Document:

ex_120787.htm

 

	
			Exhibit 10.3

				
			The Monroe Bank & Trust Supplemental Executive Retirement Agreement with H. Douglas Chaffin, as amended.

			

 

 

AMENDED AND RESTATED

 

MONROE BANK & TRUST SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT

 

[H. Douglas Chaffin]

 

THIS AMENDED AND RESTATED AGREEMENT is adopted this 16th day of July, 2018, by and between MONROE BANK & TRUST, a state-chartered commercial bank located in Monroe, Michigan (the "Company"), and H. DOUGLAS CHAFFIN (the "Executive").

 

RECITALS

 

Whereas, on the 1st day of July, 2003, the Company and the Executive entered into the Monroe Bank & Trust Supplemental Executive Retirement Agreement (the “Agreement” or “SERP”) to encourage the Executive to remain an employee of the Company by providing supplemental retirement benefits to the Executive; and

 

Whereas, the SERP was Amended and Restated on June 4, 2007, in order to comply with the requirements applicable to deferred compensation arrangements under Section 409A of the Internal Revenue Code and to make certain other changes to the SERP; and

 

Whereas, the SERP was previously amended on August 25, 2011, to provide for the elimination of the otherwise required benefit accrual for the 2010 Plan Year; and

 

Whereas, the Company and the Executive now desire to further amend the SERP to reverse the effect of the 2011 amendment and to amend certain benefit calculations provided for in the SERP.

 

AGREEMENT

 

The Company and the Executive agree as follows:

 

Article 1 

Definitions

 

Whenever used in this Agreement, the following words and phrases shall have the meanings specified:

 

1.1     1. “Accrual Balance” shall mean the amount that reflects the benefits accrual resulting from the payments owed to the Executive under the provisions of Section 2.1 hereof, computed in accordance with the assumptions set forth in Addendum A.

 

1

 

 

1.2     1."Code" means the Internal Revenue Code of 1986, as amended.

 

1.3     1."Effective Date" means July 1, 2003.

 

1.4     1."Final Pay" means the total annual base salary payable to the Executive at the rate in effect at Termination of Employment. Final Pay shall not be reduced for any salary reduction contributions to: (i) cash or deferred arrangements under Section 401(k) of the Code; (ii) a cafeteria plan under Section 125 of the Code; or (iii) a deferred compensation plan that is not qualified under Section 401(a) of the Code.

 

1.4     1."Normal Retirement Age" means the Executive's 65th birthday.

 

1.5     1."Retirement" means the voluntary retirement, other than by reason of death, of the Executive resulting in a Termination of Employment.

 

1.6     1."Plan Year" means the calendar year ending on December 31.

 

1.7     1.“Specified Employee” means at any time at which any stock of the Company is publicly traded on an established securities market or otherwise, a person who is determined to be a key employee (as defined in Section 416(i) of the Code without regard to paragraph 5 thereof) of the Company as of the preceding December 31.

 

1.8     1."Termination for Cause" See Article 5.

 

1.9     "Termination of Employment" means the termination of the Executive’s employment with the Company for reasons other than death. Whether a Termination of Employment takes place is determined based on the facts and circumstances surrounding the termination of the Executive’s employment and whether the Company and the Executive intend for the Executive to provide significant services for the Company following such termination. A change in the Executive's employment status will not be considered a Termination of Employment if the Executive continues to provide service to the Company at an annual rate that is fifty percent (50%) or more of the services rendered, on average, during the immediately preceding three full calendar years of employment (or if employed less than three years, such lesser period) and the annual remuneration for such service is fifty percent (50%) or more of the average annual remuneration earned during the final three years of employment (or if less, such lesser period). A change in the Executive’s employment status will be considered a Termination of Employment if as a result of such change the level of bona fide services the Executive continues to provide to the Company decreases to an annual rate that is twenty percent (20%) or less of the service rendered, on average, during the immediately preceding three full calendar years of employment (or, if employed less than three years, such lesser period) and the annual remuneration for such services is twenty percent (20%) or more of the average annual remuneration earned during the final three full calendar years of employment (or, if less, such lesser period).

