Document:

EMPLOYMENT
AGREEMENT

               THIS EMPLOYMENT AGREEMENT (this “Agreement”) dated as of November 12, 2019 is made by and between
First Community Bank (the “Employer”), a wholly-owned subsidiary of First Community Corporation, a South Carolina corporation
(the “Company”), and Donald Shawn Jordan, an individual resident of South Carolina (the “Executive”).

               WHEREAS, the Employer, the Company and the Executive wish to and enter into this Agreement under the terms
and conditions set forth herein. 

               Now therefore, in consideration of the foregoing, the mutual covenants
contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto, intending to be legally bound, hereby agree as follows:

               1.               Employment.
The Employer shall employ the Executive, and the Executive shall serve the Employer, as Chief Financial Officer
and Executive Vice President of the Employer upon the terms and conditions set forth herein. The Executive shall have such authority
and responsibilities consistent with his position as are set forth in the Employer’s Bylaws or assigned by the Employer’s
board of directors (the “Board”) from time to time. The Executive shall devote his full business time, attention, skill
and efforts to the performance of his duties hereunder, except during periods of illness or periods of vacation and leaves of absence
consistent with the Employer’s policy. The Executive may devote reasonable periods to service as a director or advisor to
other organizations, to charitable and community activities, and to managing his personal investments, provided that such activities
do not materially interfere with the performance of his duties hereunder and are not in conflict or competitive with, or adverse
to, the interests of the Employer. The Executive agrees to conduct himself in accordance with the code of ethics for officers and
employees adopted by the Employer, as amended from time to time. 

               2.               Term.
Unless earlier terminated as provided herein, the Executive’s employment under this Agreement shall commence on the date
hereof and be for a term of three years (the “Term”). At the end of each day of the Term, the Term shall be extended
for an additional day so that the remaining term shall continue to be three years (unless earlier terminated as provided in Section
4); provided that the Executive or the Employer may at any time, by written notice, fix the Term to a finite term of three years
commencing with the date of the notice, in which case the Agreement shall continue through its remaining term but shall not be
extended absent written agreement by both the Employer and the Executive.

               3.               Compensation
and Benefits.

                                 (a)               The
Employer shall pay the Executive a rate of annual base salary of $235,000.00 which shall be paid in accordance with the Employer’s
standard payroll procedures, which shall be no less frequently than monthly. The Employer shall have the right to increase this
salary from time to time in accordance with the salary payment practices of the Employer. The Board shall review the Executive’s
salary at least annually and may increase the Executive’s base salary if it determines in its sole discretion that an increase
is appropriate. 

                                 (b)               The
Executive shall participate in the Employer’s long-term equity incentive program and be eligible for the grant of stock
options, restricted stock, and other awards thereunder or under any similar plan adopted by the Company. Any options or similar
awards shall be issued to Executive at an exercise price of not less than the stock’s current fair market value as of the
date of grant, and the number of shares subject to such grant shall be fixed on the date of grant.

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                                 (c)               The
Executive shall participate in all retirement, health, welfare insurance and other benefit plans or programs of the Employer now
or hereafter applicable generally to employees of the Employer or to a class of employees that includes senior executives of the
Employer. The Employer shall require and pay the cost of an annual physical for the Executive, and the Executive hereby authorizes
the examining physician and other relevant persons and entities to release the results of that annual physical to the Employer
(and the Executive will execute one or more separate release authorizations if and as requested by the Employer).

                               

                                 (d)               The
Employer shall reimburse the Executive for reasonable travel and other expenses, including cell phone expenses related to the
Executive’s duties, which are incurred and accounted for in accordance with the normal practices of the Employer. The Employer
shall reimburse the Executive for such expenses within sixty days of Executive’s notice to Employer of such expense.

                               

                                 (e)               The
Employer shall provide the Executive with annual paid time off, which includes sick leave, in accordance with the Employer’s
Benefit policy as in effect from time to time, and which shall be taken in accordance with any banking rules or regulations governing
paid time off leave. Except as allowed in accordance with the Employer’s Benefit policy, paid time off days may not be carried
forward into following calendar years, and any payments made by the Employer to the Executive as compensation for paid time off
days shall be paid in accordance with the Employer’s standard payroll procedures, which shall be no less frequently than
monthly.

                               

                                 (f)               The
Executive shall be eligible to receive cash bonuses based on the Executive’s achievement of specified goals and criteria.
These goals and criteria may include both annual and long-term goals, may provide for vesting over a specified time period, and
shall be established annually by the Human Resources Committee of the Board of Directors. Unless otherwise set forth in a bonus
plan that complies with Section 409A, any bonus payment made pursuant to this Section 3(f) shall be made in a lump sum not later
than March 15 of the year after the end of the year for which the bonus was earned by the Executive.

               4.               Termination.

                                 (a)               The
Executive’s employment under this Agreement may be terminated prior to the end of the Term only as provided in this Section
4.

                                 (b)               The
Executive’s employment under this Agreement will be terminated upon the death of the Executive. In this event, the Employer
shall pay Executive’s estate any sums due him as base salary and/or reimbursement of expenses through the end of the month
during which death occurred in accordance with the Employer’s normal payroll practices, which shall mean no less frequently
than monthly. The Employer shall also pay the Executive’s estate any bonus earned through the date of death. Any bonus for
previous years which was not yet paid will be paid pursuant to the terms as set forth in Section 3(f). Any bonus that is earned
in the year of death will be paid pursuant to the terms set forth in Section 3(f); provided that to the extent that the bonus
is performance-based, the amount of the bonus (if any) will be calculated by the Company taking into account the performance of
the Company for the entire year, and/or the performance of the Executive through the date of death, as applicable, and prorated
through the date of the Executive’s death.

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                                 (c)               The
Employer may terminate the Executive’s Employment on account of the Disability of the Executive under this Section 4(c).
During the period of any Disability leading up to the Executive’s Termination of Employment under this provision, the Employer
shall continue to pay the Executive his full base salary at the rate then in effect and all perquisites and other benefits (other
than any bonus) in accordance with the Employer’s normal payroll schedule (and in no event less frequently than monthly)
until the Executive becomes eligible for benefits under any long-term disability plan or insurance program maintained by the Employer,
provided that the amount of any such payments to the Executive shall be reduced by the sum of the amounts, if any, payable to
the Executive for the same period under any other disability benefit or pension plan covering the Executive. Furthermore, the
Employer shall pay the Executive any bonus earned through the date of Disability. Any bonus for previous years, or the year in
which the Executive’s employment is terminated in accordance with this Section 4(c), which was not yet paid will be paid
pursuant to the terms as set forth in Section 3(f). Any bonus that is earned in the year of termination on account of Disability
will be paid pursuant to the terms set forth in Section 3(f); provided that to the extent that the bonus is performance-based,
the amount of the bonus (if any) will be calculated by the Company taking into account the performance of the Company for the
entire year, and/or the performance of the Executive through the date of termination, as applicable, and prorated through the
date of termination of the Executive’s employment on account of Disability. Nothing herein shall prohibit the Employer from
hiring an acting chief financial officer during the period of any disability of the Executive.

                                 (d)               The
Employer may terminate the Executive’s Employment for Cause upon delivery of a Notice of Termination to the Executive. If
the Executive’s employment is terminated for Cause under this provision, the Executive shall receive only any sums due him as base salary and/or reimbursement of expenses through the date of termination, which shall be paid in accordance with the Employer’s
normal payroll practices, which shall mean no less frequently than monthly.

                                 (e)               
Except for a termination within Section 4(g), the Employer may terminate the Executive’s employment without Cause upon delivery
of a Notice of Termination to the Executive. If the Executive’s employment is terminated without Cause under this provision,
subject to Section 4(h) and also to the possibility of a six-month delay described in Section 20, on the sixtieth (60th) day after
the date of termination, the Employer will pay to the Executive an amount equal to twice the amount of the Executive’s monthly
base salary as in effect immediately prior to his termination of employment, and thereafter on the first day of the month for
the next 10 months, the Employer shall pay to the Executive severance compensation in an amount equal to 100% of his monthly base
salary as in effect immediately prior to his termination of employment. Employer shall also pay the Executive any bonus earned
through the date of termination (including any amounts awarded for previous years but which were not yet vested). Any bonus for
previous years, or the year in which the Executive’s employment is terminated in accordance with this Section (e), which
was not yet paid will be paid pursuant to the terms as set forth in Section 3(f). Any bonus that is earned in the year of the
termination of the Executive’s employment without Cause will be paid pursuant to the terms set forth in Section 3(f); provided
that to the extent that the bonus is performance-based, the amount of the bonus (if any) will be calculated by the Company taking
into account the performance of the Company for the entire year, and/or the performance of the Executive through the date of termination,
as applicable, and prorated through the date of the Executive’s termination of employment without Cause. 

                                 (f)               Except
for a termination within Section 4(g), the Executive may terminate his employment at any time by delivering a Notice of Termination
at least 14 days prior to such termination, and such termination shall not in and of itself be, nor shall it be deemed to be,
a breach of this Agreement. If the Executive terminates his employment under this provision, the Executive shall receive any sums
due him as base salary and/or reimbursement of expenses through the date of such termination, which shall be paid in accordance
with the Employer’s normal payroll practices, which shall mean no less frequently than monthly. In addition, if the Executive
terminates his employment under this Section 4(f) and except for a termination within Section 4(g), and if (and only if) such
termination constitutes a Retirement, then the Employer shall pay the Executive any bonus earned through the date of Retirement,
as follows: (i) any bonus for previous years which was not yet paid will be paid pursuant to the terms set forth in Section 3(f),
and (ii) any bonus that is earned in the year of Retirement will be paid pursuant to the terms set forth in Section 3(f); provided
that to the extent that the bonus is performance-based, the amount of the bonus (if any) will be calculated by the Company taking
into account the performance of the Company for the entire year, and/or the performance of the Executive through the date of Retirement,
as applicable, and prorated through the date of the Executive’s Retirement. For purposes of this Agreement, “Retirement”
means a termination of employment by the Executive under this Section 4(f) that occurs upon or after both (a) the Executive’s
attainment of age 65 and (b) when Executive’s years of service to the Company and its subsidiaries (such years of service
determined in accordance with the rules for determining years of service under the Company’s 401(k) Plan) is at least ten
(10).

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                                 (g)               If
Executive’s employment is terminated by the Employer without Cause or by the Executive with Good Reason upon or during the
two (2) years following a Change in Control (a “Qualifying Termination”), the Executive shall be entitled to the following:

 

	                                 	(i)                 	the
                                         Employer shall pay the Executive upon the 15th day following the date of the
                                         Qualifying Termination cash compensation in a single lump sum payment in an amount equal
                                         to his then current annual base salary multiplied by two, as well as any bonus earned
                                         through the date of the Qualifying Termination, in each case subject to the provisions
                                         of Section 4(j) below;

	                                 	(ii)                	in
                                         addition, Executive may continue participation, in accordance with the terms of the applicable
                                         benefits plans, in the Company’s group health plan pursuant to plan continuation
                                         rules under the Consolidated Omnibus Budget Reconciliation Act (including regulations
                                         related thereto, “COBRA”), subject to any amendments to COBRA after the date
                                         of this Agreement. In accordance with COBRA (and subject to any amendments to COBRA after
                                         the date of this Agreement), assuming Executive is covered under the Company’s
                                         group health plan as of his date of Qualifying Termination, Executive will be entitled
                                         to elect COBRA continuation coverage for the legally required COBRA period (the “Continuation
                                         Period”). If Executive elects COBRA coverage for group health coverage in connection
                                         with a Qualifying Termination, then, he will be obligated to pay only the portion of
                                         the full COBRA cost of the coverage equal to an active employee’s share of premiums
                                         for coverage for the respective plan year and the Company’s share of such premiums
                                         (the “Employer-Provided COBRA Premium”) shall be treated as taxable income
                                         to Executive.
	 	 	 
	 	 	In
                                         addition, on the date that is sixty (60) days after a Qualifying Termination, the Company
                                         shall pay to the Executive a single lump sum payment equal to six times the amount of
                                         the initial monthly Employer-Provided COBRA Premium.
	 	 	 
	 	 	Notwithstanding
                                         the above, the Employer’s obligations hereunder with respect to the foregoing benefits
                                         provided in this subsection (ii) shall be eliminated if and when the Executive is offered
                                         Affordable Care Act compliant group health coverage from a subsequent employer.

In addition,
upon a Qualifying Termination, to the extent that “portable” life insurance coverage is offered under the Company’s
life insurance programs and after a Qualifying Termination, the Executive continues to pay for “portable” life insurance
coverage that was provided by the Employer immediately prior to the Qualifying Termination, the Employer shall reimburse the life
insurance premiums (with respect to each such life insurance premium payment, such reimbursement shall be limited to the amount
of the life insurance premium that the Employer would have paid or otherwise provided for the Executive had the Executive remained
employed by the Employer) paid by the Executive with respect to such life insurance coverage with respect to the two-year period
ending immediately after such Qualifying Termination.

