Exhibit 10.1

MEMBERSHIP INTEREST PURCHASE AGREEMENT

THIS MEMBERSHIP INTEREST PURCHASE AGREEMENT (“Agreement”) is dated as of the
14th day of May, 2012, and entered into by and between Inergy, L.P., a Delaware
limited partnership (“Seller”), and Inergy Midstream, L.P., a Delaware limited
partnership (“Buyer”). The above-named entities are sometimes referred to in
this Agreement each as a “Party” and collectively as the “Parties.”

R E C I T A L S:

WHEREAS, on August 25, 2008 (the “Cutoff Date”), Buyer purchased from Demetree
Salt, LLC all of the issued and outstanding membership interests (the
“Interest”) in US Salt, LLC, a Delaware limited liability company (the
“Company”);

WHEREAS, on November 25, 2011, Buyer transferred, assigned and conveyed the
Interest to Seller in connection with Buyer’s initial public offering;

WHEREAS, subsequent to Buyer’s acquisition of the Interest (including the period
of time following Buyer’s conveyance thereof to Seller), the personnel
responsible for managing the business and affairs of Buyer have also been
responsible for managing the business and affairs of the Company, and the
financial results of both Buyer and the Company have been included in Seller’s
consolidated financial statements;

WHEREAS, Seller desires to sell the Interest to Buyer, and Buyer is willing to
purchase the Interest from Seller, for the consideration and on the terms and
conditions set forth in this Agreement; and

NOW, THEREFORE, in consideration of the foregoing premises, the mutual
agreements made herein, and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the Parties hereto, intending
to be legally bound, represent, warrant and agree as follows:

1. Certain Terms Defined. In addition to terms defined elsewhere in this
Agreement, the following capitalized terms have the meanings assigned to them in
this Section 1:

“1060 Forms” has the meaning set forth in Section 2.3.

“Action” has the meaning set forth in Section 3.7.

“Affiliate” has the meaning assigned to such term in Rule 405 of the Securities
Act and the rules and regulations of the SEC promulgated thereunder.

“Agreement” has the meaning set forth in the Preamble.

“Amendment to the Omnibus Agreement” means that certain amendment to the Omnibus
Agreement, in the form attached hereto as Exhibit A.

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“Assignment and Transfer of Membership Interest” means that certain Assignment
and Transfer of Membership Interest, in the form attached hereto as Exhibit B,
transferring the Interest to Buyer.

“Associated Employees” has the meaning set forth in Section 3.15(b).

“Balance Sheet Date” has the meaning set forth in Section 3.8(a).

“Basket” has the meaning set forth in Section 6.5(a).

“Business” means the actual lines of business conducted by the Company.

“Buyer” has the meaning set forth in the Preamble.

“Buyer Units” means common units representing limited partnership interests in
Buyer.

“Capital Lease” means, with respect to any Person, any lease of, or other
arrangement conveying the right to use, property by such Person as lessee that
would be accounted for as a capital lease on a balance sheet of such Person
prepared in accordance with GAAP.

“Cash Price” has the meaning set forth in Section 2.1.

“Claim Notice” has the meaning set forth in Section 6.3(a).

“Code” means the Internal Revenue Code of 1986, as amended, and the rules and
regulations promulgated thereunder.

“Company” has the meaning set forth in the Recitals.

“Consideration Units” means the Buyer Common Units constituting the Equity
Consideration.

“Contracts” means any agreement of any kind or nature whatsoever by which any
Person is legally bound, including all contracts, agreements, notes, bonds,
instruments, leases, subleases, mortgages, Capital Leases, or other binding
commitments or arrangements, express or implied, oral or written, and all
amendments thereto.

“Cutoff Date” has the meaning set forth in the Preamble.

“Damages” has the meaning set forth in Section 6.1.

“Encumbrance” means any hypothecation, security interest, pledge, mortgage,
lien, charge, defect of title, claim, community property interest, easement,
equitable interest, option, right of first refusal, order, other encumbrance or
restriction of any kind, including any restriction on use, voting, transfer,
receipt of income or exercise of any other attribute of ownership.

“Environment” means any water or water vapor, any land, including land surface
or subsurface, air, fish, storm water, wildlife, flora, fauna, biota, and all
other natural resources.

“Environmental Laws” means all federal, state and local environmental, chemical
use, safety and sanitation Laws governing the use, presence, recycling,
transfer, distribution, storage, treatment, generation, transportation,
processing, handling, management, production, spill control, remediation,
removal, discharge, Release, threatened Release or disposal of Hazardous
Substances and the rules, regulations, policies, decisions, orders and
directives of Governmental Authorities with respect thereto, but excluding Laws
pertaining to the health and safety of the Company’s employees including,
without limitation, the Occupational Safety and Health Act of 1970 (29 U.S.C.
651 et. seq.) and New York Labor Law Sections 27 and 27A.

 

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“Environmental Permits” means all permits, licenses, approvals, authorizations,
consents or registrations required by any applicable Environmental Law for the
operation of the Business or occupation of the Real Property.

“Equity Consideration” has the meaning set forth in Section 2.1.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended,
and the rules and regulations promulgated thereunder.

“Financial Statements” has the meaning set forth in Section 3.8(a).

“GAAP” means United States generally accepted accounting principles consistently
applied.

“Governmental Authority” means any court, tribunal, arbitrator, authority,
agency, commission, official or other instrumentality of the United States or
any state, county, city or other political subdivision or similar governing
entity, and including any governmental or quasi- governmental body
administering, regulating or having general oversight over the Business of the
Company or any of the assets associated with the Business of the Company.

“Hazardous Substance” means, without limitation, any flammable explosives,
radon, radioactive materials, asbestos, urea formaldehyde foam insulation,
chlorinated solvents, polychlorinated biphenyls, petroleum and petroleum
products, methane, hazardous materials, hazardous wastes, hazardous or toxic
substances or related materials as defined in the Comprehensive Environmental
Response, Compensation and Liability Act of 1980 (42 U.S.C. § 9601, et seq.),
the Resource Conservation and Recovery Act (42 U.S.C. § 6901, et seq.), the
Clean Water Act (33 U.S.C. § 1251 et seq.), the Clean Air Act (42 U.S.C. § 7401,
et seq.), the Hazardous Materials Transportation Act (49 U.S.C. § 1801, et
seq.), the Toxic Substances Control Act (15 U.S.C. § 2601, et seq.), Articles
17, 27 and 37 of the New York State Environmental Conservation Law or any other
applicable Environmental Law and the regulations promulgated thereunder.

“Indebtedness” means, with respect to a Person, all indebtedness, liabilities
and obligations (including interest accrued on such indebtedness, liabilities
and obligations), for money borrowed (including any Capital Lease) by the
Person, or any contingent liability for any guaranty by the Person of any
obligation of any other Person for money borrowed (including the pledge of any
collateral or grant of any security interest by a Person and any property as
security for any such liability, guaranty or obligation) whether or not any of
the foregoing is evidenced by any note, indenture, guaranty or agreement.
Indebtedness does not include trade accounts payable, accrued liabilities or
expenses (except for interest accrued on indebtedness, liabilities or
obligations (including make-whole, prepayment and other similar obligations)
relating to money borrowed) or customer deposits.

“Indemnified Party” has the meaning set forth in Section 6.3.

“Indemnifying Party” has the meaning set forth in Section 6.3.

“Interest” has the meaning set forth in the Recitals.

“IRS” means the United States Internal Revenue Service.

 

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“Laws” means all laws, statutes, rules, regulations, ordinances and other
pronouncements having the effect of law of any Governmental Authority.

“March 31 Financials” has the meaning set forth in Section 3.8(a).

“Material Adverse Effect” means with respect to the consequences of any event,
fact or circumstance (including the occurrence or non-occurrence of any event,
fact or circumstance) applicable to the Business, that such event, fact or
circumstance has caused or is reasonably likely to cause, directly, indirectly
or consequentially, singularly or in the aggregate with all such events, facts
and circumstances, a material adverse effect on the assets, liabilities,
financial condition, operating results or operations of the Business, all taken
as a whole; provided, however, to the extent such effect results from any of the
following, such effect will not be considered a Material Adverse Effect:
(a) changes in general business or economic conditions, including such
conditions related to the Business; (b) changes in industry conditions that do
not disproportionately affect the Company; (c) national or international
political or social conditions, including the engagement by the United States in
hostilities, whether or not pursuant to the declaration of a national emergency
or war, or the occurrence of any military or terrorist attack upon the United
States, or any of its territories, possessions, or diplomatic or consular
offices or upon any military installation, equipment or personnel of the United
States; (d) general economic conditions or events affecting the financial,
banking, or securities markets generally; (e) changes in United States generally
accepted accounting principles; or (f) changes in law, rules, regulations,
orders and other binding directives issued by any Governmental Authority.