 

Article 2 

Benefits During Lifetime

 

2.1      Retirement Benefit. Upon Retirement, the Company shall pay to the Executive the benefit described in this Section 2.1 in lieu of any other benefit under this Agreement.

 

2

 

 

2.1.1 Amount of Benefit. The annual benefit under this Section 2.1(computed as indicated in the example presented in Addendum B hereof) is sixty-five percent (65%) of the Executive's Final Pay, reduced by:

 

	 	(a)	fifty percent (50%) of the primary federal Social Security benefit payable (before earnings reduction) to the Executive or which would be payable if applied for by the Executive upon his Normal Retirement Age; and
	 	 	 
	 	
			(b)

				
			the annual amount of benefits payable to the Executive on a single life annuity basis, attributable to the portion of the Executive's account balances as of the date of Executive’s Termination of Employment arising from employer contributions (but excluding the portion of such balances arising from employee salary reduction contributions) from the MBT Retirement Plan.

			

 

2.1.2 Payment of Benefit. The Company shall pay the retirement benefit in 120 equal monthly installments commencing the month following Executive’s Retirement.

 

2.1.3 Vesting of Benefit. Prior to this amendment and restatement Executive became and remains fully vested in the benefits provided for in this Agreement on April 4, 2009.

 

2.2     Restriction on Timing of Distributions.  Notwithstanding any provision of this Agreement to the contrary, if the Executive is considered a Specified Employee at Termination of Employment under such procedures as established by the Company in accordance with Section 409A of the Code, benefit distributions that are made upon Termination of Employment may not commence earlier than six (6) months after the date of such Termination of Employment. Therefore, in the event this Section 2.2 is applicable to the Executive, any distribution which would otherwise be paid to the Executive within the first six months following the Termination of Employment shall be accumulated and paid to the Executive in a lump sum on the first day of the seventh month following the Termination of Employment. All subsequent distributions shall be paid in the manner specified.

 

2.3     Distributions Upon Income Inclusion Under Section 409A of the Code. Upon the inclusion of any amount into the Executive’s income as a result of the failure of this non-qualified deferred compensation plan to comply with the requirements of Section 409A of the Code, to the extent such tax liability can be covered by the entire amount accrued by the Company with respect to the Company’s obligations hereunder, a distribution shall be made as soon as is administratively practicable following the assertion by the Internal Revenue Service of the plan failure.

 

2.4     Change in Form or Timing of Distributions. All changes in the form or timing of distributions hereunder must comply with the following requirements. The changes:

 

	 	
			(a)

				
			may not accelerate the time or schedule of any distribution, except as provided in Section 409A of the Code and the regulations thereunder;

			

	 	
			(b)

				
			must, for benefits distributable, delay the commencement of distributions for a minimum of five (5) years from the date the first distribution was originally scheduled to be made; and

			

	 	
			(c)

				
			must take effect not less than twelve (12) months after the election is made.

			

 

3

 

 

Article 3

Death Benefits

 

3.1     Death During Active Service. Upon Termination of Employment of the Executive by reason of death, no benefit shall be payable under this Agreement. It is acknowledged by the Company and the Executive that while Executive is employed by the Company provision has been made for a death benefit to be payable to the Executive’s beneficiary pursuant to that certain “Monroe Bank & Trust Split Dollar Agreement” dated July 1, 2003, and as amended of even date with this amendment and restatement.

 

3.2     Death During Payment of a Benefit. If the Executive dies after any benefit payments have commenced under Article 2 of this Agreement but before receiving all such payments, the Company shall pay the remaining benefits to the Executive's beneficiary at the same time and in the same amounts they would have been paid to the Executive had the Executive survived.

 

3.3     Death After Termination of Employment But Before Payment of a Benefit Commences. If the Executive is entitled to a benefit under Article 2 of this Agreement, but dies prior to the commencement of said benefit payments, the Company shall pay the same benefit payments to the Executive's beneficiary that the Executive was entitled to prior to death except that the benefit payments shall commence on the first day of the month following the date of the Executive's death.

