial Purchasers may become subject, under the Act, or otherwise, insofar as such losses, damages or liabilities (or actions or claims in respect
thereof) arise out of or are based upon an untrue statement or alleged untrue statement of a material fact contained in the Offering Memorandum or any Issuer Written Communication, or any amendment or supplement thereto, or arise out of or are based
upon any omission or alleged omission to state therein a material fact necessary to make the statements therein, in light of the circumstances in which they were made, not misleading, and will reimburse each of the Initial Purchasers for any legal
or other out-of-pocket expenses incurred by such Initial Purchasers in connection with investigating, preparing, pursuing or defending against or appearing as a third party witness in connection with any such loss, damage, liability or action or
claim, including, without limitation, any investigation or proceeding by any governmental agency or body, commenced or threatened, including the reasonable fees and expenses of counsel to the indemnified party, as such expenses are incurred
(including such losses, damages, liabilities or expenses to the extent of the aggregate amount paid in settlement of any such action or claim, provided that (subject to Section 8(c) hereof) any such settlement is effected with the written
consent of the Partnership); provided, however, that the Inergy Parties shall not be liable in any such case to the extent, but only to the extent, that any such loss, damage or liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission 
  

 21 

 
made in the Offering Memorandum, any Issuer Written Communication, or in any amendment or supplement thereto, in reliance upon and in conformity with written information relating to the Initial
Purchasers furnished to the Issuers by you, expressly for use in the preparation thereof, which information is specified in Section 13. 

(b) Each of the Initial Purchasers, severally and not jointly, will indemnify and hold harmless the Inergy Parties and their respective
affiliates from and against any losses, damages or liabilities to which the Inergy Parties may become subject, under the Act or otherwise, insofar as such losses, damages or liabilities (or actions or claims in respect thereof) arise out of or are
based upon (i) an untrue statement or alleged untrue statement of a material fact contained in the Preliminary Offering Memorandum, the Offering Memorandum, any Issuer Written Communication, or in any amendment or supplement thereto, or arise
out of or are based upon any omission or alleged omission to state therein a material fact necessary to make the statements therein, in light of the circumstances in which they were made, not misleading, in each case to the extent, but only to the
extent, that such untrue statement or alleged untrue statement or omission or alleged omission was made in the Preliminary Offering Memorandum, the Offering Memorandum, any Issuer Written Communication, or in any amendment or supplement thereto, in
reliance upon and in conformity with written information relating to such Initial Purchaser furnished to the Issuers by such Initial Purchaser, expressly for use in the preparation thereof (as provided in Section 13 hereof), and will reimburse
the Inergy Parties for any legal or other expenses incurred by the Inergy Parties in connection with investigating or defending any such action or claim as such expenses are incurred (including such losses, damages, liabilities or expenses to the
extent of the aggregate amount paid in settlement of any such action or claim, provided that (subject to Section 8(d) hereof) any such settlement is effected with the written consent of the Initial Purchasers). 

(c) Promptly after receipt by an indemnified party under Section 8(a) or 8(b) hereof of notice of the commencement of any action,
such indemnified party shall, if a claim in respect thereof is to be made against an indemnifying party under Section 8(a) or 8(b) hereof, notify each such indemnifying party in writing of the commencement thereof, but the failure so to notify
such indemnifying party shall not relieve such indemnifying party from any liability it may have under Section 8(a) or 8(b) hereof except to the extent it has been materially prejudiced (through the forfeiture of substantive rights and defenses
by such failure, and such failure shall not relieve such indemnifying party from any liability it may have to any such indemnified party otherwise than under Section 8(a) or 8(b) hereof. In case any such action shall be brought against any such
indemnified party and it shall notify each indemnifying party of the commencement thereof, each such indemnifying party shall be entitled to participate therein and, to the extent that it shall wish, jointly with any other indemnifying party under
Section 8(a) or 8(b) hereof similarly notified, to assume the defense thereof, with counsel satisfactory to such indemnified party (who shall not, except with the consent of such indemnified party, be counsel to such indemnifying party), and,
after notice from such indemnifying party to such indemnified party of its election so to assume the defense thereof, such indemnifying party shall not be liable to such indemnified party under Section 8(a) or 8(b) hereof for any legal expenses
of other counsel or any other expenses, in each case subsequently incurred by such indemnified party, in connection with the defense thereof other than reasonable costs of investigation. The indemnified party shall have the right to employ its own
counsel in any such action, but the fees and expenses of such counsel shall be at the expense of such indemnified party unless (i) the 

 

 22 

 
employment of counsel by such indemnified party at the expense of the indemnifying party has been authorized by the indemnifying party, (ii) the indemnified party shall have been advised by
such counsel that there may be a conflict of interest between the indemnifying party and the indemnified party in the conduct of the defense, or certain aspects of the defense, of such action (in which case the indemnifying party shall not have the
right to direct the defense of such action with respect to those matters or aspects of the defense on which a conflict exists or may exist on behalf of the indemnified party) or (iii) the indemnifying party shall not in fact have employed
counsel reasonably satisfactory to such indemnified party to assume the defense of such action, in any of which events such fees and expenses to the extent applicable shall be borne, and shall be paid as incurred, by the indemnifying party. If at
any time such indemnified party shall have requested such indemnifying party under Section 8(a) or 8(b) hereof to reimburse such indemnified party for fees and expenses of counsel, such indemnifying party agrees that it shall be liable for any
settlement of the nature contemplated by Section 8(a) or 8(b) hereof effected without its written consent if (i) such settlement is entered into more than 60 days after receipt by such indemnifying party of such request for reimbursement,
(ii) such indemnifying party shall have received notice of the terms of such settlement at least 45 days prior to such settlement being entered into and (iii) such indemnifying party shall not have reimbursed such indemnified party in
accordance with such request for reimbursement prior to the date of such settlement. No such indemnifying party shall, without the written consent of such indemnified party, effect the settlement or compromise of, or consent to the entry of any
judgment with respect to, any pending or threatened action or claim in respect of which indemnification or contribution may be sought hereunder (whether or not such indemnified party is an actual or potential party to such action or claim) unless
such settlement, compromise or judgment (A) includes an unconditional release of such indemnified party from all liability arising out of such action or claim and (B) does not include a statement as to or an admission of fault, culpability
or a failure to act, by or on behalf of any such indemnified party. In no event shall such indemnifying parties be liable for the fees and expenses of more than one counsel, including any local counsel, for all such indemnified parties in connection
with any one action or separate but similar or related actions in the same jurisdiction arising out of the same general allegations or circumstances. 

(d) If the indemnification provided for in this Section 8 is unavailable to or insufficient to indemnify or hold harmless an
indemnified party under Section 8(a) or 8(b) hereof in respect of any losses, damages or liabilities (or actions or claims in respect thereof) referred to therein, then each indemnifying party under Section 8(a) or 8(b) hereof shall
contribute to the amount paid or payable by such indemnified party as a result of such losses, damages or liabilities (or actions or claims in respect thereof) in such proportion as is appropriate to reflect the relative benefits received by the
Inergy Parties on the one hand, and the Initial Purchasers on the other hand, from the offering of the Notes. If, however, the allocation provided by the immediately preceding sentence is not permitted by applicable law or if the indemnified party
failed to give the notice required under Section 8(c) hereof and such indemnifying party was prejudiced in a material respect by such failure, then each such indemnifying party shall contribute to such amount paid or payable by such indemnified
party in such proportion as is appropriate to reflect not only such relative benefits but also the relative fault, as applicable, of the Inergy Parties on the one hand, and the Initial Purchasers, on the other hand in connection with the statements
or omissions that resulted in such losses, damages or liabilities (or actions or claims in respect thereof), as well as any other relevant equitable considerations. The relative benefits received by, as applicable, the Inergy Parties on the one hand
and the Initial Purchasers, 
  

 23 

 
on the other hand, shall be deemed to be in the same proportion as the total net proceeds from such offering (before deducting expenses) received by the Issuers bear to the total discounts and
commissions received by the Initial Purchasers. The relative fault, as applicable, of the Inergy Parties, on the one hand and the Initial Purchasers, 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 relates to information supplied by the Inergy Parties on the one hand, or the Initial Purchasers on the other hand and the parties’
relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The Inergy Parties and the Initial Purchasers agree that it would not be just and equitable if contribution pursuant to this
Section 8(d) were determined by pro rata allocation or by any other method of allocation that does not take account of the equitable considerations referred to above in this Section 8(d). The amount paid or payable by such an
indemnified party as a result of the losses, damages or liabilities (or actions or claims in respect thereof) referred to above in this Section 8(d) shall be deemed to include any legal or other expenses incurred by such indemnified party in
connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 8(d), no Initial Purchaser shall be required to contribute any amount in excess of the amount by which the total price at which
the Notes purchased by it and distributed to the public were offered to the public exceeds the amount of any damages that such Initial Purchasers has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or
alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The Initial
Purchasers' obligations to contribute pursuant to this Section 8 are several in proportion to their respective purchase obligations hereunder and not joint. 

(e) The obligations of the Inergy Parties under this Section 8 shall be in addition to any liability that the Inergy Parties may
otherwise have and shall extend, upon the same terms and conditions, to each officer, director, employee, agent or other representative of each Initial Purchaser and to each person, if any, who controls any Initial Purchaser within the meaning of
the Act; and the obligations of each of the Initial Purchasers under this Section 8 shall be in addition to any liability that the respective Initial Purchaser may otherwise have and shall extend, upon the same terms and conditions, to each
officer and director of the Issuers and the Managing General Partner and to each person, if any, who controls the Inergy Parties within the meaning of the Act. 

9. Defaulting Initial Purchasers. If, on the Closing Date, any Initial Purchaser defaults in the performance of its obligations
under this Agreement, the remaining non-defaulting Initial Purchasers shall be obligated to purchase the Notes that the defaulting Initial Purchaser agreed but failed to purchase on the Closing Date in the respective proportions that the principal
amount of the Notes set opposite the name of each remaining non-defaulting Initial Purchaser in Schedule I hereto bears to the total principal amount of the Notes set opposite the names of all the remaining non-defaulting Initial Purchasers in
Schedule I hereto; provided, however, that the remaining non-defaulting Initial Purchasers shall not be obligated to purchase any of the Notes on the Closing Date if the total number of Notes that the defaulting Initial Purchaser or
Initial Purchasers agreed but failed to purchase on such date exceeds 9.09% of the total number of Notes to be purchased on the Closing Date, and any remaining non-defaulting Initial Purchasers shall not be obligated to purchase more than 110% of
the number of Notes that 
  

 24 

 
it agreed to purchase on the Closing Date pursuant to the terms of Section 4. If the foregoing maximums are exceeded, the remaining non-defaulting Initial Purchasers, or those other Initial
Purchasers satisfactory to the Initial Purchasers who so agree, shall have the right, but shall not be obligated, to purchase, in such proportion as may be agreed upon among them, all the Notes to be purchased on the Closing Date. If the remaining
Initial Purchasers or other Initial Purchasers satisfactory to the Initial Purchasers do not elect to purchase the Notes that the defaulting Initial Purchaser or Initial Purchasers agreed but failed to purchase on the Closing Date, this Agreement
shall terminate without liability on the part of any non-defaulting Initial Purchaser or the Inergy Parties, except that the Inergy Parties will continue to be liable for the payment of expenses to the extent set forth in Sections 11 and 12.

 Nothing contained herein shall relieve a defaulting Initial Purchaser of any liability it may have to the Inergy Parties for
damages caused by its default. If other Initial Purchasers are obligated or agree to purchase the Notes of a defaulting or withdrawing Initial Purchaser, either the remaining Initial Purchasers or the Issuers may postpone the Closing Date for up to
seven full business days in order to effect any changes that in the opinion of counsel for the Issuers or counsel for the Initial Purchasers may be necessary in the Offering Memorandum or in any other document or arrangement. 

10. Termination. The obligations of the Initial Purchasers hereunder may be terminated by the Initial Purchasers by notice given
to and received by the Issuers prior to delivery of and payment for the Notes if, prior to that time, any of the events described in Section 7(m) shall have occurred or if the Initial Purchasers shall decline to purchase the Notes for any
reason permitted under this Agreement. 
 11. Cost and Expenses. The Partnership will bear and pay the costs and expenses
incident to the offering of the Notes, including, without limitation, (a) all expenses (including stock transfer taxes) incurred in connection with the delivery to the Initial Purchasers of the Notes, (b) the fees and expenses of the
Issuers’ counsel and accountants, (c) the preparation, printing, filing, delivery and shipping of the Preliminary Offering Memorandum and the Offering Memorandum and any amendments or supplements thereto and the printing, delivery and
shipping of this Agreement, the Indenture, the Registration Rights Agreement, all Blue Sky Memoranda and all other agreements, memoranda, correspondence and other documents printed and delivered in connection therewith and with the Exempt Resales
(but not, however, legal fees and expenses of your counsel incurred in connection with any of the foregoing other than fees of such counsel plus reasonable disbursements incurred in connection with the preparation, printing and delivery of such Blue
Sky Memoranda), (d) the furnishing of copies of such documents to the Initial Purchasers, (e) the issuance and delivery by the Issuers of the Notes and by the Guarantors of the Guarantees and any taxes payable in connection therewith,
(f) the qualification of the Notes and Exchange Notes for the offer, issuance and sale under the securities or Blue Sky laws of the several states (including, without limitation, the reasonable fees and disbursements of your counsel relating to
such registration or qualification), (g) the furnishing of such copies of the Preliminary Offering Memorandum and the Offering Memorandum, and all amendments and supplements thereto, as may be reasonably requested for use in connection with the
Exempt Resales, (h) the preparation of certificates for the Notes (including, without limitation, printing and engraving thereof), (i) the approval of the Notes by DTC for “book-entry” transfer (including fees and expenses of
counsel), (j) the rating of the Notes and the Exchange Notes, (k)
  

 25 

 
the obligations of the Trustee, any agent of the Trustee and the counsel for the Trustee in connection with the Indenture, the Notes, the Guarantees, the Exchange Notes and the Exchange
Guarantees, (l) the performance by the Inergy Parties of their other obligations under this Agreement, (m) all travel expenses, including one-half of the expenses relating to chartered aircraft and all accommodation expenses, of
representatives of the Partnership in connection with the offering of the Notes, and (n) all of the other costs and expenses incident to the performance by the Issuers of the offering of the Notes; provided, that the Initial Purchasers will
bear and pay all of their own costs and expenses, including the fees and expenses of counsel, and any advertising costs and expenses incurred by any of the Initial Purchasers incident to the offering of the Notes. 

