Document:

EX-10.1

 Exhibit 10.1 

MORGANS HOTEL GROUP CO. 

475 Tenth Avenue 
 New
York, New York 
 August 30, 2013 
 Michael Gross

 49 Murray Street 
 New York, New York 10007 

Dear Michael: 
 As we have discussed and
mutually agreed, your employment with Morgans Hotel Group Co. (the “Company”) will end, effective as of August 30, 2013 (the “Separation Date”). The purpose of this letter agreement (the “Agreement”)
is to confirm the terms concerning your separation from employment, as follows: 
 1. Separation. As of the Separation Date,
you will be deemed to have resigned from and to no longer hold any positions or offices with the Company or any of its Affiliates (as defined below). The Company agrees to release a mutually agreeable public statement regarding your departure in the
form attached hereto as Exhibit A and you and the Company agree to make public statements consistent with the substance thereof. 

2. Final Salary Payment. You will receive, on or before the next regular Company payday following the Separation Date, pay for
all work you performed for the Company through the Separation Date, to the extent not previously paid, at the Annual Base Salary rate in effect on the Separation Date. You acknowledge that you have no earned but unused vacation days remaining as of
the Separation Date; accordingly, you will receive no payment for vacation days. Capitalized terms in this Agreement are used with the meanings set forth in the Employment Agreement between you and the Company dated as of March 20, 2011 and
amended as of February 28, 2013 (as amended, the “Employment Agreement”, attached hereto as Exhibit B) unless otherwise defined in this Agreement. 

3. Severance Benefits. In consideration of your acceptance of this Agreement: 

(a) The Company will pay you a lump sum in the gross amount of $500,000. Such payment shall be made by wire transfer on the
later to occur of the following: (i) within four business days of the date this Agreement takes effect (which shall be the date it has been signed by both you and the Company) or (ii) the Separation Date, 

 (b) The Company will grant you, on the Separation Date, 58,334 Stock Units (as
such term is defined in the Company’s Amended and Restated 2007 Omnibus Incentive Plan (the “Plan”)) under the Plan which will vest on the Separation Date (such grant, the “Immediately Vesting Award”). The
terms and conditions of the Immediately Vesting Award will be set forth in a separate award agreement (the “Immediately Vesting Award Agreement”, attached hereto as Exhibit C). The Immediately Vesting Award will be subject to
the terms of the Plan and the Immediately Vesting Award Agreement. 
 (c) The Company will grant you, on the Separation Date,
25,000 Stock Units (as such term is defined in the Plan) under the Plan which will vest on the first anniversary of the Separation Date (such grant, the “One Year Vesting Award”). The terms and conditions of the One Year Vesting
Award will be set forth in a separate award agreement (the “One Year Vesting Award Agreement”, attached hereto as Exhibit D). The One Year Vesting Award will be subject to the terms of the Plan and the One Year Vesting Award
Agreement. 
 (d) Any LTIP Units that are unvested as of the Separation Date will vest as of the Separation Date, and will be
subject to the Plan and the LTIP Agreement. 
 (e) Any Stock Options that are unvested as of the Separation Date will vest as
of the Separation Date, and will be subject to the Plan and the Stock Option Agreement (as such term is defined in the Employment Agreement); provided, however, that, notwithstanding any provision in the Plan or the Stock Option Agreement to the
contrary, all Stock Options that are vested as of the Separation Date will remain exercisable for a period of one year following the Separation Date. 

(f) Effective as of the day following the Separation Date the Company waives your non-competition obligations under
Section 7(a) of the Employment Agreement (but this shall not apply to the provisions of the penultimate sentence thereof with respect to the deal pipeline list set forth in the letter agreement entered into by the parties on August 30,
2013 (the “Deal Pipeline List”); for the avoidance of doubt, this means that you shall not pursue in any location any hotel management or food or beverage matters involving any of the entities, products or brands appearing under the
heading “All Locations Restricted” on the Deal Pipeline List, and shall not pursue any hotel management or food or beverage matters at the other hotel properties identified on the Deal Pipeline List during the one year period following the
Separation Date). 
 4. Acknowledgement of Full Payment and Withholding. 