 

Article 4

Beneficiaries

 

4.1     Beneficiary Designations. The Executive shall designate a beneficiary by filing a written designation with the Company. The Executive may revoke or modify the designation at any time by filing a new designation. However, designations will only be effective if signed by the Executive and received by the Company during the Executive's lifetime. The Executive's beneficiary designation shall be deemed automatically revoked if the beneficiary predeceases the Executive, or if the Executive names a spouse as beneficiary and the marriage is subsequently dissolved. If the Executive dies without a valid beneficiary designation, all payments shall be made to the Executive's estate.

 

4.2     4.Facility of Payment. If a benefit is payable to a minor, to a person declared incompetent, or to a person incapable of handling the disposition of his or her property, the Company may pay such benefit to the guardian, legal representative or person having the care or custody of such minor, incompetent person or incapable person. The Company may require proof of incompetence, minority or guardianship as it may deem appropriate prior to distribution of the benefit. Such distribution shall completely discharge the Company from all liability with respect to such benefit.

 

Article 5 

General Limitations

 

5.1 Termination for Cause. Notwithstanding any provision of this Agreement to the contrary, the Company shall not pay any benefit under this Agreement if the Company terminates the Executive's employment for:

 

	 	
			(a)

				
			gross negligence or gross neglect of duties;

			

 

4

 

 

	 	
			(b)

				
			commission of a felony or of a gross misdemeanor involving moral turpitude; or

			

 

	 	
			(c)

				
			fraud, disloyalty, dishonesty or willful violation of any law or significant Company policy committed in connection with the Executive's employment and resulting in an adverse effect on the Company.

			

 

5.2     Suicide or Misstatement. The Company shall not pay any benefit under this Agreement if the Executive commits suicide within three years after the date of this Agreement. In addition, the Company shall not pay any benefit under this Agreement if the Executive has made any material misstatement of fact on an employment application or resume provided to the Company, or on any application for any benefits provided by the Company to the Executive.

 

5.3     Competition After Termination of Employment. The Company shall not pay any benefit under this Agreement if the Executive, within 12 months following Termination of Employment, without the prior written consent of the Company, engages in, becomes interested in, directly or indirectly, as a sole proprietor, as a partner in a partnership, or as a substantial shareholder in a corporation, or becomes associated with, in the capacity of employee, director, officer, principal, agent, trustee or in any other capacity whatsoever, any enterprise conducted in the trading area (a 50 mile radius) of the business of the Company, which enterprise is, or may deemed to be, competitive with any business carried on by the Company as of the date of termination of the Executive's employment or retirement. This section shall not apply following a Change of Control as defined by 7.3(a) hereof.

 

Article 6 

Claims and Review Procedures

 

6.1 Claims Procedure. An Executive or beneficiary ("claimant") who has not received benefits under the Agreement that he or she believes should be paid shall make a claim for such benefits as follows:

 

6.1.1     Initiation - Written Claim. The claimant initiates a claim by submitting to the Company a written claim for the benefits.

 

6.1.2     Timing of Company Response. The Company shall respond to such claimant within 90 days after receiving the claim. If the Company determines that special circumstances require additional time for processing the claim, the Company can extend the response period by an additional 90 days by notifying the claimant in writing, prior to the end of the initial 90-day period, that an additional period is required. The notice of extension must set forth the special circumstances and the date by which the Company expects to render its decision.

 

6.1.3     Notice of Decision. If the Company denies part or all of the claim, the Company shall notify the claimant in writing of such denial. The Company shall write the notification in a manner calculated to be understood by the claimant. The notification shall set forth:

 

	 	
			(a)

				
			The specific reasons for the denial;

			

 

	 	
			(b)

				
			A reference to the specific provisions of the Agreement on which the denial is based;

			

 

5

 

 

	 	
			(c)

				
			A description of any additional information or material necessary for the claimant to perfect the claim and an explanation of why it is needed;

			

 

	 	
			(d)

				
			An explanation of the Agreement's review procedures and the time limits applicable to such procedures; and

			

 

	 	
			(e)

				
			A statement of the claimant's right to bring a civil action under ERISA Section 502(a) following an adverse benefit determination on review.

			

 

6.2     Review Procedure. If the Company denies part or all of the claim, the claimant shall have the opportunity for a full and fair review by the Company of the denial, as follows:

 

6.2.1     Initiation - Written Request. To initiate the review, the claimant, within 60 days after receiving the Company's notice of denial, must file with the Company a written request for review.