“Material Contract” has the meaning set forth in Section 3.4.

“Notice Period” has the meaning set forth in Section 6.3(a).

“Omnibus Agreement” means the Omnibus Agreement dated effective as of
December 15, 2011, among Inergy GP, LLC, Seller, NRGM GP, LLC and Buyer.

“Party” and “Parties” have the meaning set forth in the Preamble.

“Permits” has the meaning set forth in Section 3.5(b).

“Permitted Encumbrances” means: (i) liens for Taxes not yet due, or that are
being contested in good faith by appropriate proceedings; (ii) statutory liens
of mechanics, materialmen, warehousemen and other similar statutory liens for
labor, materials or supplies, and which individually or in aggregate, do not
materially detract from the value of the assets subject thereto or materially
impair the operation of such assets as currently conducted or as proposed to be
conducted; and (iii) with respect to the Real Property, (a) zoning, entitlement,
restriction, and other land use and environmental regulations by Governmental
Authorities that do not in any material respect interfere with the present use
by the Company of the Real Property and as to which there is no material default
on the part of the Company, (b) all Encumbrances set forth in the Title Policy
(other than any security interests or mortgages set forth therein in favor of
Merrill Lynch Business Financial Services, Inc. or its assignees), (c) other
Encumbrances arising in the ordinary course of business that do not have a
materially adversely impact on the Company’s operations, and (d) landlord liens.

“Person” has the meaning set forth in Section 3.1(b).

“Plans” has the meaning set forth in Section 3.15(d).

“Purchase Price” has the meaning set forth in Section 2.1.

 

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“Real Property” has the meaning set forth in Section 3.11(a).

“Refinery” means the Company’s Watkins Glen salt refinery located on the shore
of Seneca Lake in the State of New York.

“Release” has the meaning given to that term in the Comprehensive Environmental
Response, Compensation and Liability Act of 1980 (42 U.S.C. § 9601, et seq.),
and the regulations promulgated thereunder.

“SEC” means the United States Securities and Exchange Commission.

“Securities Act” means the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder.

“Seller” has the meaning set forth in the Preamble.

“Steelworkers Agreement” means the Agreement, dated November 1, 2009 between the
Company and the Steelworkers Union on behalf of Local Union 12460-4.

“Steelworkers Union” means, collectively, the United Steelworkers Union,
AFL-CIO, CLC and United Steelworkers Union Local 12460-4.

“Taxes” means all taxes, levies or other similar governmental charges including
all federal, state, local and foreign income, corporation, gross receipts,
value-added, goods and services, license, franchise, profits, capital gains,
capital stock, transfer, sales, use, occupation, property, ad valorem, excise,
severance, unclaimed property (escheat) liability, windfall profits, stamp,
license, payroll, withholding, social security and other taxes (whether payable
directly or by withholding and whether or not requiring the filing of a Tax
Return), and all estimated taxes, additions to tax, and penalties and interest
imposed thereon or with respect thereto.

“Tax Partnership” has the meaning set forth in Section 3.10(k).

“Tax Return” means any return, declaration, report, claim for refund,
information return or other document (including any related or supporting
estimates, elections, schedules, statements or information) filed in connection
with the determination, assessment or collection of any Tax or the
administration of any Laws or administrative requirements relating to any Tax.

“Title Policy” shall mean that certain Owner’s Policy of Title Insurance
No. 5608-25021, dated August 22, 2008, in the amount of $15,000,000.00, insuring
fee simple title to the Real Property (and certain other interests) in and to
the Company, together with all endorsements, schedules and exhibits appended
thereto.

“Transaction Documents” has the meaning set forth in Section 3.3.

2. Sale and Purchase of Interest.

2.1 Purchase of Interest. Seller contemporaneously herewith sells, assigns and
transfers to Buyer, and Buyer contemporaneously herewith purchases from Seller
all of Seller’s right, title and interest in and to the Interest, for aggregate
consideration consisting of (i) $182,500,000 in cash (the “Cash Price”) and
(ii) 473,707 Buyer Units (the “Equity Consideration” and, together with the Cash
Price, the “Purchase Price”).

 

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2.2 Deliveries; Closing Obligations. Contemporaneously herewith:

(a) Buyer is: (i) delivering to Seller by wire transfer an amount equal to the
Cash Price to the order of Seller, and (ii) causing the Equity Consideration to
be issued to Seller.

(b) Seller is: (i) delivering to Buyer (A) a fully executed copy of the
Assignment and Transfer of Membership Interest, and (B) a “Certificate of
Non-Foreign Status” with regards to Section 1445 of the Code, in the form
attached hereto as Exhibit C; and (ii) causing any Encumbrances (other than
Permitted Encumbrances) on the assets of the Company not released prior to the
date hereof to be released.

(c) The Amendment to the Omnibus Agreement was signed by all parties thereto.

2.3 Allocation of Purchase Price. The Purchase Price will for all Tax purposes
be allocated in the manner set forth in Schedule 2.3. Unless otherwise required
by Law, Buyer and Seller will act, and Buyer will cause the Company to act, in
accordance with the relevant Tax Returns or similar filings (including any forms
or reports required to be filed pursuant to Section 1060 of the Code (the “1060
Forms”)), to cooperate in the preparation of any 1060 Forms, to file such 1060
Forms in the manner required by Law and not to take any position inconsistent
with Schedule 2.3 on any Tax Return unless otherwise required by a final
determination applicable to the relevant Tax jurisdiction resulting from an
audit, subsequent proceedings or the expiration of the applicable statute of
limitations.

3. Representations and Warranties of Seller. Seller hereby makes the following
representations and warranties to Buyer, solely (in the case of representations
and warranties relating to the Company) with respect to the period commencing as
of the Cutoff Date, each of which is true and correct on the date hereof, each
of which shall be unaffected by any investigation heretofore or hereafter made
by Buyer and each of which shall survive the transactions contemplated hereby.
Notwithstanding anything to the contrary herein, Seller is not providing any
representation or warranty to Buyer (in the case of representations and
warranties relating to the Company) with respect to the period prior to the
Cutoff Date:

3.1 Organization; Capitalization.

(a) Seller is a limited partnership duly formed, validly existing and in good
standing under the Laws of the State of Delaware, and has all requisite power
and authority to own, operate and lease its assets and to conduct its business
as and where such business is now conducted. Seller is the only member of the
Company and is record and beneficial owner of all of the Interest.

(b) The Company is a limited liability company validly existing and in good
standing under the Laws of Delaware, and has all requisite limited liability
company power and authority to own, operate and lease its assets and to conduct
its business as and where such business is now conducted. The Company has no
subsidiaries and does not hold any equity or other ownership interest in any
partnership, limited partnership, joint venture, corporation, limited liability
company, trust, Governmental Authority and any other legal entity (together with
an individual, a “Person”).

 

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(c) Other than the Interest, there are no outstanding options, preemptive or
other rights, warrants, agreements, voting trusts, proxies, contracts, calls,
commitments or demands of any character relating to any limited liability
company interests or other equity interests in the Company. Other than the
Interest, there are no other securities of the Company, whether or not issued,
including any securities convertible into or evidencing the right to purchase
any limited liability company interest or other equity securities of the
Company.

(d) Sections 3.1(a)-(c) accurately and completely describe the capitalization
and ownership of the Company.

(e) All right, title and interest in and to the Interest is owned by Seller
beneficially and of record free and clear of all Encumbrances and without any
condition or restriction on transferability, except for restrictions under
federal and state securities Laws, and, except for such restrictions, is being
transferred to Buyer free and clear of all Encumbrances and without any
condition or restriction on transferability.

3.2 Due Qualification. The Company is duly qualified to do business and is in
good standing as a foreign limited liability company under the Laws of the
States of Kansas, Missouri, New York and Pennsylvania.

3.3 Authority; Binding Effect. Seller has the requisite limited partnership
right, power, authority and capacity to execute and deliver this Agreement and
all other agreements contemplated hereby to be entered into by it, to perform
its obligations hereunder and thereunder on its part to be performed and to
consummate the transactions contemplated hereby and thereby. The execution and
delivery by Seller of this Agreement and all other agreements and documents
contemplated hereby (the “Transaction Documents”) to be entered into by Seller
and the performance of its obligations hereunder and thereunder have been duly
approved by all necessary limited partnership action, and no further approvals
are required by the officers, directors, partners, managers, members, or equity
holders of Seller in connection therewith. This Agreement and each of the
Transaction Documents contemplated hereby to be entered into by Seller
constitute (or, when executed, will constitute) the legal, valid and binding
obligations of Seller, enforceable against Seller in accordance with their
respective terms, except as enforcement may be limited by bankruptcy,
insolvency, reorganization, moratorium, or other similar Laws relating to or
affecting creditors’ rights generally and to general equity principles (whether
such enforceability is considered in a proceeding at Law or in equity).