If this Agreement is terminated by you in accordance with the provisions of Section 10, the Issuers shall reimburse the Initial
Purchasers for all of their reasonable out-of-pocket expenses, including the reasonable fees and disbursements of counsel to the Initial Purchasers. 

12. Reimbursement of Initial Purchasers’ Expenses. If the Issuers fail to tender the Notes for delivery to the Initial
Purchasers by reason of any failure, refusal or inability on the part of the Inergy Parties to perform any agreement on their part to be performed, or because any other condition of the obligations hereunder required to be fulfilled by the Inergy
Parties is not fulfilled, the Inergy Parties shall reimburse the Initial Purchasers for all reasonable out-of-pocket expenses (including fees and disbursements of counsel) incurred by the Initial Purchasers in connection with this Agreement and the
proposed purchase of the Notes, and upon demand the Inergy Parties shall pay the full amount thereof to the Initial Purchasers. If this Agreement is terminated pursuant to Section 10 by reason of the default of one or more Initial Purchasers,
the Inergy Parties shall not be obligated to reimburse any defaulting Initial Purchaser on account of those expenses. 
 13.
Information Furnished by the Initial Purchasers. The statements set forth in the third paragraph, the last sentence of the fifth paragraph, the third sentence of the tenth paragraph and the twelfth paragraph, all under the section captioned
“Plan of Distribution” in the Offering Memorandum, constitute the only information furnished by or on behalf of the Initial Purchasers through you as such information is referred to in Sections 3(d), 8(a) and 8(b) hereof. 

14. Notices. All statements, requests, notices and agreements hereunder shall be in writing, and: 

(a) if to any Initial Purchasers, shall be delivered or sent by hand delivery, mail, telex, overnight courier or facsimile transmission
c/o Wells Fargo Securities, LLC, 301 South College Street, Charlotte, North Carolina 28288-0604, Attention: Jeff Gore. 
 (b) if
to the Inergy Parties, shall be delivered or sent by mail, telex, overnight courier or facsimile transmission to Inergy, L.P., Two Brush Creek Boulevard, Kansas City, Missouri 64112, facsimile number (816) 471-3854, with a copy to Laura
Ozenberger, General Counsel, Two Brush Creek Boulevard, Kansas City, Missouri 64112, facsimile number (816) 531-4680; 
  

 26 

 provided, however, that any notice to an Initial Purchaser pursuant to
Section 8(c) shall be delivered or sent by hand delivery, mail, telex or facsimile transmission to such Initial Purchaser at its address set forth in its acceptance telex, overnight courier to Wells Fargo Securities, LLC, which address will be
supplied to any other party hereto by Wells Fargo Securities, LLC upon request. Any such statements, requests, notices or agreements shall take effect at the time delivered by hand, if personally delivered; two business days after being deposited in
the mail, postage prepaid, if mailed; when answered back, if telexed; when receipt is acknowledged, if telecopied; and on the next business day, if timely delivered to an air courier guaranteeing overnight delivery. The Issuers shall be entitled to
act and rely upon any request, consent, notice or agreement given or made on behalf of the Initial Purchasers by Wells Fargo Securities, LLC. 

15. Persons Entitled to Benefit of Agreement. This Agreement shall inure to the benefit of and be binding upon the Initial
Purchasers, the Inergy Parties and their respective successors. This Agreement and the terms and provisions hereof are for the sole benefit of only those persons, except that (A) the representations, warranties, indemnities and agreements of
the Inergy Parties contained in this Agreement shall also be deemed to be for the benefit of directors of the Initial Purchasers, officers of the Initial Purchasers and any person or persons controlling any Initial Purchaser within the meaning of
Section 15 of the Act and (B) the indemnity agreement of the Initial Purchasers contained in Section 8(b) of this Agreement shall be deemed to be for the benefit of directors of the Inergy Parties, officers of the Inergy Parties and
any person controlling the Inergy Parties within the meaning of Section 15 of the Act. Nothing in this Agreement is intended or shall be construed to give any person, other than the persons referred to in this Section 15, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any provision contained herein. 
 16. Research
Independence. In addition, the Partnership acknowledges that the Initial Purchasers’ research analysts and research departments are required to be independent from their respective investment banking divisions and are subject to certain
regulations and internal policies, and that such Initial Purchasers’ research analysts may hold and make statements or investment recommendations and/or publish research reports with respect to the Partnership and/or the offering that differ
from the views of its investment bankers. The Partnership hereby waives and releases, to the fullest extent permitted by law, any claims that the Partnership may have against the Initial Purchasers with respect to any conflict of interest that may
arise from the fact that the views expressed by their independent research analysts and research departments may be different from or inconsistent with the views or advice communicated to the Partnership by such Initial Purchasers’ investment
banking divisions. The Partnership acknowledges that each of the Initial Purchasers is a full service securities firm and as such from time to time, subject to applicable securities laws, may effect transactions for its own account or the account of
its customers and hold long or short positions in debt or equity securities of the companies which may be the subject of the transactions contemplated by this Agreement. 

17. No fiduciary duty. Notwithstanding any preexisting relationship, advisory or otherwise, between the parties or any oral
representations or assurances previously or subsequently made by the Initial Purchasers, each of the Inergy Parties acknowledges and agrees that: (i) nothing herein shall create a fiduciary or agency relationship between any of the Inergy
Parties, on the one hand, and the Initial Purchasers, on the other; (ii) the Initial Purchasers are not 
  

 27 

 
acting as advisors, expert or otherwise, to any of the Inergy Parties in connection with this offering, the sale of the Notes or any other services the Initial Purchasers may be deemed to be
providing hereunder, including, without limitation, with respect to the public offering price of the Notes; (iii) the relationship between the Inergy Parties, on the one hand, and the Initial Purchasers, on the other, is entirely and solely
commercial, based on arms-length negotiations; (iv) any duties and obligations that the Initial Purchasers may have to any of the Inergy Parties shall be limited to those duties and obligations specifically stated herein; and
(v) notwithstanding anything in this Agreement to the contrary, the Inergy Parties acknowledge that the Initial Purchasers’ may have financial interest in the success of the offering that are not limited to the difference between the price
to the public and the purchase price paid to the Inergy Parties by the Initial Purchasers for the Notes and the Initial Purchasers have no obligation to disclose, or account to the Inergy Parties for, any of such additional financial interests. Each
of the Inergy Parties hereby waives and releases, to the fullest extent permitted by law, any claims that any of the Inergy Parties may have against the Initial Purchasers with respect to any breach or alleged breach of fiduciary duty with respect
to the transactions contemplated by this Agreement. 
 18. Survival. The respective indemnities, representations,
warranties and agreements of the Inergy Parties and the Initial Purchasers contained in this Agreement or made by or on behalf on them, respectively, pursuant to this Agreement, shall survive the delivery of and payment for the Notes and shall
remain in full force and effect, regardless of any investigation made by or on behalf of any of them or any person controlling any of them. 

19. Definition of the Terms “Business Day” and “Subsidiary.” For purposes of this Agreement,
(a) “business day” means any day on which the New York Stock Exchange, Inc. is open for trading and (b) “subsidiary” has the meaning set forth in Rule 405 of the Rules and Regulations. 

20. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of New York. 

21. Counterparts. This Agreement may be executed in one or more counterparts and, if executed in more than one counterpart, the
executed counterparts shall each be deemed to be an original but all such counterparts shall together constitute one and the same instrument. 

22. Headings. The headings herein are inserted for convenience of reference only and are not intended to be part of, or to affect
the meaning or interpretation of, this Agreement. 
  

 28 

 If the foregoing correctly sets forth the agreement among the Inergy Parties and the Initial
Purchasers, please indicate your acceptance in the space provided for that purpose below. 
  

			
	Very truly yours,
	
	INERGY, L.P.
	
	By: Inergy GP, LLC (its Managing General Partner)
		
	By:	 	 /s/ R. Brooks Sherman, Jr.

	Name:	 	R. Brooks Sherman, Jr.
	Title:	 	Executive Vice President and
		 	Chief Financial Officer
	
	INERGY FINANCE CORP.
		
	By:	 	 /s/ R. Brooks Sherman, Jr.

	Name:	 	R. Brooks Sherman, Jr.
	Title:	 	Executive Vice President and
		 	Chief Financial Officer
	
	INERGY PROPANE, LLC
	INERGY MIDSTREAM, LLC
	L & L TRANSPORTATION, LLC
	INERGY TRANSPORTATION, LLC
	FINGER LAKES LPG STORAGE, LLC
	INERGY GAS MARKETING, LLC
	INERGY STORAGE, INC
	STELLAR PROPANE SERVICE, LLC
	 CENTRAL NEW YORK OIL AND GAS COMPANY, L.L.C.

	INERGY SALES & SERVICE, INC.
	ARLINGTON STORAGE COMPANY, LLC
	US SALT, LLC
	LIBERTY PROPANE GP, LLC
	 LIBERTY PROPANE, LP, by Liberty Propane GP, LLC, its general partner

	LIBERTY PROPANE OPERATIONS, LLC
	INERGY PIPELINE EAST, LLC
		
	By:	 	 /s/ R. Brooks Sherman, Jr.

	Name:	 	R. Brooks Sherman, Jr.
	Title:	 	Executive Vice President and
		 	Chief Financial Officer

  

 29 

			
	Accepted:
	
	WELLS FARGO SECURITIES, LLC
	BARCLAYS CAPITAL INC.
	J.P. MORGAN SECURITIES LLC
	BANC OF AMERICA SECURITIES LLC
	CREDIT SUISSE SECURITIES (USA) LLC
	CITIGROUP GLOBAL MARKETS INC.
	MORGAN STANLEY & CO. INCORPORATED
	SUNTRUST ROBINSON HUMPHREY, INC.
		
	By:	 	WELLS FARGO SECURITIES, LLC
		 	as Authorized Representative
		
	By:	 	 /s/ Jeff Gore

	Name:	 	Jeff Gore
	Title:	 	Managing Director

  

 30 

 SCHEDULE I 

 

				
	 Initial Purchasers
	  	Principal
Amount of
Notes
to
be
Purchased
	 Wells Fargo Securities, LLC
	  	$	171,600,000
	 Barclays Capital Inc
	  	$	109,200,000
	 J.P. Morgan Securities LLC
	  	$	109,200,000
	 Bank of America Securities LLC
	  	$	66,000,000
	 Credit Suisse Securities (USA) LLC
	  	$	66,000,000
	 Citigroup Global Markets Inc
	  	$	30,000,000
	 Morgan Stanley & Co. Incorporated
	  	$	30,000,000
	 Suntrust Robinson Humphrey, Inc
	  	$	18,000,000
		  	 	 
	 Total
	  	$	600,000,000
		  	 	 

 SCHEDULE II 

Inergy, L.P. Subsidiaries 
  

	1.	Inergy Propane, LLC, a Delaware limited liability company 

  

	2.	Inergy Finance Corp., a Delaware corporation 

  

	3.	Inergy Midstream, LLC, a Delaware limited liability company 

  

	4.	L & L Transportation, LLC, a Delaware limited liability company 

  

	5.	Inergy Transportation, LLC, a Delaware limited liability company 

  

	6.	Inergy Sales & Service, Inc., a Delaware corporation 

  

	7.	Inergy Canada Company, a Nova Scotia unlimited company 

  

	8.	 Stellar Propane Service,
LLC, a Delaware limited liability company

  

	9.	Liberty Propane, L.P., a Delaware limited partnership 

  

	10.	Liberty Propane GP, LLC, a Delaware limited liability company 

  

	11.	Liberty Propane Operations, LLC, a Delaware limited liability company 

  

	12.	Inergy Gas Marketing, LLC, a Delaware limited liability company 

  

	13.	US Salt, LLC, a Delaware limited liability company 

  

	14.	Inergy Storage, Inc., a Delaware corporation 

  

	15.	Finger Lakes LPG Storage, LLC, a Delaware limited liability company 

  

	16.	Central New York Oil And Gas Company, L.L.C., a New York limited liability company 

 

	17.	Arlington Storage Company, LLC, a Delaware limited liability company 

  

	18.	Inergy Pipeline East, LLC, a Delaware limited liability company 

  

	19.	Steuben Gas Storage Company, a New York general partnership 

  

	20.	Arlington Associates Limited Partnership, a Massachusetts limited partnership 

 

	21.	Inergy ASC, LLC, a Delaware limited liability company 

  

	22.	Escondido Gas Storage, LLC, a Texas limited liability company (75% ownership interest) 

 Exhibit A 

Pricing Disclosure Supplement 

[See Attached] 

 Exhibit B 

Form of Registration Rights Agreement 

[See Attached] 

 Exhibit C 

Vinson & Elkins Opinion 

Vinson & Elkins L.L.P. shall have furnished to the Initial Purchasers its written opinion, as counsel to the Issuers and the
Guarantors, addressed to the Initial Purchasers and dated the Closing Date, in form and substance reasonably satisfactory to Wells Fargo Securities, LLC, to the effect that: 

(i) Each of the Issuers and the Operating Company, Midstream, Service Sub, L & L Transportation, Inergy Transportation,
Inergy Gas, Stellar Propane, Finger Lakes, Storage, CNYOGC, Arlington Storage and each of the General Partners has been duly formed and is validly existing in good standing under its jurisdiction of formation with all necessary limited liability
company or partnership power and authority to own or lease its properties and to conduct its business, in all material respects as described in the Offering Memorandum. Each of US Salt, Liberty, Liberty GP, Liberty Operations and Inergy East are
validly existing and in good standing under the laws of the State of Delaware with all necessary power and authority to own or lease its properties and to conduct its business, in all material respects as described in the Offering Memorandum. Each
of the Inergy Parties and the General Partners is duly registered or qualified as a foreign entity for the transaction of business under the laws of the jurisdictions set forth on an exhibit to such counsel’s opinion. 