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	                                 	(iii)              	the
                                         restrictions on any outstanding incentive awards (including restricted stock) granted
                                         to the Executive under the Company’s or the Bank’s long-term equity incentive
                                         program or any other incentive plan or arrangement shall lapse and such awards shall
                                         become 100% vested, all stock options and stock appreciation rights granted to the Executive
                                         shall become immediately exercisable and shall become 100% vested, and all performance
                                         units granted to the Executive shall become 100% vested, in each case subject to the
                                         provisions of Section 4(j) below.

	                                 	(iv)              	the
                                         Employer shall pay the Executive any bonus earned through the date of the Qualifying
                                         Termination, as follows: (i) any bonus for previous years which was not yet paid will
                                         be paid pursuant to the terms set forth in Section 3(f), and (ii) any bonus that is earned
                                         in the year of the Qualifying Termination will be paid pursuant to the terms set forth
                                         in Section 3(f). 

               (h)            With
the exceptions of the express provisions of this Section 4, and the express terms of any benefit plan under which the
Executive is a participant, it is agreed that, upon termination of the Executive’s Employment, the Employer shall have
no obligation to the Executive for, and the Executive waives and relinquishes, any further compensation or benefits
(exclusive of COBRA benefits). Unless otherwise stated in this Section 4, the effect of termination on any outstanding
incentive awards, stock options, stock appreciation rights, performance units, or other incentives shall be governed by the
terms of the applicable benefit or incentive plan and/or the agreements governing such incentives. Following the termination
of the Executive’s employment pursuant to Section 4(e) or Section 4(g), if (and only if) the Executive shall
execute within 52 days of the date of termination, and not timely revoke during any revocation period provided pursuant to
such release, a release substantially in the form attached hereto as Exhibit A, then the Employer shall pay the
applicable severance described herein. 

               (i)              The
Employer is aware that upon the occurrence of a Change in Control, the Board, the board of directors of the Company, or a shareholder
of the Company may then cause or attempt to cause the Employer to refuse to comply with its obligations under this Agreement,
or may cause or attempt to cause the Employer to institute, or may institute, litigation seeking to have this Agreement declared
unenforceable, or may take, or attempt to take, other action to deny the Executive the benefits intended under this Agreement.
In these circumstances, the purpose of this Agreement could be frustrated. It is the intent of the parties that the Executive
not be required to incur the legal fees and expenses associated with the protection or enforcement of the Executive’s rights
under this Agreement by litigation or other legal action because such costs would substantially detract from the benefits intended
to be extended to the Executive hereunder, nor be bound to negotiate any settlement of the Executive’s rights hereunder
under threat of incurring such costs. Accordingly, if at any time after a Change in Control, it should appear to the Executive
that the Employer is acting or has acted contrary to or is failing or has failed to comply with any of its obligations under this
Agreement for the reason that it regards this Agreement to be void or unenforceable or for any other reason, or that the Employer
has purported to terminate the Executive’s employment for Cause or is in the course of doing so in either case contrary
to this Agreement, or in the event that the Employer or any other person takes any action to declare this Agreement void or unenforceable,
or institutes any litigation or other legal action designed to deny, diminish or recover (other than as required by law) from
the Executive the benefits provided or intended to be provided to the Executive hereunder, and the Executive has acted in good
faith to perform the Executive’s obligations under this Agreement, the Employer irrevocably authorizes the Executive from
time to time to retain counsel of the Executive’s choice at the expense of the Employer to represent the Executive in connection
with the protection and enforcement of the Executive’s rights hereunder, including without limitation representation in
connection with termination of the Executive’s employment contrary to this Agreement or with the initiation or defense of
any litigation or other legal action, whether by or against the Executive or the Employer or any director, officer, shareholder
or other person affiliated with the Employer, in any jurisdiction. The reasonable fees and expenses of counsel selected from time
to time by the Executive as hereinabove provided shall be paid or reimbursed to the Executive by the Employer on a regular, periodic
basis upon presentation by the Executive of a statement or statements prepared by such counsel. If other officers or key executives
of the Employer have retained counsel in connection with the protection and enforcement of their rights under similar agreements
between them and the Employer, and, unless in the Executive’s sole judgment use of common counsel could be prejudicial to
the Executive or would not be likely to reduce the fees and expenses chargeable hereunder to the Employer, the Executive agrees
to use the Executive’s best efforts to agree with such other officers or executives to retain common counsel.

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               (j)              The
parties intend that the severance payments and other compensation provided for herein are reasonable compensation for the Executive’s
services to the Employer and shall not constitute “excess parachute payments” within the meaning of Section 280G of
the Code. As used herein, “the “Code” means the Internal Revenue Code of 1986, as amended, and any regulations
thereunder. In the event that Tax Counsel (as defined below) determines that the payments provided for herein constitute “excess
parachute payments,” then the payments or benefits payable hereunder or otherwise that constitute “parachute payments”
within the meaning of Section 280G (“Covered Payments”) shall be reduced to an amount the value of which is $1.00
less than the maximum amount that could be paid to the Executive without the Covered Payments being treated as “excess parachute
payments” under Section 280G. The Covered Payments shall be reduced by the Company pursuant to the foregoing sentence in
a manner that Tax Counsel determines maximizes the Executive’s economic position. In applying this principle, the reduction
shall be made in a manner consistent with the requirements of Section 409A of the Code, and where Tax Counsel determines that
two economically equivalent amounts are subject to reduction but payable at different times, such amounts shall be reduced on
a pro rata basis but not below zero.

               All
determinations required to be made under this Section 4(j), and the assumptions to be utilized in arriving at such determination,
shall be made by tax counsel (which may be a law firm, compensation consultant or an accounting firm) appointed by the Company
(the “Tax Counsel”), which shall provide its determinations and any supporting calculations to the Company within
10 business days of having made such determination. The Tax Counsel shall consult with any compensation consultants, accounting
firm and/or other legal counsel selected by the Company in determining which payments to, or for the benefit of, the Executive
are to be deemed to be ‘parachute payments’ within the meaning of Section 280G(b)(2) of the Code. In connection with
making determinations under this Section 4(j), Tax Counsel shall take into account, to the extent applicable, the value of any
reasonable compensation for services to be rendered by the Executive before or after the applicable change in ownership or control,
including the non-competition provisions, if any, applicable to the Executive under Section 9 and any other non-competition provisions
that may apply to the Executive, and the Company shall cooperate in the valuation of any such services, including any non-competition
provisions

               (k)             If
the Executive is suspended or temporarily prohibited from participating, in any way or to any degree, in the conduct of the Employer’s
affairs by (1) a notice served under section 8(e) or (g) of Federal Deposit Insurance Act (12 U.S.C. 1818 (e) or (g)) or (2) as
a result of any other regulatory or legal action directed at the Executive by any regulatory or law enforcement agency having
jurisdiction over the Executive (each of the foregoing referred to herein as a “Suspension Action”), and if this Agreement
is not terminated, the Employer’s obligations under this Agreement shall be suspended as of the earlier of the effective
date of such Suspension Action or the date on which the Executive was provided notice of the Suspension Action, unless stayed
by appropriate proceedings. If the charges underlying the Suspension Action are dismissed, the Bank shall:

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	                                 	(i)                	pay
                                         on the first day of the first month following such dismissal of charges (or as provided
                                         elsewhere in this Agreement) the Executive all of the compensation withheld while the
                                         obligations under this Agreement were suspended; and
	 	 	 
		(ii)                	reinstate
                                         any such obligations which were suspended.

               Notwithstanding
anything to the contrary herein, if the Executive is removed or permanently prohibited from participating, in any way or to any
degree, in the conduct of the Employer’s affairs by (1) an order issued under section 8(e)(4) or (g)(1) of the Federal Deposit
Insurance Act (12 U.S.C. Section 1818 (e)(4) or (g)(1)) or (2) any other legal or law enforcement action (each of the foregoing
referred to herein as a “Removal Action”), all obligations of the Employer under this Agreement shall terminate as
of the effective date of the Removal Action, but any vested rights of the parties hereto shall not be affected.

               Notwithstanding
anything to the contrary herein, if the Employer is in default (as defined in section 3(x)(1) of the Federal Deposit Insurance
Act, 12 U.S.C. Section 1813(x)(1)), all obligations under this Agreement shall terminate as of the date of default, but this paragraph
(4)(k) shall not affect any vested rights of the parties hereto.

               Any
payments made to the Executive pursuant to this Agreement, or otherwise, are subject to and conditioned upon their compliance
with 12 U.S.C. Section 1828(k) and any regulations promulgated thereunder.

               Any
payments made to the Executive pursuant to this Agreement, or otherwise, are subject to applicable withholdings and deductions.

               5.               Ownership
of Work Product. The Employer shall own all Work Product arising during the course of the Executive’s employment (prior,
present or future). For purposes hereof, “Work Product” shall mean all intellectual property rights, including all
Trade Secrets, U.S. and international copyrights, patentable inventions, and other intellectual property rights in any programming,
documentation, technology or other work product that relates to the Employer, its business or its customers and that the Executive
conceives, develops, or delivers to the Employer at any time during his employment, during or outside normal working hours, in
or away from the facilities of the Employer, and whether or not requested by the Employer. If the Work Product contains any materials,
programming or intellectual property rights that the Executive conceived or developed prior to, and independent of, the Executive’s
work for the Employer, the Executive agrees to point out the pre-existing items to the Employer and the Executive grants the Employer
a worldwide, unrestricted, royalty-free right, including the right to sublicense such items. The Executive agrees to take such
actions and execute such further acknowledgments and assignments as the Employer may reasonably request to give effect to this
provision.

 

               6.               Protection
of Trade Secrets. The Executive agrees to maintain in strict confidence and, except as necessary to perform his duties for
the Employer, the Executive agrees not to use or disclose any Trade Secrets of the Employer during or after his employment. “Trade
Secret” means information, including a formula, pattern, compilation, program, device, method, technique, process, drawing,
cost data or customer list, that: (i) derives economic value, actual or potential, from not being generally known to, and not
being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use; and (ii)
is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.

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               7.               Protection
of Other Confidential Information. In addition, the Executive agrees to maintain in strict confidence and, except as necessary
to perform his duties for the Employer, not to use or disclose any Confidential Business Information of the Employer during his employment and for a period of 24 months following termination of the Executive’s employment. “Confidential Business
Information” shall mean any internal, non-public information (other than Trade Secrets already addressed above) concerning
the Employer’s financial position and results of operations (including revenues, assets, net income, etc.); annual and long-range
business plans; product or service plans; marketing plans and methods; training, educational and administrative manuals; customer
and supplier information and purchase histories; and employee lists. The provisions of Sections 6 and 7 shall also apply to protect
Trade Secrets and Confidential Business Information of third parties provided to the Employer under an obligation of secrecy.

               8.               Return
of Materials. The Executive shall surrender to the Employer, promptly upon its request and in any event upon termination of
the Executive’s employment, all media, documents, notebooks, computer programs, handbooks, data files, models, samples,
price lists, drawings, customer lists, prospect data, or other material of any nature whatsoever (in tangible or electronic form)
in the Executive’s possession or control, including all copies thereof, relating to the Employer, its business, or its customers.
Upon the request of the Employer, Executive shall certify in writing compliance with the foregoing requirement.

               9.               Restrictive
Covenants.

                                 (a)               No
Solicitation of Customers. During the Executive’s employment with the Employer and for a period of 12 months thereafter,
the Executive shall not (except on behalf of or with the prior written consent of the Employer), either directly or indirectly,
on the Executive’s own behalf or in the service or on behalf of others, (A) solicit, divert, or appropriate to or for a
Competing Business, or (B) attempt to solicit, divert, or appropriate to or for a Competing Business, any person or entity that
is or was a customer of the Employer or any of its Affiliates at any time during the 12 months prior to the date of termination
and with whom the Executive has had material contact. The parties agree that solicitation of such a customer to acquire stock
in a Competing Business during this time period would be a violation of this Section 9(a).

                                 (b)               No
Recruitment of Personnel. During the Executive’s employment with the Employer and for a period of 12 months thereafter,
the Executive shall not, either directly or indirectly, on the Executive’s own behalf or in the service or on behalf of
others, (A) solicit, divert, or hire away, or (B) attempt to solicit, divert, or hire away, to any Competing Business located
in the Territory, any employee of or consultant to the Employer or any of its Affiliates, regardless of whether the employee or
consultant is full-time or temporary, the employment or engagement is pursuant to written agreement, or the employment is for
a determined period or is at will.

 

                                 (c)               Non-Competition
Agreement. During the Executive’s employment with the Employer and for a period of 12 months following any termination
(as opposed to expiration) of this Agreement, the Executive shall not (without the prior written consent of the Employer) compete
with the Employer or any of its Affiliates by, directly or indirectly, forming, serving as an organizer, director or officer of,
or consultant to, or acquiring or maintaining more than a 1% passive investment in, a depository financial institution or holding
company therefor if such depository institution or holding company has, or upon formation will have, one or more offices or branches
located in the Territory. This restriction does not apply following a Change in Control. 

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                                 (d)               Notwithstanding
the foregoing, the Executive may serve as an officer of or consultant to a depository institution or holding company therefor
even though such institution operates one or more offices or branches in the Territory, if the Executive’s employment does
not directly involve, in whole or in part, the depository financial institution’s or holding company’s operations
in the Territory.

               10.             Independent
Provisions. The provisions in each of the above Sections 9(a), 9(b), and 9(c) are independent, and the unenforceability of
any one provision shall not affect the enforceability of any other provision.