3.4 No Creation of Violation, Default, Breach or Encumbrance. The execution,
delivery and performance of this Agreement by Seller, and the execution,
delivery and performance of the Transaction Documents by Seller, do not
(i) violate (A) any applicable Law in any material respect or (B) any applicable
order, writ, injunction, decree, judgment or ruling of any Governmental
Authority, (ii) conflict with or violate any provision of the certificate of
limited partnership or the agreement of limited partnership of Seller,
(iii) conflict with or violate any provision of the certificate of organization
or the limited liability company agreement of the

 

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Company, or (iv) require the consent of any Person or result in the material
breach of or constitute a material default (or an event that, with notice or
lapse of time or both, would constitute a material default) under, violate,
conflict with, materially breach or give rise to any right of termination,
cancellation, modification or acceleration, or to a loss of material benefit to
which the Company is entitled, under (A) any contract to which the Company is a
party and that (I) involves, or may reasonably be expected to involve, the
payment or receipt of $100,000 or more (whether in cash or in goods or services
of an equivalent value) over its term, including extension and renewal rights
that are at the option of the counterparty (i.e., not the Company) to such
Contract, or $50,000 during any one year; (II) imposes any restriction on the
conduct of the Business (including noncompetition and similar restrictions);
(III) was not made in the ordinary course of business of the Company consistent
with past practice; (IV) burdens, benefits, or imposes liabilities upon, or
otherwise with respect to, any Real Property; (V) the continued conduct of the
Business is dependent upon; (VI) is a partnership, joint venture or other
similar contract; or (VII) is a collective bargaining or other labor union
contract (each, a “Material Contract”), or (B) any licenses, authorizations,
permits, consents or approvals of any Governmental Authority required for the
Company to own, license or lease and operate its properties or to conduct the
Business in substantially the same manner as conducted by the Company on the
date hereof.

3.5 Approvals, Licenses, Permits and Authorizations.

(a) To the knowledge of Seller, no (i) order, license, consent, waiver,
authorization or approval of, or (ii) giving of notice to, or (iii) filing,
recording, publication, registration or other action with or by, any
Governmental Authority is necessary on behalf of Seller or the Company (y) to
authorize Seller’s execution, delivery and performance of this Agreement or any
other Transaction Document, or (z) for the legality, validity, binding effect or
enforceability with respect to Seller or the Company of this Agreement or any
other Transaction Document.

(b) The Company has all permits, licenses, approvals, authorizations, consents
or registrations (collectively, “Permits”) issued or granted by Governmental
Authorities that are necessary for the conduct of the Business as currently
conducted, except as would not, individually or in the aggregate, have a
Material Adverse Effect. All such Permits are validly held by the Company and
are in all material respects in full force and effect. The Company has complied
in all material respects with the terms and conditions of such Permits and such
Permits will not be subject to suspension, modification, revocation or
non-renewal as a result of the execution, delivery and performance by Seller of
this Agreement or any other Transaction Document or the consummation by Seller
of the transactions contemplated hereby or thereby, except as would not,
individually or in the aggregate, have a Material Adverse Effect. No proceeding
is pending or, to the knowledge of Seller, threatened with respect to any
alleged failure by the Company to have any material Permit necessary for the
operation of any of the Company’s assets or the conduct of the Business or to be
in compliance therewith. This Section 3.5(b) does not include any matters with
respect to Environmental Permits or Environmental Laws; such matters are being
addressed exclusively by Section 3.13.

 

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3.6 Compliance With Laws. The Company is not in violation of any Law, or any
order, writ, injunction or decree of any Governmental Authority to which it or
any of its assets is subject, except for a violation that would not,
individually or in the aggregate, have a Material Adverse Effect.

3.7 No Litigation. Except as set forth on Schedule 3.7 attached hereto, there is
no lawsuit, claim, demand, action, investigation, hearing, charge, condemnation
or other proceeding, complaint or notice of noncompliance, whether or not such
matter is by or before any Governmental Authority, mediator or arbitrator (an
“Action”) or other proceeding or governmental investigation or examination or
any change in any zoning or building ordinance adversely affecting the property
of the Company, pending or, to the knowledge of Seller, threatened, or any
injunctions or orders entered, pending or, to the knowledge of Seller,
threatened, against the Company or any of its properties or assets, at Law or in
equity, and, to the knowledge of Seller, there exists no basis for the
commencement and successful prosecution of any of the foregoing.

3.8 Financial Statements.

(a) Attached as Schedule 3.8(a) are accurate and complete copies of: (i) the
unaudited balance sheet of the Company as of September 30, 2011 and the related
unaudited statements of operations and cash flows of the Company for the fiscal
year ending September 30, 2011 (the “Balance Sheet Date”) (collectively, the
“Financial Statements “), and (ii) the unaudited balance sheet of the Company as
of March 31, 2012 and unaudited statements of operations and cash flows for the
six months ended March 31, 2012 (the “March 31 Financials”); all of which have
been previously delivered to Buyer. The Financial Statements fairly present the
financial position of the Company as of the Balance Sheet Date and the March 31
Financials fairly present the financial position of the Company as of March 31,
2012, in all material respects, and the results of the Company’s operations as
of the dates and for the periods indicated above, and have been prepared in
conformity with GAAP (with the exception that the Financial Statements and
March 31 Financials do not include both a statement of stockholders equity and
footnotes), applied on a consistent basis throughout the periods covered
thereby, and no event has occurred after the Balance Sheet Date that would be
required to be set forth in the Financial Statements under GAAP (or in footnotes
thereto, if footnotes were prepared).

(b) The Company has no liabilities or obligations, whether accrued, absolute,
contingent or otherwise, that are required to be reflected or reserved against
on its balance sheet under GAAP that is part of the Financial Statements other
than (i) those which are fully and adequately reflected or reserved against in
the Company’s balance sheet included in the Financial Statements, and
(ii) liabilities (other than non-current liabilities and Indebtedness for
borrowed money) incurred since the Balance Sheet Date in the ordinary course of
business consistent with past practice.

3.9 Absence of Certain Events. Since the Balance Sheet Date, the Business has
been operated only in the ordinary course of business consistent with past
practice and in particular:

 

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(a) there has not been any Material Adverse Effect;

(b) except in the ordinary course of business consistent with past practice,
there has not been (i) any damage, destruction or loss, whether covered by
insurance or not, adversely affecting the Company’s assets or the Business or
(ii) any cancellation, modification or settlement for less than the full amount
thereof of any debt or claim by or owing to the Company;

(c) the Company has not (i) incurred any non-current obligation or liability
(including any Capital Lease) or assumed, guaranteed, endorsed or otherwise
become responsible for any non-current liabilities or obligations of any other
Person (including any Capital Lease) (whether absolute, accrued, contingent or
otherwise), (ii) transferred or granted any rights under any Material Contract
other than in the ordinary course of business consistent with past practice,
(iii) modified or changed any Material Contract other than in the ordinary
course of business consistent with past practice, (iv) entered into any
transaction, contract or commitment that by reason of its size or otherwise was
material to the Business or financial condition of the Company or that was not
in the ordinary course of business consistent with past practice, (v) declared
or paid any dividend or made any distribution or payment, (vi) delayed or
postponed the payment of any non-current liabilities, or (vii) made any capital
investments in, any loan to or any acquisition of the securities or assets of
any other Person that was material to the Business or financial condition of the
Company or other than in the ordinary course of business consistent with past
practice;

(d) except for the replacement of obsolete materials or in the ordinary course
of business, the Company has not terminated, discontinued, closed or disposed of
any plant, facility or any other portion of its assets;

(e) except for the Omnibus Agreement and the Contracts disclosed in the
Financial Statements, the Company is not currently a party to any Contract
between the Company, on the one hand, and Seller or any of its Affiliates (other
than the Company, the Buyer and the Buyer’s subsidiaries), on the other hand;
and

(f) the Company has not entered into a Contract to do any of the foregoing.

3.10 Tax Returns and Tax Audits.

(a) Seller and the Company have timely filed with all appropriate Governmental
Authorities all Tax Returns required to be filed by or with respect to the
Company or its assets for all years and periods starting with the Cutoff Date
for which such Tax Returns have become due. All such Tax Returns are correct and
complete in all material respects. All such Tax Returns that are based on income
have been prepared on the same basis as those of previous years; and, since the
Cutoff Date, all Taxes of Seller and the Company (whether or not shown to be due
on any Tax Returns) have been fully paid prior to the date on which such Taxes
would otherwise be delinquent.