(a) You acknowledge and agree that the payments provided under Section 2 of this Agreement are in complete satisfaction of any and all
compensation due to you from the Company, whether for services provided to the Company or otherwise, through the Separation Date and that, except as expressly provided under this Agreement, no further compensation is owed or will be paid to you.

  
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 (b) All payments made by the Company under this Agreement shall be reduced by any tax or other
amounts required to be withheld by the Company under applicable law and all other lawful deductions authorized by you, subject to the provisions of the Immediately Vesting Award Agreement and the One Year Vesting Award Agreement. 

5. Status of Employee Benefits, Paid Time Off, Expenses and Equity. 

(a) Except for any right you may have to continue your participation and that of your eligible dependents in the Company’s medical,
dental, and vision plans under the federal law known as “COBRA”, your participation in all employee benefit plans of the Company will end as of the Separation Date, in accordance with the terms of those plans. You will not continue to earn
paid time off or other similar benefits after the Separation Date. You will receive information about your COBRA continuation rights under separate cover. 

(b) Within two (2) weeks following the Separation Date, you shall submit your final expense reimbursement statement reflecting all
business expenses you incurred through the Separation Date, if any, for which you seek reimbursement, and, in accordance with Company policy, reasonable substantiation and documentation for the same. The Company will reimburse you for your
authorized and documented expenses within thirty (30) days of receiving such statement pursuant to its regular business practice. 

(c) Except as expressly provided herein, any equity awards granted to you by the Company that are unvested as of the Separation Date will
expire and be forfeited as of the Separation Date, including without limitation any and all Stock Units granted to you on February 28, 2013. 

6. Continuing Obligations, Confidentiality and Non-Disparagement. 

(a) You and the Company acknowledge that you and the Company continue to be bound by your and its respective rights and obligations under
Section 5, Section 7(b), Section 7(c), Section 7(d) and Section 8 of the Employment Agreement and you continue to be bound by your obligations under the penultimate sentence of Section 7(a) of the Employment Agreement
(collectively, your obligations under Section 7(b), Section 7(c), Section 7(d), and under the penultimate sentence of Section 7(a) of the Employment Agreement are referred to as your “Continuing Obligations”),
and provided further that with respect to Section 8 of the Employment Agreement, (y) the Company’s indemnification obligations thereunder, for the avoidance of doubt, shall not apply to claims made by you which were released by you
under this Agreement, and (z) you shall not be entitled to any payment of legal fees in connection with your obligations under Section 10 hereof, other than in matters in which you are to be presented by the Company as a witness or in
which there are claims pending or threatened against you; provided further, that the Company’s compliance with Section 3 of this Agreement shall be deemed compliance with Section 4 of the Employment Agreement, for purposes of Sections
7(a) and 7(b) of the Employment Agreement; and provided further that the Company shall not be obliged under Section 5 of the Employment Agreement to pay any interest to you on account of any deferred payments, or otherwise increase the payments
expressly provided hereunder, and provided further that the provisions of Section 5 of the Employment Agreement concerning COBRA continuation reimbursement payments shall not apply. 

  
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 (b) You agree that you will not disparage or criticize the Company or any of its past, present or
future directors, shareholders, officers, members, managers, general and limited partners, their management of the Company or the Company’s business or its products or services, or employees, and that you will not otherwise do or say anything
that could disrupt the good morale of employees of the Company or harm the interests or reputation of the Company. The Company agrees that it, its officers, directors, or senior executives will never disparage or criticize you or your management of
the Company, or your management of any entities by which you are employed or of which you are a principal that are known to the Company or its directors and executive officers, and that the Company will not otherwise do or say anything that could
harm your interests or reputation. Statements made to a government regulator or investigator or in testimony in any proceeding or in connection with and relevant to a proceeding to enforce this Agreement shall not constitute a violation of this
Section 6(b). 
 (c) For the purposes of this Agreement, “Affiliates” means all persons and entities directly or
indirectly controlling, controlled by or under common control with the Company, where control may be by management authority, equity interest or otherwise. 