 

6.2.2     Additional Submissions - Information Access. The claimant shall then have the opportunity to submit written comments, documents, records and other information relating to the claim. The Company shall also provide the claimant, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information relevant (as defined in applicable ERISA regulations) to the claimant's claim for benefits.

 

6.2.3     Considerations on Review. In considering the review, the Company shall take into account all materials and information the claimant submits relating to the claim, without regard to whether such information was submitted or considered in the initial benefit determination.

 

6.2.4     Timing of Company Response. The Company shall respond in writing to such claimant within 60 days after receiving the request for review. If the Company determines that special circumstances require additional time for processing the claim, the Company can extend the response period by an additional 60 days by notifying the claimant in writing, prior to the end of the initial 60-day period that an additional period is required. The notice of extension must set forth the special circumstances and the date by which the Company expects to render its decision.

 

6.2.5     Notice of Decision. The Company shall notify the claimant in writing of its decision on review. The Company shall write the notification in a manner calculated to be understood by the claimant. The notification shall set forth:

 

	 	
			(a)

				
			The specific reasons for the denial;

			

 

	 	
			(b)

				
			A reference to the specific provisions of the Agreement on which the denial is based;

			

 

	 	
			(c)

				
			A statement that the claimant is entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information relevant (as defined in applicable ERISA regulations) to the claimant's claim for benefits; and

			

 

6

 

 

	 	
			(d)

				
			A statement of the claimant's right to bring a civil action under ERISA Section 502(a).

			

 

Article 7 

Amendments and Termination

 

	
			7.1

				
			Amendments. This Agreement may be amended only by a written agreement signed by the Company and the Executive. However, the Company may unilaterally amend this Agreement to conform with written directives to the Company from its auditors or banking regulators or to comply with legislative changes or tax law, including without limitation Section 409A of the Code and any and all Treasury regulations and guidance promulgated thereunder.

			

 

	
			7.2

				
			Plan Termination Generally. The Company and Executive may by mutual agreement terminate this Agreement at any time. The benefit hereunder shall be the entire amount accrued by the Company with respect to the Company’s obligations hereunder. Except as provided in Section 7.3, the termination of this Agreement shall not cause a distribution of benefits under this Agreement. Rather, after such termination benefit distributions will be made at the earliest distribution event permitted under Article 2 or Article 3.

			

 

	
			7.3

				
			Plan Terminations Under Section 409A. Notwithstanding anything to the contrary in Section 7.2, this Agreement may be terminated by the Company, without the consent of the Executive, in the following circumstances, as provided by and subject to the limitations and requirements of IRC 409A and section 1.409A-3(j)(4)(ix) of the IRS Regulations, as now in effect and hereinafter amended.

			

 

	 	
			(a)

				
			Within thirty (30) days before or twelve (12) months after a change in the ownership or effective control of the Company, or in the ownership of a substantial portion of the assets of the Company as described in Section 409A(a)(2)(A)(v) of the Code (collectively a “Change in Control”), provided that all distributions are made no later than twelve (12) months following such termination of the Agreement and further provided that all the Company's arrangements which are substantially similar to the Agreement are terminated so the Executive and all participants in the similar arrangements are required to receive all amounts of compensation deferred under the terminated arrangements within twelve (12) months of the termination of the arrangements; or

			

	 	
			(b)

				
			Upon the Company’s termination and liquidation of this Agreement within 12 months of a corporate dissolution or with the approval of a bankruptcy court provided that the amounts deferred under the Agreement are paid and included in the Executive's gross income in the latest of (i) the calendar year in which the Agreement terminates; (ii) the calendar year in which the amount is no longer subject to a substantial risk of forfeiture; or (iii) the first calendar year in which the distribution is administratively practical.

			

 

In connection with termination of this Agreement as provided in this Section 7.3, the Company shall distribute the amount of the Accrual Balance as of the date of the termination of the Agreement and in accordance with the assumptions and provisions of Addendum A, which amount shall be distributed to the Executive in a lump sum.

 

7

 

 

Article 8 

Miscellaneous

 

8.1     Binding Effect. This Agreement shall bind the Executive and the Company, and their beneficiaries, survivors, executors, successors, administrators and transferees.