(ii) The General Partners are the only general partners of the Partnership. The Non-Managing General Partner owns of record an
approximate 0.6% general partner interest in the Partnership and the Managing General Partner owns of record a non-economic, managing general partner interest in the Partnership; such general partner interests have been duly authorized and validly
issued in accordance with the Partnership Agreement; and except as described in the Partnership Agreement or the Offering Memorandum, each General Partner owns its general partner interest free and clear of all liens, encumbrances, security
interests, charges or claims (A) in respect of which a financing statement under the Uniform Commercial Code of the State of Delaware naming either of such General Partners as debtors is on file in the office of the Secretary of State of the
State of Delaware or (B) otherwise known to such counsel, without independent investigation, other than those created by or arising under the Delaware LP Act or those created by the Credit Agreement. 

(iii) The Partnership owns, directly or indirectly, 100% of the issued shares of capital stock, membership interests or limited partner
interests, as applicable, in each of Finance Corp and the Guarantors; such shares of capital stock, membership interests or limited partner interests have been duly authorized and validly issued in accordance with the Organizational Documents
governing such entity and are fully paid and non-assessable (except (i) in the case of an interest in a Delaware limited liability company, as such nonassessability may be affected by Sections 18-607 and 18-804 of the Delaware LLC Act, and
(ii) in the case of an interest in a limited liability company formed under the laws of another domestic state, as such nonassessability may be affected by similar provisions of such state’s limited liability company statute, as
applicable) and except as described in the Organizational Documents, the Partnership owns such shares of capital stock, membership interests or limited partner interests free and clear of all liens, encumbrances, security interests, charges or
claims (A) in respect of 
  

 C-1 

 
which a financing statement under the Uniform Commercial Code of the State of Delaware naming the Partnership as debtor is on file in the office of the Secretary of State of the State of
Delaware, (B) arising under the Credit Agreement or (C) otherwise known to such counsel, without independent investigation, other than those created by or arising under the Delaware LLC Act and the New York Limited Liability Company Law.

 (iv) To our knowledge, there are no contracts, agreements or understandings between either of the Issuers, or any Guarantor
and any person granting such person the right (other than rights that have been waived or satisfied) to require the Issuers or any Guarantor to file a registration statement under the Act with respect to any securities of the Issuers or any
Guarantor (other than the Registration Rights Agreement) owned or to be owned by such person, and which are substantially similar to the Notes, the Guarantees, or the Exchange Notes, or to require either of the Issuers or any Guarantor to include
any other securities in the securities registered pursuant to the Registration Rights Agreement. 
 (v) This Agreement has been
duly executed and delivered by each of the Issuers and the Guarantors. 
 (vi) The Partnership Agreement and each of the
limited liability company agreements (except in the case of CNYOGC, the operating agreement) of the Guarantors has been duly authorized and validly executed and delivered by the parties thereto. Each of the foregoing agreements constitutes a valid
and legally binding agreement of the parties thereto, enforceable against such entity in accordance with its respective terms, subject to (A) applicable bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and other similar
laws relating to or affecting creditors’ rights generally and by general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law) and (B) public policy, applicable law relating to
fiduciary duties and indemnification and an implied covenant of good faith and fair dealing. 
 (vii) The Issuers have all
requisite corporate or partnership power and authority to issue, sell and deliver the Notes. The Notes have been duly authorized by the Issuers and, when duly executed by the Issuers in accordance with the terms of the Indenture, assuming due
authentication of the Notes by the Trustee, upon delivery to the Initial Purchasers against payment therefor in accordance with the terms hereof, will be validly issued and delivered, and will constitute valid and binding obligations of the Issuers
entitled to the benefits of the Indenture, enforceable against the Issuers in accordance with their terms, except as such enforceability may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium, and other similar
laws relating to or affecting creditors’ rights generally and by general equitable principles (regardless of whether such enforceability is considered in a proceeding in equity or at law) and by an implied covenant of good faith and fair
dealing. 
 (viii) The Exchange Notes have been duly and validly authorized by the Issuers and if and when duly issued and
authenticated in accordance with the terms of the Indenture and delivered in accordance with the Exchange Offer provided for in the Registration Rights Agreement, will constitute valid and binding obligations of the Issuers entitled to the benefits
of the Indenture, enforceable against the Issuers in accordance with their terms, except as such enforceability may be limited by bankruptcy, insolvency, fraudulent transfer, 

 

 C-2 

 
reorganization, moratorium, and other similar laws relating to or affecting creditors’ rights generally and by general equitable principles (regardless of whether such enforceability is
considered in a proceeding in equity or at law) and by an implied covenant of good faith and fair dealing. 
 (ix) The
Guarantee of each of the Guarantors has been duly authorized by that Guarantor and, when the Notes have been duly executed by the Issuers and authenticated by the Trustee in accordance with the terms of the Indenture and delivered and paid for by
the Initial Purchasers in accordance with the terms of the Purchase Agreement, the Guarantee of each Guarantor will constitute the valid and binding obligations of that Guarantor, enforceable against that Guarantor in accordance with their terms
except as such enforceability may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium, and other laws relating to or affecting creditors’ rights generally and by general equitable principles (regardless of
whether such enforceability is considered in a proceeding in equity or at law) and by an implied covenant of good faith and fair dealing. 

(x) The Exchange Guarantee of each of the Guarantors has been duly and validly authorized by that Guarantor and, upon the due execution
and authentication of the Exchange Notes in accordance with the Indenture and the issuance and delivery of the Exchange Notes in the Exchange Offer contemplated by the Registration Rights Agreement, will constitute valid and binding obligations of
the Guarantors, entitled to the benefits of the Indenture, enforceable against the Guarantors in accordance with their terms except as such enforceability may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium, and
other similar laws relating to or affecting creditors’ rights generally and by general equitable principles (regardless of whether such enforceability is considered in a proceeding in equity or at law) and by an implied covenant of good faith
and fair dealing. 
 (xi) The Indenture has been duly authorized, executed and delivered by each of the Issuers and the
Guarantors and, assuming the due authorization, execution and delivery thereof by the Trustee, is the legally valid and binding agreement of the Inergy Parties, enforceable against the Inergy Parties in accordance with its terms, except as such
enforceability may be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium, and other similar laws relating to or affecting creditors’ rights generally, by general equitable principles (regardless of whether such
enforceability is considered in a proceeding in equity or at law) and by an implied covenant of good faith and fair dealing; no qualification of the Indenture under the 1939 Act is required in connection with the offer, issuance and sale of the
Notes or in connection with the Exempt Resales. The Indenture conforms in all material respects to the requirements of the 1939 Act and the rules and regulations of the Commission applicable to an indenture that is qualified thereunder. 

(xii) The Registration Rights Agreement has been duly authorized, executed and delivered by the Issuers and the Guarantors and, assuming
the due execution and delivery thereof by the Initial Purchasers, is the legally valid and binding agreement of the Inergy Parties, enforceable against the Inergy Parties in accordance with its terms, except as such enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium and other similar laws relating to or affecting creditor’s rights generally, by general equitable principles (regardless of whether such enforceability is considered in a proceeding in equity
or at law), by an implied covenant of good faith and fair dealing and, as to rights of indemnification and contribution thereunder may be limited by federal or state law or by principles of public policy. 

 

 C-3 

 (xiii) The statements set forth in the Offering Memorandum under the captions
“Description of Notes,” insofar as they purport to constitute a summary of the terms of the Notes, Indenture, the Guarantees and the Registration Rights Agreement and under the captions “Description of Other Indebtedness—Senior
Notes,” and “Certain United States Federal Tax Considerations” insofar as they purport to describe the provisions of the laws and documents referred to therein, are accurate in all material respects. Treasury Department Circular 230
Notice—This document was not intended or written to be used, and cannot be used, by any person, for the purpose of (i) avoiding penalties that may be imposed on that person or (ii) to promote, market or recommend any transaction or
matter addressed herein. 
 (xiv) None of the offering, issuance and sale of the Notes and the Guarantees by the Issuers and
the Guarantors, the execution, delivery and performance of the Notes, the Guarantees, the Exchange Notes, the Indenture, the Registration Rights Agreement, the Exchange Guarantees and this Agreement by the Inergy Parties, or the consummation by each
of them of the transactions contemplated hereby and thereby (A) constitutes or will constitute a violation of their respective Organizational Documents, (B) constitutes or will constitute a breach or violation of, or a default (or an event
which, with notice or lapse of time or both, would constitute such a default) under, any agreement filed or incorporated by reference as an exhibit to the Partnership’s annual report on Form 10-K for the year ended September 30, 2009, the
Partnership’s quarterly report on Form 10-Q for the period ended December 31, 2009, the Partnership’s quarterly report on Form 10-Q for the period ended March 31, 2010, the Partnership’s quarterly report on Form 10-Q for the
period ended June 30, 2010 or to the current reports of the Partnership on Form 8-K incorporated by reference in the Offering Memorandum (excluding the Organizational Documents); (C) violates or will violate the Delaware LP Act, the
Delaware LLC Act, the DGCL, the laws of the State of New York or, assuming the accuracy of the representations and warranties of the Initial Purchasers contained in this Agreement and their compliance with their agreements set forth herein, federal
law (provided, however, that such counsel need express no opinion with respect to compliance with any state securities or federal or state antifraud law except as otherwise specifically stated in the opinion of such counsel), or (D) to our
knowledge, results or will result in the creation or imposition of any lien, charge or encumbrance upon any property or assets of any of the Inergy Parties, which breaches, violations, defaults or liens, in the case of clauses (B), (C) or
(D) would, individually or in the aggregate, have a Material Adverse Effect. 
 (xv) No registration under the Act of the
Notes is required for the sale of the Notes to the Initial Purchasers as contemplated hereby or for the Exempt Resales, assuming (i) the accuracy of the Initial Purchasers’ representations in this Agreement and (ii) the accuracy of
the Inergy Parties’ representations contained herein. 
 (xvi) None of the Inergy Parties is now, and after the sale of
the Notes to be sold by the Issuers hereunder, the issuance of the Guarantees and the application of the net proceeds from such sale as described in the Offering Memorandum under the caption “Use of Proceeds,” none of the Inergy Parties
will be an “investment company” as such term is defined in the Investment Company Act of 1940, as amended. 
  

 C-4 

 Such counsel shall also have furnished to the Initial Purchasers a written statement,
addressed to the Initial Purchasers and dated the Closing Date, in form and substance satisfactory to the Initial Purchasers, to the effect that such counsel has participated in conferences with officers and other representatives of the Issuers and
Guarantors and the independent registered public accounting firm of the Partnership and your representatives, at which the contents of the Offering Memorandum and related matters were discussed, and although such counsel has not independently
verified, is not passing on, and is not assuming any responsibility for the accuracy, completeness or fairness of the statements contained in or incorporated by reference in, the Offering Memorandum (except to the extent specified in the foregoing
opinion), based on the foregoing, nothing has come to the attention of such counsel that causes it to believe that: 
 (a) the
Final Offering Memorandum, as of its date and as of the Closing Date, contained or contains any untrue statement of a material fact or omitted or omits to state any material fact required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they were made, not misleading; or 
 (b) the Preliminary
Offering Memorandum and the Pricing Disclosure Supplement, as of the Applicable Time, contained any untrue statement of a material fact or omitted to state any material fact required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not misleading; 
 in each case other than (1) the
financial statements included or incorporated by reference therein, including the notes and schedules thereto and the auditors’ reports thereon, and (2) the other financial and accounting data included or incorporated by reference therein,
as to which such counsel need express no belief. 
 In rendering such opinion, such counsel may (A) rely, to the extent
such counsel deems proper, in respect of matters of fact upon representations of the Inergy Parties set forth in this Agreement and upon certificates of officers and employees of the Issuers and Guarantors and upon information obtained from public
officials, (B) assume that all documents submitted to them as originals are authentic, that all copies submitted to them conform to the originals thereof, and that the signatures on all documents examined by them are genuine, (C) state
that their opinion is limited to federal laws, the Delaware LP Act, the Delaware LLC Act, and the DGCL and the laws of the State of New York, (D) with respect to the opinions expressed in subparagraphs (i) through (vi) above as to the
due qualification or registration as a foreign limited partnership, corporation or limited liability company, as the case may be, state that such opinions are based upon certificates of foreign qualification or registration provided by the Secretary
of State of the States listed on an exhibit to such opinion (each of which shall be dated as of a date not more than fourteen days prior to the Closing Date and shall be provided to you), and (E) state that they express no opinion with respect
to (i) any permits to own or operate any real or personal property or (ii) state or local taxes or tax statutes to which any of the limited partners of the Partnership or any of the other Inergy Parties may be subject. 