               11.             Successors;
Binding Agreement. The rights and obligations of this Agreement shall bind and inure to the benefit of the surviving corporation
in any merger or consolidation in which the Employer is a party, or any assignee of all or substantially all of the Employer’s
business and properties. The Executive’s rights and obligations under this Agreement may not be assigned by him, except
that his right to receive accrued but unpaid compensation, unreimbursed expenses and other rights, if any, provided under this
Agreement which survive termination of this Agreement shall pass after death to the personal representatives of his estate.

               12.             Notice.
For the purposes of this Agreement, notices and all other communications provided for in the Agreement shall be in writing and
shall be deemed to have been duly given when personally delivered or sent by certified mail, return receipt requested, postage
prepaid, addressed to the respective addresses last given by each party to the other; provided, however, that all
notices to the Employer shall be directed to the attention of the Employer with a copy to the Secretary of the Employer. All notices
and communications shall be deemed to have been received on the date of delivery thereof.

               13.             Governing
Law. This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of South Carolina
without giving effect to the conflict of laws principles thereof. Any action brought by any party to this Agreement shall be brought
and maintained in a court of competent jurisdiction in State of South Carolina.

               14.             Non-Waiver.
Failure of the Employer to enforce any of the provisions of this Agreement or any rights with respect thereto shall in no way
be considered to be a waiver of such provisions or rights, or in any way affect the validity of this Agreement.

               15.             Enforcement.
The Executive agrees that in the event of any breach or threatened breach by the Executive of any covenant contained in Section
6, 7, 9(a), 9(b), or 9(c) hereof, the resulting injuries to the Employer would be difficult or impossible to estimate accurately,
even though irreparable injury or damages would certainly result. Accordingly, an award of legal damages, if without other relief,
would be inadequate to protect the Employer. The Executive, therefore, agrees that in the event of any such breach, the Employer
shall be entitled to obtain from a court of competent jurisdiction an injunction to restrain the breach or anticipated breach
of any such covenant, and to obtain any other available legal, equitable, statutory, or contractual relief. Should the Employer
have cause to seek such relief, no bond shall be required from the Employer, and the Executive shall pay all attorney’s
fees and court costs which the Employer may incur to the extent the Employer prevails in its enforcement action.

    	9

    	 

    

               16.             Saving
Clause. If any term, provision or condition of this Agreement is determined to be invalid, illegal or unenforceable, the remaining
terms, provisions and conditions of this Agreement remain in full force, if the essential terms, provisions and conditions of
this Agreement for each party remain valid, binding and enforceable. It is the intention of the parties that, if any court construes
any provision or clause of this Agreement, or any portion thereof, to be illegal, void, or unenforceable because of the duration
of such provision or the area or matter covered thereby, such court shall reduce the duration, area, or matter of such provision,
and, in its reduced form, such provision shall then be enforceable and shall be enforced. The Executive and the Employer hereby
agree that they will negotiate in good faith to amend this Agreement from time to time to modify the terms of Sections 9(a), 9(b)
or 9(c), the definition of the term “Territory,” and the definition of the term “Business,” to reflect
changes in the Employer’s business and affairs so that the scope of the limitations placed on the Executive’s activities
by Section 9 accomplishes the parties’ intent in relation to the then current facts and circumstances. Any such amendment
shall be effective only when completed in writing and signed by the Executive and the Employer. The parties agree that all of
the terms, provisions and conditions contained in Section 4 and Section 9 constitute essential terms, provisions and conditions
of this Agreement. The parties further agree that no part of Section 4 is independent of any part of Section 9, and that no part
of Section 9 is independent of any part of Section 4. If a material part of Section 9 is held by a court of competent jurisdiction
to be invalid, illegal or unenforceable and is not revised by the court to be enforceable and enforced, then all of Section 4
shall automatically become void and unenforceable. If it is unclear or disputed whether the part of Section 9 held invalid, illegal
or unenforceable (and not so revised by the court) is material, the parties shall negotiate in good faith to reach agreement on
materiality or immateriality, and if they are unable to agree within a reasonable period of time, the part in question shall be
deemed material. If the parties agree the part in question is not material, they shall negotiate in good faith to agree upon a
modification necessary to make whole any party adversely affected by the holding of invalidly, illegality or unenforceability,
and if they are not able to agree upon such a modification within a reasonable period of time, a material part of Section 9 will
be deemed to have been held by a court of competent jurisdiction to be invalid, illegal or unenforceable. Each party agrees to
maintain the status quo ante, to the extent necessary to avoid gaining any advantage over the other party or causing the other
party to suffer a disadvantage, for so long as it is obligated to negotiate in good faith but the parties have not reached agreement.
A violation of the covenant in the preceding sentence shall result in a material part of Section 4 being deemed to be invalid,
illegal or unenforceable.

               17.             Certain
Definitions. 

                                 (a)               “Affiliate”
shall mean any business entity controlled by, controlling or under common control with the Employer.

                                 (b)               “Business”
shall mean the operation of a depository financial institution, including, without limitation, the solicitation and acceptance
of deposits of money and commercial paper, the solicitation and funding of loans and the provision of other banking services,
or any other related business engaged in by the Employer or any of its Affiliates to a material extent as of the date of termination.

    	10

    	 

    

                                 (c)               “Cause”
shall consist of any of (A) the commission by the Executive of a willful act (including, without limitation, a dishonest or fraudulent
act) or a grossly negligent act, or the willful or grossly negligent omission to act by the Executive, which is intended to cause,
causes or is reasonably likely to cause material harm to the Employer (including harm to its business reputation), (B) the indictment
of the Executive for the commission or perpetration by the Executive of any felony or any crime involving dishonesty, moral turpitude
or fraud, (C) the material breach by the Executive of this Agreement that, if susceptible of cure, remains uncured 10 days
following written notice to the Executive of such breach, (D) the receipt of any form of notice, written or otherwise, that
any regulatory agency having jurisdiction over the Employer intends to institute any form of formal or informal (e.g.,
a memorandum of understanding which relates to the Executive’s performance) regulatory action against the Executive or the
Employer (provided that the Board determines in good faith, with the Executive abstaining from participating
in the consideration of and vote on the matter, that the subject matter of such action involves acts or omissions by or under
the supervision of the Executive or that termination of the Executive would materially advance the Employer’s compliance
with the purpose of the action or would materially assist the Employer in avoiding or reducing the restrictions or adverse effects
to the Employer related to the regulatory action); (E) the exhibition by the Executive of a standard of behavior within the scope
of his employment that is materially disruptive to the orderly conduct of the Employer’s business operations (including,
without limitation, substance abuse or sexual misconduct) to a level which, in the Board’s good faith and reasonable judgment,
with the Executive abstaining from participating in the consideration of and vote on the matter, is materially detrimental to
the Employer’s best interest, that, if susceptible of cure remains uncured 10 days following written notice to the Executive
of such specific inappropriate behavior; or (F) the failure of the Executive to devote his full business time and attention to his employment as provided under this Agreement that, if susceptible of cure, remains uncured 30 days following written notice
to the Executive of such failure. In order for the Board to make a determination that termination shall be for Cause, the Board
must provide the Executive with an opportunity to meet with the Board in person.

                                 (d)               “Change
in Control” shall mean a “change in control event,” as set forth in Treasury Regulation § 1.409A-3(i)(5),
with respect to the Executive that occurs after the date of this Agreement. 

                                 (e)               “Competing
Business” shall mean any business that, in whole or in part, is substantially engaged in the Business or a business
that is substantially similar to (and in competition with) the Business.

                                 (f)               “Disability”
shall have the meaning set forth in Treasury Regulation § 1.409A-3(i)(4).

                                 (g)               “Good
Reason” shall mean that one or more of the following has occurred without the Executive’s written consent: 

                

	                                 	(i)                 	a
                                         material negative change in the nature or scope of the Executive’s responsibilities,
                                         duties or authority as set forth in Section 1;
	 	 	 
		(ii)	a
                                         material reduction in the Executive’s Base Salary, excluding any reduction up to
                                         10% that is applied across the senior management group;
	 	 	 
		(iii)	Executive’s
                                         required re-location to a worksite location which is more than fifty (50) miles from
                                         Executive’s then current principal worksite without Executive’s consent (such
                                         consent not to be unreasonably withheld), or
	 	 	 
		(iv)	the
                                         Employer’s material breach of this Agreement (excluding any delay of payment required
                                         or permitted under Code Section 409A);

 

provided that, in any such
case, the Executive provides written notice to the Employer that the event giving rise to such claim of Good Reason has occurred
within thirty (30) days after the occurrence of such event, and such Good Reason remains uncured thirty (30) days after the Executive
has provided such written notice; provided further that any resignation of the Executive’s employment for
“Good Reason” occurs no later than thirty (30) days following the expiration of such cure period.

                                 (h)               “Notice
of Termination” shall mean a written notice of termination from the Employer or the Executive which specifies an effective
date of termination, indicates the specific termination provision in this Agreement relied upon, and, in the case of a termination
for Cause, sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive’s
employment under the provision so indicated.

                                 (i)               “Terminate,”
“terminated,” “termination,” or “Termination” of Employment” shall
mean separation from service as defined by Regulation 1.409A-1(h).

    	11

    	 

    

                                 (j)               “Territory”
shall mean a radius of 15 miles from (i) the main office of the Employer or (ii) any branch or loan production office of the Employer.

 

               18.             Compliance
with Regulatory Restrictions. Notwithstanding anything to the contrary herein, and in addition to any restrictions stated
in Section 4 hereof, any compensation or other benefits paid to the Executive shall be limited to the extent required by any federal
or state regulatory agency having authority over the Bank. The Executive agrees that compliance by the Bank with such regulatory
restrictions, even to the extent that compensation or other benefits paid to the Executive are limited, shall not be a breach
of this Agreement by the Bank.

 

               19.             Compliance
with Dodd–Frank Wall Street Reform and Consumer Protection Act. Notwithstanding anything to the contrary herein, any
incentive payments to the Executive shall be subject to the Dodd–Frank Wall Street Reform and Consumer Protection Act and
any regulations promulgated, and any applicable stock exchange listing requirements adopted, thereunder (collectively, the “DF
Act”), including, but not limited to, clawbacks for such incentive payments as may be required by the DF Act. The Executive
agrees to such amendments, agreements, or waivers that are required by the DF Act or requested by the Employer to comply with
the terms of the DF Act. Executive agrees to comply with the terms of any incentive-based compensation “claw back”
policy, as in effect from time to time, adopted or that may be adopted by the Employer in connection with the DF Act.

 

               20.             Compliance
with Internal Revenue Code Section 409A. All payments that may be made and benefits that may be provided pursuant to this
Agreement are intended to qualify for an exclusion from Section 409A of the Code and any related regulations or other pronouncements
thereunder and, to the extent not excluded, to meet the requirements of Section 409A of the Code. Any payments made under Sections
3 and 4 of this Agreement which are paid on or before the last day of the applicable period for the short-term deferral exclusion
under Treasury Regulation § 1.409A-1(b)(4) are intended to be excluded under such short-term deferral exclusion. Any remaining
payments under Sections 3 and 4 are intended to qualify for the exclusion for separation pay plans under Treasury Regulation §
1.409A-1(b)(9). To the extent permissible, each payment made under Sections 3 and 4 shall be treated as a “separate payment”,
as defined in Treasury Regulation § 1.409A-2(b)(2), for purposes of Code Section 409A. Further, notwithstanding anything
to the contrary, all severance payments payable under the provisions of Section 4 shall be paid to the Executive no later than
the last day of the second calendar year following the calendar year in which occurs the date of Executive’s termination
of employment. None of the payments under this Agreement are intended to result in the inclusion in Executive’s federal
gross income on account of a failure under Section 409A(a)(1) of the Code. The parties intend to administer and interpret this
Agreement to carry out such intentions. However, Company does not represent, warrant or guarantee that any payments that may be
made pursuant to this Agreement will not result in inclusion in Executive’s gross income, or any penalty, pursuant to Section
409A(a)(1) of the Code or any similar state statute or regulation. Notwithstanding any other provision of this Agreement, to the
extent that the right to any payment (including the provision of benefits) hereunder provides for the “deferral of compensation”
within the meaning of Section 409A(d)(1) of the Code, the payment shall be paid (or provided) in accordance with the following:

    	12

    	 

    

                                 (a)               If
the Executive is a “Specified Employee” within the meaning of Section 409A(a)(2)(B)(i) of the Code on the date of
the Executive’s termination (the “Separation Date”), and if an exemption from the six month delay requirement
of Code Section 409A(a)(2)(B)(i) is not available, then no such payment that is payable on account of the Executive’s termination
shall be made or commence during the period beginning on the Separation Date and ending on the date that is six months following
the Separation Date or, if earlier, on the date of the Executive’s death. The amount of any payment that would otherwise
be paid to the Executive during this period shall instead be paid to the Executive on the first day of the first calendar month
following the end of the period.

 

                                 (b)               Payments
with respect to reimbursements of expenses or benefits or provision of fringe or other in-kind benefits shall be made on or before
the last day of the calendar year following the calendar year in which the relevant expense or benefit is incurred. The amount
of expenses or benefits eligible for reimbursement, payment or provision during a calendar year shall not affect the expenses
or benefits eligible for reimbursement, payment or provision in any other calendar year.