7. Representations regarding Return of Company Documents and Other Matters. In signing this Agreement, you represent and warrant
that you have returned to the Company any and all documents, materials and information (whether in hardcopy, on electronic media or otherwise) related to the business of the Company and its Affiliates (whether present or otherwise), and all keys,
access cards, credit cards, computer hardware and software (in each case without deletion of files or other data), telephones and telephone-related equipment and all other property of the Company or any of its Affiliates in your possession or
control. Further, you represent and warrant that you have not retained any copy or derivation of any documents, materials or information (whether in hardcopy, on electronic media or otherwise) of the Company or any of its Affiliates. Recognizing
that your employment with the Company will end as of the Separation Date, you agree that you will not, following the Separation Date, for any purpose, attempt to access or use any computer or computer network or system of the Company or any of its
Affiliates, including without limitation the electronic mail system. Further, you acknowledge that you have disclosed to the Company all passwords necessary or desirable to obtain access to, or that would assist in obtaining access to, all
information which you have password-protected on any computer equipment, network or system of the Company or any of its Affiliates. 

  
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 8. Release of Claims. 

(a) In consideration of and in exchange for the Company’s agreement to make the payments and provide the other benefits to you contained
in this Agreement, on your own behalf and that of your heirs, executors, administrators, beneficiaries, personal representatives and assigns, you agree that this Agreement shall be in complete and final settlement of any and all causes of action,
rights and claims, whether known or unknown, that you have had in the past, now have, or might now have, including without limitation any such causes of action, rights or claims in any way related to, connected with or arising out of your
employment, service as a director, role as an investor, or the termination of any of the foregoing or pursuant to the wage and hour, wage payment and fair employment practices laws and statutes of the city of New York, the state of New York or any
other localities or states in which you have provided services to the Company (each as amended from time to time), the Age Discrimination in Employment Act, Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act, the Fair
Labor Standards Act, the Employee Retirement Income Security Act, and/or any other federal, state or local law, regulation or other requirement, and you hereby release and forever discharge the Company, its Affiliates and all of their respective
past, present and future directors, shareholders, officers, members, managers, general and limited partners, employees, employee benefit plans, administrators, trustees, agents, representatives, successors and assigns, and all others connected with
any of them, both individually and in their official capacities, from any and all such causes of action, rights and claims, and you represent that no such causes of action, rights or claims have been filed as of the effective date of this Agreement.
Excluded from the scope of this release of claims are any causes of action, rights and claims under this Agreement arising after its effective date. 