 

 C-5 

 Exhibit D 

Laura Ozenberger Opinion 

Laura Ozenberger shall have furnished to the Initial Purchasers her written opinion, addressed to the Initial Purchasers and dated the
Closing Date, in form and substance reasonably satisfactory to Wells Fargo Securities, LLC, to the effect that: 
 (i) None of
the offering, issuance and sale of the Notes and the Guarantees by the Issuers and the Guarantors, respectively, the execution, delivery and performance of the Notes, the Guarantees, the Exchange Notes, the Exchange Guarantees, the Indenture, the
Registration Rights Agreement and this Agreement by the Issuers and the Guarantors, or the consummation by each of them of the transactions contemplated hereby (A) constitutes or will constitute a breach or violation of, or a default (or an
event which, with notice or lapse of time or both, would constitute such a default) under, any agreement, lease or instrument known to her (excluding the Credit Agreement or any Organizational Document and any other agreement filed or incorporated
by reference as an exhibit to the Partnership’s annual report on Form 10-K for the year ended September 30, 2009, the Partnership’s quarterly report on Form 10-Q for the period ended December 31, 2009, the Partnership’s
quarterly report on Form 10-Q for the period ended March 31, 2010, the Partnership’s quarterly report on Form 10-Q for the period ended June 30, 2010 or to the current reports of the Partnership on Form 8-K incorporated by reference
in the Offering Memorandum, as to which such counsel need not express an opinion) to which any of the Inergy Parties or any of their properties may be bound, or (B) will result, to my knowledge, in any violation of any federal or Missouri
judgment, order, decree, rule or regulation of any court or arbitrator or governmental agency having jurisdiction over the Inergy Parties or any of their assets or properties (such opinion with respect to federal law assumes the accuracy of the
representations and warranties of the Initial Purchasers contained in the Agreement and their compliance with their agreements set forth therein) (provided, however, that such counsel need express no opinion with respect to compliance with any state
securities or federal or state antifraud law except as otherwise specifically stated in the opinion of such counsel), which breaches, violations, defaults or liens, in the case of clauses (A), or (B) would, individually or in the aggregate,
have a Material Adverse Effect. 
 (ii) Except as described in the Offering Memorandum, to my knowledge there is no litigation,
proceeding or governmental investigation pending or threatened against any of the Inergy Parties or to which any of the Inergy Parties is a party or to which any of their respective properties is subject, which, if adversely determined to such
Inergy Parties, is reasonably likely to have a Material Adverse Effect. 
 Such counsel shall also have furnished to the Initial
Purchasers a written statement, addressed to the Initial Purchasers and dated the Closing Date, in form and substance satisfactory to the Initial Purchasers, to the effect that such counsel has participated in conferences with officers and other
representatives of the Issuers and Guarantors and the independent registered public accounting firm of the Partnership and your representatives, at which the contents of the Offering Memorandum and related matters were discussed, and although such
counsel has not independently verified, is not passing on, and is not assuming any responsibility for the accuracy, completeness or fairness of the statements contained in, the Offering Memorandum, based on the foregoing, nothing has come to the
attention of such counsel that causes her to believe that: 
 (a) the Final Offering Memorandum, as of its date and as of the
Closing Date, contained or contains any untrue statement of a material fact or omitted or omits to state any material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under
which they were made, not misleading; or 
  

 D-1 

 (b) the Preliminary Offering Memorandum and the Pricing Disclosure Supplement, as of the
Applicable Time, contained any untrue statement of a material fact or omitted to state any material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were
made, not misleading; 
 in each case other than (1) the financial statements included or incorporated by reference
therein, including the notes and schedules thereto and the auditors’ reports thereon, and (2) the other financial and accounting data included or incorporated by reference therein, as to which such counsel need express no belief.

 In rendering such opinion, such counsel may (A) rely in respect of matters of fact upon representations of the Inergy
Parties set forth in this Agreement and upon certificates of officers and employees of the Inergy Parties and upon information obtained from public officials, (B) assume that all documents submitted to her as originals are authentic, that all
copies submitted to her conform to the originals thereof, and that the signatures on all documents examined by her are genuine, (C) state that her opinion is limited to the laws of the state of Missouri, and (D) state that she expresses no
opinion with respect to state or local taxes or tax statutes to which any of the limited partners of the Partnership or any of the other Inergy Parties may be subject. 
  

 D-2 

 Exhibit E 

Joinder Agreement 

WELLS FARGO SECURITIES, LLC 

BARCLAYS CAPITAL INC. 

J.P. MORGAN SECURITIES LLC 

BANC OF AMERICA SECURITIES LLC 

CREDIT SUISSE SECURITIES (USA) LLC 

CITIGROUP GLOBAL MARKETS INC. 

MORGAN STANLEY & CO. INCORPORATED 

SUNTRUST ROBINSON HUMPHREY, INC. 

c/o Wells Fargo Securities, LLC 
 301 South
College Street 
 Charlotte, North Carolina 28288 

Ladies and Gentlemen: 

Reference is made to (i) the Purchase Agreement (the “Purchase Agreement”) dated September 13, 2010, initially
among Inergy, L.P., a Delaware limited partnership (the “Partnership”), Inergy Finance Corp., a Delaware corporation (“Finance Corp” and together with the Partnership, the “Issuers”), the Guarantors
named therein and you (the “Initial Purchasers”), concerning the purchase of the Notes (as defined in the Purchase Agreement) from the Issuers by the Initial Purchasers, and (ii) the Registration Rights Agreement (the
“Registration Rights Agreement”) dated as of the Closing Date among the same parties relating to an exchange offer to be made for the Notes. Capitalized terms used herein but not defined herein shall have the meanings assigned to
such terms in the Purchase Agreement. 
 The undersigned Guarantors agree that this letter agreement is being executed and
delivered in connection with the issue and sale of the Offered Securities pursuant to the Purchase Agreement and as required by Section 2 of the Purchase Agreement, and is being executed concurrently with the consummation of the transactions
contemplated by the Tres Palacios Purchase Agreement and as a condition to the release to the Company of the funds in the Escrow Account. 
  

	 	(i)	Joinder. The undersigned Guarantors hereby agree to be bound by the terms, conditions and other provisions of each of the Purchase Agreement and the Registration
Rights Agreement, including, without limitation, the indemnity and contribution provisions contained in Section 8 of the Purchase Agreement and in Section 5 of the Registration Rights Agreement, with all attendant rights, duties and
obligations stated therein, on a joint and several basis with the parties hereto and thereto, with the same force and effect as if originally named as a Guarantor therein and as if such Guarantor had executed the Purchase Agreement and the
Registration Rights Agreement on the respective dates thereof. 

  

 E-1 

	 	(ii)	Representations, etc. Each of the undersigned Guarantors has all requisite limited liability company power and authority to execute and deliver this Agreement,
and all limited liability company action required to be taken by it for the due and proper authorization, execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby has been duly and validly
taken; and this Agreement has been duly executed and delivered by each of the undersigned Guarantors and is enforceable against such Guarantor in accordance with its terms, except as such enforceability may be limited by bankruptcy, fraudulent
conveyance, insolvency, reorganization, moratorium, and other laws relating to or affecting creditors’ rights generally and by general equitable principles (regardless whether such enforceability is considered in a proceeding in equity or at
law). 

  

	 	(iii)	GOVERNING LAW. THIS LETTER AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. 

 

	 	(iv)	Counterparts. This letter agreement may be signed in counterparts (which may include counterparts delivered by any standard form of telecommunication), each of
which shall be an original and all of which together shall constitute one and the same instrument. 

  

	 	(v)	Amendments. No amendment or waiver of any provision of this Agreement, nor any consent or approval to any departure therefrom, shall in any event be effective
unless the same shall be in writing and signed by the parties hereto. 

  

	 	(vi)	Headings. The headings herein are included for convenience of reference only and are not intended to be part of, or to affect the meaning or interpretation of,
this Agreement. 

 [signature page follows] 

 

 E-2 

 If the foregoing is in accordance with your understanding of our agreement, please indicate
your acceptance of this letter agreement by signing in the space provided below, whereupon this letter agreement will become a binding agreement between the Guarantors and the several Initial Purchasers in accordance with its terms. 

 

			
	GUARANTORS:
	
	TRES PALACIOS GAS STORAGE LLC
		
	By:	 	  

		 	Name:
		 	Title:
	
	TP GAS LESSOR LLC
		
	By:	 	  

		 	Name:
		 	Title:

  

 E-3Convertible Note Hedge Transaction Confirmation, dated September 14, 2010

 Exhibit 10.4 

 

			
	EXECUTION VERSION	  	

 JPMorgan Chase Bank, National Association 

P.O. Box 161 
 60 Victoria Embankment 

London EC4Y 0JP 
 England 

September 14, 2010 
  

					
	To:	  	Volcano Corporation
		  	3661 Valley Centre Drive, Suite 200
		  	San Diego, California 92130
		  	Attention:	  	John Dahldorf
		  	Telephone No.:	  	(858) 720-4112
		  	Facsimile No.:	  	(858) 720-0383
		
	Re:	  	Base Call Option Transaction

The purpose of this letter agreement (this “Confirmation”) is to confirm the terms and conditions of the call option
transaction entered into between JPMorgan Chase Bank, National Association, London Branch (“JPMorgan”) and Volcano Corporation (“Counterparty”) as of the Trade Date specified below (the
“Transaction”). This letter agreement constitutes a “Confirmation” as referred to in the ISDA Master Agreement specified below. This Confirmation shall replace any previous agreements and serve as the final documentation
for the Transaction. 
 The definitions and provisions contained in the 2002 ISDA Equity Derivatives Definitions (the
“Equity Definitions”), as published by the International Swaps and Derivatives Association, Inc. (“ISDA”) are incorporated into this Confirmation. In the event of any inconsistency between the Equity Definitions and
this Confirmation, this Confirmation shall govern. Certain defined terms used herein are based on terms that are defined in the Prospectus dated September 13, 2010, as supplemented by the Prospectus Supplement dated September 14, 2010 (as
so supplemented, the “Prospectus”) relating to the 2.875% Convertible Senior Notes due September 1, 2015 (the “Convertible Notes” and each USD 1,000 principal amount of Convertible Notes, a “Convertible
Note”) issued by Counterparty in an aggregate initial principal amount of USD 100 million (as increased by up to an aggregate principal amount of USD 15 million if and to the extent that the Underwriter (as defined herein)
exercises its option to purchase additional Convertible Notes pursuant to the Underwriting Agreement (as defined herein)) pursuant to an indenture to be dated September 20, 2010 between Counterparty and Wells Fargo Bank, National Association,
as trustee (the “Base Indenture”), as supplemented by a supplemental indenture thereto to be dated September 20, 2010 between Counterparty and Wells Fargo Bank, National Association, as trustee (such supplemental indenture, the
“Supplemental Indenture,” and the Base Indenture, as so supplemented, the “Indenture”). In the event of any inconsistency between the terms defined in the Prospectus, the Indenture and this Confirmation, this
Confirmation shall govern. The parties acknowledge that this Confirmation is entered into on the date hereof with the understanding that (i) definitions set forth in the Indenture which are also defined herein by reference to the Indenture and
(ii) sections of the Indenture that are referred to herein will conform to the descriptions thereof in the Prospectus. If any such definitions in the Indenture or any such sections of the Indenture differ from the descriptions thereof in the
Prospectus, the descriptions thereof in the Prospectus will govern for purposes of this Confirmation. The parties further acknowledge that the Indenture section numbers used herein are based on the draft of the Supplemental Indenture last reviewed
by JPMorgan as of the date of this Confirmation, and if any such section numbers are changed in the Supplemental Indenture as executed, the parties will amend this Confirmation in good faith to preserve the intent of the parties. Subject to the
foregoing, references to the Base Indenture or the Supplemental Indenture herein are references to the Base Indenture or the Supplemental Indenture, as the case may be, as in effect on the date hereof and on the date of its execution, respectively,
and if either the Base Indenture or the Supplemental Indenture is amended following such date, any such amendment will be disregarded for purposes of this Confirmation unless the parties agree otherwise in writing. 