 

8.2     No Guarantee of Employment. This Agreement is not an employment policy or contract. It does not give the Executive the right to remain an employee of the Company, nor does it interfere with the Company's right to discharge the Executive. It also does not require the Executive to remain an employee nor interfere with the Executive's right to terminate employment at any time.

 

8.3     Non-Transferability. Benefits under this Agreement cannot be sold, transferred, assigned, pledged, attached or encumbered in any manner.

 

8.4     Reorganization. The Company shall not merge or consolidate into or with another company, or reorganize, or sell substantially all of its assets to another company, firm, or person unless such succeeding or continuing company, firm, or person agrees to assume and discharge the obligations of the Company under this Agreement. Upon the occurrence of such event, the term "Company" as used in this Agreement shall be deemed to refer to the successor or survivor company.

 

8.5     Tax Withholding. The Company shall withhold any taxes that are required to be withheld from the benefits provided under this Agreement.

 

8.6     Applicable Law. The Agreement and all rights hereunder shall be governed by the laws of the State of Michigan, except to the extent preempted by the laws of the United States of America.

 

8.7     Unfunded Arrangement. The Executive and beneficiary are general unsecured creditors of the Company for the payment of benefits under this Agreement. The benefits represent the mere promise by the Company to pay such benefits. The rights to benefits are not subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, attachment, or garnishment by creditors. Any insurance on the Executive's life is a general asset of the Company to which the Executive and beneficiary have no preferred or secured claim.

 

8.8     Entire Agreement. This Agreement constitutes the entire agreement between the Company and the Executive as to the subject matter hereof. No rights are granted to the Executive by virtue of this Agreement other than those specifically set forth herein.

 

8.9     Administration. The Company shall have powers which are necessary to administer this Agreement, including but not limited to:

 

	 	
			(a)

				
			Establishing and revising the method of accounting for the Agreement;

			

 

	 	
			(b)

				
			Maintaining a record of benefit payments;

			

 

	 	
			(c)

				
			Establishing rules and prescribing any forms necessary or desirable to administer the Agreement; and

			

 

	 	
			(d)

				
			Interpreting the provisions of the Agreement.

			

 

8

 

 

IN WITNESS WHEREOF, the Executive and the Company have signed this Amended and Restated Agreement.

 

	EXECUTIVE:  	
			 

				
			COMPANY:

				
			 

			
	 	
			 

				
			 

				
			 

				
			 

			
	 	
			 

				
			 

				
			 

				
			 

			
	H. Douglas Chaffin	
			 

				
			By: 

				
			Michael J. Miller

				
			 

			
	 	
			 

				
			Title: 

				
			Chairman of the Board of Directors

				
			 

			
	 	
			 

				
			 

				
			 

				
			 

			

 

9

 

 

Addendum A – Determination of Accrual Balance

 

 

The following factors will be applied in calculating the participant's benefit accrual, and will be subject to review and modification by the Compensation Committee of the Board:

 

	
			Interest Rate

				
			6.00%

			
	 	 
	
			Rate of return on 401(k) account balance

				
			6.00%

			
	 	 
	
			Mortality Assumptions

				
			1994 GAR Table as defined in

			Rev. Ruling 2001-62

			
	 	 
	
			Social Security law In effect at termination

				 
	 	 
	
			For purposes of estimating the Social Security PIA:

				 
	 	 
	
			Wage Base Increases

				
			3.00%

			
	 	 
	
			Average Wage Index

				
			2.75%

			
	 	 
	
			CPI

				
			2.50%

			
	 	 
	
			Executive's historical wages based on historical national average wage index

			
	 	 
	
			Executive assumed to continue to earn level future wages after termination until age 65

			 

			

 

Addendum B – Retirement Benefit (Refer to Section 2.1)

 

Illustration of benefit calculation (All assumptions are for purposes of illustrating benefit calculation only)

 

Assumed termination: December 31, 2017

 

$385,000           12/31/2017 annual base salary

             X

          65%         Benefit percent

$250,250           Base annual benefit

                          Minus offset amounts

   $17,346          50% of projected Social Security PIA at age 65

   $44,583          Projected life annuity value of 12/31/2017 employer contribution balance under MBT retirement plan