(b) In signing this Agreement, you give the Company and its Affiliates assurance that you have signed it voluntarily and with a full
understanding of its terms; that you have had sufficient opportunity before signing this Agreement to consider its terms and to consult with any of your immediate family and your legal and tax advisors; and that you have not relied on any promises
or representations, express or implied, that are not set forth expressly in this Agreement. 
 (c) In consideration of and in exchange for
your obligations hereunder, on its own behalf, on behalf of any other entities of which the Company is the majority owner, and on behalf of the successors and assigns of any of the foregoing (collectively, the “Company Releasors”), the
Company hereby (i) agrees that this Agreement shall be in complete and final settlement of any and all causes of action, rights and claims, whether known or unknown, that the Company Releasors have had in the past, now have, or might now have,
including without limitation any such causes of action, rights or claims in any way related to, connected with or arising out of your employment, board service or role as an investor or the termination of any of the foregoing under or pursuant to
any federal, state or local laws, regulations or other requirements, and (ii) releases and forever discharges you and your heirs, executors, administrators beneficiaries, personal representatives and assigns, and all others connected with any
of them, both individually and in their official capacities, from any and all such causes of action, rights and claims. The Company represents and warrants that no entity or person has majority ownership of the Company’s common stock. Excluded
from the scope of this release of claims are (y) any causes of action, rights and claims under this Agreement arising after its effective date and (z) any causes of action, rights and claims arising from any criminal conduct or willful bad
faith acts by you of which Jason Kalisman is not aware as of the effective date of this Agreement. The Company will not oppose your dismissal from the action entitled OTK Associates, LLC v. Robert Friedman, et al. and Morgans Hotel Group Co.,
CA No. 8447-VCL pending in the Court of Chancery of the State of Delaware (the “Delaware Litigation”), provided that this shall not preclude, and you agree that you shall not assert the fact of such dismissal as precluding, the
Company from seeking your rejoinder to the Delaware Litigation on the basis of any causes of action, rights or claims arising from any criminal conduct or willful bad faith acts by you of which Jason Kalisman is not aware as of the effective
date of this Agreement, or from opposing your dismissal from the Delaware Litigation on the basis of any causes of action, rights or claims arising from any criminal conduct or willful bad faith acts by you prior to the effective date of this
Agreement first discovered by Jason Kalisman after the effective date of this Agreement. 

  
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 9. Dispute Resolution. 

(a) This is a New York contract and shall be governed and construed in accordance with the laws of the State of New York, without regard to
the conflict of laws principles thereof. 
 (b) You and the Company hereby submit to the exclusive jurisdiction of the state and federal
courts in the State and County of New York in connection with any dispute arising out of this Agreement. To the extent permitted by law, you and the Company waive any and all rights to a jury trial with respect to any dispute arising out of this
Agreement. 
 10. Cooperation. Upon reasonable notice, you will (a) make yourself reasonably available to the Company’s
Board of Directors and to your successor as Chief Executive Officer of the Company for general advice regarding leadership transition at the Company; (b) furnish the Company promptly, following specific request being made by an executive
officer of the Company, with any records and information in your possession acquired by you during or after the period of your service to the Company that relate to or arise out of (i) your service with the Company or any of its Affiliates or
(ii) any Company matters arising in whole or in part during the period of such service (other than records and information as to which you properly may assert on your own behalf the attorney-client privilege or attorney work product doctrine)
and (c) communicate with the Company and its advisors in response to requests for such records and information, and will provide testimony as a witness in a Proceeding (as such term is defined in Section 8(a) of the Employment Agreement)
if requested to do so by the Company at reasonable times on reasonable notice to you. Nothing herein shall limit your obligations to provide testimony, records or information in response to any subpoena or other legal process issued in connection
with any Proceeding, and you shall be entitled to reimbursement for reasonable attorneys’ fees and expenses incurred by you in connection with all such testimony and response to any such subpoena or other legal process in accordance with and
subject to the requirements of Section 8(a) of the Employment Agreement. The Company will make reasonable efforts to avoid having such requests by the Company require you to take any action that would interfere with your work and business
responsibilities, and you and the Company will in good faith attempt to schedule any meetings or other appearances in a manner that will not interfere with your work and business responsibilities. The Company will reimburse you, within fifteen
(15) days following your request for reimbursement, for travel and lodging expenses reasonably incurred and any actual lost wages in connection with Company requests for assistance under this Section 10. 

  
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 11. Miscellaneous. 

(a) This Agreement, together with its Exhibits, constitutes the entire agreement between you and the Company, and supersedes all prior and
contemporaneous communications, agreements and understandings, whether written or oral, with respect to your employment, its termination and all related matters, excluding only: 

 

	 	(i)	the Continuing Obligations, all of which shall remain in full force and effect in accordance with their terms, 

  

	 	(ii)	any prior award agreements, all of which shall remain in full force and effect in accordance with their terms except as modified by this Agreement, 

 

	 	(iii)	the Deal Pipeline List. 