JPMorgan Chase Bank, National Association 

Organised under the laws of the United States as a National Banking Association 

Main Office 1111 Polaris Parkway, Columbus, Ohio 43271 

Registered as a branch in England & Wales branch No. BR000746 

Registered Branch Office 125 London Wall, London EC2Y 5AJ 

Authorised and regulated by the Financial Services Authority 

 

 

  

 Each party is hereby advised, and each such party acknowledges, that the other party has
engaged in, or refrained from engaging in, substantial financial transactions and has taken other material actions in reliance upon the parties’ entry into the Transaction to which this Confirmation relates on the terms and conditions set forth
below. 
 1. This Confirmation evidences a complete and binding agreement between JPMorgan and Counterparty as to the terms of the Transaction
to which this Confirmation relates. This Confirmation shall supplement, form a part of, and be subject to an agreement in the form of the 2002 ISDA Master Agreement (the “Agreement”) as if JPMorgan and Counterparty had executed an
agreement in such form (but without any Schedule except for (i) the election of the laws of the State of New York as the governing law (without reference to choice of law doctrine), and (ii) the election that the provisions of
Section 5(a)(vi) of the Agreement shall apply to JPMorgan; provided that (a) the phrase “or becoming capable at such time of being declared” shall be deleted from clause (1) of such Section 5(a)(vi); (b) the
following language shall be added to the end thereof: “Notwithstanding the foregoing, a default under subsection (2) hereof shall not constitute an Event of Default if (i) the default was caused solely by error or omission of an
administrative or operational nature; (ii) funds were available to enable the party to make the payment when due; and (iii) the payment is made within two Local Business Days of such party’s receipt of written notice of its failure to
pay.”; (c) “Specified Indebtedness” will have the meaning specified in Section 14 of the Agreement, except that such term shall not include obligations in respect of deposits received in the ordinary course of a
party’s banking business; and (d) “Threshold Amount” means in relation to JPMorgan, three percent (3%) of shareholders’ equity of JPMorgan Chase & Co. (“Dealer Parent”)) on the Trade
Date. In the event of any inconsistency between provisions of the Agreement and this Confirmation, this Confirmation will prevail for the purpose of the Transaction to which this Confirmation relates. The parties hereby agree that no transaction
other than the Transaction to which this Confirmation relates shall be governed by the Agreement. 
  

			
	2. The terms of the particular Transaction to which this Confirmation relates are as follows:
		
	 General Terms.
	  	
		
	 Trade Date:
	  	September 14, 2010
		
	 Effective Date:
	  	The third Exchange Business Day immediately prior to the Premium Payment Date
		
	 Option Style:
	  	“Modified American”, as described under “Procedures for Exercise” below
		
	 Option Type:
	  	Call
		
	 Buyer:
	  	Counterparty
		
	 Seller:
	  	JPMorgan
		
	 Shares:
	  	The common stock of Counterparty, par value USD 0.001 per share (Exchange symbol “VOLC”).
		
	 Number of Options:
	  	100,000. For the avoidance of doubt, the Number of Options shall be reduced by any Options exercised by Counterparty. In no event will the Number of Options be less than zero.

		
	 Option Entitlement:
	  	33.7339
		
	 Strike Price:
	  	USD 29.6438
		
	 Premium:
	  	USD 23,579,100.00
		
	 Premium Payment Date:
	  	The closing date of the initial issuance of the Convertible Notes.
		
	 Exchange:
	  	The NASDAQ Global Select Market

  

 2 

 

 

  

			
	 Related Exchange(s):
	  	All Exchanges
		
	 Excluded Provisions:
	  	Sections 10.06 and 10.07 of the Supplemental Indenture.
		
	 Procedures for Exercise.
	  	
		
	 Conversion Date:
	  	With respect to any conversion of a Convertible Note, the date on which the Holder (as such term is defined in the Supplemental Indenture) of such Convertible Note satisfies all
of the requirements for conversion thereof as set forth in Section 10.02 of the Supplemental Indenture; provided that if Counterparty has elected to designate a financial institution to deliver the consideration due upon any conversion of a
Convertible Note in exchange for such Convertible Note (an “Exchange Election” ) pursuant to Section 10.10 of the Supplemental Indenture and such financial institution accepts such Convertible Note (an “Excluded Convertible
Note”), then in no event shall a Conversion Date be deemed to occur hereunder (and no Option shall be exercised or deemed to be exercised hereunder) with respect to such conversion, unless, subject to Counterparty’s obligation to
deliver to JPMorgan a Notice of Exercise in accordance with “Notice of Exercise” below, such financial institution informs Counterparty that it will not honor such exchange and Counterparty shall be obligated, pursuant to the Supplemental
Indenture, to deliver the amounts due upon conversion. For the avoidance of doubt, except as set forth in the preceding sentence, Counterparty will not provide JPMorgan with a Notice of Exercise with respect to any Excluded Convertible Notes, and
such Excluded Convertible Notes may subsequently trigger the exercise of Options hereunder if such Excluded Convertible Notes are resubmitted for conversion in accordance with the terms of the Supplemental Indenture (and are not subject to a
subsequent Exchange Election).
		
	 Free Convertibility Date:
	  	June 1, 2015
		
	 Expiration Time:
	  	The Valuation Time
		
	 Expiration Date:
	  	September 1, 2015, subject to earlier exercise.
		
	 Multiple Exercise:
	  	Applicable, as described under “Automatic Exercise” below.
		
	 Automatic Exercise:
	  	Notwithstanding Section 3.4 of the Equity Definitions, on each Conversion Date, a number of Options equal to the number of Convertible Notes in denominations of USD 1,000 as to
which such Conversion Date has occurred shall be deemed to be automatically exercised; provided that such Options shall be exercised or deemed exercised only if Counterparty has provided a Notice of Exercise to JPMorgan in accordance with
“Notice of Exercise” below.
		
		  	Notwithstanding the foregoing, in no event shall the number of Options that are exercised or deemed exercised hereunder exceed the Number of Options.

 

 3 

 

 

  

			
	 Notice of Exercise:
	  	Notwithstanding anything to the contrary in the Equity Definitions or under “Automatic Exercise” above, in order to exercise any Options, Counterparty must notify
JPMorgan in writing before (i) 5:00 p.m. (New York City time) on the Scheduled Valid Day immediately preceding the scheduled first day of the Settlement Averaging Period for the Options being exercised, or (ii) 5:00 p.m. (New York City time) on the
fifth Scheduled Valid Day immediately following the scheduled first day of the Settlement Averaging Period for the Options being exercised (in which case the Calculation Agent will determine the adjustment to be made to any one or more of the Strike
Price, Number of Options, Option Entitlement and any other variable relevant to the exercise, settlement or payment for the Transaction in a commercially reasonable manner as appropriate to reflect the additional costs (including, but not limited
to, hedging mismatches and market losses) and reasonable expenses incurred by JPMorgan in connection with its hedging activities (including the unwinding of any hedge position) due to such notification occurring after the time specified in the
immediately preceding clause (i)) of (A) the number of such Options (without regard to any adjustments by the Calculation Agent in accordance with the immediately preceding clause (ii)) and (B) the scheduled first day of the Settlement Averaging
Period and the scheduled Settlement Date; provided that, notwithstanding the immediately preceding clause (i), in respect of Options relating to Convertible Notes with a Conversion Date occurring on or after the Free Convertibility Date, such notice
may be given on or prior to the Scheduled Valid Day immediately preceding the Expiration Date and need only specify the number of such Options.
		
	 Valuation Time:
	  	At the close of trading of the regular trading session on the Exchange; provided that if the principal trading session is extended, the Calculation Agent shall determine
the Valuation Time in its reasonable discretion.
		
	 Market Disruption Event:
	  	Section 6.3(a) of the Equity Definitions is hereby replaced in its entirety by the following:
		
		  	“‘Market Disruption Event’ means, in respect of a Share, (i) a failure by the principal United States national or regional securities exchange or market on which
the Shares are listed or admitted for trading to open for trading during its regular trading session or (ii) the occurrence or existence prior to 1:00 p.m. (New York City time) on any Scheduled Valid Day for the Shares for more than a one half-hour
period in the aggregate during regular trading hours of any suspension or limitation imposed on trading (by reason of movements in price exceeding limits permitted by the relevant securities exchange or otherwise) in the Shares or in any options
contracts or futures contracts relating to the Shares.”

  

 4 

 

 

  

			
	 Settlement Terms.
	  	
		
	 Settlement Method:
	  	Net Share Settlement
		
	 Net Share Settlement:
	  	JPMorgan will deliver to Counterparty, on the relevant Settlement Date, a number of Shares equal to the Net Shares in respect of any Option exercised or deemed exercised
hereunder. In no event will the Net Shares be less than zero.
		
	 Net Shares:
	  	In respect of any Option exercised or deemed exercised, a number of Shares equal to (A) the sum of the quotients, for each Valid Day during the Settlement Averaging Period for
such Option, of (x) the Option Entitlement on such Valid Day multiplied by (y) the Relevant Price on such Valid Day less the Strike Price, divided by (z) such Relevant Price, divided by (B) the number of Valid Days in the
Settlement Averaging Period; provided that if the calculation contained in clause (y) above results in a negative number, such number shall be replaced with the number “zero”.
		
		  	JPMorgan will deliver cash in lieu of any fractional Shares to be delivered with respect to any Net Shares valued at the Relevant Price for the last Valid Day of the Settlement
Averaging Period.
		
	 Valid Day:
	  	A day on which (i) there is no Market Disruption Event and (ii) trading in the Shares generally occurs on the Exchange or, if the Shares are not then listed on the Exchange, on
the principal other United States national or regional securities exchange on which the Shares are then listed or, if the Shares are not then listed on a United States national or regional securities exchange, on the principal other market on which
the Shares are then listed or admitted for trading. If the Shares are not so listed or admitted for trading, “Valid Day” means a Business Day.
		
	 Scheduled Valid Day:
	  	A day that is scheduled to be a Valid Day on the principal United States national or regional securities exchange or market on which the Shares are listed or admitted for
trading. If the Shares are not so listed or admitted for trading, “Scheduled Valid Day” means a Business Day.
		
	 Business Day:
	  	Any day other than a Saturday, a Sunday or a day on which the Federal Reserve Bank of New York is authorized or required by law or executive order to close or be
closed.
		
	 Relevant Price:
	  	On any Valid Day, the per Share volume-weighted average price as displayed under the heading “Bloomberg VWAP” on Bloomberg page VOLC <equity> AQR (or any
successor thereto) in respect of the period from the scheduled opening of trading on the Exchange to the Scheduled Closing Time of the Exchange on such Valid Day (or if such volume-weighted average price is unavailable at such time, the market value
of one Share on such Valid Day, as determined by the Calculation Agent using a volume-weighted method.

  

 5 

 

 

  

			
	 Settlement Averaging Period:
	  	For any Option:
		
		  	 (i)     if the related Conversion Date occurs prior to the Free Convertibility Date, the 25
consecutive Valid Days commencing on, and including, the third Valid Day following such Conversion Date; or

		
		  	 (ii)    if the related Conversion Date occurs on or following the Free Convertibility Date, the 25
consecutive Valid Days commencing on, and including, the
27th Scheduled Valid Day (or the immediately following
Valid Day, if such Scheduled Valid Day is not a Valid Day) immediately prior to the Expiration Date.

		
	 Settlement Date:
	  	For any Option, the date Shares will be delivered under the terms of the Supplemental Indenture with respect to the Convertible Note related to such Option.
		
	 Settlement Currency:
	  	USD
		
	 Other Applicable Provisions:
	  	The provisions of Sections 9.1(c), 9.8, 9.9, 9.11, 9.12 and 10.5 of the Equity Definitions will be applicable, except that all references in such provisions to
“Physically-settled” shall be read as references to “Net Share Settled”. “Net Share Settled” in relation to any Option means that Net Share Settlement is applicable to that Option.
		
	 Representation and Agreement:
	  	Notwithstanding Section 9.11 of the Equity Definitions, the parties acknowledge that any Shares delivered to Counterparty shall be, upon delivery, subject to restrictions and
limitations arising from Counterparty’s status as issuer of the Shares under applicable securities laws.
	
	3. Additional Terms applicable to the Transaction.
		
	 Adjustments applicable to the Transaction:
	  	
		
	 Potential Adjustment Events:
	  	Notwithstanding Section 11.2(e) of the Equity Definitions, a “Potential Adjustment Event” means an occurrence of any event or condition, as set forth in any Dilution
Adjustment Provision, that would result in an adjustment to the Conversion Rate (as defined in the Supplemental Indenture) of the Convertible Notes.
		
	 Method of Adjustment:
	  	Calculation Agent Adjustment, which means that, notwithstanding Section 11.2(c) of the Equity Definitions, upon any Potential Adjustment Event, the Calculation Agent shall make
an adjustment to the terms relevant to the exercise, settlement or payment for the Transaction corresponding to the adjustments under the Supplemental Indenture; provided that, notwithstanding the foregoing, if the Calculation Agent in good faith
disagrees with any adjustment to the Convertible Notes that involves an exercise of discretion by Counterparty or its board of directors (including, without limitation, pursuant to Sections 10.05(h), (i) and (j) of the Supplemental Indenture or in
connection with any proportional adjustment or the determination of the fair value of any securities, property, rights or other assets) or constitutes a manifest error, then in each such case, the Calculation Agent will determine the adjustment to
be made to any one or more of the Strike Price, Number of Options, Option Entitlement and any other variable relevant to the exercise, settlement or payment for the Transaction in a commercially reasonable manner.

 

 6 

 

 

  

			
	 Dilution Adjustment Provisions:
	  	Sections 10.05(a), (b), (c), (d), (e), (h), (i), (j) and (l) of the Supplemental Indenture.
		
	 Extraordinary Events applicable to the Transaction:
	  	
		
	 Merger Events:
	  	Applicable; provided that notwithstanding Section 12.1(b) of the Equity Definitions, a “Merger Event” means the occurrence of any event or condition set forth in
the definition of “Merger Event” in Section 10.08 of the Supplemental Indenture.
		