$188,321           Projected retirement benefit

 

 

10EX-10.1

 Exhibit 10.1 

Execution Version 

August 8, 2018 
 Apache Midstream LLC 

2000 Post Oak Blvd., Suite 100 
 Houston, TX 77056 

Re: Option Agreements 
 Ladies and Gentlemen:

 Reference is made to the following agreements: (1) the Equity Purchase Option Agreement dated as of December 20, 2017 by and
between Kinder Morgan Texas Pipeline LLC and Apache Midstream LLC (“Apache Midstream”) (the “GCX Option Agreement”); (2) the Shin Oak Pipeline Equity Option Agreement dated as of May 23, 2018 and entered into
by and between Enterprise Products Operating LLC and Apache Midstream (the “Shin Oak Option Agreement”); (3) the Option Agreement to Purchase Partners Interest in EPIC Crude Holdings, LP dated as of May 10, 2018 and entered
into by and among EPIC Midstream Holdings, LP, EPIC Crude Holdings, LP, EPIC Crude Holdings GP, LLC, and Apache Midstream (the “EPIC Option Agreement” and, together with the GCX Option Agreement and the Shin Oak Option Agreement,
the “Option Agreements”); and (4) the Contribution Agreement entered into as of even date hereof by and among Apache Midstream, Kayne Anderson Acquisition Corp. (“Kayne”), and the Companies (as such term is
defined in the Contribution Agreement) (the “Contribution Agreement”). Kayne, Apache Corporation (“Apache”), with respect to Sections 2(a)(ii), 2(b) and 2(c) only, and Apache Midstream are each sometimes herein
referred to individually as a “Party” and sometimes collectively referred to as the “Parties.” For purposes of this letter agreement and Apache Midstream’s and Apache’s obligations hereunder,
“commercially reasonable efforts” means Apache Midstream’s and Apache’s efforts in accordance with reasonable commercial practice and without incurrence of unreasonable expense, and provided always that “commercially
reasonable efforts” shall not require Apache Midstream or Apache to provide, or to cause any of their respective affiliates to provide, any guaranty or credit support or to take any actions or incur any expenses not required or set forth in the
Option Agreements. 
 Kayne, Apache, with respect to Sections 2(a)(ii), 2(b) and 2(c) only, and Apache Midstream hereby agree as follows: 

 

	 	1.	 Apache Midstream Obligations. Apache Midstream shall comply in all material respects with the terms and
conditions of each of the Option Agreements and use commercially reasonable efforts to preserve the ability of Kayne or its designated subsidiaries to exercise the options from and after the closing of the transactions contemplated by the
Contribution Agreement (“Closing”) in accordance with the terms set forth in the Option Agreements. 

  
 1 

	 	2.	 Option Agreements. In furtherance, but not in limitation, of the obligations set forth in
Section 1 of this letter agreement: 

  

	 	a.	 GCX Option Agreement. 

(i) Apache Midstream shall use commercially reasonable efforts to cause Kayne’s designated subsidiary to be determined an Eligible Person
(as such term is defined in the Amended and Restated Limited Liability Company Agreement of Gulf Coast Express Pipeline LLC, dated as of December 19, 2017 (the “LLC Agreement”)) at the time such designated subsidiary is
proposed to be admitted as a Member of the Company (as such term is defined in the LLC Agreement). If Kayne’s designated subsidiary is not determined to be an Eligible Person at the time such designated subsidiary is proposed to be admitted as
a Member of the Company, then (A) prior to the expiration of the option set forth in the GCX Option Agreement, Apache Midstream shall exercise in full the option set forth in the GCX Option Agreement within the time specified for such exercise
in the GCX Option Agreement and (B) as soon as reasonably practicable thereafter and provided that Apache Midstream is admitted as a Member (as such term is defined in the LLC Agreement) in accordance with the LLC Agreement, (1) Apache
Midstream shall transfer and assign to Kayne’s designated subsidiary the equity interests in the Company that Apache Midstream received upon the exercise of such option and (2) Kayne shall reimburse Apache Midstream for any capital costs
incurred by Apache Midstream in connection with the exercise of such option. 
 (ii) To the extent within Apache’s control and until
the earlier of Kayne’s designated subsidiary’s admission as a Member of the Company under Section 2(a)(i) or December 31, 2018, Apache shall use commercially reasonable efforts to not cause the termination of any of the
Transportation Agreements (as such term is defined in the GCX Option Agreement); provided, however, that this Section 2(a)(ii) does not apply to any Apache termination right in any Transportation Agreement (as such term is defined in the GCX
Option Agreement), and nothing in this Section 2(a)(ii) shall prevent or prohibit Apache from exercising any such termination right pursuant to any or all of such Transportation Agreements (as such term is defined in the GCX Option Agreement),
and the Parties agree that any such termination shall not, in any circumstances, be a breach of this Section 2(a)(ii). 
  