 (b) The Company represents and warrants that (i) this Agreement,
the Immediately Vesting Award, and the One Year Vesting Award have been duly authorized by the Company’s Board of Directors or Compensation Committee, as applicable, (ii) the Immediately Vesting Award and the One Year Vesting Award are
within the 10% safe harbor established by the fifth sentence of Section 10.2 of the Plan, and (iii) the shares of Stock deliverable following vesting of the Restricted Stock Units under the Immediately Vesting Award and the One Year
Vesting Award have been registered pursuant to a Form S-8 Registration Statement filed by the Company under the Securities Act of 1933, as amended, and the Company will use its reasonable efforts to keep such Form S-8 effective until delivery of the
shares of Stock vested under such Awards. 
 (c) This Agreement may not be modified or amended, and no breach shall be deemed to be waived,
unless agreed to in writing by you and the Chair of the Board of Directors of the Company or his expressly authorized designee. The captions and headings in this Agreement are for convenience only, and in no way define or describe the scope or
content of any provision of this Agreement. 
 (d) This Agreement may be executed in two or more counterparts, each of which shall be an
original and all of which together shall constitute one and the same instrument. 
 (e) Both parties have participated in the drafting of
this Agreement and no inference shall be drawn against either party based on its role in such drafting. 

  
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 If the terms of this Agreement are acceptable to you, please sign, date and return it to me on
the Separation Date. When you and the Company have signed it, this Agreement shall take effect as a legally binding agreement between you and the Company on the basis set forth above. The enclosed copy of this letter, which you should also sign and
date, is for your records. 
  

			
	Sincerely,
	MORGANS HOTEL GROUP CO.
		
	By:	 	 /s/ Jason T. Kalisman

		 	 Date: August 30, 2013

		 	 Print Name: Jason T. Kalisman

		 	 Print Title: Interim Chief Executive Officer

  

			
	Accepted and agreed:
		
	Signature:	 	 /s/ Michael Gross

		 	Michael Gross
	
	Date: August 30, 2013

  
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 Exhibit A 

Public Statement 
 MORGANS HOTEL
GROUP ANNOUNCES THAT MICHAEL GROSS RESIGNS 
 Michael Gross, who has served as Chief Executive Officer of Morgans Hotel Group Co since 2011, has announced
that he is stepping down from that role to pursue new opportunities. 
 [ABC] [DEF] of Morgans has been named the Company’s Chief Executive Officer on
an interim basis, effective immediately. [DEF] will continue to serve in his role as [XYZ]. 

 Exhibit B 

EMPLOYMENT AGREEMENT FOR MICHAEL GROSS 

AMENDMENT NO. 1 
 This
Amendment No. 1 to the Employment Agreement for Michael Gross (this “Amendment No. 1”), dated February 28, 2013, by and between Morgans Hotel Group Co., with a principal place of business at 475 Tenth Avenue, New York, NY
10018 (the “Company” or “Employer”) and Michael Gross (“Executive”). 
 WHEREAS, Executive and the
Company previously entered into an Employment Agreement, dated and effective as of March 20, 2011 (the “Agreement”); and 

WHEREAS, the Parties desire to amend the Agreement to extend the term of the Executive’s employment under the Agreement; 

NOW, THEREFORE, the Parties agree as follows, effective as of March 20, 2011 as if included within the original Agreement: 

 

	 	1.	All capitalized terms used in the Amendment No. 1 and not otherwise defined shall have the meaning assigned to them in the Agreement. 