	 Consequence of Merger Events:
	  	Notwithstanding Section 12.2 of the Equity Definitions, upon the occurrence of a Merger Event, the Calculation Agent shall make a corresponding adjustment in respect of any
adjustment under the Supplemental Indenture to any one or more of the nature of the Shares, Strike Price, Number of Options, Option Entitlement and any other variable relevant to the exercise, settlement or payment for the Transaction;
provided, however, that such adjustment shall be made without regard to any adjustment to the Conversion Rate pursuant to any Excluded Provision; provided further that if, with respect to a Merger Event, the consideration for
the Shares includes (or, at the option of a holder of Shares, may include) shares of an entity or person not organized under the laws of the United States, any State thereof or the District of Columbia, then Cancellation and Payment (Calculation
Agent Determination) shall apply.
		
	 Nationalization, Insolvency or Delisting:
	  	Cancellation and Payment (Calculation Agent Determination); provided that, in addition to the provisions of Section 12.6(a)(iii) of the Equity Definitions, it will also
constitute a Delisting if the Exchange is located in the United States and the Shares are not immediately re-listed, re-traded or re-quoted on any of the New York Stock Exchange, The NASDAQ Global Select Market or The NASDAQ Global Market (or their
respective successors); provided further that if the Shares are immediately re-listed, re-traded or re-quoted on any of the New York Stock Exchange, The NASDAQ Global Select Market or The NASDAQ Global Market (or their respective successors),
such exchange or quotation system shall thereafter be deemed to be the Exchange.
		
	 Additional Disruption Events:
	  	
		
	 Change in Law:
	  	Applicable; provided that Section 12.9(a)(ii) of the Equity Definitions shall be amended by inserting, at the end thereof, the words “after using commercially
reasonable efforts to avoid such increased cost” and Section 12.9(a)(ii)(X) of the Equity Definitions is hereby amended by replacing the word “Shares” with the phrase “Hedge Positions”.

 

 7 

 

 

  

			
	 Failure to Deliver:
	  	Applicable
		
	 Hedging Disruption:
	  	Applicable; provided that:
		
		  	 (i)     Section 12.9(a)(v) of the Equity Definitions is hereby amended by inserting the following two
phrases at the end of such Section:

		
		  	 “For the avoidance of doubt, the term “equity price risk” shall be deemed to include, but shall not be limited to, stock price and
volatility risk. And, for the further avoidance of doubt, any such transactions or assets referred to in phrases (A) or (B) above must be available on commercially reasonable pricing terms.”; and

		
		  	 (ii)    Section 12.9(b)(iii) of the Equity Definitions is hereby amended by inserting in the third line
thereof, after the words “to terminate the Transaction”, the words “or a portion of the Transaction affected by such Hedging Disruption”.

		
	 Increased Cost of Hedging:
	  	Not Applicable
		
	 Loss of Stock Borrow:
	  	Not Applicable
		
	 Increased Cost of Stock Borrow:
	  	Not Applicable
		
	 Hedging Party:
	  	For all applicable Additional Disruption Events, JPMorgan.
		
	 Determining Party:
	  	For all applicable Extraordinary Events, JPMorgan.
		
	 Non-Reliance:
	  	Applicable
		
	 Agreements and Acknowledgements Regarding Hedging Activities:
	  	Applicable
		
	 Additional Acknowledgments:
	  	Applicable
		
	4. Calculation Agent.	  	JPMorgan, whose judgments, determinations and calculations shall be made in good faith and in a commercially reasonable manner. Following any determination or calculation by the
Calculation Agent hereunder, upon a written request by Counterparty, the Calculation Agent will provide to Counterparty by e-mail to the e-mail address provided by Counterparty in such written request a report (in a commonly used file format for the
storage and manipulation of financial data) displaying in reasonable detail the basis for such calculation, it being understood that the Calculation Agent shall not be obligated to disclose any proprietary models used by it for such calculation.

  

 8 

 

 

  

			
	5. Account Details.	  	
		
	6. Offices.	  	
	
	 (a)      The Office of Counterparty for the Transaction is: Inapplicable, Counterparty
is not a Multibranch Party.

	
	 (b)      The Office of JPMorgan for the Transaction is: London

	
	 JPMorgan Chase Bank, National Association

	 London Branch

	 P.O. Box 161

	 60 Victoria Embankment

	 London EC4Y 0JP

	 England

		
	7. Notices.	  	
	
	
(a)      Address for notices or communications to Counterparty:

	
	 Volcano Corporation

	 3661 Valley Centre Drive, Suite 200

	 San Diego, California 92130

	 Attention:
	  	John Dahldorf
	 Telephone No.:
	  	(858) 720-4112
	 Facsimile No.:
	  	(858) 720-0383
	
	 (b)      Address for notices or communications to JPMorgan:

	
	 JPMorgan Chase Bank, National Association

	 4 New York Plaza, Floor 18

	 New York, NY 10004-2413

	 Attention:
	  	Mariusz Kwasnik
	 Title:
	  	Operations Analyst, EDG Corporate Marketing
	 Telephone No:
	  	(212) 623-7223
	 Facsimile No:
	  	(212) 623-7719

8. Representations and Warranties of Counterparty. 

Each of the representations and warranties of Counterparty set forth in Section 3 of the Underwriting Agreement (the “Underwriting
Agreement”), dated as of September 14, 2010, between Counterparty and J.P. Morgan Securities LLC (the “Underwriter”) as representative of the several Underwriters party thereto, are true and correct and are hereby deemed to be
repeated to JPMorgan as if set forth herein. In lieu of the representations and warranties set forth in Section 3(a) of the Agreement, Counterparty hereby further represents and warrants to JPMorgan on the date hereof and on and as of the Premium
Payment Date that: 
  

	 	(a)	Counterparty has all necessary corporate power and authority to execute, deliver and perform its obligations in respect of the Transaction; such execution, delivery and
performance have been duly authorized by all necessary corporate action on Counterparty’s part; and this Confirmation has been duly and validly executed and delivered by Counterparty and constitutes its valid and binding obligation, enforceable
against Counterparty in accordance with its terms, subject to applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and similar laws affecting creditors’ rights and remedies generally, and subject, as to
enforceability, to general principles of equity, including principles of commercial reasonableness, good faith and fair dealing (regardless of whether enforcement is sought in a proceeding at law or in equity) and except that rights to
indemnification and contribution hereunder may be limited by federal or state securities laws or public policy relating thereto. 

  

 9 

 

 

  

	 	(b)	Neither the execution and delivery of this Confirmation nor the incurrence or performance of obligations of Counterparty hereunder will conflict with or result in a
breach of (i) the certificate of incorporation or by-laws (or any equivalent documents) of Counterparty, (ii) any applicable law or regulation, or any order, writ, injunction or decree of any court or governmental authority or agency, or (iii) any
agreement or instrument filed as an exhibit to, or incorporated by reference therein, Counterparty’s Form 10-K filed on March 5, 2010, Counterparty’s Form 10-Q filed on May 7, 2010, Counterparty’s Form 10-Q filed on
August 5, 2010 or, solely with respect to any such agreement or instrument dated as of or prior to the date hereof or the Premium Payment Date, as the case may be, Counterparty’s Form 10-Q to be filed for the quarter ending
September 30, 2010, in each case, with the Securities and Exchange Commission, to which Counterparty or any of its subsidiaries is a party or by which Counterparty or any of its subsidiaries is bound or to which Counterparty or any of its
subsidiaries is subject, or constitute a default under, or result in the creation of any lien under, any such agreement or instrument. 

  

	 	(c)	To Counterparty’s knowledge, after due inquiry, no consent, approval, authorization, or order of, or filing with, any governmental agency or body or any court is
required in connection with the execution, delivery or performance by Counterparty of this Confirmation, except such as have been obtained or made and such as may be required under the Securities Act of 1933, as amended (the “Securities
Act”) or state securities laws. 

  

	 	(d)	Counterparty is not and will not be required to register as an “investment company” as such term is defined in the Investment Company Act of 1940, as amended.

  

	 	(e)	Counterparty is an “eligible contract participant” (as such term is defined in Section 1a(12) of the Commodity Exchange Act, as amended, other than a person
that is an eligible contract participant under Section 1a(12)(C) of the Commodity Exchange Act). 

  

	 	(f)	Counterparty is not, on the date hereof, aware of any material non-public information with respect to Counterparty or the Shares. 

9. Other Provisions. 
  

	 	(a)	Opinions. Counterparty shall deliver to JPMorgan an opinion of counsel, dated as of the Trade Date, with respect to the matters set forth in Sections 8(a)
through (c) of this Confirmation (subject to customary exceptions and qualifications). Delivery of such opinion to JPMorgan shall be a condition precedent for the purpose of Section 2(a)(iii) of the Agreement with respect to each obligation of
JPMorgan under Section 2(a)(i) of the Agreement. 

  

 10 

 

 

  

	 	(b)	Repurchase Notices. Counterparty shall, on any day on which Counterparty effects any repurchase of Shares, promptly give JPMorgan a written notice of such
repurchase (a “Repurchase Notice”) on such day if following such repurchase, the Notice Percentage as determined on such day is (i) greater than 8.1% or (ii) thereafter greater by 0.5% than the Notice Percentage included in the
immediately preceding Repurchase Notice; provided that Counterparty shall have publicly disclosed such information prior to the time of such Repurchase Notice if and to the extent that it would have constituted material non-public information in
respect of Counterparty, the Shares or otherwise. The “Notice Percentage” as of any day is the fraction, expressed as a percentage, the numerator of which is the sum of (x) the product of the Number of Options and the Option
Entitlement and (y) the aggregate number of Shares underlying any other call option transaction sold by JPMorgan to Counterparty and the denominator of which is the number of Shares outstanding on such day. Counterparty agrees to indemnify and hold
harmless JPMorgan and its affiliates and their respective officers, directors, employees, affiliates, advisors, agents and controlling persons (each, an “Indemnified Person”) from and against any and all losses (including losses
relating to JPMorgan’s hedging activities as a consequence of becoming, or of the risk of becoming, a Section 16 “insider”, including without limitation, any forbearance from hedging activities or cessation of hedging activities and
any losses in connection therewith with respect to the Transaction), claims, damages, judgments, liabilities and expenses (including reasonable attorney’s fees), joint or several, to which an Indemnified Person may become subject under
applicable securities laws (including, without limitation, Section 16 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as a result of Counterparty’s failure to provide JPMorgan with a Repurchase Notice
on the day and in the manner specified in this paragraph, and to reimburse, within 30 days, upon written request, each of such Indemnified Persons for any reasonable legal or other expenses incurred in connection with investigating, preparing for,
providing testimony or other evidence in connection with or defending any of the foregoing. If any suit, action, proceeding (including any governmental or regulatory investigation), claim or demand shall be brought or asserted against the
Indemnified Person as a result of Counterparty’s failure to provide JPMorgan with a Repurchase Notice in accordance with this paragraph, such Indemnified Person shall promptly notify Counterparty in writing, and Counterparty, upon request of
the Indemnified Person, shall retain counsel reasonably satisfactory to the Indemnified Person to represent the Indemnified Person and any others Counterparty may designate in such proceeding and shall pay the fees and expenses of such counsel
related to such proceeding. Counterparty shall not be liable for any settlement of any proceeding contemplated by this paragraph that is effected without its written consent, but if settled with such consent or if there be a final judgment for the
plaintiff, Counterparty agrees to indemnify any Indemnified Person from and against any loss or liability by reason of such settlement or judgment. Counterparty shall not, without the prior written consent of the Indemnified Person, effect any
settlement of any pending or threatened proceeding contemplated by this paragraph that is in respect of which any Indemnified Person is or could have been a party and indemnity could have been sought hereunder by such Indemnified Person, unless such
settlement includes an unconditional release of such Indemnified Person from all liability on claims that are the subject matter of such proceeding on terms reasonably satisfactory to such Indemnified Person. If the indemnification provided for in
this paragraph is unavailable to an Indemnified Person or insufficient in respect of any losses, claims, damages or liabilities referred to therein, then Counterparty hereunder, in lieu of indemnifying such Indemnified Person thereunder, shall
contribute to the amount paid or payable by such Indemnified Person as a result of such losses, claims, damages or liabilities. The remedies provided for in this paragraph (b) are not exclusive and shall not limit any rights or remedies which may
otherwise be available to any Indemnified Person at law or in equity. The indemnity and contribution agreements contained in this paragraph shall remain operative and in full force and effect regardless of the termination of the Transaction.

  

	 	(c)	Regulation M. Counterparty is not on the Trade Date engaged in a distribution, as such term is used in Regulation M under the Exchange Act, of any
securities of Counterparty, other than the distribution of the Convertible Notes. Counterparty shall not, until the second Scheduled Trading Day immediately following the Effective Date, engage in any such distribution other than as described in
this paragraph. 

  

	 	(d)	No Manipulation. Counterparty is not entering into the Transaction to create actual or apparent trading activity in the Shares (or any security
convertible into or exchangeable for the Shares) or to raise or depress or otherwise manipulate the price of the Shares (or any security convertible into or exchangeable for the Shares) or otherwise in violation of the Exchange Act.

  

	 	(e)	Transfer or Assignment. 