	 	b.	 Shin Oak Option Agreement. To the extent within Apache’s control, Apache shall use commercially
reasonable efforts to not cause the failure of the condition precedent set forth in Section 3(g)(iii) of the Shin Oak Option Agreement or termination of the NGL Purchase Agreement (as such term is defined in the Shin Oak Option Agreement).

  

	 	c.	 EPIC Option Agreement. Apache shall (i) to the extent within Apache’s control, use
commercially reasonable efforts to ensure that no Event of Default has occurred and is continuing to occur in the Transportation Agreement (as such terms are defined in the EPIC Option Agreement) and (ii) use commercially reasonable efforts to
provide any necessary equity commitment letter pursuant to and as required, if applicable, under Section 3(l)(ii) of the EPIC Option Agreement. 

  
 2 

	 	3.	 Repurchase of the Option Interests: 

 

	 	a.	 GCX Option: If, (i) as a result of Apache Midstream breaching its obligations set forth in
Section 1 or Section 2a(i) of this letter agreement (ii) Apache breaching its obligations set forth in Section 2(a)(ii) of this letter agreement, or (iii) Apache exercising a termination right under the Transportation
Agreements (as such term is defined in the GCX Option Agreement) as permitted under Section 2(a)(ii) of this letter agreement, Kayne or its designated subsidiary is unable to exercise the option set forth in the GCX Option Agreement or acquire
the equity interest in the Company on the same economic terms and on the same timeframe as specified in the GCX Option Agreement (either pursuant to an assignment in accordance with Section 2a of this letter agreement or otherwise) and
(ii) Closing (as defined in the Contribution Agreement) has occurred, then Apache Midstream shall forfeit 16,500,000 Common Units (as such term is defined in the Contribution Agreement) and a corresponding number of shares of Buyer Class C
Common Stock (as defined in the Contribution Agreement), and Kayne shall transfer, or shall cause the transfer of, the GCX Option to Apache Midstream or one of Apache Midstream’s designated affiliates. Upon such forfeiture by Apache Midstream,
(i) Kayne agrees that it shall have no further recourse, cause of action, claim, or other redress whatsoever against Apache Midstream or any affiliate of Apache Midstream in respect of the GCX Option Agreement or this letter agreement as it
relates to the GCX Option Agreement, and (ii) Kayne waives any and all other potential claims against, and releases from all other liability, Apache Midstream or any of Apache Midstream’s affiliates with respect to any matters relating to
or arising from the GCX Option Agreement or this letter agreement as it relates to the GCX Option Agreement. 

  

	 	b.	 Shin Oak Option. If, (i) as a result of Apache Midstream breaching its obligations set forth in
Section 1 of this letter agreement or Apache breaching its obligations set forth in Section 2b of this letter agreement, Kayne or its designated subsidiary is unable to exercise the option set forth in the Shin Oak Option Agreement and
(ii) Closing (as defined in the Contribution Agreement) has occurred, then Apache Midstream shall forfeit 18,500,000 Common Units and a corresponding number of shares of Buyer Class C Common Stock, and Kayne shall transfer, or shall cause
the transfer of, the Shin Oak Option to Apache Midstream or one of Apache Midstream’s designated affiliates. Upon such forfeiture by Apache Midstream, (i) Kayne agrees that it shall have no further recourse, cause of action, claim, or
other redress whatsoever against Apache Midstream or any affiliate of Apache Midstream in respect of the Shin Oak Option Agreement or this letter Agreement as it relates to the Shin Oak Option Agreement, and (ii) Kayne waives any and all other
potential claims against, and releases from all other liability, Apache Midstream or any of Apache Midstream’s affiliates with respect to any matters relating to or arising from the Shin Oak Option Agreement or this letter agreement as it
relates to the Shin Oak Option Agreement. 