 

	 	2.	The Agreement is hereby amended by deleting the text of Section 1 and replacing it with the following: 

The Company hereby employs the Executive, and the Executive hereby accepts employment with the Company, on the terms and
conditions of this Agreement, for the period commencing on the Effective Date and ending on the fourth anniversary of the Effective Date (the “Employment Period”), subject to the provisions for early termination or extension
as hereinafter provided. The Company (but not the Executive) will have the right to offer (the “Extension Offer”) to extend the Employment Period by six (6) months (the “Extension Period”) by
giving notice to Executive of such offer no less than seventy-five (75) days prior to the end of the initial Employment Period. During any Extension Period, the Executive shall receive compensation on substantially the same terms as being
provided at the end of the initial Employment Period and will receive a cash bonus, payable on the last day of the Extension Period, in an amount equal to one-half of the Annual Bonus paid to the Executive with respect to the 2014 fiscal year. In
the event that the parties hereafter agree to extend Executive’s employment beyond the end of the Extension Period the amount of the pro-rated cash bonuses paid by the Company with respect to the Extension Period and the period from
January 1, 2015 to the fourth anniversary of the Effective Date will be taken into account and be credited against any cash bonus that may become payable to Executive for fiscal year 2015. The Executive shall have the right to accept or reject
the Extension Offer; if the Executive rejects the Extension Offer and terminates employment, such termination will be deemed to be a termination due to non-renewal of the Agreement by the Company for purposes of Section 4(d) below and shall not
be considered a termination under Section 4(c) below. 

	 	3.	The Agreement is further amended by deleting Section 2(b)(ii) and replacing it with the following: 

(ii) Annual Bonus. The Executive will be eligible for an annual cash bonus for the Company’s 2011 fiscal year and
for each other complete Company fiscal year during the Employment Period (“Annual Bonus”) with a target payout of 100% of Annual Base Salary. The target payout for the 2011 Annual Bonus shall be pro rated, based on the number
of days in the fiscal year from and including the Effective Date to and including December 31, 2011, 50% of which shall be guaranteed. The remaining 50% of the 2011 Annual Bonus shall depend on the following performance metrics: 40% on EBITDA
and 10% on the RevPAR Index, both as established by the Compensation Committee of the Board of Directors. For each other complete Company fiscal year during the Employment Period, the Executive’s Annual Bonus will range from 50% up to 150% of
target. The actual Annual Bonus for each fiscal year shall be determined in good faith after consultation with the Executive by the Compensation Committee based upon actual corporate and individual performance for such year and shall be payable in
accordance with the procedures specified by the Compensation Committee. The Executive’s Annual Bonus will be paid no later than seventy-five (75) days after the end of the applicable bonus period (or, if earlier, as provided in
Section 4 below). Except as provided in Section 4 of this Agreement, Employee must be employed by the Company on the date bonuses are paid to Company employees in order to be entitled to receive a bonus. To the extent the Annual
Bonus exceeds 100% of Annual Base Salary, the Compensation Committee may in its discretion, and subject to applicable law, cause the Company to pay such excess in the form of fully vested equity compensation awards under one of Company’s equity
compensation plans (which award may be subject to other conditions that the Compensation Committee may determine). 
  

	 	4.	The provisions of this Amendment No. 1 may be amended and waived only with the prior written consent of the parties hereto. This Amendment No. 3 may be executed and delivered in one or more counterparts, each
of which shall be deemed an original and together shall constitute one and the same instrument. 

  

	 	5.	Except as set forth in this Amendment No. 1, the Agreement shall remain unchanged and shall continue in full force and effect. 

*        *        * 

 IN WITNESS WHEREOF, the parties hereto have executed and delivered this Amendment
No. 1 on the date first written above.  
  

			
	MORGANS HOTEL GROUP CO.
		
	By:	 	
	