(b) Seller and the Company have made adequate accruals for the payment of all
Taxes payable in respect of the periods starting with the Cutoff Date and ending
prior to the date hereof and any period subsequent to the last period for which
such Taxes were paid, and, to the knowledge of Seller, the Company has no
liability for such Taxes in excess of the amounts so paid or accruals so made.

 

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(c) There are no Liens for Taxes with respect to the assets of the Company
(except for statutory Encumbrances for current Taxes not yet due).

(d) Neither Seller nor the Company is a party to any pending Action by any
Governmental Authority nor, to the knowledge of Seller, is any Action threatened
or contemplated by any Governmental Authority, for assessment or collection of
Taxes or any other governmental charges with respect to the Company or its
assets, and no claim for assessment or collection of Taxes or any other
governmental charges has been asserted against either Seller or the Company with
respect to the Company or its assets, nor, to the knowledge of Seller, is the
assertion of any such Action pending or contemplated nor, to the knowledge of
Seller, is there any basis for any such Action with respect to the period
beginning as of the Cutoff Date. To the knowledge of Seller, since the Cutoff
Date, there has been no adverse reports prepared by any agent of the IRS with
respect to any Tax matter involving with respect to the Company or its assets.

(e) Each of Seller and the Company is not and, since the Cutoff Date, has not
been required to file any Tax Returns with, or pay any Taxes to, any foreign
countries or political subdivisions thereof with respect to the Company or its
assets. Neither Seller nor the Company has in effect any powers of attorney with
respect to any Tax matters involving the Company or its assets. Since the Cutoff
Date, no consent been filed by Seller or the Company to have the provisions of
Section 341(f)(2) of the Code apply to the Company or its assets, nor has any
agreement under Section 341(f)(3) of the Code been filed following the Cutoff
Date by Seller or the Company with respect to the Company or its assets.

(f) The Company has, since the Cutoff Date, been treated as a partnership or a
disregarded entity for federal income tax purposes and no election has been made
that is inconsistent with such treatment,

(g) The Company is not, and since the Cutoff Date has never been, a party to any
Tax sharing or allocation Contracts, arrangements or understandings, whether
written or oral.

(h) Since the Cutoff Date, the Company has complied with all applicable Laws
relating to the withholding of Taxes (including withholding of Taxes pursuant to
Sections 1441 and 1442 of the Code) and has, since the Cutoff Date and within
the time and within the manner prescribed by Law, withheld and paid over to the
proper taxing authorities all amounts required to be withheld and paid over
under all applicable Laws in connection with amounts paid or owing to any
employee, independent contractor, creditor, member and other third party.

(i) No written notice has been received, nor to the knowledge of Seller has any
oral notice been received, by the Company from any Governmental Authority, since
the Cutoff Date, in a jurisdiction where the Company does not file Tax Returns
stating that the Company is required to file Tax Returns with that jurisdiction,

 

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(j) Seller has no knowledge of any fact or circumstance that arose following the
Cutoff Date that would give rise to a claim by a state in which Seller or the
Company is not currently filing income tax returns that either Seller or the
Company has such an income tax filing responsibility with respect to the
operations or assets of the Company.

(k) The Company has not been at any time since the Cutoff Date a member of any
partnership, joint venture or other arrangement or Contract that is treated as a
partnership for federal, state, local or foreign tax purposes (a “Tax
Partnership”) or the holder of a beneficial interest in any trust for any period
for which the statute of limitations for any Tax has not expired.

3.11 Real Property.

(a) The Title Policy lists all of the real property in which the Company has any
ownership and other interests and which is necessary for the conduct of the
Business as currently conducted (except as would not, individually or in the
aggregate, have a Material Adverse Effect) (collectively, the “Real Property”).
The Company does not lease, as lessee, landlord, sublandlord, licensor or
otherwise, or otherwise make available, any interest in real or mixed property
including, without limitation, the Real Property. The Company has good and
indefeasible fee simple title to all real property in which the Company has any
ownership free and clear of all Encumbrances except for Permitted Encumbrances.

(b) Neither Seller nor the Company has received notice of any threatened or
pending actions, orders, or forbearances in effect as to the Real Property, and
to the knowledge of Seller and the Company, no action, order or forbearance is
currently in effect or threatened with respect to the Real Property including,
without limitation, any condemnation or similar proceeding, special assessment
or change in zoning.

3.12 Other Property and Inventory.

(a) The Company has good and indefeasible title to all tangible personal
property (other than construction in process) of the Company necessary for the
conduct of the Business as currently conducted (except as would not,
individually or in the aggregate, have a Material Adverse Effect), free and
clear of all Encumbrances except Permitted Encumbrances. The Company has good
and indefeasible title to all of the tangible personal property reflected in the
balance sheets included in the Financial Statements.

(b) The material machinery and equipment (including automobiles, trucks and
heavy machinery) regularly used by the Company in the Business are in an
operating condition and repair as of the date of this Agreement that is adequate
for such uses.

(c) All product inventories of the Company are of a quality and quantity usable
in the ordinary course of its business. The values at which product inventories
of the Company are carried on its books of account reflect the normal inventory
valuation policy of the Company on a first-in-first-out basis at the lower of
cost or market.

 

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(d) The trade accounts receivable of the Company as shown on its books and
records have arisen in the ordinary course of business, represent valid
obligations owed to the Company and are recorded as accounts receivable on the
books of the Company in accordance with GAAP.

(e) The Company has (and, after the consummation of the transactions
contemplated hereby, will have) a level of working capital that is adequate for
the continuing operation of the Business, consistent with past practice.

3.13 Environmental.

(a) Except as provided in Schedule 3.13(a), as of the Cutoff Date and through
the date hereof, the Company has complied and is in compliance with all
Environmental Laws.

(b) All Environmental Permits necessary for the construction, equipping,
ownership, use or operation of the Business as currently conducted or occupation
of the Real Property has been obtained and Seller has, in all material respects,
complied and is in material compliance with such Environmental Permits. The
Environmental Permits are in full force and effect, and the transactions will
not materially adversely affect them.

(c) Except as provided in Schedule 3.13(a), there are no actions pending or, to
the knowledge of Seller, threatened, that could reasonably be expected to cause
the incurrence of material expenses or costs or that seek material money
damages, injunctive relief, investigatory, corrective or remedial action or
remedy that arise out of, relate to or result from (i) conditions of the
Environment on the Real Property, (ii) a violation or alleged violation of any
applicable Environmental Law or non-compliance or alleged non-compliance with
any Environmental Permit, (iii) the presence of any Hazardous Substances or a
Release or the threat of a Release of any Hazardous Substances, (iv) arrangement
for treatment or disposal of any Hazardous Substances at any location other than
the Real Property, or (v) human exposure to any Hazardous Substance (excluding
exposure by Company employees, which is governed by Section 3.15) to the extent
the same arise from the condition of the Real Property since the Cutoff Date.

(d) As of the Cutoff Date and through the date hereof, Seller has not received
any form of notice or inquiry, notice of violation or enforcement notice from
any Governmental Authority, any operator, tenant, subtenant, licensee or
occupant of the Real Property or any property adjacent to or within one half
mile of the Real Property or any other Person with regard to a Release or the
threat of a Release of any Hazardous Substances on, under, at or from the Real
Property, or any property adjacent to or within the immediate vicinity of the
Real Property in violation of any applicable Law; and to Seller’s actual
knowledge there has been no Release or threat of Release of any Hazardous
Substances by the Company on, under, at, from or in the vicinity of the Real
Property that requires or may require reporting, investigation, assessment,
cleanup or remediation by the Company pursuant to any Environmental Law.

 

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3.14 Contracts and Commitments.

(a) Each Material Contract is in full force and effect as to the Company and
embodies the Company’s complete understanding of the parties agreement with
respect to the subject matter thereof. There exists no material default or claim
thereof by the Company, or, to the knowledge of Seller, any other party to any
Material Contract. There are no facts or conditions that, if continued or
noticed, would result in a material default by the Company under any Material
Contract. The Company has not received any notice that any other Person intends
to cancel, modify or terminate any Material Contract, or to exercise or not to
exercise any options thereunder. The Company has not given any notice of
cancellation, modification or termination of any Material Contract or of
exercise or non-exercise of any options thereunder. Each Material Contract is a
valid and binding agreement with respect to the Company and enforceable against
the Company in accordance with its terms, except as enforcement may be limited
by bankruptcy, insolvency, reorganization, moratorium, or other similar Laws
relating to or affecting creditors’ rights generally and to general equity
principles (whether such enforceability is considered in a proceeding at Law or
in equity). No consent or approval of the other parties to any Material Contract
or any Person pursuant to any Material Contract is required for the consummation
of the transactions contemplated herein.