  

	 	(i)	Counterparty shall have the right to transfer or assign its rights and obligations hereunder with respect to all, but not less than all, of the Options hereunder (such
Options, the “Transfer Options”); provided that such transfer or assignment shall be subject to reasonable conditions that JPMorgan may impose, including but not limited, to the following conditions: 

 

	 	(A)	With respect to any Transfer Options, Counterparty shall not be released from its notice and indemnification obligations pursuant to Section 9(b) or any obligations
under Section 9(m) or 9(r) of this Confirmation; 

  

	 	(B)	Any Transfer Options shall be transferred or assigned only to a third party that is a United States person (as defined in the Internal Revenue Code of 1986, as
amended); 

  

	 	(C)	Such transfer or assignment shall be effected on terms, including any reasonable undertakings by such third party (including, but not limited to, an undertaking with
respect to compliance with applicable securities laws in a manner that, in the reasonable judgment of JPMorgan, will not expose JPMorgan to material risks under applicable securities laws) and execution of any documentation and delivery of legal
opinions with respect to securities laws and other matters by such third party and Counterparty, as are requested and reasonably satisfactory to JPMorgan; 

  

 11 

 

 

  

	 	(D)	JPMorgan will not, as a result of such transfer and assignment, be required to pay the transferee on any payment date an amount under Section 2(d)(i)(4) of the
Agreement greater than an amount that JPMorgan would have been required to pay to Counterparty in the absence of such transfer and assignment; 

  

	 	(E)	An Event of Default, Potential Event of Default or Termination Event will not occur as a result of such transfer and assignment; 

 

	 	(F)	Without limiting the generality of clause (B), Counterparty shall cause the transferee to make such Payee Tax Representations and to provide such tax documentation as
may be reasonably requested by JPMorgan to permit JPMorgan to determine that results described in clauses (D) and (E) will not occur upon or after such transfer and assignment; and 

 

	 	(G)	Counterparty shall be responsible for all reasonable out-of-pocket costs and expenses, including reasonable counsel fees, incurred by JPMorgan in connection with such
transfer or assignment. 

  

	 	(ii)	JPMorgan may, without Counterparty’s consent, transfer or assign all or any part of its rights or obligations under the Transaction to (x) any third party with a
rating for its long term, unsecured and unsubordinated indebtedness equal to or better than the lesser of (1) the credit rating of JPMorgan at the time of the transfer and (2) A- by Standard and Poor’s Rating Group, Inc. or its successor
(“S&P”), or A3 by Moody’s Investor Service, Inc. (“Moody’s”) or, if either S&P or Moody’s ceases to rate such debt, at least an equivalent rating or better by a substitute rating agency
mutually agreed by Counterparty and JPMorgan or (y) an affiliate of JPMorgan whose obligations hereunder would be guaranteed by Dealer Parent. If at any time at which (A) the Section 16 Percentage exceeds 8.0%, (B) the Option Equity Percentage
exceeds 14.5%, or (C) the Share Amount exceeds the Applicable Share Limit (if any applies) (any such condition described in clauses (A), (B) or (C), an “Excess Ownership Position”), JPMorgan is unable after using its commercially
reasonable efforts to effect a transfer or assignment of Options to a third party on pricing terms reasonably acceptable to JPMorgan and within a time period reasonably acceptable to JPMorgan such that no Excess Ownership Position exists, then
JPMorgan may designate any Exchange Business Day as an Early Termination Date with respect to a portion of the Transaction (the “Terminated Portion”), such that following such partial termination no Excess Ownership Position exists.
In the event that JPMorgan so designates an Early Termination Date with respect to a portion of the Transaction, a payment shall be made pursuant to Section 6 of the Agreement as if (1) an Early Termination Date had been designated in respect of a
Transaction having terms identical to the Transaction and a Number of Options equal to the number of Options underlying the Terminated Portion, (2) Counterparty were the sole Affected Party with respect to such partial termination and (3) the
Terminated Portion were the sole Affected Transaction (and, for the avoidance of doubt, the provisions of Section 9(k) shall apply to any amount that is payable by JPMorgan to Counterparty pursuant to this sentence as if Counterparty was not the
Affected Party). The “Section 16 Percentage” as of any day is the fraction, expressed as a percentage, (A) the numerator of which is the number of Shares that JPMorgan and each person subject to aggregation of Shares with JPMorgan
under Section 13 or Section 16 of the Exchange Act and rules promulgated thereunder directly or indirectly beneficially own (as defined under Section 13 or Section 16 of the Exchange Act and rules promulgated thereunder) and (B) the denominator of
which is the number of Shares outstanding. The “Option Equity Percentage” as of any day is the fraction, expressed as a percentage, (A) the numerator of which is the sum of (1) the product of the Number of Options and the Option
Entitlement and (2) the aggregate number of Shares underlying any other call option transaction sold by JPMorgan to Counterparty, and (B) the denominator of which is the number of Shares outstanding. The “Share Amount” as of any day
is the number of Shares that JPMorgan and any person whose ownership position would be aggregated with that of JPMorgan (JPMorgan or any such person, a “JPMorgan Person”) under any law, rule, regulation, regulatory order or
organizational documents or contracts of Counterparty that are, in each case, applicable to ownership of Shares (“Applicable Restrictions”), owns, beneficially owns, constructively owns, controls, holds the power to vote or
otherwise meets a relevant definition of ownership under any Applicable Restriction, as determined by JPMorgan in its reasonable discretion. The “Applicable Share Limit” means a number of Shares equal to (A) the minimum number of
Shares that could give rise to reporting or registration obligations or other requirements (including obtaining prior approval from any person or entity) of a JPMorgan Person, or could result in an adverse effect on a JPMorgan Person, under any
Applicable Restriction, as determined by JPMorgan in its reasonable discretion, minus (B) 1% of the number of Shares outstanding. 

  

 12 

 

 

  

	 	(iii)	Notwithstanding any other provision in this Confirmation to the contrary requiring or allowing JPMorgan to purchase, sell, receive or deliver any Shares or other
securities, or make or receive any payment in cash, to or from Counterparty, JPMorgan may designate any of its affiliates to purchase, sell, receive or deliver such Shares or other securities, or to make or receive such payment in cash, and
otherwise to perform JPMorgan’s obligations in respect of the Transaction and any such designee may assume such obligations. JPMorgan shall be discharged of its obligations to Counterparty to the extent of any such performance.

  

	 	(f)	Staggered Settlement. If upon advice of counsel with respect to applicable legal and regulatory requirements, including any requirements relating to
JPMorgan’s hedging activities hereunder, JPMorgan reasonably determines that it would not be practicable or advisable to deliver, or to acquire Shares to deliver, any or all of the Shares to be delivered by JPMorgan on the Settlement Date for
the Transaction, JPMorgan may, by notice to Counterparty on or prior to any Settlement Date (a “Nominal Settlement Date”), elect to deliver the Shares on two or more dates (each, a “Staggered Settlement Date”) as
follows: 

  

	 	(i)	in such notice, JPMorgan will specify to Counterparty the related Staggered Settlement Dates (each of which will be on or prior to such Nominal Settlement Date, but not
prior to the beginning of the related Settlement Averaging Period) and the number of Shares that it will deliver on each Staggered Settlement Date; 

  

	 	(ii)	the aggregate number of Shares that JPMorgan will deliver to Counterparty hereunder on all such Staggered Settlement Dates will equal the number of Shares that JPMorgan
would otherwise be required to deliver on such Nominal Settlement Date; and 

  

	 	(iii)	if the Net Share Settlement terms set forth above were to apply on the Nominal Settlement Date, then the Net Share Settlement terms will apply on each Staggered
Settlement Date, except that the Net Shares will be allocated among such Staggered Settlement Dates as specified by JPMorgan in the notice referred to in clause (i) above. 

 

	 	(g)	Role of Agent. Each party agrees and acknowledges that (i) J.P. Morgan Securities LLC, an affiliate of JPMorgan (“JPMLLC”), has
acted solely as agent and not as principal with respect to the Transaction and (ii) JPMLLC has no obligation or liability, by way of guaranty, endorsement or otherwise, in any manner in respect of the Transaction (including, if applicable, in
respect of the settlement thereof). Each party agrees it will look solely to the other party (or any guarantor in respect thereof) for performance of such other party’s obligations under the Transaction. 

 

 13 

 

 

  

	 	(h)	Additional Termination Events. 

  

	 	(i)	Notwithstanding anything to the contrary in this Confirmation if an event of default with respect to Counterparty occurs under the terms of the Convertible Notes as set
forth in Section 6.02 of the Supplemental Indenture that results in an acceleration of the Convertible Notes pursuant to Section 6.03 of the Supplemental Indenture, then such event of default shall constitute an Additional Termination Event
applicable to the Transaction and, with respect to such Additional Termination Event, (A) Counterparty shall be deemed to be the sole Affected Party, (B) the Transaction shall be the sole Affected Transaction and (C) JPMorgan shall be the party
entitled to designate an Early Termination Date pursuant to Section 6(b) of the Agreement. 

  

	 	(ii)	Promptly following, but in no event later than the fifth Exchange Business Day after, any repurchase and cancellation of Convertible Notes (whether pursuant to Article
3 of the Supplemental Indenture in connection with a Fundamental Change (as defined in the Supplemental Indenture) or otherwise), Counterparty shall notify JPMorgan in writing of such repurchase and cancellation and the aggregate principal amount of
Convertible Notes so repurchased and cancelled (any such notice, a “Notes Repurchase Notice”). Notwithstanding anything to the contrary in this Confirmation, the receipt by JPMorgan from Counterparty of any Notes Repurchase Notice,
within the applicable time period set forth in the preceding sentence, shall constitute an Additional Termination Event as provided in this Section 9(h)(ii). Upon receipt of any such Notes Repurchase Notice, JPMorgan shall designate an Exchange
Business Day following receipt of such Notes Repurchase Notice (which Exchange Business Day shall be on or as promptly as reasonably practicable after the related settlement date for the repurchase of such Convertible Notes) as an Early Termination
Date with respect to the portion of this Transaction corresponding to a number of Options (the “Repurchase Options”) equal to the lesser of (A) the aggregate principal amount of such Convertible Notes specified in such Repurchase
Notice, divided by USD 1,000 and (B) the Number of Options as of the date JPMorgan designates such Early Termination Date and, as of such date, the Number of Options shall be reduced by the number of Repurchase Options. Any payment hereunder
with respect to such termination shall be calculated pursuant to Section 6 of the Agreement as if (1) an Early Termination Date had been designated in respect of a Transaction having terms identical to this Transaction and a Number of Options equal
to the number of Repurchase Options, (2) Counterparty were the sole Affected Party with respect to such Additional Termination Event and (3) the terminated portion of the Transaction were the sole Affected Transaction. 

 

	 	(iii)	Notwithstanding anything to the contrary in this Confirmation, the receipt by JPMorgan from Counterparty, within the applicable time period set forth under “Notice
of Exercise” above, of any Notice of Exercise in respect of Options that relate to Convertible Notes as to which additional Shares would be added to the Conversion Rate pursuant to Section 10.07 of the Supplemental Indenture in connection with
a “Make-Whole Fundamental Change” (as defined in the Supplemental Indenture) shall constitute an Additional Termination Event as provided in this Section 9(h)(iii). Upon receipt of any such Notice of Exercise, JPMorgan shall designate an
Exchange Business Day following such Additional Termination Event (which Exchange Business Day shall be on or as promptly as reasonably practicable after the related settlement date for such Convertible Notes) as an Early Termination Date with
respect to the portion of this Transaction corresponding to a number of Options (the “Make-Whole Conversion Options”) equal to the lesser of (A) the number of such Options specified in such Notice of Exercise and (B) the Number of
Options as of the date JPMorgan designates such Early Termination Date and, as of such date, the Number of Options shall be reduced by the number of Make-Whole Conversion Options. Any payment hereunder with respect to such termination (the
“Make-Whole Unwind Payment”) shall be calculated pursuant to Section 6 of the Agreement as if (1) an Early Termination Date had been designated in respect of a Transaction having terms identical to this Transaction and a Number of
Options equal to the number of Make-Whole Conversion Options, (2) Counterparty were the sole Affected Party with respect to such Additional Termination Event and (3) the terminated portion of the Transaction were the sole Affected Transaction (and,
for the avoidance of doubt, in determining the amount payable pursuant to Section 6 of the Agreement, the Calculation Agent shall not take into account any adjustments to the Option Entitlement that result from corresponding adjustments to the
Conversion Rate pursuant to Section 10.07 of the Supplemental Indenture); provided that, the amount of cash deliverable in respect of such early termination by JPMorgan to Counterparty shall not be greater than the excess of (x)(1) the number
of Make-Whole Conversion Options multiplied by (2) the Conversion Rate (after taking into account any applicable adjustments to the Conversion Rate pursuant to Section 10.07 of the Supplemental Indenture) multiplied by (3) a price per
Share determined by the Calculation Agent over (y) the aggregate principal amount of such Convertible Notes, as determined by the Calculation Agent in a commercially reasonable manner. Counterparty may irrevocably elect, if so designated in its
Notice of Exercise to JPMorgan as set forth above, to receive the Make-Whole Unwind Payment in Shares, in which case, in lieu of making such Make-Whole Unwind Payment as set forth above, JPMorgan shall deliver to Counterparty, within a commercially
reasonable period of time after such designation as determined by JPMorgan (taking into account existing liquidity conditions and JPMorgan’s hedging and hedge unwind activity or settlement activity in connection with such delivery) a number of
Shares equal to such Make-Whole Unwind Payment divided by a price per Share determined by the Calculation Agent in good faith and in a commercially reasonable manner. 