               21.             Entire
Agreement. This Agreement constitutes the entire agreement between the parties hereto and supersedes all prior agreements,
understandings and arrangements, oral or written, between the parties hereto with respect to the subject matter hereof. Any waiver
or modification of any term of this Agreement shall be effective only if it is set forth in writing and signed by all parties
hereto.

               22.             Counterparts.
This Agreement may be executed in one or more counterparts, each of which shall be deemed an original but all of which together
shall constitute one and the same instrument.

 

[Signatures appear
on following page]

    	13

    	 

    

               IN
WITNESS WHEREOF, the Employer has caused this Agreement to be executed and its seal to be affixed hereunto by its officers thereunto
duly authorized, and the Executive has signed and sealed this Agreement, effective as of the date first above written.

	 	 	FIRST COMMUNITY BANK
	 	 	 
	ATTEST:	 	
	 	 	 
	By: /s/
    Robin D. Brown	 	By: /s/
    Michael C. Crapps
	 	 	 
	Name: Robin D. Brown	 	Name: Michael C. Crapps
	 	 	 
	 	 	Title: President and Chief Executive Officer
	 	 	
	 	 	EXECUTIVE
	 	 	
	 	 	/s/ D. Shawn Jordan
	 	 	Donald Shawn Jordan

    	14

    	 

    

Exhibit A

 

Form of Release
of Claims

                

SEVERANCE
AGREEMENT AND RELEASE

 

               This Severance Agreement and Release (the “Agreement”) is made between Donald
Shawn Jordan, an individual resident of South Carolina (“Employee”), and First Community Bank (the “Bank”).

 

               As
used in this Agreement, the term “Employee” shall include the employee’s heirs, executors, administrators, and
assigns.

 

               On
_________, 2019, the Bank and Employee entered into an Employment Agreement (the “Employment Agreement”) governing
the relationship between the parties. Section 4(e) provides that the Bank may terminate the Employment Agreement without cause.
Section 4 of the Employment Agreement also provides that Employee shall be entitled to severance pay if the Employment Agreement
is terminated without cause, on the condition that Employee enter into this release or a substantially similar release.

 

               Employee
desires to receive severance pay and the Bank is willing to provide severance pay on the condition the Employee enter into this
Agreement.

 

               Now,
in consideration for the mutual promises and covenants set forth herein, and in full and complete settlement of all matters between
Employee and the Bank, the parties agree as follows:

 

1.            Termination
Date: The Employee agrees that his employment with the Bank terminates as of ________________ (the “Termination Date”).

 

2.            Severance
Payments: Subsequent to his Termination Date, the Bank shall pay Employee severance pay as noted in Paragraph 4(e) of the
Employment Agreement (the “Severance Payment”), less applicable deductions and withholdings.

 

3.            Legal
Obligations

 

               The
parties acknowledge that pursuant to Section 4(h) of the Employment Agreement, they agreed that at the time of termination and
as a condition of payment of severance, they would enter into this release acknowledging any remaining obligations and discharging
each other from any other claims or obligations arising out of or in connection with Employee’s employment by the Bank,
including the circumstances of such termination.

 

               Employee
acknowledges that the Bank has no prior legal obligations to make the payments described in Section 2 above which are exchanged
for the promises of Employee set forth in this Agreement. It is specifically agreed that the payments described in Section 2 are
valuable and sufficient consideration for each of the promises of Employee set forth in this Agreement and are payments in addition
to anything of value to which Employee is otherwise entitled.

    	A-1

    	 

    

4.            Waiver
and Release:

 

               a)               Employee
unconditionally releases and discharges the Bank, entities affiliated with the Bank, and the respective current and former officers,
directors, shareholders, employees, and agents of them (collectively, the “Bank Released Parties”) from any and all
causes of action, suits, damages, claims, proceedings, and demands that the Employee has ever had, or may now have, against any
of the Bank Released Parties, whether asserted or unasserted, whether known or unknown, concerning any matter occurring up to
and including the date of the signing of this Agreement; provided that Employee is not releasing or discharging (i) any
right to enforce Section 4 of the Employment Agreement, or (ii) any exculpatory or indemnification (or advancement) provisions
set forth in the articles of incorporation or bylaws of the Bank.

 

               b)               Employee
acknowledges that he is waiving and releasing, to the full extent permitted by law, all claims against the Bank Released Parties,
including (but not limited to) all claims arising out of, or related in any way to, his employment with the Bank or the termination
of that employment, including (but not limited to) any and all breach of contract claims, tort claims, claims of wrongful discharge,
claims for breach of an express or implied employment contract, defamation claims, claims under Title VII of the Civil Rights
Act of 1964 as amended, which prohibits discrimination in employment based on race, color, national origin, religion or sex, the
Family and Medical Leave Act, which provides for unpaid leave for family or medical reasons, the Equal Pay Act, which prohibits
paying men and women unequal pay for equal work, the Age Discrimination in Employment Act of 1967, which prohibits age discrimination
in employment, the Americans with Disabilities Act, which prohibits discrimination based on disability, the Rehabilitation Act
of 1973, the South Carolina Human Affairs Law, any and all other applicable local, state and federal non-discrimination statutes,
the Employee Retirement Income Security Act, the Fair Labor Standards Act, the South Carolina Payment of Wages Law and all other
statutes relating to employment, the common law of the State of South Carolina, or any other state, and any and all claims for
attorneys’ fees.

 

               c)               This
Waiver and Release provision ((a) through (c) of this paragraph) shall be construed to release all claims to the full extent allowed
by law. If any term of this paragraph shall be declared unenforceable by a court or other tribunal of competent jurisdiction,
it shall not adversely affect the enforceability of the remainder of this paragraph.

 

               d)               The
Bank unconditionally releases and discharges Employee from any and all causes of action, suits, damages, claims, proceedings,
and demands that the Bank has ever had, or may now have, against Employee, whether asserted or unasserted, whether known or unknown,
concerning any matter occurring up to and including the date of the signing of this Agreement with the exception of any claims
for breach of trust, or any act which constitutes a felony or crime involving dishonesty, theft, or fraud.

 

5.            Restrictive
Covenants and Other Obligations

 

               The
parties agree that Section 5 – “Ownership of Work Product,” Section 6 – “Protection of Trade Secret,”
Section 7 – “Protection of Confidential Information,” Section 8 – “Return of Materials,” Section
9 – “Restrictive Covenants,” Section 10 – “Independent Provisions,” Section 15 – “Enforcement,”
and Section 16 – “Savings Clause,” of the Employment Agreement shall remain in full force and effect and that
Employee will perform his obligations under those sections and those sections of the Employment Agreement are incorporated by
reference as if set forth fully herein. In the event Employee breaches any obligation under this Section 5, the Bank’s obligation
to make severance payments to Employee shall terminate immediately and the Bank shall have no further obligations to Employee.

    	A-2

    	 

    

6.            Duty
of Loyalty/Nondisparagement

 

               The
parties shall not (except as required by law) communicate to anyone, whether by word or deed, whether directly or through any
intermediary, and whether expressly or by suggestion or innuendo, any statement, whether characterized as one of fact or of opinion,
that is intended to cause or that reasonably would be expected to cause any person to whom it is communicated to have a lowered
opinion of the other party.

 

7.            Confidentiality
Of The Terms Of This Agreement

 

               Employee
agrees not to publicize or disclose the contents of this Agreement, including the amount of the monetary payments, except (i)
to his immediate family; (ii) to his attorney(s), accountant(s), and/or tax preparer(s); (iii) as may be required by law; or (iv)
as necessary to enforce the terms of this Agreement. Employee further agrees that he will inform anyone to whom the terms of
this Agreement are disclosed of the confidentiality requirements contained herein. Notwithstanding the foregoing, the parties
agree that where business needs dictate, Employee may disclose to a third party that he has entered into an agreement with the
Bank, which agreement contains restrictive covenants including noncompetition and nondisclosure provisions, one or more of which
prohibit him from performing the requested service.

 

               Employee
recognizes that the disclosure of any information regarding this Agreement by him, his family, his attorneys, his
accountants or financial advisors, could cause the Bank irreparable injury and damage, the amount of which would be difficult
to determine. In the event the Bank establishes a violation of this paragraph of the Agreement by Employee, his attorneys,
immediate family, accountants, or financial advisors, or others to whom Employee disclosed information in violation of the
terms of this Agreement, the Bank shall be entitled to injunctive relief without the need for posting a bond and shall also
be entitled to recover from Employee the amount of attorneys’ fees and costs incurred by the Bank in enforcing the
provisions of this paragraph.

 

8.            Continued
Cooperation

 

               Employee
agrees that he will cooperate fully with the Bank in the future regarding any matters in which he was involved during the course
of his employment, and in the defense or prosecution of any claims or actions now in existence or which may be brought or threatened
in the future against or on behalf of the Bank. Employee’s cooperation in connection with such matters, actions and claims
shall include, without limitation, being available to meet with the Bank’s officials regarding personnel or commercial matters
in which he was involved; to prepare for any proceeding (including, without limitation, depositions, consultation, discovery
or trial); to provide affidavits; to assist with any audit, inspection, proceeding or other inquiry; and to act as a witness in
connection with any litigation or other legal proceeding affecting the Bank. Employee further agrees that should he be contacted
(directly or indirectly) by any person or entity adverse to the Bank, he shall within 48 hours notify the then-current Chairman
of the Board of the Bank. Employee shall be reimbursed for any reasonable costs and expenses incurred in connection with providing
such cooperation.

 

9.            Entire
Agreement; Modification of Agreement

 

               Except
as otherwise expressly noted herein, this Agreement constitutes the entire understanding of the parties and supersedes all prior
discussions, understandings, and agreements of every nature between them relating to the matters addressed herein. Accordingly,
no representation, promise, or inducement not included or incorporated by reference in this Agreement shall be binding upon the
parties. Employee affirms that the only consideration for the signing of this Agreement are the terms set forth above and that
no other promises or assurances of any kind have been made to him by the Bank or any other entity or person as an inducement for him to sign this Agreement. This Agreement may not be changed orally, but only by an agreement in writing signed by the parties
or their respective heirs, legal representatives, successors, and assigns.

    	A-3

    	 

    

10.          Partial
Invalidity

 

               The
parties agree that the provisions of this Agreement and any paragraphs, subsections, sentences, or provisions thereof shall be
deemed severable and that the invalidity or unenforceability of any paragraph, subsection, sentence, or provision shall not affect
the validity or enforceability of the remainder of the Agreement.

 

11.          Waiver

 

               The
waiver of the breach of any term or provision of this Agreement shall not operate as or be construed to be a waiver of any other
subsequent breach of this Agreement.

 

12.          Successors
and Assigns

 

               This
Agreement shall inure to and be binding upon the Bank and Employee, their respective heirs, legal representatives, successors,
and assigns.

 

13.          Governing
Law

 

               This
Agreement shall be construed in accordance with the laws of the state of South Carolina and any applicable federal laws.

 

14.          Headings

 

               The
headings or titles of sections and subsections of this Agreement are for convenience and reference only and do not constitute
a part of this Agreement.

 

15.          Notice

 

               Any
notice or communication required or permitted under this Agreement shall be made in writing and sent by certified mail, return
receipt requested, addressed as follows:

 

                                                     If
to Employee:

 

                                                     [INSERT]

 

                                                     If
to the Bank:

 

                                                     [INSERT]

 

16.          Representations:
Employee acknowledges that:

 

               a)               He
has read this Agreement and understands its meaning and effect.

    	A-4

    	 

    

               b)               He
has knowingly and voluntarily entered into this Agreement of his own free will.

 

               c)               By
signing this Agreement, Employee has waived, to the full extent permitted by law, all claims against the Bank based on any actions
taken by the Bank up to the date of the signing of this Agreement, and the Bank may plead this Agreement as a complete defense
to any claim the Employee may assert.

 

               d)               He
would not otherwise be entitled to the consideration described in this Agreement, and that the Bank is providing such consideration
in return for Employee’s agreement to be bound by the terms of this Agreement.

 

               e)               He
has been advised to consult with an attorney before signing this Agreement.

 

               f)               He
has been given up to [21/45] days to consider the terms of this Agreement.

 

               g)               He
has seven days, after Employee has signed the Agreement and it has been received by the Bank, to revoke it by notifying the Chairman
of the Board of his intent to revoke acceptance. For such revocation to be effective, the notice of revocation must be received
no later than 5:00 p.m. on the seventh day after the signed Agreement is received by the Bank. This Agreement shall not become
effective or enforceable until the revocation period has expired.

 

               h)               He
is not waiving or releasing any rights or claims that may arise after the date the Employee signs this Agreement.

 

[Signatures
appear on following page]

    	A-5

    	 

    

	As to Employee:	 	
	 	 	 
	 	 	
	Date	 	Donald Shawn Jordan

	 	 	 
	 	 	 
	As to the Bank:	 	
	 	 	 
	 	 	
	Date	 	[Title]

 

 

 

[SEVERANCE AGREEMENT
AND RELEASE: SIGNATURE PAGE]

    	A-6spp_Ex 43

		

			Exhibit 4.3

		

		

			 

		

		
			Description of THE REGISTRANT’S Securities
REGISTERED PURSUANT TO SECTION 12 OF THE 
SECURITIES EXCHANGE ACT OF 1934
		

		
			As of December 31, 2019, Sanchez Midstream Partners LP (the “Partnership,” “we” or “us”) had a single class of security registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”): common units representing limited partner interests in the Partnership (“common units”). We also had a  single Warrant Exercisable for Junior Securities (the “2019 Warrant”) issued and outstanding, which is exercisable for Junior Securities, including common units. 
		