  

	 	c.	 EPIC Option. If, (i) as a result of Apache Midstream breaching its obligations set forth in
Section 1 of this letter agreement or Apache breaching its obligations set forth in Section 2c of this letter agreement, Kayne or its designated subsidiary is unable to exercise the option set forth in the EPIC Option Agreement and
(ii) Closing (as defined in the 

  
 3 

	 	
Contribution Agreement) has occurred, then Apache Midstream shall forfeit 5,000,000 Common Units and a corresponding number of shares of Buyer Class C Common Stock, and Kayne shall transfer,
or shall cause the transfer of, the EPIC Option to Apache Midstream or one of Apache Midstream’s designated affiliates. Upon such forfeiture by Apache Midstream, (i) Kayne agrees that it shall have no further recourse, cause of action,
claim, or other redress whatsoever against Apache Midstream or any affiliate of Apache Midstream in respect of the EPIC Option Agreement or this letter agreement as it relates to the EPIC Option Agreement, and (ii) Kayne waives any and all
other potential claims against, and releases from all other liability, Apache Midstream or any of Apache Midstream’s affiliates with respect to any matters relating to or arising from the EPIC Option Agreement or this letter agreement as it
relates to the EPIC Option Agreement. 

  

	 	d.	 Sole and Exclusive Remedy. Kayne agrees that the forfeiture of Common Units and Buyer Class C
Common Stock set out in Sections 3(a)-3(c) of this letter agreement shall be the sole and exclusive remedy for any breach by Apache or Apache Midstream, as applicable, of any covenant, undertaking, agreement,
or other obligation made pursuant to Section 1 or Sections 2(a)-2(c), as applicable, or any other provision of this letter agreement. 

 

	 	4.	 Common Units and Buyer Class C Common Stock. From and after Closing and until this
letter agreement is terminated in accordance with Section 6 of this letter agreement, Apache Midstream shall at all times hold a number of Common Units and shares of Buyer Class C Common Stock sufficient to fulfill its obligations under
Section 3 of this letter agreement. 

  

	 	5.	 Miscellaneous. The following provisions of the Contribution Agreement shall apply to this letter
agreement mutatis mutandis: Section 9.2(b) (Waiver of Unrecoverable Damages); Section 10.5 (Binding Effect), Section 10.6 (Governing Law; Consent to Jurisdiction; Severability; Waiver of Jury Trial),
Section 10.7 (Amendments), Section 10.10 (Assignment and Successors and Assigns), and Section 10.11 (Counterparts). 

  

	 	6.	 Termination. With respect to each Option Agreement, this letter agreement shall continue in full force
until the sooner to occur of (i) the expiration of such Option Agreement and (ii) the termination of the Contribution Agreement in accordance with its terms. 

[Signature Page Follows] 

  
 4 

 IN WITNESS WHEREOF, the Parties hereto have caused this letter agreement to be executed by
their respective, duly authorized representatives effective as of the date first written above. 
  

			
	APACHE CORPORATION, as a party hereto for Sections 2(a)(ii), 2(b) and 2(c) only
		
	By:	 	 /s/ Stephen J. Riney

	Name:	 	Stephen J. Riney
	Title: Chief Financial Officer and Executive Vice President
	
	APACHE MIDSTREAM LLC
		
	By:	 	 /s/ Brian W. Freed

	Name:	 	Brian W. Freed
	Title:	 	Senior Vice President

  
 [Signature Page to
Side Letter re: Option Agreements] 

 
			
	KAYNE ANDERSON ACQUISITION CORP.
		
	By:	 	 /s/ Robert S. Purgason

	Name:	 	Robert S. Purgason
	Title:	 	Chief Executive Officer

  
 [Signature Page to
Side Letter re: Option Agreements]

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