 

 14 

 

 

  

	 	(i)	Amendments to Equity Definitions. 

  

	 	(i)	Section 12.6(a)(ii) of the Equity Definitions is hereby amended by (1) deleting from the fourth line thereof the word “or” after the word “official”
and inserting a comma therefor, and (2) deleting the semi-colon at the end of subsection (B) thereof and inserting the following words therefor “or (C) at JPMorgan’s option, the occurrence of any of the events specified in Section
5(a)(vii)(1) through (9) of the ISDA Master Agreement with respect to that Issuer.” 

  

	 	(ii)	Section 12.9(b)(i) of the Equity Definitions is hereby amended by (1) replacing “either party may elect” with “JPMorgan may elect” and (2) replacing
“notice to the other party” with “notice to Counterparty” in the first sentence of such section. 

  

	 	(j)	Setoff. Each party waives any and all rights it may have to set off obligations arising under the Agreement and the Transaction against other obligations
between the parties, whether arising under any other agreement, applicable law or otherwise. 

  

	 	(k)	Alternative Calculations and Payment on Early Termination and on Certain Extraordinary Events. If in respect of the Transaction, an amount is payable by
JPMorgan to Counterparty (i) pursuant to Section 12.7 or Section 12.9 of the Equity Definitions or (ii) pursuant to Section 6(d)(ii) of the Agreement (any such amount, a “Payment Obligation”), Counterparty may request JPMorgan to
satisfy the Payment Obligation by the Share Termination Alternative (as defined below) (except that Counterparty shall not have the right to make such an election in the event of (I) a Nationalization, Insolvency or Merger Event, in each case, in
which the consideration to be paid to holders of Shares consists solely of cash, (II) a Merger Event that is within Counterparty’s control, or (III) an Event of Default in which Counterparty is the Defaulting Party or a Termination Event in
which Counterparty is the Affected Party, and the Event of Default or Termination Event resulted from an event or events within Counterparty’s control) and shall give irrevocable telephonic notice to JPMorgan, confirmed in writing within one
Scheduled Trading Day, no later than 12:00 p.m. (New York City time) on the Merger Date, the Announcement Date (in the case of Nationalization, Insolvency or Delisting), the Early Termination Date or date of cancellation, as applicable; provided
that if Counterparty does not validly request JPMorgan to satisfy the Payment Obligation by the Share Termination Alternative, JPMorgan shall have the right, in its sole discretion, to satisfy its Payment Obligation by the Share Termination
Alternative, notwithstanding Counterparty’s election to the contrary. 

  

 15 

 

 

  

			
	Share Termination Alternative:	  	If applicable, JPMorgan shall deliver to Counterparty the Share Termination Delivery Property on, or within a commercially reasonable period of time after, the date when the
relevant Payment Obligation would otherwise be due pursuant to Section 12.7 or 12.9 of the Equity Definitions or Section 6(d)(ii) and 6(e) of the Agreement, as applicable (the “Share Termination Payment Date”), in satisfaction of
such Payment Obligation in the manner reasonably requested by Counterparty free of payment.
		
	Share Termination Delivery Property:	  	A number of Share Termination Delivery Units, as calculated by the Calculation Agent, equal to the Payment Obligation divided by the Share Termination Unit Price. The Calculation
Agent shall adjust the Share Termination Delivery Property by replacing any fractional portion of a security therein with an amount of cash equal to the value of such fractional security based on the values used to calculate the Share Termination
Unit Price.
		
	Share Termination Unit Price:	  	The value to JPMorgan of property contained in one Share Termination Delivery Unit, as determined by the Calculation Agent in its discretion by commercially reasonable means and
notified by the Calculation Agent to JPMorgan at the time of notification of the Payment Obligation. For the avoidance of doubt, the parties agree that in determining the Share Termination Delivery Unit Price the Calculation Agent may consider the
purchase price paid in connection with the purchase of Share Termination Delivery Property.
		
	Share Termination Delivery Unit:	  	One Share or, if a Merger Event has occurred and a corresponding adjustment to the Transaction has been made, a unit consisting of the number or amount of each type of property
received by a holder of one Share (without consideration of any requirement to pay cash or other consideration in lieu of fractional amounts of any securities) in such Merger Event, as determined by the Calculation Agent.
		
	Failure to Deliver:	  	Applicable
		
	Other applicable provisions:	  	If Share Termination Alternative is applicable, the provisions of Sections 9.8, 9.9, 9.11, 9.12 and 10.5 (as modified above) of the Equity Definitions will be applicable, except
that all references in such provisions to “Physically-settled” shall be read as references to “Share Termination Settled” and all references to “Shares” shall be read as references to “Share Termination Delivery
Units”. “Share Termination Settled” in relation to the Transaction means that the Share Termination Alternative is applicable to the Transaction.

 

 16 

 

 

  

	 	(l)	Waiver of Jury Trial. Each party waives, to the fullest extent permitted by applicable law, any right it may have to a trial by jury in respect of any
suit, action or proceeding relating to the Transaction. Each party (i) certifies that no representative, agent or attorney of either party has represented, expressly or otherwise, that such other party would not, in the event of such a suit, action
or proceeding, seek to enforce the foregoing waiver and (ii) acknowledges that it and the other party have been induced to enter into the Transaction, as applicable, by, among other things, the mutual waivers and certifications provided herein.

  

	 	(m)	Registration. Counterparty hereby agrees that if, in the good faith reasonable judgment of JPMorgan based on the advice of outside counsel, the Shares
(“Hedge Shares”) acquired by JPMorgan for the purpose of hedging its obligations pursuant to the Transaction cannot be sold in the public market by JPMorgan without registration under the Securities Act, Counterparty shall, at its
election, either (i) in order to allow JPMorgan to sell the Hedge Shares in a registered offering, make available to JPMorgan an effective registration statement under the Securities Act and enter into an agreement, in form and substance reasonably
satisfactory to JPMorgan, substantially in the form of an underwriting agreement for a registered secondary offering; provided, however, that if JPMorgan, in its sole reasonable discretion, is not satisfied with access to due diligence
materials, the results of its due diligence investigation, or the procedures and documentation for the registered offering referred to above, then clause (ii) or clause (iii) of this paragraph shall apply at the election of Counterparty; and
provided, further that, JPMorgan has given Counterparty reasonable notice of its determination and provided Counterparty with reasonable opportunity to satisfy JPMorgan’s concerns; (ii) in order to allow JPMorgan to sell the Hedge
Shares in a private placement, enter into a private placement agreement substantially similar to private placement purchase agreements customary for private placements of equity securities, in form and substance satisfactory to JPMorgan (in which
case, the Calculation Agent shall make any adjustments to the terms of the Transaction that are necessary, in its reasonable judgment, to compensate JPMorgan for any discount from the public market price of the Shares incurred on the sale of Hedge
Shares in a private placement); or (iii) purchase the Hedge Shares from JPMorgan at the Relevant Price on such Exchange Business Days, and in the amounts, requested by JPMorgan. For the avoidance of doubt, under no circumstances shall Counterparty
be obligated to make the election described in clause (iii) of the preceding sentence. 

  

	 	(n)	Tax Disclosure. Effective from the date of commencement of discussions concerning the Transaction, Counterparty and each of its employees,
representatives, or other agents may disclose to any and all persons, without limitation of any kind, the tax treatment and tax structure of the Transaction and all materials of any kind (including opinions or other tax analyses) that are provided
to Counterparty relating to such tax treatment and tax structure. 

  

	 	(o)	Right to Extend. JPMorgan may postpone or add, in whole or in part, any Valid Day or Valid Days during the Settlement Averaging Period or any other date
of valuation, payment or delivery by JPMorgan, with respect to some or all of the Options hereunder, if JPMorgan reasonably determines, in its reasonable discretion, that such action is reasonably necessary or appropriate to preserve JPMorgan’s
hedging or hedge unwind activity hereunder in light of existing liquidity conditions or to enable JPMorgan to effect purchases of Shares in connection with its hedging, hedge unwind or settlement activity hereunder in a manner that would, if
JPMorgan were Counterparty or an affiliated purchaser of Counterparty, be in compliance with applicable legal, regulatory or self-regulatory requirements, or with related policies and procedures applicable to JPMorgan. 

 

	 	(p)	Status of Claims in Bankruptcy. JPMorgan acknowledges and agrees that this Confirmation is not intended to convey to JPMorgan rights against Counterparty
with respect to the Transaction that are senior to the claims of common stockholders of Counterparty in any United States bankruptcy proceedings of Counterparty; provided that nothing herein shall limit or shall be deemed to limit
JPMorgan’s right to pursue remedies in the event of a breach by Counterparty of its obligations and agreements with respect to the Transaction; provided, further, that nothing herein shall limit or shall be deemed to limit
JPMorgan’s rights in respect of any transactions other than the Transaction. For the avoidance of doubt, the parties acknowledge that the obligations of Counterparty under this Confirmation are not secured by any collateral that would otherwise
secure the obligations of Counterparty herein under or pursuant to any other agreement. 

  

 17 

 

 

  

	 	(q)	Securities Contract; Swap Agreement. The parties hereto intend for (i) the Transaction to be a “securities contract” and a “swap
agreement” as defined in the Bankruptcy Code (Title 11 of the United States Code) (the “Bankruptcy Code”), and the parties hereto to be entitled to the protections afforded by, among other Sections, Sections 362(b)(6),
362(b)(17), 546(e), 546(g), 555 and 560 of the Bankruptcy Code, (ii) a party’s right to liquidate the Transaction and to exercise any other remedies upon the occurrence of any Event of Default under the Agreement with respect to the other party
to constitute a “contractual right” as described in the Bankruptcy Code, and (iii) each payment and delivery of cash, securities or other property hereunder to constitute a “margin payment” or “settlement payment” and a
“transfer” as defined in the Bankruptcy Code. 

  

	 	(r)	Notice of Certain Other Events. Counterparty covenants and agrees that: 

 

	 	(i)	promptly following the public announcement of the results of any election by the holders of Shares with respect to the consideration due upon consummation of any
consolidation, merger and binding share exchange to which Counterparty is a party, or any sale of all or substantially all of Counterparty’s assets, in each case pursuant to which the Shares will be converted into cash, securities or other
property, Counterparty shall give JPMorgan written notice of the types and amounts of consideration that holders of Shares have elected to receive upon consummation of such transaction or event (the date of such notification, the
“Consideration Notification Date”); provided that in no event shall the Consideration Notification Date be later than the date on which such transaction or event is consummated; and 

 

	 	(ii)	promptly following any adjustment to the Convertible Notes in connection with any Potential Adjustment Event or Merger Event, Counterparty shall give JPMorgan written
notice of the details of such adjustment. 

  

	 	(s)	Early Unwind. In the event the sale of the “Firm Securities” (as defined in the Underwriting Agreement) is not consummated with the Underwriter
for any reason, or Counterparty fails to deliver to JPMorgan opinions of counsel as required pursuant to Section 9(a), in each case by 5:00 p.m. (New York City time) on September 20, 2010, or such later date as agreed upon by the parties (the
Premium Payment Date or such later date, the “Early Unwind Date”), the Transaction shall automatically terminate (the “Early Unwind”) on the Early Unwind Date and (i) the Transaction and all of the respective rights
and obligations of JPMorgan and Counterparty under the Transaction shall be cancelled and terminated and (ii) each party shall be released and discharged by the other party from and agrees not to make any claim against the other party with respect
to any obligations or liabilities of the other party arising out of and to be performed in connection with the Transaction either prior to or after the Early Unwind Date. Each of JPMorgan and Counterparty represent and acknowledge to the other that,
upon an Early Unwind, all obligations with respect to the Transaction shall be deemed fully and finally discharged. 

  

	 	(t)	Payment by Counterparty. In the event that (i) an Early Termination Date occurs or is designated with respect to the Transaction as a result of a
Termination Event or an Event of Default (other than an Event of Default arising under Section 5(a)(ii) or 5(a)(iv) of the Agreement) and, as a result, Counterparty owes to JPMorgan an amount calculated under Section 6(e) of the Agreement, or (ii)
Counterparty owes to JPMorgan, an amount calculated under Section 12.7 or Section 12.8 of the Equity Definitions, such amount shall be deemed to be zero. 

  

 18 

 Please confirm that the foregoing correctly sets forth the terms of our agreement by
executing this Confirmation and returning it to EDG Confirmation Group, J.P. Morgan Securities LLC, 277 Park Avenue, 11th Floor, New York, NY 10172-3401, or by fax to (212) 622 8519. 

        Very truly yours, 

 

			
	J.P. Morgan Securities LLC, as agent for JPMorgan Chase Bank, National Association
		
	By:	 	 /s/ Jason M. Wood

	Authorized Signatory
	Name:	 	Jason M. Wood
		 	Managing Director

  

			
	Accepted and confirmed as of the Trade Date:
	
	Volcano Corporation
		
	By:	 	 /s/ John T. Dahldorf

	Authorized Signatory
	Name:	 	John T. Dahldorf

 JPMorgan Chase Bank,
National Association 
 Organised under the laws of the United States as a National Banking Association 

Main Office 1111 Polaris Parkway, Columbus, Ohio 43271 

Registered as a branch in England & Wales branch No. BR000746 

Registered Branch Office 125 London Wall, London EC2Y 5AJ 

Authorised and regulated by the Financial Services Authority

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