	     /s/ Richard Szymanski

	Name:	 	Richard Szymanski
	Title:	 	Chief Financial Officer
	
	EXECUTIVE
	
	     /s/ Michael Gross

	Michael Gross

 EMPLOYMENT AGREEMENT 

(MICHAEL GROSS) 
 This
EMPLOYMENT AGREEMENT (this “Agreement”), dated on March 20, 2011, between Morgans Hotel Group Co., a Delaware corporation (the “Company”), and Michael Gross (the
“Executive”) shall become effective as of March 20, 2011 (the “Effective Date”). 
 1. Employment
Period 
 The Company hereby employs the Executive, and the Executive hereby accepts employment with the Company, on the terms and
conditions of this Agreement, for the period commencing on the Effective Date and ending on the third anniversary of the Effective Date (the “Employment Period”), subject to the provisions for early termination or extension
as hereinafter provided. The Company (but not the Executive) will have the right to offer (the “Extension Offer”) to extend the Employment Period by six (6) months (the “Extension Period”) by
giving notice to Executive of such offer no less than seventy-five (75) days prior to the end of the initial Employment Period. During any Extension Period, the Executive shall receive compensation on substantially the same terms as being
provided at the end of the initial Employment Period and will receive a cash bonus, payable on the last day of the Extension Period, in an amount equal to one-half of the Annual Bonus paid to the Executive with respect to the 2013 fiscal year. In
the event that the parties hereafter agree to extend Executive’s employment beyond the end of the Extension Period the amount of the pro-rated cash bonuses paid by the Company with respect to the Extension Period and the period from
January 1, 2014 to the third anniversary of the Effective Date will be taken into account and be credited against any cash bonus that may become payable to Executive for fiscal 2014. The Executive shall have the right to accept or reject the
Extension Offer; if the Executive rejects the Extension Offer and terminates employment, such termination will be deemed to be a termination due to non-renewal of the Agreement by the Company for purposes of Section 4(d) below and shall not be
considered a termination under Section 4(c) below. 
 2. Terms of Employment 

(a) Position and Duties  
 (i) During
the Employment Period, the Executive shall serve as Chief Executive Officer of the Company with the customary and usual authority, duties and responsibilities attendant to such position and any other duties that may reasonably be assigned by the
Company’s Board of Directors (the “Board”) (taking into consideration that the Company has an Executive Chairman and Chief Operating Officer), and subject to such policies and procedures for coordinating and consulting
with the Executive Chairman consistent with the foregoing as the Board, after consultation with the Executive, may adopt, from time to time. It is understood that a portion of the Executive’s duties and responsibilities contemplated above shall
be provided to Morgans Group LLC (the “Operating Company”). The Executive shall report to the Board. 

 (ii) During the Employment Period, and excluding any periods of vacation and sick leave to
which the Executive is entitled, the Executive agrees to devote substantially all of the Executive’s business time, attention and energies to the performance of the duties so that Executive can perform the duties contemplated by
Section 2(a)(i), and to perform such duties faithfully, diligently and to the best of the Executive’s abilities and subject to such laws, rules, regulations and policies from time to time applicable to the Company’s executives.
Notwithstanding the above, Executive shall be entitled to attend to personal and family affairs and investments, be involved in not for profit, charitable and professional activities and, with the Board’s prior consent, serve on boards of other
organizations, provided that all of the foregoing does not, in the aggregate, materially interfere with Executive’s responsibilities hereunder. 

(iii) During the Employment Period, (i) the Executive agrees to continue to serve as a director of the Company; and (ii) the
Company agrees that the Executive shall be nominated for election as a director of the Company at each annual meeting of the Company’s stockholders or other meeting of the Company’s stockholders at which directors are elected and be
nominated as a member of the investment committee of the Board of Directors. Any failure by the Board to nominate the Executive for election as a director of the Company in accordance with clause (ii) above or failure to be elected to the Board
or to the investment committee shall constitute Good Reason for the Executive to terminate his employment in accordance with Section 3(c) of this Agreement. 

(b) Compensation  
 (i) Annual Base
Salary. During the Employment Period, the Executive shall receive an annual base salary (“Annual Base Salary”) equal to $750,000 (payable semi-monthly), which shall be subject to annual performance reviews and may be
increased at the good faith discretion of the Board or the Compensation Committee of the Board (the “Compensation Committee”) in accordance with standard practices of the Company. The term “Annual Base
Salary” as utilized in this Agreement shall refer to Annual Base Salary as so increased. Annual Base Salary shall not be less than $750,000 without the prior written consent of the Executive. 