(b) The Company is not a party to any contract for goods or services or any
lease with Seller, or any officer, director, manager or other senior employee of
Seller or the Company or any Affiliate of any such Person nor are there any
loans or advances to any such Persons from the Company that are presently
outstanding.

(c) After the date hereof, none of Seller or its Affiliates (excluding Buyer,
its subsidiaries and its general partner) will have any legal rights with
respect to the use, operation or maintenance of the Business or its assets.

3.15 Labor Matters.

(a) The Company employs employees, some of which are covered by the Steelworkers
Agreement. Except for the Steelworkers Union: (i) the Company has not agreed to
recognize any union or other collective bargaining representative; and (ii) no
union or other collective bargaining representative has been certified as the
exclusive bargaining representative of any of the Company’s employees. None of
the Company’s employees are covered by any collective bargaining agreement,
other than the Steelworkers Agreement. The Steelworkers Agreement has been duly
ratified, certified and approved by the parties having authority to ratify,
certify or approve it.

(b) None of the following are pending or, to the knowledge of Seller, threatened
against or affecting the Company or the Refinery:

(i) labor strikes, slowdowns, lockouts, representation or certification
campaigns, or work stoppages with respect to the Company’s employees or any of
the Seller’s employees who provide exclusive or shared services to the Company
(the “Associated Employees”);

 

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(ii) material claims, grievances or arbitration proceedings, written decisions,
letter agreements or settlement agreements arising out of collective bargaining
agreements, including the Steelworkers Agreement, to which any of the Company,
Seller or Affiliates of Seller is a party;

(iii) unfair labor practices or unfair labor practice charges or complaints
before the National Labor Relations Board or other Governmental Authority
responsible for regulating labor relations; or

(iv) charges, complaints or proceedings before the Equal Employment Opportunity
Commission, Department of Labor or any other Governmental Authority responsible
for regulating employment practices.

(c) Since the Cutoff Date, there have not been any plant closings, mass layoffs
or other terminations of the Company’s employees or of the Associated Employees
that would create any liabilities for the Company under the Worker Adjustment
and Retraining Notification Act or similar Laws.

(d) The Company does not sponsor, maintain or contribute to or have or could
reasonably be expected, directly or indirectly, to have any actual or contingent
liability with respect to, nor does it have any legal or equitable obligation to
establish, maintain or contribute to any compensation or benefit plan,
agreement, program or policy (whether written or oral, formal or informal) for
the benefit of any present or former directors, officers, employees, agents,
consultants or other similar representatives, including, but not limited to, any
“employee benefit plan” as defined in Section 3(3) of ERISA (any of the
foregoing arrangements for the benefit of such persons are hereinafter
collectively referred to as “Plans”). All Plans in which Associated Employees
participate are sponsored or maintained by Seller or an Affiliate (other than
the Company).

3.16 Investment Representations.

(a) Seller is an “accredited investor” (as such term is used in Rule 501 under
the Securities Act, as amended by the Dodd-Frank Wall Street Reform and Consumer
Protection Act) and has such knowledge and experience in financial and business
matters as to be capable of evaluating the merits and risks of its investment in
Buyer Units, and it is able to bear the economic risk of such an investment for
an indefinite period of time. Seller was not formed for the specific purpose of
acquiring Buyer Units.

(b) The Consideration Units are being acquired (i) solely for investment for the
account of Seller and not as nominee or agent or otherwise on behalf of any
other Person, and (ii) not with a view to or with any present intention to
reoffer, resell, fractionalize, assign, grant any participating interest in,
transfer or otherwise distribute the Consideration Units in violation of the
Securities Act.

 

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(c) Seller understands that the transfer of the Consideration Units to Seller
has not been registered under the Securities Act or any applicable state
securities Laws by reason of a specified exemption from the registration
provisions of the Securities Act and applicable state securities Laws, which
depends upon, among other things, the bona fide nature of Seller’s investment
intent as expressed herein.

(d) Seller understands that Buyer is under no obligation to register the
Consideration Units for sale on Seller’s behalf or to assist Seller in complying
with any exemption from registration under the Securities Act or under
applicable state securities Laws.

(e) Seller agrees that the certificates evidencing the Consideration Units will
be stamped or otherwise imprinted with a conspicuous legend in substantially the
following form:

The Units represented by this certificate have not been registered under the
Securities Act of 1933, as amended (the “Act”) or any state securities laws.
These Units have been acquired for investment and not with a view to
distribution or resale, and may not be sold, pledged, hypothecated, donated or
otherwise transferred, whether or not for consideration, without an effective
registration statement under the Act and any applicable state securities laws,
or an opinion of counsel satisfactory to Inergy Midstream, L.P. that such
registration is not required with respect to the proposed disposition thereof
and that such disposition will not cause the loss of the exemption(s) upon which
Inergy Midstream, L.P. relied in issuing these Units to the original purchaser
thereof.

(f) Seller agrees that a stop transfer order that gives effect to the foregoing
restrictive legend will be placed on the transfer books maintained with respect
to the Consideration Units for so long as transfers are restricted under the
Securities Act.

3.17 No Other Warranties. Except for the specific representations and warranties
of Seller expressly set forth in this Section 3, there are no other
representations or warranties (including any warranty of merchantability or
warranty of fitness for a particular purpose), express or implied, made by
Seller, the Company or any of their employees, agents, members, partners,
managers or representatives relating to or concerning any assets, properties,
liabilities, obligations, financial condition, operations, or other aspects or
prospects of the Company and its business (including the physical condition,
structural integrity, suitability or usability of any salt caverns for gas
storage purposes), and all assets, properties and business of the Company are
being acquired by Buyer in AS IS, WHERE IS CONDITION AND WITH ALL FAULTS.

3.18 Reliance. Seller has been actively involved in the management of the
Company and, in connection with its decision to sell the Interest pursuant to
this Agreement, is not relying upon any representation or warranty of Buyer or
the Company regarding the Company or its business, financial condition or
results of operations, except as expressly set forth herein.

 

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4. Representations and Warranties of Buyer. Buyer hereby makes the following
representations and warranties to Seller, each of which is true and correct on
the date hereof, each of which shall be unaffected by any investigation
heretofore or hereafter made by Seller and each of which shall survive the
transactions contemplated hereby:

4.1 Organization. Buyer is a limited partnership duly formed, validly existing
and in good standing under the Laws of the State of Delaware, and has all
requisite power and authority to own, operate and lease its assets and to
conduct its business as and where such business is now conducted.

4.2 Due Qualification. Buyer is duly qualified to do business and is in good
standing under the Laws of the States of Missouri, New York and Texas.

4.3 Authority; Binding Effect. Buyer has the requisite limited partnership
right, power, authority and capacity to execute and deliver this Agreement and
all other agreements contemplated hereby to be entered into by it, and to
perform its obligations hereunder and thereunder on its part to be performed and
to consummate the transactions contemplated hereby and thereby. The execution
and delivery by Buyer of this Agreement and the Transaction Documents and the
performance of its obligations hereunder and thereunder have been duly approved
by all necessary limited liability company action, and no further approvals are
required by the officers, directors, partners, managers, members or equity
holders of Buyer in connection therewith. This Agreement and each of the
Transaction Documents contemplated hereby to be entered into by Buyer constitute
(or, when executed, will constitute) the legal, valid and binding obligations of
Buyer, enforceable against Buyer in accordance with their respective terms,
except as enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium, or other similar Laws relating to or affecting creditors’ rights
generally and to general equity principles (whether such enforceability is
considered in a proceeding at Law or in equity).

4.4 No Creation of Violation, Default, Breach or Encumbrance. The execution,
delivery and performance by Buyer of this Agreement and the Transaction
Documents do not, (i) violate (A) any applicable Law in any material respect, or
(B) any order, writ, injunction, decree, judgment or ruling of any Governmental
Authority, or (ii) conflict with or violate any provision of the certificate of
limited partnership or the agreement of limited partnership of Buyer.

4.5 Approvals, Licenses and Authorizations. No (i) order, license, consent,
waiver, authorization or approval of, or (ii) giving of notice to, or
(iii) filing, recording, publication, registration or other action is necessary
on behalf of Buyer (y) to authorize Buyer’s execution, delivery and performance
of this Agreement or any other Transaction Document, or (z) for the legality,
validity, binding effect or enforceability with respect to Buyer of any of the
foregoing.

