Targa Resources Corp. Stock Compensation Disclosure

Note 21 — Compensation Plans

2010 Targa Resources Corp. Stock Incentive Plan

In December 2010, we adopted the Targa Resources Corp. 2010 Stock Incentive Plan (the “2010 TRGP Plan”) for employees, consultants and non-employee directors of the Company. In May 2017, the 2010 TRGP Plan was amended and restated. In August 2023, the 2010 TRGP Plan was amended and restated for a second time. Total authorized shares of common stock under the plan is 15,000,000, comprised of 5,000,000 shares originally available and an additional 10,000,000 shares that became available in May 2017. The 2010 TRGP Plan allows for the grant of (i) incentive stock options qualified as such under U.S. federal income tax laws (“Incentive Options”), (ii) stock options that do not qualify as Incentive Options (“Non-statutory Options,” and together with Incentive Options, “Options”), (iii) stock appreciation rights granted in conjunction with Options or Phantom Stock Awards, (iv) restricted stock awards, (v) phantom stock awards, (vi) bonus stock awards, (vii) performance unit awards, or (viii) any combination of such awards.

Unless otherwise specified, the compensation costs for the awards listed below were recognized as expense over related vesting periods based on the grant-date fair values, reduced by forfeitures incurred.

Restricted Stock Awards – Restricted stock entitles the recipient to cash dividends. Dividends on unvested restricted stock will be accrued when declared and recorded as short-term or long-term liabilities, dependent on the time remaining until payment of the dividends, and paid in cash when the award vests. Upon issuance, the restricted stock awards will be included in the outstanding shares of our common stock. The Compensation Committee of the Targa board of directors (the “Compensation Committee”) awarded our common stock to our outside directors. In 2025, 2024 and 2023, we issued 9,479, 23,984 and 23,518 shares of director grants with weighted average grant-date fair values of $209.18, $85.70 and $74.13, respectively.

Restricted Stock Units Awards – RSUs are similar to restricted stock, except that shares of common stock are not issued until the RSUs vest. The vesting periods generally vary from one to six years. In March 2023, the Compensation Committee amended the Restricted Stock Units Grant Agreements that govern the RSUs that vest no later than three years following the RSUs’ grant date. The amendment resulted in quarterly cash dividend payments to RSU holders beginning with the common stock dividend paid in May 2023. In 2025, 2024 and 2023, we issued 348,443, 415,467 and 587,326 shares of RSUs with weighted average grant-date fair values of $173.24, $117.95 and $78.69, respectively.

Performance Share Units

During 2025, 2024 and 2023, we granted 77,114, 131,816 and 140,020 performance share units (“PSUs”) to executive management for the 2025, 2024 and 2023 compensation cycles that will vest/have vested in January 2028, January 2027 and January 2026. The PSUs granted under the 2010 TRGP Plan are three-year equity-settled awards linked to the performance of shares of our common stock. The awards also include dividend equivalent rights (“DERs”) that are based on the notional dividends accumulated during the vesting period.

The vesting of the PSUs is dependent on the satisfaction of a combination of certain service-related conditions and the Company’s total shareholder return (“TSR”) relative to the TSR of the members of a specified comparator group of publicly-traded midstream companies (the “LTIP Peer Group”) measured over designated periods. For the PSUs granted in 2023, 2024 and 2025, the TSR performance factor is determined by the Compensation Committee based on relative TSR over a cumulative three-year performance period. The Compensation Committee determines a guideline performance percentage for the performance period and the percentage may then be decreased or increased by the Compensation Committee at its discretion. The grantee will become vested in a number of PSUs equal to the target number awarded multiplied by the TSR performance factor, and vested PSUs will be settled by the issuance of Company common stock. The value of DERs will be paid in cash when the awards vest.

Compensation cost for equity-settled PSUs was recognized as an expense over the performance period based on fair value at the grant date. The compensation cost will be reduced if forfeitures occur. Fair value was calculated using a simulated share price that incorporates peer ranking. DERs associated with equity-settled PSUs were accrued over the performance period as a reduction of owners’ equity. We evaluated the grant date fair value using a Monte Carlo simulation model and historical volatility assumption with an expected term of three years. The expected volatilities were 32%, 34% and 38% for PSUs granted in 2025, 2024 and 2023.

Stock Compensation Expense

Stock compensation expense under our plans totaled $69.5 million, $63.2 million and $62.4 million for the years ended December 31, 2025, 2024 and 2023, respectively. As of December 31, 2025, we have $105.2 million of unrecognized compensation expense associated with share-based awards and an approximate remaining weighted average vesting period of 2.3 years related to our various compensation plans.

The fair values of share-based awards vested in 2025, 2024 and 2023 were $83.8 million, $87.2 million and $96.8 million, respectively. Cash dividends paid for the vested awards were $3.2 million, $5.3 million and $8.3 million for the years ended December 31, 2025, 2024 and 2023, respectively.

In relation to our equity compensation plans, we recognized $13.9 million, $14.2 million and $17.0 million in windfall tax benefits for the years ended December 31, 2025, 2024 and 2023, respectively.

Subsequent Events

In January 2026, the Compensation Committee made the following awards under the 2010 TRGP Plan:

In January 2026, the following shares vested:

Targa 401(k) Plan

We have a 401(k) plan whereby we match 100% of up to 5% of an employee’s contribution (subject to certain limitations in the plan). We also contribute an amount equal to 3% of each employee’s eligible compensation to the plan as a retirement contribution and may make additional contributions at our sole discretion. All Targa contributions are made 100% in cash. We made contributions to the 401(k) plan totaling $39.8 million, $35.1 million and $32.3 million during the years ended December 31, 2025, 2024 and 2023, respectively.