		
			The following description is a summary and does not purport to be complete. It is subject to and qualified in its entirety by reference to (i) the Third Amended and Restated Agreement of Limited Partnership of the Partnership  (our “partnership agreement”), which is incorporated by reference as Exhibit 3.4 to the Annual Report on Form 10-K, of which this Exhibit 4.3 is a part, and (ii) the 2019 Warrant, which is incorporated by reference as Exhibit 10.27 to the Annual Report on Form 10-K of which this Exhibit 4.3 is a part.  Please read and refer to the partnership agreement, the applicable provisions of the Delaware Act and the 2019 Warrant, for additional information.  References to our “general partner,” refer to Sanchez Midstream Partners GP, LLC. Capitalized terms used but not defined herein have the meanings ascribed to them in the partnership agreement.
		

		
			DESCRIPTION OF THE COMMON UNITS
		

		
			The Common Units
		

		
			The common units represent limited partner interests in us that entitle the holders thereof to the rights and privileges specified to limited partners set forth in our partnership agreement, including the right to participate in Partnership distributions. 
		

		
			Listing of Common Units
		

		
			Our common units are traded on the NYSE American under the trading symbol “SNMP”.
		

		
			Transfer Agent and Registrar
		

		
			Duties
		

		
			Computershare Trust Company, N.A. serves as the registrar and transfer agent for the common units. We pay all fees charged by the transfer agent for transfers of common units except the following, which must be paid by our unitholders:
		

			
	
			
				 ·
			

			
	
			
			surety bond premiums to replace lost or stolen certificates, taxes and other governmental charges;

			
	
			
				 ·
			

			
	
			
			special charges for services requested by a holder of a common unit; and

			
	
			
				 ·
			

			
	
			
			other similar fees or charges.

		
			There is no charge to unitholders for disbursements of our cash distributions. We indemnify the transfer agent, its agents and each of their respective stockholders, directors, officers and employees against all claims and losses that may arise out of acts performed or omitted for their activities in that capacity, except for any liability due to any gross negligence or intentional misconduct of the indemnified person or entity.
		

		
			Resignation or Removal
		

		
			The transfer agent may resign, by notice to us, or be removed by us. The resignation or removal of the transfer agent will become effective upon our appointment of a successor transfer agent and registrar and its acceptance of the 

		 

		

			 

		

appointment. If no successor is appointed or a successor has not accepted its appointment, our general partner may act as the transfer agent and registrar until a successor is appointed.
		

		
			Transfer of Common Units
		

		
			Common units are “securities” as defined in the Securities Act, and are transferable according to the laws governing transfers of securities. In addition to the other rights acquired upon transfer, the transferee of the common units shall be admitted as a limited partner with respect to the common units transferred when such transfer and admission are reflected in our books and records. Each transferee:
		

			
	
			
				 ·
			

			
	
			
			represents that the transferee has the capacity, power and authority to enter into our partnership agreement;

			
	
			
				 ·
			

			
	
			
			automatically becomes bound by the terms and conditions of our partnership agreement; and

			
	
			
				 ·
			

			
	
			
			makes the consents, acknowledgement and waivers contained in our partnership agreement, all with or without the execution of the partnership agreement by such transferee.

		
			Our general partner will cause any transfers to be recorded on our books and records no less frequently than quarterly.
		

		
			We may, at our discretion, treat the nominee holder of a common unit as the absolute owner. In that case, the beneficial holder’s rights are limited solely to those that it has against the nominee holder as a result of any agreement between the beneficial owner and the nominee holder.
		

		
			Until a common unit has been transferred on our books, we and the transfer agent may treat the record holder of the common unit as the absolute owner for all purposes, except as otherwise required by law or stock exchange regulations.
		

		
			Number of Common Units
		

		
			As of December 31, 2019, we had 20,087,462 common units issued and outstanding; 10,910,828 common units were held by the public; and 9,176,634 common units were held by affiliates of our general partner. 
		

		
			PROVISIONS OF OUR PARTNERSHIP AGREEMENT RELATING TO CASH DISTRIBUTIONS
		

		
			Set forth below is a summary of the significant provisions of our partnership agreement that relate to cash distributions. 
		

		
			Cash Distribution Policy
		

		
			Distributions of Available Cash
		

		
			Our partnership agreement requires that, on or about the last day of each of February, May, August and November, we distribute all of our available cash to unitholders of record on the applicable record date. Available cash generally means, for any quarter, the sum of all cash and cash equivalents on hand at the end of that quarter:
		

			
	
			
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			less, the amount of cash reserves established by our general partner to:

			
	
			
				 o
			

			
	
			
			provide for the proper conduct of our business (including cash reserves for our future capital expenditures and anticipated future debt service requirements) subsequent to that quarter;

			
	
			
				 o
			

			
	
			
			comply with applicable law, any of our debt instruments or other agreements; or

		
			

		 

		

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				 o
			

			
	
			
			provide funds for distributions to our unitholders for any one or more of the next four quarters (provided that our general partner may not establish cash reserves for distributions if the effect of the establishment of such reserves will prevent us from distributing the cash portion of any distributions on our Class C Preferred Units or minimum quarterly distribution on our common units with respect to such quarter);

			
	
			
				 ·
			

			
	
			
			plus, if our general partner so determines, all or any portion of additional cash and cash equivalents on hand on the date of determination of available cash for the quarter resulting from working capital borrowings made subsequent to the end of such quarter.

		
			The purpose and effect of the last bullet point above is to allow our general partner, if it so decides, to use cash from working capital borrowings made after the end of the quarter but on or before the date of determination of available cash for that quarter to pay distributions to unitholders. Under our partnership agreement, working capital borrowings are generally borrowings that are made under a credit facility, commercial paper facility or similar financing arrangement, and in all cases are used solely for working capital purposes or to pay distributions to unitholders, and with the intent of the borrower to repay such borrowings within twelve months with funds other than from additional working capital borrowings.
		

		
			Class C Preferred Units
		

		
			Under the terms of our partnership agreement, commencing with the quarter ended on June 30, 2019, the Class C Preferred Units receive a quarterly distribution of, at the election of the Board of Directors, (i) with respect to any distribution made with respect to the quarter ended June 30, 2019, 10.0% per annum if paid in full in cash or 12.0% per annum if paid in paid-in-kind units; (ii) with respect to any distribution made with respect to any quarter beginning with and after the quarter ending September 30, 2019, through and including the quarter ending December 31, 2021, 12.5% per annum, regardless of whether paid in cash, paid-in-kind units or a combination thereof; and (iii) with respect to any distribution made with respect to any quarter beginning on or after January 1, 2022, 14.0% per annum, regardless of whether paid in cash, paid-in-kind units or a combination thereof.
		

		
			Additionally, under the terms of our partnership agreement, until the first quarter in which no Class C Preferred Units remain outstanding, we are not permitted to, and are prohibited from declaring or making, any distributions, redemptions or repurchases in respect of any Junior Securities, including common units, or any Parity Securities.  
		

		
			General Partner Interest and Incentive Distribution Rights
		

		
			Our general partner currently owns a non-economic general partner interest in us which does not entitle it to receive cash distributions. However, our general partner may in the future own common units or other equity interests in us and will be entitled to receive distributions on any such interests. 
		

		
			SP Holdings, LLC (“SP Holdings”), the sole member of our general partner, holds all of our incentive distribution rights, which entitles it to receive increasing percentages, up to a maximum of 35.5%, of the available cash we distribute from operating surplus (as defined in our partnership agreement)  after we have achieved the minimum quarterly distribution and the target distribution levels. 
		

		
			Percentage Allocation of Distributions from Operating Surplus
		

		
			The following table illustrates the percentage allocation of distributions from operating surplus among our unitholders and SP Holdings (as the holder of our incentive distribution rights) at various distribution levels (1) pursuant to the distribution provisions of our partnership agreement, as well as (2) following a hypothetical reset of the target distribution levels based on the assumption that the quarterly distribution amount per common unit during the two fiscal quarters immediately preceding the reset election was $0.875.
		

		
			Under our partnership agreement, our general partner has considerable discretion to determine the amount of available cash (as defined therein) for distribution each quarter to our unitholders, including discretion to establish 

		 

		

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cash reserves that would limit the amount of available cash eligible for distribution to our unitholders for any quarter. We do not guarantee that we will pay the target amount of the minimum quarterly distribution listed below (or any distributions at all) on our units in any quarter. The percentage interest set forth below for SP Holdings (1) assume that SP Holdings has not transferred its incentive distribution rights and (2) assume that we do not issue additional classes of equity securities.  Additionally, as disclosed above under “—Class C Preferred Units” we are prohibited from making distributions to our common unitholders until the first quarter during which no Class C Preferred Units remain outstanding. 
		

			
					
						 

					
					
						Total Quarterly Distribution per Common Unit 

					
					
						Common
Unitholders

					
					
						SP Holdings 

					
					
						 

				
	
					
						Minimum Quarterly Distribution

					
					
						up to $0.50

					
					
						100.0 % 

					
0.0%
					
					
						 

				
	
					
						First Target Distribution

					
					
						above $0.50
up to $0.575

					
					
						100.0% 

					
0.0%
					
					
						 

				
	
					
						Second Target Distribution

					
					
						above
$0.575

					
						up to $0.625

					
					
						87.0% 

					
13.0%
					
					
						 

				
	
					
						Third Target Distribution

					
					
						above

					
						$0.625 up to

					
						$0.875

					
					
						77.0% 

					
					
						23.0% 

					
					
						 

				
	
					
						Thereafter

					
					
						above
$0.875

					
					
						64.5% 

					
					
						35.5% 

					
					
						 

				

		
			Distributions of Cash Upon Liquidation
		

		
			If we dissolve in accordance with our partnership agreement, we will sell or otherwise dispose of our assets in a process called liquidation. We will first apply the proceeds of liquidation to the payment of our creditors. We will distribute any remaining proceeds to the unitholders and the holders of the incentive distribution rights, in accordance with their capital account balances, as adjusted to reflect any gain or loss upon the sale or other disposition of our assets in liquidation. Any further net gain recognized upon liquidation will be allocated in a manner that takes into account the incentive distribution rights of SP Holdings. 
		

		
			Adjustments to Capital Accounts
		

		
			We will make adjustments to capital accounts upon the issuance of additional units. In doing so, we generally will allocate any unrealized and, for tax purposes, unrecognized gain or loss resulting from the adjustments to the unitholders and the holders of our incentive distribution rights in the same manner as we allocate gain or loss upon liquidation.
		

			
	
			
				
			DESCRIPTION OF OUR partnership agreement

		
			The following is a summary of the material provisions of our partnership agreement. Please refer to our partnership agreement for additional information, which is incorporated by reference as an exhibit to the Annual Report on Form 10-K of which this Exhibit 4.3 is a part. We summarize the following provisions of our partnership agreement elsewhere herein: 
		

			
	
			
				 ·
			

			
	
			
			information relating to the rights and preferences of holders of common units in and to Partnership cash distributions is summarized under “Provisions of Our Partnership Agreement Relating to Cash Distributions” above; and

			
	
			
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			information relating to the transfer of common units is summarized under “Description of the Common Units—Transfer of Common Units” above.

		
			

		 

		

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			Capital Contributions
		

		
			Unitholders are not obligated to make additional capital contributions, except as described below under “—Limited Liability.”
		

		
			Voting Rights
		

		
			The following is a summary of the unitholder vote required for approval of the matters specified below. Matters that require the approval of a “unit majority” require the approval of a majority of the common units. Holders of Class C Preferred Units have voting rights identical to the voting rights of the common unitholders and vote together with the common units as a single class, such that the Class C Preferred Units (including, for the avoidance of doubt, the Class C Preferred PIK Units) will be entitled to one vote per Class C Preferred Unit,  except that the Class C Preferred Units are entitled to vote as a separate class on any matter on which unitholders are entitled to vote that adversely affects the rights or preferences of the Class C Preferred Units in relation to other classes of partnership interests.
		

		
			In voting their common units, our general partner and its affiliates will have no fiduciary duty or obligation whatsoever to us or the limited partners, including any duty to act in good faith or in the best interests of us or the limited partners.
		

			
					
						Issuance of additional units

					
					
						No approval right.

				
	
					
						Amendment of the partnership agreement

					
					
						Certain amendments may be made by our general partner without the approval of the unitholders. Other amendments generally require the approval of a unit majority. Please read “—Amendment of Our Partnership Agreement.” In addition, amendments to the partnership agreement pertaining to the Class C Preferred Units requires the consent of each holder of a Class C Preferred Unit, to the extent such amendment would adversely affect such holder.

				
	
					
						Merger of our partnership or the sale of all or substantially all of our assets

					
					
						Unit majority in certain circumstances. 

				
	
					
						Dissolution of our partnership

					
					
						Unit majority. 