4.6 Reliance. Buyer has been actively involved in the management of the Company
and, in connection with its decision to purchase the Interest pursuant to this
Agreement, is not relying upon any representation or warranty of Seller or the
Company regarding the Company or its business, financial condition or results of
operations, except as expressly set forth herein.

 

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5. Covenants and Acknowledgements.

5.1 Proration of Taxes. All ad valorem Taxes (including real property, personal
property and inventory) against or in respect of the assets of the Company for
the taxable period which includes the day before the date hereof will be
prorated between Seller and Buyer as of the end of the day before the date
hereof based on the ratio of the number of days in the portion of any taxable
period that includes the day before the date hereof and the number of days in
the entire Tax period. If the amount of such Taxes or assessments cannot be
ascertained as of the day before the date hereof, proration will be made on the
basis of the preceding year and to the extent that such proration may be
inaccurate Buyer and Seller agree to make such payment to the other within ten
business days after the Tax statements have been received which are necessary to
allocate such Taxes properly between Buyer and Seller as of the end of the day
before the date hereof; provided, however, that Seller will have no
responsibility for any increase in ad valorem Taxes resulting from any increase
in valuation assessments of property resulting from the transactions
contemplated by this Agreement. Buyer will cause the Company to pay such Taxes
when due and Buyer’s and Seller’s prorated portions thereof will be paid by
Buyer and Seller upon the Company’s request to the extent not already paid by
such Person. Ad valorem Taxes include payments to be made by the Company in lieu
of ad valorem Taxes under any PILOT program.

5.2 Cooperation with Tax Filings. Buyer and Seller will reasonably cooperate, as
and to the extent reasonably requested by the other party, in connection with
the filing of Tax Returns and any audit, litigation or other proceeding with
respect to Taxes relating to the Company or its assets, Buyer and Seller
acknowledge that the transfer of the Interest (other than the proportionate
share contributed in exchange for Buyer Units) will be treated as an asset
purchase for Federal and state income tax purposes. Accordingly, Seller will
file all Tax Returns for the period ending at the effective time of the transfer
of the Interest. Such cooperation includes the retention and (upon the other
party’s request) the provision of records and information reasonably relevant to
any such audit, litigation or other proceeding and making employees available on
a mutually convenient basis to provide additional information and explanation of
any material provided under this Section 5.2. Buyer and Seller will (A) retain
(or cause the Company to retain) all books and records with respect to Tax
matters relating to the Company relating to any taxable period beginning before
the date hereof until the expiration of the statute of limitations (and, to the
extent notified by Seller, any extensions thereof) of the respective taxable
periods, and abide by all record retention agreements entered into with any
taxing authority, and (B) give the other party reasonable written notice prior
to destroying or discarding any such books and records and, if the other Party
so requests, allow the other party to take possession of such books and records.
For those Taxes for which the Company is deemed to continue as the same state
Law entity after the consummation of the transactions contemplated by this
Agreement, the Company will not, and Buyer will not cause or allow the Company
to, file any amended Tax Returns for periods ending on or before the date hereof
unless required by Law; and if required by Law, Buyer will provide advance
notice to Seller of such filing and at least ten days to review and comment on
(but not approve) such filing.

 

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5.3 Cash Tax Refunds for Certain Periods. Buyer will promptly pay to Seller any
cash Tax refund received by Buyer (or any Affiliate of Buyer) or the Company
directly related to the operations, activities or assets of the Company for any
taxable period or any portion of any taxable period ending prior to the date
hereof, that includes the date hereof.

5.4 Audited Financials. Seller shall use commercially reasonable efforts to
provide or to cooperate with Buyer as it may reasonably request from Seller in
Buyer’s preparation of the financial statements necessary for Buyer to timely
meet its disclosure and filing requirements pursuant to the Securities Act and
the Securities Exchange Act of 1934, as amended, and to provide direct access to
the data required to prepare such financial statements for auditing purposes.
Data provided will be limited to such information that Seller has readily
available for up to three years prior to the year in which the request is made
and within the periods 2009 to 2012. All expenses for this process, including
the preparation of such financial statements, shall be borne by Buyer; provided
that Seller shall bear its internal costs concerning the allocation of personnel
to abide by its undertaking made in this Section 5.4.

5.5 Expenses. Each Party agrees to pay, without right of reimbursement from any
other Person (including the Company), the costs incurred by such party incident
to the preparation and execution of this Agreement and performance of their
respective obligations hereunder, including the fees and disbursements of legal
counsel, accountants and consultants employed by the respective parties in
connection with the transactions contemplated by this Agreement. Buyer will be
responsible for paying any and all sales taxes, transfer taxes, stamp taxes and
similar transfer (issuance) taxes that may be imposed by any Governmental
Authority as a result of the purchase and sale of the Interest and issuance of
the Consideration Units.

6. Indemnification.

6.1 Seller’s Indemnity. Subject to the provisions of this Section 6, Seller,
from and after the date hereof, will indemnify, defend and hold Buyer and its
partners, members, directors, officers, agents, employees, representatives,
successors and assigns, harmless from and against all damage, loss, cost,
obligation, claims, demands, assessments, judgments or liability (whether based
on contract, tort, product liability, strict liability or otherwise), including
taxes, and all expenses (including interest, penalties and attorneys’ and
accountants’ fees and disbursements) (collectively “Damages”) incurred in
litigation or otherwise, and any investigation relating thereto, by any of the
above-named Persons, directly or indirectly, resulting from or in connection
with:

(a) any representation or warranty made by Seller in this Agreement or in any
Transaction Document not having been accurate and complete;

(b) any breach by Seller of any covenant or obligation made or undertaken in
this Agreement or in any Transaction Document; and

(c) any Action incident to any of the foregoing.

6.2 Buyer’s Indemnity. Subject to the provisions of this Section 6, Buyer, from
and after the date hereof, will indemnify, defend and hold Seller and its
partners, members, directors, officers, agents, employees, representatives,
successors and assigns, harmless from and against all Damages incurred in
litigation or otherwise, and any investigation relating thereto, by any of the
above-named Persons, directly or indirectly, resulting from or in connection
with:

 

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(a) any representation or warranty made by Buyer in this Agreement or in any
Transaction Document not having been accurate and complete;

(b) any breach by Buyer of any covenant or obligation made or undertaken in this
Agreement or in any Transaction Document; and

(c) any Action incident to any of the foregoing.

6.3 Procedure. All claims for indemnification by Buyer or Seller under this
Section 6 (the Party claiming indemnification and the Party against whom such
claims are asserted being the “Indemnified Party” and the “Indemnifying Party,”
respectively) must be asserted and resolved as follows:

(a) If any claim or demand for which an Indemnifying Party would be liable to an
Indemnified Party hereunder is asserted against or sought to be collected from
such Indemnified Party by a third party, such Indemnified Party will with
reasonable promptness give notice (the “Claim Notice”) to the Indemnifying Party
of such claim or demand, specifying the nature of and specific basis for such
claim or demand and the amount or the estimated amount thereof to the extent
then feasible (which estimate will not be conclusive of the final amount of such
claim and demand). The Indemnifying Party will not be obligated to indemnify the
Indemnified Party under this Agreement with respect to any such claim or demand
if the Indemnified Party fails to notify the Indemnifying Party thereof in
accordance with the provisions of this Agreement, and, as a result of such
failure, the Indemnifying Party’s ability to defend against the claim or demand
is materially prejudiced. The Indemnifying Party will have ten days from the
delivery or mailing of the Claim Notice (the “Notice Period”) to notify the
Indemnified Party (i) whether or not it disputes the liability of the
Indemnifying Party to the Indemnified Party hereunder with respect to such claim
or demand, and (ii) whether or not it desires, at the cost and expense of the
Indemnifying Party, to defend the Indemnified Party against such claim or
demand; provided, however, that any Indemnified Party is hereby authorized, but
is not obligated, prior to and during the Notice Period, to file any motion,
answer or other pleading that it deems necessary or appropriate to protect its
interests or those of the Indemnifying Party, subject to providing reasonable
advance notice to the Indemnifying Party of such action and a copy of any
documentation to be provided or submitted in connection therewith; provided,
that failure to deliver any such notice shall not be deemed a breach hereunder
except to the extent the Indemnifying Party’s ability to defend against the
claim or demand is materially prejudiced. If the Indemnifying Party notifies the
Indemnified Party within the Notice Period that it desires to defend the
Indemnified Party against such claim or demand, the Indemnifying Party will,
subject to the last sentence of this paragraph, have the right to control the
defense against the claim by all appropriate proceedings and any settlement
negotiations and the Indemnified Party shall not compromise or settle the claim
without the Indemnifying Party’s prior written consent. If the Indemnified Party
desires to participate in, but not control, any such defense or settlement, it
may do so at its sole cost

 

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and expense. If the Indemnifying Party fails to respond to the Indemnified Party
within the Notice Period, elects not to defend the Indemnified Party, or after
electing to defend fails to commence or reasonably pursue such defense, then the
Indemnified Party may, but is not required to, undertake or continue the defense
of, and compromise or settle (exercising reasonable business judgment), the
claim or other matter all on behalf, for the account and at the risk of the
Indemnifying Party.

(b) If requested by the Indemnifying Party, the Indemnified Party agrees, at the
Indemnifying Party’s expense, to cooperate with the Indemnifying Party and its
counsel in contesting any claim or demand that the Indemnifying Party elects to
contest.

(c) If any Indemnified Party has a claim against the Indemnifying Party
hereunder that does not involve a claim or demand being asserted against or
sought to be collected from it by a third party, the Indemnified Party will send
a Claim Notice with respect to such claim to the Indemnifying Party. If the
Indemnifying Party disputes such claim, such dispute will be resolved by
litigation in an appropriate court of competent jurisdiction.

6.4 Time Limitations on Certain Obligations.

(a) Seller will have no liability for indemnification under this Agreement
pursuant to Section 6.1(a), except for the representations and warranties set
forth in Sections 3.1 (Organization; Capitalization), 3.2 (Due Qualification),
3.3 (Authority; Binding Effect), and 3.10 (Tax Returns and Tax Audits), unless
on or before the end of the 12th month following the date hereof Buyer notifies
Seller of a claim specifying the factual basis of that claim in reasonable
detail to the extent then known by Buyer. A claim with respect to Sections 3.1
(Organization; Capitalization), 3.2 (Due Qualification), 3.3 (Authority; Binding
Effect), and 3.10 (Tax Returns and Tax Audits), may be made at any time.

(b) Buyer will have no liability for indemnification under this Agreement
pursuant to Section 6.2(a), except for the representations and warranties set
forth in Sections 4.1 (Organization), 4.2 (Due Qualification) and 4.3
(Authority; Binding Effect), unless on or before the end of the 12th month
following the date hereof Seller notifies Buyer of a claim specifying the
factual basis of that claim in reasonable detail to the extent then known by
Seller. A claim with respect to Sections 4.1 (Organization), 4.2 (Due
Qualification) and 4.3 (Authority; Binding Effect), may be made at any time.

6.5 Limitations on Amount.

(a) Subject to the last sentence of this Section 6.5(a), Seller will have no
liability for indemnification under Section 6.1(a) until the total of all
Damages with respect to such matters exceeds $1,750,000 (this amount, the
“Basket”), and once such amount has been exceeded, Seller will be liable for
indemnification for the total of all Damages in excess of the Basket. Subject to
the last sentence of this Section 6.5(a), Seller’s aggregate liability under
Section 6.1(a) (but excluding any liability for breach of any of Seller’s
representations and warranties contained in Sections 3.1 (Organization;

 

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Capitalization), 3.2 (Due Qualification), 3.3 (Authority; Binding Effect), and
3.10 (Tax Returns and Tax Audits)) is limited to $15,750,000. Notwithstanding
the foregoing, this Section 6.5(a) will not apply to any breach of any of
Seller’s representations and warranties contained in Sections 3.1 (Organization;
Capitalization), 3.2 (Due Qualification), 3.3 (Authority; Binding Effect), and
3.10 (Tax Returns and Tax Audits); provided that the first sentence of this
Section 6.5(a) shall apply with respect to any breach of any of Seller’s
representations and warranties contained in Section 3.10 (Tax Returns and Tax
Audits).

(b) Subject to the last sentence of this Section 6.5(b), Buyer will have no
liability for indemnification under Section 6.2(a) until the total of all
Damages with respect to such matters exceeds the Basket, and once such amount
has been exceeded, Buyer will be liable for indemnification for the total of all
Damages in excess of the Basket. Subject to the last sentence of this Section
6.5(b), Buyer’s aggregate liability under Section 6.2(a) (but excluding any
liability for breach of any of Buyer’s representations and warranties contained
in Sections 4.1 (Organization), 4.2 (Due Qualification) and 4.3 (Authority;
Binding Effect)) is limited to $15,750,000. Notwithstanding the foregoing, this
Section 6.5(b) will not apply to any breach of any of Buyer’s representations
and warranties contained in Sections 4.1 (Organization), 4.2 (Due Qualification)
and 4.3 (Authority; Binding Effect).

(c) The Parties have agreed upon the amount of the Basket as a means of applying
a materiality standard to the amount of any claim that Buyer may have against
Seller, or that Seller may have against Buyer, resulting from a breach of
Seller’s or Buyer’s representations and warranties, as the case may be.
Therefore, for purposes of determining whether any breach of the representations
or warranties of Seller or Buyer, as the case may be, has occurred and for
purposes of calculating the dollar amount of Damages to which Buyer or Seller,
as the case may be, is entitled to indemnification (including the amounts needed
to reach the Basket), each of Seller’s and Buyer’s representations and
warranties that contain any qualification as to materiality will be deemed and
interpreted to be a representation or warranty as to such items made without
such qualification.

6.6 Waiver of Punitive Damages. No Party will be liable to another party for any
consequential, indirect, incidental, punitive, exemplary, special or other
similar damages or lost profits resulting from or arising out of this Agreement
or the transactions contemplated by this Agreement.

6.7 Costs. If any Action is brought for the enforcement or interpretation of any
of the rights or provisions of this Agreement (including the indemnification
provision), or because of an alleged dispute, breach, default or
misrepresentation in connection with any of the provisions of this Agreement,
the successful or prevailing party will be entitled to recover reasonable
attorneys’ fees and all other costs and expenses incurred in that Action, in
addition to any other relief to which it may be entitled.

 

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6.8 Exclusive Remedy. Each Party’s sole and exclusive remedy with respect to all
claims relating to the subject matter of this Agreement will be pursuant to the
indemnification provisions set forth in this Section 6.

7. Miscellaneous.

7.1 Choice of Law; Submission to Jurisdiction. This Agreement shall be subject
to and governed by the Laws of the State of Delaware, excluding any
conflicts-of-law rule or principle that might refer the construction or
interpretation of this Agreement to the Laws of another state. Each Party hereby
submits to the jurisdiction of the state and federal courts in the State of
Delaware and to venue in Delaware.

7.2 Notice. All notices or requests or consents provided for by, or permitted to
be given pursuant to, this Agreement must be in writing and must be given by
depositing same in the United States mail, addressed to the Person to be
notified, postpaid, and registered or certified with return receipt requested or
by delivering such notice in person or by telecopier or telegram to such Party.
Notice given by personal delivery or mail shall be effective upon actual
receipt. Notice given by telegram or telecopier shall be effective upon actual
receipt if received during the recipient’s normal business hours or at the
beginning of the recipient’s next business day after receipt if not received
during the recipient’s normal business hours. All notices to be sent to a Party
pursuant to this Agreement shall be sent to or made at the address set forth
below or at such other address as such Party may stipulate to the other Parties
in the manner provided in this Section 7.2.

For notice to Seller:

Inergy, L.P.

Two Brush Creek Boulevard, Suite 200

Kansas City, Missouri 64112

Attention: General Counsel

Fax: (816) 842-8181

For notice to Buyer:

Inergy Midstream, L.P.

Two Brush Creek Boulevard, Suite 200

Kansas City, Missouri 64112

Attention: General Counsel

Fax: (877) 506-3359

7.3 Entire Agreement. This Agreement constitutes the entire agreement of the
Parties relating to the matters contained herein, superseding all prior
contracts or agreements, whether oral or written, relating to the matters
contained herein.

7.4 Effect of Waiver or Consent. No waiver or consent, express or implied, by
any Party to or of any breach or default by any Party in the performance by such
Party of its obligations hereunder shall be deemed or construed to be a consent
or waiver to or of any other breach or default in the performance by such Party
of the same or any other obligations of such Party hereunder. Failure on the
part of a Party to complain of any act of the other Party or to declare the
other Party in default, irrespective of how long such failure continues, shall
not constitute a waiver by such Party of its rights hereunder until the
applicable statute of limitations period has run.

 

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7.5 Amendment or Modification. This Agreement may be amended or modified from
time to time only by the written agreement of both Parties. Each such instrument
shall be reduced to writing and shall be designated on its face an “Amendment”
or an “Addendum” to this Agreement.

7.6 Assignment; Third-Party Beneficiaries. No Party shall have the right to
assign any of its rights or obligations under this Agreement without the consent
of the other Parties hereto. This Agreement does not create any rights or
benefits for any entity or individual other than the Parties.