				
	
					
						Continuation of our business upon dissolution

					
					
						Unit majority. 

				
	
					
						Withdrawal of our general partner

					
					
						Under most circumstances, the approval of a majority of the common units and Class C Preferred Units, excluding common units held by our general partner and its affiliates, is required for the withdrawal of our general partner prior to September 30, 2024 in a manner that would cause a dissolution of our partnership. 

				
	
					
						Removal of our general partner

					
					
						Not less than 66 2/3% of the outstanding units, voting as a single class, including units held by our general partner and its affiliates. 

				
	
					
						Transfer of our general partner interest

					
					
						No approval right. 

				
	
					
						Transfer of incentive distribution rights

					
					
						No approval right. 

				
	
					
						Transfer of ownership interests in our general partner

					
					
						No approval right. 

				

		
			

		 

		

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			Our partnership agreement contains specific provisions that are intended to discourage a person or group from attempting to remove Sanchez Midstream Partners GP LLC as our general partner or otherwise change our management. Please read “—Change of Management Provisions” and “—Meetings; Voting.”
		

		
			Applicable Law; Forum, Venue and Jurisdiction
		

		
			Our partnership agreement is governed by Delaware law. Our partnership agreement requires that any claims, suits, actions or proceedings:
		

			
	
			
				 ·
			

			
	
			
			arising out of or relating in any way to our partnership agreement (including any claims, suits or actions to interpret, apply or enforce the provisions of our partnership agreement or the duties, obligations or liabilities among limited partners or of limited partners to us, or the rights or powers of, or restrictions on, the limited partners or us);

			
	
			
				 ·
			

			
	
			
			brought in a derivative manner on our behalf;

			
	
			
				 ·
			

			
	
			
			asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee of us or our general partner, or owed by our general partner, to us or the limited partners;

			
	
			
				 ·
			

			
	
			
			asserting a claim arising pursuant to any provision of the Delaware Act; or

			
	
			
				 ·
			

			
	
			
			asserting a claim governed by the internal affairs doctrine,

		
			shall be exclusively brought in the Court of Chancery of the State of Delaware (or, if such court does not have subject matter jurisdiction thereof, any other court located in the State of Delaware with subject matter jurisdiction), in each case regardless of whether such claims, suits, actions or proceedings sound in contract, tort, fraud or otherwise, are based on common law, statutory, equitable, legal or other grounds, or are derivative or direct claims. In addition, each party to such claims, suits, actions or proceedings irrevocably waives the right to trial by jury.
		

		
			Although we believe these provisions will benefit us by providing increased consistency in the application of Delaware law for the specific types of actions and proceedings, the provisions may have the effect of discouraging lawsuits against our directors, officers, employees and agents. The enforceability of similar forum selection provisions in other companies’ certificates of incorporation or similar governing documents have been challenged in legal proceedings, and it is possible that, in connection with one or more actions described above, a court could find that the forum selection provision contained in our partnership agreement is inapplicable or unenforceable in such action or actions, including with respect to claims arising under the federal securities laws. Limited partners will not be deemed, by operation of the forum selection provision alone, to have waived claims arising under the federal securities laws and the rules and regulations thereunder. 
		

		
			The forum selection provision is intended to apply “to the fullest extent permitted by applicable law” to the above-specified types of actions and proceedings, including, to the extent permitted by the federal securities laws, to lawsuits asserting both the above-specified claims and federal securities claims. However, application of the forum selection provision may in some instances be limited by applicable law. Section 27 of the Exchange Act provides: “The district courts of the United States ... shall have exclusive jurisdiction of violations of the Exchange Act or the rules and regulations thereunder, and of all suits in equity and actions at law brought to enforce any liability or duty created by the Exchange Act or the rules and regulations thereunder.” As a result, the forum selection provision will not apply to actions arising under the Exchange Act or the rules and regulations thereunder. However, Section 22 of the Securities Act provides for concurrent federal and state court jurisdiction over actions under the Securities Act and the rules and regulations thereunder, subject to a limited exception for certain “covered class actions” as defined in Section 16 of the Securities Act and interpreted by the courts. Accordingly, we believe that the forum selection provision would apply to actions arising under the Securities Act or the rules and regulations thereunder, except to the extent a particular action fell within the exception for covered class actions.
		

		
			

		 

		

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			Limited Liability
		

		
			Assuming that a limited partner does not participate in the control of our business within the meaning of the Delaware Act and that such limited partner otherwise acts in conformity with the provisions of our partnership agreement,  that such limited partner’s liability under the Delaware Act will be limited, subject to possible exceptions, to the amount of capital that such limited partner is obligated to contribute to us for that such limited partner’s common units plus that such limited partner’s share of any undistributed profits and assets. However, if it were determined that the right, or exercise of the right, by the limited partners as a group:
		

			
	
			
				 ·
			

			
	
			
			to remove or replace our general partner;

			
	
			
				 ·
			

			
	
			
			to approve some amendments to our partnership agreement; or

			
	
			
				 ·
			

			
	
			
			to take other action under our partnership agreement

		
			constituted “participation in the control” of our business for the purposes of the Delaware Act, then the limited partners could be held personally liable for our obligations under the laws of Delaware, to the same extent as our general partner. This liability would extend to persons who transact business with us under the reasonable belief that the limited partner is a general partner. Neither our partnership agreement nor the Delaware Act specifically provides for legal recourse against our general partner if a limited partner were to lose limited liability through any fault of our general partner. While this does not mean that a limited partner could not seek legal recourse, we know of no precedent for this type of a claim in Delaware case law.
		

		
			Under the Delaware Act, a limited partnership may not make a distribution to a partner if, after the distribution, all liabilities of the limited partnership, other than liabilities to partners on account of their partnership interests and liabilities for which the recourse of creditors is limited to specific property of the partnership, would exceed the fair value of the assets of the limited partnership. For the purpose of determining the fair value of the assets of a limited partnership, the Delaware Act provides that the fair value of property subject to liability for which recourse of creditors is limited shall be included in the assets of the limited partnership only to the extent that the fair value of that property exceeds the nonrecourse liability. The Delaware Act provides that a limited partner who receives a distribution and knew at the time of the distribution that the distribution was in violation of the Delaware Act shall be liable to the limited partnership for the amount of the distribution for three years.
		

		
			Limitations on the liability of members or limited partners for the obligations of a limited liability company or limited partnership have not been clearly established in many jurisdictions. If, by virtue of our ownership interest in our subsidiary or any subsidiaries we may have in the future, or otherwise, it were determined that we were conducting business in any jurisdiction without compliance with the applicable limited partnership or limited liability company statute, or that the right or exercise of the right by the limited partners as a group to remove or replace our general partner, to approve some amendments to our partnership agreement, or to take other action under our partnership agreement constituted “participation in the control” of our business for purposes of the statutes of any relevant jurisdiction, then the limited partners could be held personally liable for our obligations under the law of that jurisdiction to the same extent as our general partner under the circumstances. We will operate in a manner that our general partner considers reasonable and necessary or appropriate to preserve the limited liability of the limited partners.
		

		
			Issuance of Additional Partnership Interests; Preemptive Rights
		

		
			Our partnership agreement authorizes us to issue an unlimited number of additional partnership interests for the consideration and on the terms and conditions determined by our general partner without the approval of the unitholders.
		

		
			It is possible that we will fund acquisitions through the issuance of additional common units or other partnership interests. Holders of any additional common units that we issue will be entitled to share equally with the then-existing common unitholders in our distributions. In addition, the issuance of additional common units or other partnership interests may dilute the value of the interests of the then-existing common unitholders in our net assets.
		

		
			

		 

		

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			In accordance with Delaware law and the provisions of our partnership agreement, we may also issue additional partnership interests that, as determined by our general partner, may have rights to distributions or special voting rights to which the common units are not entitled. In addition, our partnership agreement does not prohibit our current or future subsidiaries from issuing equity interests, which may effectively rank senior to the common units.
		

		
			The holders of our common units do not have preemptive rights to acquire additional common units or other partnership securities. 
		

		
			Amendment of Our Partnership Agreement
		

		
			General
		

		
			Amendments to our partnership agreement may be proposed only by our general partner. However, our general partner will have no duty or obligation to propose any amendment and may decline to do so free of any fiduciary duty or obligation whatsoever to us or the limited partners, including any duty to act in good faith or in the best interests of us or the limited partners. In order to adopt a proposed amendment, other than the amendments discussed below, our general partner is required to seek written approval of the holders of the number of units required to approve the amendment or to call a meeting of the limited partners to consider and vote upon the proposed amendment. Except as described below, an amendment must be approved by a unit majority. In addition, amendments to our partnership agreement pertaining to the Class C Preferred Units requires the consent of holders of a majority of the outstanding Class C Preferred Units, voting separately as a class with one vote per Class C Preferred Unit, to the extent such amendment would adversely affect the Class C Preferred Units.
		

		
			Prohibited Amendments
		

		
			No amendment may be made that would:
		

			
	
			
				 ·
			

			
	
			
			enlarge the obligations of any limited partner without his consent, unless approved by at least a majority of the type or class of limited partner interests so affected; or

			
	
			
				 ·
			

			
	
			
			enlarge the obligations of, restrict, change or modify in any way any action by or rights of, or reduce in any way the amounts distributable, reimbursable or otherwise payable by us to our general partner or any of its affiliates without the consent of our general partner, which consent may be given or withheld in its sole discretion.

		
			The provisions of our partnership agreement preventing the amendments having the effects described in the clauses above can be amended upon the approval of the holders of at least 75% of the outstanding units, voting as a single class (including units owned by our general partner and its affiliates).
		

		
			No Unitholder Approval
		

		
			Our general partner may generally make amendments to our partnership agreement without the approval of any limited partner to reflect:
		

			
	
			
				 ·
			

			
	
			
			a change in our name, the location of our principal place of business, our registered agent or our registered office;

			
	
			
				 ·
			

			
	
			
			the admission, substitution, withdrawal or removal of partners in accordance with our partnership agreement;

			
	
			
				 ·
			

			
	
			
			a change that our general partner determines to be necessary or appropriate to qualify or continue our qualification as a limited partnership or other entity in which the limited partners have limited liability under the laws of any state or to ensure that neither we nor any of our subsidiaries will be treated as an association taxable as a corporation or otherwise taxed as an entity for U.S. federal income tax purposes (to the extent not already so treated or taxed);

		
			

		 

		

			8

		

		

			 

		

		

			 

		

		

			
	
			
				 ·
			

			
	
			
			a change in our fiscal year or taxable year and related changes;

			
	
			
				 ·
			

			
	
			
			an amendment that is necessary, in the opinion of our counsel, to prevent us or our general partner or its directors, officers, agents or trustees from in any manner being subjected to the provisions of the Investment Company Act of 1940, the Investment Advisers Act of 1940 or “plan asset” regulations adopted under the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), whether or not substantially similar to plan asset regulations currently applied or proposed;

			
	
			
				 ·
			

			
	
			
			an amendment that our general partner determines to be necessary or appropriate in connection with the creation, authorization or issuance of additional partnership interests or the right to acquire partnership interests;

			
	
			
				 ·
			

			
	
			
			any amendment expressly permitted in our partnership agreement to be made by our general partner acting alone;

			
	
			
				 ·
			

			
	
			
			an amendment effected, necessitated or contemplated by a merger agreement that has been approved under the terms of our partnership agreement;

			
	
			
				 ·
			

			
	
			
			any amendment that our general partner determines to be necessary or appropriate for the formation by us of, or our investment in, any corporation, partnership or other entity, as otherwise permitted by our partnership agreement;

			
	
			
				 ·
			

			
	
			
			conversions into, mergers with or conveyances to another limited liability entity that is newly formed and has no assets, liabilities or operations at the time of the conversion, merger or conveyance other than those it receives by way of the conversion, merger or conveyance in certain circumstances; or

			
	
			
				 ·
			

			
	
			
			any other amendments substantially similar to any of the matters described in the clauses above.

		
			In addition, our general partner may make amendments to our partnership agreement, without the approval of any limited partner, if our general partner determines that those amendments:
		

			
	
			
				 ·
			

			
	
			
			do not adversely affect the limited partners, considered as a whole, or any particular class of limited partners, in any material respect;

			
	
			
				 ·
			

			
	
			
			are necessary or appropriate to satisfy any requirements, conditions or guidelines contained in any opinion, directive, order, ruling or regulation of any federal or state agency or judicial authority or contained in any federal or state statute;

			
	
			
				 ·
			

			
	
			
			are necessary or appropriate to facilitate the trading of limited partner interests or to comply with any rule, regulation, guideline or requirement of any securities exchange on which the limited partner interests are or will be listed for trading;

			
	
			
				 ·
			

			
	
			
			are necessary or appropriate for any action taken by our general partner relating to splits or combinations of units under the provisions of our partnership agreement;

			
	
			
				 ·
			

			
	
			
			are necessary or appropriate in connection with the creation, authorization or issuance of any class or series of partnership securities; or

			
	
			
				 ·
			

			
	
			
			are required to effect the intent of the provisions of our partnership agreement or are otherwise contemplated by our partnership agreement.

		
			

		 

		

			9

		

		

			 

		

		

			 

		

		

		
			Opinion of Counsel and Unitholder Approval
		

		
			Any amendment that our general partner determines adversely affects in any material respect one or more particular classes of limited partners will require the approval of at least a majority of the class or classes so affected, but no vote will be required by any class or classes of limited partners that our general partner determines are not adversely affected in any material respect. Any amendment that would have a material adverse effect on the rights or preferences of any type or class of outstanding units in relation to other classes of units will require the approval of at least a majority of the type or class of units so affected. Any amendment that would reduce the voting percentage required to take any action other than to remove the general partner or call a meeting of unitholders is required to be approved by the affirmative vote of limited partners whose aggregate outstanding units constitute not less than the voting requirement sought to be reduced. Any amendment that would increase the percentage of units required to remove the general partner or call a meeting of unitholders must be approved by the affirmative vote of limited partners whose aggregate outstanding units constitute not less than the percentage sought to be increased. For amendments of the type not requiring unitholder approval, our general partner will not be required to obtain an opinion of counsel that an amendment will neither result in a loss of limited liability to the limited partners nor result in our being treated as a taxable entity for federal income tax purposes in connection with any of the amendments. Any amendment relating to special unitholder meetings, notices of unitholder meetings, quorum and voting requirements, actions without a meeting and the amendment provisions in our partnership agreement require approval of 75% of our outstanding units. No amendments to our partnership agreement, other than those the general partner can adopt without unitholder approval or in connection with a merger or consolidation, will become effective without the approval of holders of at least 90% of the outstanding units, voting as a single class, unless we first obtain an opinion of counsel to the effect that the amendment will not affect the limited liability under applicable law of any of our limited partners.
		

		
			Merger, Consolidation, Conversion, Sale or Other Disposition of Assets
		

		
			A merger, consolidation or conversion of us requires the prior consent of our general partner. However, our general partner will have no duty or obligation to consent to any merger, consolidation or conversion and may decline to do so free of any fiduciary duty or obligation whatsoever to us or the limited partners, including any duty to act in good faith or in the best interest of us or the limited partners.
		

		
			In addition, our partnership agreement generally prohibits our general partner, without the prior approval of the holders of a unit majority, from causing us to sell, exchange or otherwise dispose of all or substantially all of our assets in a single transaction or a series of related transactions, including by way of merger, consolidation or other combination. Our general partner may, however, mortgage, pledge, hypothecate or grant a security interest in all or substantially all of our assets without such approval. Our general partner may also sell all or substantially all of our assets under a foreclosure or other realization upon those encumbrances without such approval. Finally, our general partner may consummate any merger without the prior approval of our unitholders if we are the surviving entity in the transaction, our general partner has received an opinion of counsel regarding limited liability and tax matters, the transaction would not result in a material amendment to the partnership agreement (other than an amendment that the general partner could adopt without the consent of other partners), each of our units will be an identical unit of our partnership following the transaction and the partnership securities to be issued do not exceed 20% of our outstanding partnership interests (other than incentive distribution rights) immediately prior to the transaction. If the conditions specified in our partnership agreement are satisfied, our general partner may convert us or any of our subsidiaries into a new limited liability entity or merge us or any of our subsidiaries into, or convey all of our assets to, a newly formed entity, if the sole purpose of that conversion, merger or conveyance is to effect a mere change in our legal form into another limited liability entity, we have received an opinion of counsel regarding limited liability and tax matters and the governing instruments of the new entity provide the limited partners and our general partner with the same rights and obligations as contained in our partnership agreement. Our unitholders are not entitled to dissenters’ rights of appraisal under our partnership agreement or applicable Delaware law in the event of a conversion, merger or consolidation, a sale of substantially all of our assets or any other similar transaction or event.
		

		
			Dissolution
		

		
			We will continue as a limited partnership until dissolved and terminated under our partnership agreement and the Delaware Act. We will dissolve upon:
		

		
			

		 

		

			10

		

		

			 

		

		

			 

		

		

			
	
			
				 ·
			

			
	
			
			the election of our general partner to dissolve us, if approved by the holders of units representing a unit majority; 

			
	
			
				 ·
			

			
	
			
			there being no limited partners, unless we are continued without dissolution in accordance with applicable Delaware law; 

			
	
			
				 ·
			

			
	
			
			the entry of a decree of judicial dissolution of our partnership; 

			
	
			
				 ·
			

			
	
			
			the withdrawal or removal of our general partner or any other event that results in its ceasing to be our general partner other than by reason of a transfer of its general partner interest in accordance with our partnership agreement or its withdrawal or removal following the approval and admission of a successor; or

			
	
			
				 ·
			

			
	
			
			any other dissolution event as required by applicable Delaware law.

		
			Upon a dissolution under the penultimate clause above, the holders of a unit majority may also elect, within specific time limitations, to continue our business on the same terms and conditions described in our partnership agreement by appointing as a successor general partner an entity approved by the holders of units representing a unit majority, subject to our receipt of an opinion of counsel to the effect that:
		

			
	
			
				 ·
			

			
	
			
			the action would not result in the loss of limited liability under Delaware law of any limited partner; and

			
	
			
				 ·
			

			
	
			
			neither we nor any of our subsidiaries would be treated as an association taxable as a corporation or otherwise be taxable as an entity for U.S. federal income tax purposes upon the exercise of that right to continue (to the extent not already so treated or taxed).

		
			Liquidation and Distribution of Proceeds
		

		
			Upon our dissolution, unless our business is continued, the liquidator authorized to wind up our affairs will, acting with all of the powers of our general partner that are necessary or appropriate, liquidate our assets and apply the proceeds of the liquidation as described in “Provisions of Our Partnership Agreement Relating to Cash Distributions—Distributions of Cash Upon Liquidation.” The liquidator may defer liquidation or distribution of our assets for a reasonable period of time or distribute assets to partners in kind if it determines that a sale would be impractical or would cause undue loss to our partners.
		

		
			Withdrawal or Removal of Our General Partner
		

		
			Except as described below, our general partner has agreed not to withdraw voluntarily as our general partner prior to September 30, 2024 without obtaining the approval of the holders of at least a majority of the outstanding common units, excluding common units held by our general partner and its affiliates, and furnishing an opinion of counsel regarding limited liability and tax matters. On or after September 30, 2024, our general partner may withdraw as general partner without first obtaining approval of any unitholder by giving 90 days’ written notice, and that withdrawal will not constitute a violation of our partnership agreement. Notwithstanding the information above, our general partner may withdraw without unitholder approval upon 90 days’ notice to the limited partners if at least 50% of the outstanding common units are held or controlled by one person and its affiliates, other than our general partner and its affiliates. In addition, our partnership agreement permits our general partner to sell or otherwise transfer all of its general partner interest in us without the approval of the unitholders. Please read “—Transfer of General Partner Interest.”
		

		
			Upon withdrawal of our general partner under any circumstances, other than as a result of a transfer by our general partner of all or a part of its general partner interest in us, the holders of a unit majority may appoint a successor to that withdrawing general partner. If a successor is not elected, or is elected but an opinion of counsel regarding limited liability and tax matters cannot be obtained, we will be dissolved, wound up and liquidated, unless within a 

		 

		

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specified period after that withdrawal, the holders of a unit majority agree in writing to continue our business and to appoint a successor general partner. Please read “—Dissolution.”
		

		
			Our general partner may not be removed unless that removal is approved by the vote of the holders of not less than 66 2/3% of the outstanding units, voting together as a single class, including units held by our general partner and its affiliates, and we receive an opinion of counsel regarding limited liability and tax matters. Any removal of our general partner is also subject to the approval of a successor general partner by the vote of a unit majority. Notwithstanding that Stonepeak, as the holder of all of our Class C Preferred Units held approximately 63.1% of our outstanding units as of December 31, 2019, it has agreed that until the earlier of the occurrence of a material breach of the partnership agreement by us or our general partner, and the date on which all of the Class C Preferred Units have been redeemed, without the prior written consent of the Board of Directors, it will not vote in favor of removing our general partner.
		

		
			In the event of the removal of our general partner under circumstances where cause exists or withdrawal of our general partner where that withdrawal violates our partnership agreement, a successor general partner will have the option to purchase the general partner interest and incentive distribution rights of the departing general partner and its affiliates for a cash payment equal to the fair market value of those interests. Under all other circumstances where our general partner withdraws or is removed by the limited partners, the departing general partner will have the option to require the successor general partner to purchase the general partner interest and the incentive distribution rights of the departing general partner and its affiliates for fair market value. In each case, this fair market value will be determined by agreement between the departing general partner and the successor general partner. If no agreement is reached, an independent investment banking firm or other independent expert selected by the departing general partner and the successor general partner will determine the fair market value; if the departing general partner and the successor general partner cannot agree upon an expert, then an expert chosen by agreement of the experts selected by each of them will determine the fair market value.
		

		
			If the option described above is not exercised by either the departing general partner or the successor general partner, then the departing general partner’s general partner interest and all of its affiliates’ incentive distribution rights will automatically convert into common units equal to the fair market value of those interests as determined by an investment banking firm or other independent expert selected in the manner described in the preceding paragraph.
		

		
			In addition, we will be required to reimburse the departing general partner for all amounts due to the departing general partner, including, without limitation, all employee-related liabilities, including severance liabilities, incurred as a result of the termination of any employees employed for our benefit by the departing general partner or its affiliates.
		

		
			Transfer of General Partner Interest
		

		
			At any time, our general partner may transfer all or any of its general partner interest to another person without the approval of our common unitholders. As a condition of this transfer, the transferee must, among other things, assume the rights and duties of our general partner, agree to be bound by the provisions of our partnership agreement and furnish an opinion of counsel regarding limited liability and tax matters.
		

		
			Transfer of Ownership Interests in the General Partner
		

		
			At any time, the owners of our general partner may sell or transfer all or part of its ownership interests in our general partner to an affiliate or third-party without the approval of our unitholders.
		

		
			Transfer of Incentive Distribution Rights
		

		
			By transfer of incentive distribution rights in accordance with our partnership agreement, each transferee of incentive distribution rights will be admitted as a limited partner with respect to the incentive distribution rights transferred when such transfer and admission is reflected in our books and records. Each transferee:
		

		
			

		 

		

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			represents that the transferee has the capacity, power and authority to become bound by our partnership agreement;

			
	
			
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			automatically becomes bound by the terms and conditions of our partnership agreement; and

			
	
			
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			gives the consents, waivers and approvals contained in our partnership agreement.

		
			Our general partner will cause any transfers to be recorded on our books and records no less frequently than quarterly.
		

		
			We may, at our discretion, treat the nominee holder of incentive distribution rights as the absolute owner. In that case, the beneficial holder’s rights are limited solely to those that it has against the nominee holder as a result of any agreement between the beneficial owner and the nominee holder.
		

		
			Incentive distribution rights are securities and any transfers are subject to the laws governing transfer of securities. In addition to other rights acquired upon transfer, the transferor gives the transferee the right to become a limited partner for the transferred incentive distribution rights.
		

		
			Until an incentive distribution right has been transferred on our books, we and the transfer agent may treat the record holder of the unit or right as the absolute owner for all purposes, except as otherwise required by law or stock exchange regulations.
		

		
			Change of Management Provisions
		

		
			Our partnership agreement contains specific provisions that are intended to discourage a person or group from attempting to remove Sanchez Midstream Partners GP LLC as our general partner or from otherwise changing our management. Please read “—Withdrawal or Removal of Our General Partner” for a discussion of certain consequences of the removal of our general partner. If any person or group, other than our general partner and its affiliates, acquires beneficial ownership of 20% or more of any class of units, that person or group loses voting rights on all of its units. This loss of voting rights does not apply in certain circumstances. Please read “—Meetings; Voting.”
		

		
			Limited Call Right
		

		
			If at any time our general partner and its controlled affiliates own more than 80% of the then-issued and outstanding limited partner interests of any class, our general partner will have the right, which it may assign and transfer in whole or in part to any of its affiliates or beneficial owners or to us, to acquire all, but not less than all, of the limited partner interests of the class held by unaffiliated persons, as of a record date to be selected by our general partner, on at least 10, but not more than 60, days’ notice. The purchase price in the event of this purchase is the greater of:
		

			
	
			
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			the highest price paid by our general partner or any of its affiliates for any limited partner interests of the class purchased within the 90 days preceding the date on which our general partner first mails notice of its election to purchase those limited partner interests; and

			
	
			
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			the average of the daily closing prices of the partnership securities of such class over the 20 consecutive trading days preceding the date that is three days before the date the notice is mailed.

		
			As a result of our general partner’s right to purchase outstanding limited partner interests, a holder of limited partner interests may have his limited partner interests purchased at an undesirable time or at a price that may be lower than market prices at various times prior to such purchase or lower than a unitholder may anticipate the market price to be in the future. The tax consequences to a unitholder of the exercise of this call right are the same as a sale by that unitholder of his common units in the market. 
		