7.7 Successors. This Agreement shall bind and inure to the benefit of the
Parties and to their respective successors and assigns.

7.8 Counterparts. This Agreement may be executed in any number of counterparts,
including facsimile counterparts, with the same effect as if all signatory
Parties had signed the same document. All counterparts shall be construed
together and shall constitute one and the same instrument.

7.9 Severability. If any provision of this Agreement or the application thereof
to any Person or circumstance shall be held invalid or unenforceable by a court
or regulatory body of competent jurisdiction, the remainder of this Agreement
and the application of such provision to other Persons or circumstances shall
not be affected thereby and shall be enforced to the greatest extent permitted
by Law.

7.10 Rules of Construction. Whenever the context requires, the gender of all
words used in this Agreement shall include the masculine, feminine and neuter,
and the number of all words shall include the singular and plural. All
references to Section numbers refer to Sections of this Agreement. Unless
otherwise specifically indicated or the context otherwise requires, the terms
“include,” “includes” and “including” as used in this Agreement shall be deemed
to be followed by the words “without limitation.”

7.11 Further Assurances. In connection with this Agreement and all transactions
contemplated by this Agreement, each Party agrees to execute and deliver such
additional documents and instruments and to perform such additional acts as may
be necessary or appropriate to effectuate, carry out and perform all of the
terms, provisions and conditions of this Agreement and all such transactions.

7.12 Laws and Regulations. Notwithstanding any provision of this Agreement to
the contrary, no Party shall take any act, or fail to take any act, under this
Agreement which would violate any applicable Law.

7.13 Negation of Rights of Limited Partners, Assignees and Third Parties. The
provisions of this Agreement are enforceable solely by the Parties, and no
stockholder, limited partner, member or assignee of either Party or other Person
shall have the right, separate and apart from Seller or Buyer, to enforce any
provision of this Agreement or to compel any Party to comply with the terms of
this Agreement.

 

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7.14 No Recourse Against Officers or Directors. For the avoidance of doubt, the
provisions of this Agreement shall not give rise to any right of recourse
against any officer, director or manager of Seller, Buyer or their respective
general partners.

7.15 Legal Compliance. The Parties acknowledge and agree that this Agreement,
and all services provided under this Agreement, are intended to comply with any
and all Laws and legal obligations and that this Agreement should be construed
and interpreted with this purpose in mind.

[Signature Page Follows]

 

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IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be duly
executed as of the day and year first above written.

 

INERGY, L.P. By:   Inergy GP, LLC, its general partner By:   /s/ John J. Sherman
Name:   John J. Sherman Title:   President and Chief Executive Officer

 

INERGY MIDSTREAM, L.P. By:   NRGM GP, LLC, its general partner By:   /s/ R.
Brooks Sherman, Jr. Name:   R. Brooks Sherman, Jr. Title:  

Executive Vice President and

Chief Financial Officer

[Signature Page to Membership Interest Purchase Agrrement]

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EXHIBIT A

ASSIGNMENT AND TRANSFER OF MEMBERSHIP INTERESTS

For good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, Inergy, L.P., a Delaware limited partnership (hereinafter
referred to as “Assignor”), hereby assigns, sets over and transfers to Inergy
Midstream, L.P., a Delaware limited partnership (hereinafter referred to as
“Assignee”), effective as of the date hereof, all of Assignor’s membership
interests in US Salt, LLC, a Delaware limited liability company, being a 100%
membership interest, leaving Assignor without an interest in US Salt, LLC and
Assignee hereby accepts such assignment and transfer.

TO HAVE AND TO HOLD the same unto Assignee, its respective successors and
assigns forever.

IN WITNESS WHEREOF, Assignor and Assignee have caused this Assignment to be
executed as of May 14, 2012.

 

ASSIGNOR    ASSIGNEE INERGY, L.P.    INERGY MIDSTREAM, L.P. By:   INERGY GP,
LLC, its general partner    By:    NRGM GP, LLC, its general partner By:   /s/
John J. Sherman    By:    /s/ R. Brooks Sherman, Jr.   Name: John J. Sherman   
Name:    R. Brooks Sherman, Jr.   Title: President and Chief Executive Officer
   Title:    Executive Vice President and Chief Financial Officer        

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EXHIBIT B

AMENDMENT TO OMNIBUS AGREEMENT

This AMENDMENT TO THE OMNIBUS AGREEMENT (“Amendment”) is entered into on, and
effective as of May 14, 2012, among Inergy GP, LLC, a Delaware limited liability
company (“NRGY GP”), Inergy, L.P., a Delaware limited partnership (“NRGY”), NRGM
GP, LLC, a Delaware limited liability company (the “General Partner”), and
Inergy Midstream, L.P., a Delaware limited partnership (the “Partnership”). The
above-named entities are sometimes referred to in this Agreement each as a
“Party” and collectively as the “Parties.”

WHEREAS, the Parties entered into the Omnibus Agreement effective as of
December 15, 2011 (the “Agreement”)

WHEREAS, the Parties desire to amend the Agreement as set forth in this
Amendment and the Conflicts Committee of the Partnership has provided its prior
approval to this Amendment;

NOW THEREFORE, in consideration of the respective agreements of the parties set
forth herein, the Parties hereby agree as follows:

 

  1. The provisions of Article III of the Agreement shall not apply, and no
Party shall have any indemnity right or obligation towards any other Party under
the Agreement with respect to US Salt, LLC and its operations.

 

  2. The provisions of this Amendment shall not affect the rights of the
Partnership or NRGY under that certain Membership Interest Purchase Agreement
between them dated the date hereof.

 

  3. This Amendment represents the complete and entire understanding of the
Parties on the subject matter hereof and supersedes and replaces all prior
understandings, agreements or commitments of the parties. Except as expressly
modified herein, the Agreement shall remain in full force and effect in
accordance with its terms.

 

  4. The provisions of Article VI of the Agreement shall apply to this
Amendment, mutatis mutandis.

[remainder of page intentionally left blank]

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IN WITNESS WHEREOF, the Parties have executed this Agreement on, and effective
as of, the date above.

 

INERGY GP, LLC

By:

  /s/ John J. Sherman  

 

Name:

  John J. Sherman

Title:

 

President and Chief

Executive Officer

 

INERGY, L.P.

By:

 

Inergy GP, LLC, its

general partner

By:

  /s/ John J. Sherman  

 

Name:

  John J. Sherman

Title:

 

President and Chief

Executive Officer

 

NRGM GP, LLC By:   /s/ R. Brooks Sherman, Jr.  

 

Name:   R. Brooks Sherman, Jr. Title:  

Executive Vice President and

Chief Financial Officer

 

INERGY MIDSTREAM, L.P. By:  

NRGM GP, LLC, its

general partner

By:   /s/ R. Brooks Sherman, Jr.  

 

Name:   R. Brooks Sherman, Jr. Title:  

Executive Vice

President and

Chief Financial Officer

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EXHIBIT C

FORM OF CERTIFICATE OF NON-FOREIGN STATUS

MAY 14, 2012

Section 1445 of the Internal Revenue Code of 1986 provides that a transferee of
a U.S. real property interest must withhold tax if the transferor is a foreign
person. For U.S. tax purposes (including section 1445), the owner of a
disregarded entity (which has legal title to a U.S. real property interest under
local law) will be the transferor of the property and not the disregarded
entity. To inform the transferee that withholding of tax is not required upon
the disposition of a U.S. real property interest by Inergy, L.P., a Delaware
limited partnership (“Transferor”), the undersigned hereby certifies the
following on behalf of Transferor:

 

  (i) Transferor is not a foreign corporation, foreign partnership, foreign
trust, or foreign estate (as those terms are defined in the Internal Revenue
Code of 1986 and Income Tax Regulations);

 

  (ii) Transferor is not a disregarded entity as defined in Sec.
1.1445-2(b)(2)(iii);

 

  (iii) Transferor’s U.S. Employer Identification Number is 43-1918951; and

 

  (iv) Transferor’s office address is Two Brush Creek Boulevard, Suite 200,
Kansas City, Missouri 64112.

Transferor understands that this certificate may be disclosed to the Internal
Revenue Service by the transferee and that any false statement contained herein
could be punished by fine, imprisonment or both.

Under penalties of perjury I declare that I have examined this certificate and
to the best of my knowledge and belief it is true, correct, and complete, and I
further declare that I have authority to sign this certificate on behalf of
Transferor.

IN WITNESS WHEREOF, the undersigned has duly executed this Certificate of
Non-Foreign Status as of the date first written above.

 

    INERGY, L.P.     By: Inergy GP, LLC, its general partner     By:  

/s/ R. Brooks Sherman, Jr.

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