		
			

		 

		

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			Possible Redemption of Ineligible Holders
		

		
			Non-Taxpaying Holders; Redemption
		

		
			To avoid any adverse effect on the maximum applicable rates chargeable to customers by us or any of our future subsidiaries, or in order to reverse an adverse determination that has occurred regarding such maximum rate, our partnership agreement provides our general partner the power to amend the agreement. If our general partner, with the advice of counsel, determines that our not being treated as an association taxable as a corporation or otherwise taxable as an entity for U.S. federal income tax purposes, coupled with the tax status (or lack of proof thereof) of one or more of our limited partners, has, or is reasonably likely to have, a material adverse effect on the maximum applicable rates chargeable to customers by us or our subsidiaries, then our general partner may adopt such amendments to our partnership agreement as it determines necessary or appropriate to:
		

			
	
			
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			obtain proof of the U.S. federal income tax status of our limited partners (and their owners, to the extent relevant); and

			
	
			
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			permit us to redeem the units held by any person whose tax status has or is reasonably likely to have a material adverse effect on the maximum applicable rates or who fails to comply with the procedures instituted by our general partner to obtain proof of the federal income tax status. The redemption price in the case of such a redemption will be the average of the daily closing prices per unit for the 20 consecutive trading days immediately prior to the date set for redemption.

		
			Non-Citizen Assignees; Redemption
		

		
			If our general partner, with the advice of counsel, determines that we are subject to U.S. federal, state or local laws or regulations that create a substantial risk of cancellation or forfeiture of any property that we have an interest in because of the nationality, citizenship or other related status of any limited partner, then our general partner may adopt such amendments to our partnership agreement as it determines necessary or advisable to:
		

			
	
			
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			obtain proof of the nationality, citizenship or other related status of our limited partners (and their beneficial owners, to the extent relevant); and

			
	
			
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			permit us to redeem the units held by any person whose nationality, citizenship or other related status creates substantial risk of cancellation or forfeiture of any property or who fails to comply with the procedures instituted by the general partner to obtain proof of the nationality, citizenship or other related status. The redemption price in the case of such a redemption will be the average of the daily closing prices per unit for the 20 consecutive trading days immediately prior to the date set for redemption.

		
			Meetings; Voting
		

		
			Except as described below regarding a person or group owning 20% or more of any class of units then outstanding, record holders of units on an applicable record date will be entitled to notice of, and to vote at, meetings of our limited partners and to act upon matters for which approvals may be solicited.
		

		
			Our general partner does not anticipate that any meeting of our unitholders will be called in the foreseeable future. Any action that is required or permitted to be taken by the unitholders may be taken either at a meeting of the unitholders or without a meeting if consents in writing describing the action so taken are signed by holders of the number of units necessary to authorize or take that action at a meeting. Meetings of the unitholders may be called by our general partner or by unitholders owning at least 20% of the outstanding units of the class for which a meeting is proposed. Unitholders may vote either in person or by proxy at meetings. The holders of a majority of the outstanding units of the class or classes for which a meeting has been called, represented in person or by proxy, will constitute a quorum, unless any action by the unitholders requires approval by holders of a greater percentage of the units, in which case the quorum will be the greater percentage.
		

		
			

		 

		

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			Each record holder of a unit has a vote according to his percentage interest in us, although additional limited partner interests having special voting rights could be issued. Please read “—Issuance of Additional Interests.” However, if at any time any person or group, other than our general partner and its affiliates, or a direct or subsequently approved transferee of our general partner or its affiliates and purchasers specifically approved by our general partner, acquires, in the aggregate, beneficial ownership of 20% or more of any class of units then outstanding (other than any class of the Class C Preferred Units), that person or group will lose voting rights on all of its units and the units may not be voted on any matter and will not be considered to be outstanding when sending notices of a meeting of unitholders, calculating required votes, determining the presence of a quorum or for other similar purposes. This loss of voting rights does not apply (i) to any person or group that acquires the units directly from our general partner or its affiliates, (ii) to any transferees of that person or group approved by our general partner, (iii) to any person or group who acquires the units with the specific prior approval of our general partner, (iv)  Stonepeak with respect to its ownership (beneficial or recorded) of the Class C Preferred Units or (v)  the holder of the 2019 Warrant with respect to the Junior Securities issued or issuable upon exercise of the 2019 Warrant. In addition, if any person or group beneficially owns 20% or more of any class of units solely as a result of actions taken by us, then the 20% threshold is increased, with respect to such person, to a percentage equal to such person’s new beneficial ownership after the taking of such action plus the difference between 20% and such person’s beneficial ownership prior to such action. Common units held in nominee or street name account will be voted by the broker or other nominee in accordance with the instruction of the beneficial owner unless the arrangement between the beneficial owner and his nominee provides otherwise.
		

		
			Any notice, demand, request, report or proxy material required or permitted to be given or made to record common unitholders under our partnership agreement will be delivered to the record holder by us or by the transfer agent.
		

		
			Voting Rights of Incentive Distribution Rights
		

		
			If a majority of the incentive distribution rights are held by our general partner and its affiliates, the holders of the incentive distribution rights will have no right to vote in respect of such rights on any matter, unless otherwise required by law, and the holders of the incentive distribution rights shall be deemed to have approved any matter approved by our general partner.
		

		
			If less than a majority of the incentive distribution rights are held by our general partner and its affiliates, the incentive distribution rights will be entitled to vote on all matters submitted to a vote of unitholders, other than amendments and other matters that our general partner determines do not adversely affect the holders of the incentive distribution rights in any material respect. On any matter in which the holders of incentive distribution rights are entitled to vote, such holders will vote together with the common units as a single class, and such incentive distribution rights shall be treated in all respects as common units when sending notices of a meeting of our limited partners to vote on any matter (unless otherwise required by law), calculating required votes, determining the presence of a quorum or for other similar purposes under our partnership agreement. The relative voting power of the holders of the incentive distribution rights and the common units will be set in the same proportion as cumulative cash distributions, if any, in respect of the incentive distribution rights for the four consecutive quarters prior to the record date for the vote bears to the cumulative cash distributions in respect of such class of units for such four quarters.
		

		
			Status as Limited Partner
		

		
			By transfer of common units in accordance with our partnership agreement, each transferee of common units shall be admitted as a limited partner with respect to the common units transferred when such transfer and admission are reflected in our books and records. Except as described under “—Limited Liability,” the common units and the Class C Preferred Units will be fully paid, and unitholders will not be required to make additional contributions.
		

		
			Indemnification
		

		
			Under our partnership agreement, in most circumstances, we will indemnify the following persons, to the fullest extent permitted by law, from and against all losses, claims, damages or similar events:
		

		
			

		 

		

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			our general partner;

			
	
			
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			any departing general partner;

			
	
			
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			any person who is or was an affiliate of our general partner or any departing general partner;

			
	
			
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			any person who is or was a manager, managing member, general partner, director, officer, employee, agent, fiduciary or trustee of our partnership, our subsidiaries, our general partner, any departing general partner or any of their affiliates;

			
	
			
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			any person who is or was serving at the request of a general partner, any departing general partner or any of their respective affiliates as a manager, managing member, general partner, director, officer, employee, agent, fiduciary or trustee of another person owing a fiduciary duty to us or our subsidiaries;

			
	
			
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			any person who controls our general partner or any departing general partner; and

			
	
			
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			any person designated by our general partner.

		
			Any indemnification under these provisions will only be out of our assets. Unless our general partner otherwise agrees, it will not be personally liable for, or have any obligation to contribute or lend funds or assets to us to enable us to effectuate, indemnification. We may purchase insurance against liabilities asserted against and expenses incurred by persons for our activities, regardless of whether we would have the power to indemnify the person against liabilities under our partnership agreement.
		

		
			Reimbursement of Expenses
		

		
			Our partnership agreement requires us to reimburse our general partner and its affiliates for all direct and indirect expenses they incur or payments they make on our behalf and all other expenses allocable to us or otherwise incurred by our general partner and its affiliates in connection with operating our business. Our partnership agreement does not set a limit on the amount of expenses for which our general partner and its affiliates may be reimbursed. These expenses may include salary, bonus, incentive compensation and other amounts paid to persons who perform services for us or on our behalf and expenses allocated to our general partner by its affiliates. Our general partner is entitled to determine in good faith the expenses that are allocable to us.
		

		
			Books and Reports
		

		
			Our general partner is required to keep appropriate books of our business at our principal offices. These books will be maintained for both tax and financial reporting purposes on an accrual basis. For tax and fiscal reporting purposes, our fiscal year is the calendar year.
		

		
			We will furnish or make available to record holders of our common units, within 105 days after the close of each fiscal year, an annual report containing audited consolidated financial statements and a report on those consolidated financial statements by our independent registered public accounting firm. Except for our fourth quarter, we will also furnish or make available summary financial information within 50 days after the close of each quarter. We will be deemed to have made any such report available if we file such report with the SEC on EDGAR or make the report available on a publicly available website which we maintain.
		

		
			We will furnish each record holder with information reasonably required for U.S. federal and state tax reporting purposes within 90 days after the close of each calendar year. This information is expected to be furnished in summary form so that some complex calculations normally required of partners can be avoided. Our ability to furnish this summary information to our unitholders will depend on their cooperation in supplying us with specific information. Every unitholder will receive information to assist him in determining his U.S. federal and state tax liability and in filing his U.S. federal and state income tax returns, regardless of whether he supplies us with the necessary information.
		

		
			

		 

		

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			Right to Inspect Our Books and Records
		

		
			Our partnership agreement provides that a limited partner can, for a purpose reasonably related to his interest as a limited partner, upon reasonable written demand stating the purpose of such demand and at his own expense, have furnished to him:
		

			
	
			
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			a current list of the name and last known address of each record holder;

			
	
			
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			information as to the amount of cash, and a description and statement of the agreed value of any other capital contribution, contributed or to be contributed by each partner and the date on which each became a partner;

			
	
			
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			copies of our partnership agreement, our certificate of limited partnership, related amendments and powers of attorney under which they have been executed;

			
	
			
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			information regarding the status of our business and financial condition (provided that obligation shall be satisfied to the extent the limited partner is furnished our most recent annual report and any subsequent quarterly or periodic reports required to be filed (or which would be required to be filed) with the SEC pursuant to Section 13(a) of the Exchange Act); and

			
	
			
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			any other information regarding our affairs that our general partner determines is just and reasonable.

		
			Under our partnership agreement, however, each of our limited partners and other persons who acquire interests in our partnership interests do not have rights to receive information from us or any of the persons we indemnify as described above under “—Indemnification” for the purpose of determining whether to pursue litigation or assist in pending litigation against us or those indemnified persons relating to our affairs, except pursuant to the applicable rules of discovery relating to the litigation commenced by the person seeking information.
		

		
			Our general partner may, and intends to, keep confidential from the limited partners trade secrets or other information the disclosure of which our general partner believes in good faith is not in our best interests or that we are required by law or by agreements with third parties to keep confidential.
		

		
			Registration Rights
		

		
			Under our partnership agreement, we have agreed to register for resale under the Securities Act and applicable state securities laws any common units or other limited partner interests proposed to be sold by our general partner or any of its affiliates or their assignees if an exemption from the registration requirements is not otherwise available. These registration rights continue for two years following any withdrawal or removal of our general partner. We are obligated to pay all expenses incidental to the registration, excluding underwriting discounts.
		

		
			On November 22, 2016, we entered into a registration rights agreement with SN UR Holdings, LLC, and agreed to register the common units issued to such person on such date in connection with a private placement of our common units.
		

		
			On August 2, 2019, we entered into an amended and restated registration rights agreement with Stonepeak and agreed to register the common units issuable to Stonepeak upon exercise of the 2019 Warrant.
		

		
			DESCRIPTION OF 2019 WARRANT
		

		
			On August 2, 2019, we issued the 2019 Warrant to Stonepeak. The 2019 Warrant entitles the holder to receive a number of each class of Junior Securities representing ten percent (10%) of the Junior Securities Deemed Outstanding (as defined in the 2019 Warrant) of such class as of the date the 2019 Warrant is exercised.  
		

		
			

		 

		

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			The 2019 Warrant is exercisable until the later of August 2, 2026 or the thirtieth  (30th) calendar day following the date on which all of the Class C Preferred Units are redeemed by us. There is no exercise price payable in connection with the exercise of the 2019 Warrant. As a result of the 2019 Warrant having no exercise price, the 2019 Warrant does not contain any provisions for changes to or adjustments in the exercise price.
		

		
			In the event of any (i) capital reorganization of the Partnership, (ii) reclassification of Partnership interests (other than a change as a result of a unit dividend or subdivision, split-up or combination of units), (iii) consolidation or merger of the Partnership with or into another Person, (iv) sale of all or substantially all of the Partnership’s assets to another Person or (v) other similar transaction, in each case which entitles the holders of Junior Securities other than Excluded Junior Securities (as defined in the 2019 Warrant) to receive (either directly or upon subsequent liquidation) units, securities or assets with respect to or in exchange for such class of Junior Securities (each such transaction, an “Adjustment Transaction”), the 2019 Warrant shall, immediately after such Adjustment Transaction, remain outstanding and shall thereafter, in lieu of or in addition to (as the case may be) the number of Warrant Units (as defined in the 2019 Warrant) then exercisable under the 2019 Warrant, be exercisable for the kind and number of units or other securities or assets of the Partnership or of the successor Person resulting from such transaction to which the holder would have been entitled upon such Adjustment Transaction if the Holder had exercised the 2019 Warrant in full immediately prior to the time of such Adjustment Transaction and acquired the applicable number of Warrant Units then issuable hereunder as a result of such exercise.
		

		
			 
		

		 

		

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