(ii) Annual Bonus. The Executive will be eligible for an annual cash bonus for each of the Company’s 2011, 2012, and 2013 fiscal
years (“Annual Bonus”) with a target payout of 100% of Annual Base Salary. The target payout for the 2011 Annual Bonus shall be pro rated, based on the number of days in the fiscal year from and including the Effective Date
to and including December 31, 2011, 50% of which shall be guaranteed. The remaining 50% of the 2011 Annual Bonus shall depend on the following performance metrics: 40% on EBITDA and 10% on the RevPAR Index, both as established by the
Compensation Committee of the Board of Directors. For 2012 and 2013, the Annual Bonus will range from 50% up to 150% of target. The actual Annual Bonus for each fiscal year shall be determined in good faith after consultation with the Executive by
the Compensation Committee based upon actual corporate and individual performance for such year and shall be payable in accordance with the procedures specified by the Compensation Committee. The Executive’s Annual Bonus will be paid no later
than seventy-five (75) days after the end of the applicable bonus period (or, if earlier, as provided in Section 4 below). Except as provided in Section 4 of this Agreement, Employee must be employed by the Company on the date
bonuses are paid to Company employees in order to be entitled to receive a bonus. To the extent the Annual Bonus exceeds 100% of Annual Base Salary, the Compensation Committee may in its discretion, and subject to applicable law, cause the Company
to pay such excess in the form of fully vested equity compensation awards under one of Company’s equity compensation plans (which award may be subject to other conditions that the Compensation Committee may determine). 

  
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 (iii) Stock Option Award. On the Effective Date, the Company shall grant to the Executive
a non-qualified option to purchase 300,000 shares of the Company’s common stock (the “Stock Option”) under the Morgans Hotel Group Co. Amended and Restated 2007 Omnibus Incentive Plan (the “Incentive
Plan”). Except as otherwise provided in Section 4 upon certain events of termination, subject to the Executive’s continued employment with the Company, the Stock Option shall vest and become exercisable with respect to 33-1/3%
of the shares subject thereto on each of the first, second, and third anniversaries of the Effective Date. Consistent with the foregoing, the terms and conditions of the Stock Option shall be set forth in an award agreement (the “Stock
Option Agreement”) in the form attached as Exhibit A hereto, to be entered into by the Company and the Executive concurrently herewith and which shall evidence the grant of the Stock Option. The Company shall determine
whether future awards will be awarded to the Executive in its sole good faith discretion. 
 (iv) Equity Award. On the Effective Date,
the Company shall grant to the Executive 125,000 long term incentive units (the “LTIP Units”) under the Incentive Plan. Except as otherwise provided in Section 4 upon certain events of termination, subject to the
Executive’s continued employment with the Company, the LTIP Units shall vest with respect to 33-1/3% of the LTIP Units subject thereto on each of the first, second, and third anniversaries of the Effective Date. Consistent with the foregoing,
the terms and conditions of such award shall be set forth in an award agreement (the “LTIP Agreement”) in the form attached as Exhibit B hereto, to be entered into by the Company and the Executive and which shall
evidence the grant of such award. 
 (v) Outperformance Award. On the Effective Date, the Company shall grant to the Executive a
performance incentive award entitling the Executive to 35% of the “Total Outperformance Pool,” as such term is defined in the Outperformance Award Agreement attached as Exhibit C hereto, subject to the terms and conditions of
such award agreement. 
 (vi) Additional Performance Incentive Award. On the Effective Date, the Company shall grant to the Executive
an additional performance incentive award entitling the Executive to 35% of the “Promoted Interest Pool,” as such term is defined in the Promoted Interest Pool Award Agreement attached as Exhibit D hereto, subject to the terms
and conditions of such award agreement. 

  
 3 

 (c) Benefits  

(i) Employee Benefits. During the Employment Period, the Executive shall be entitled to participate in all employee benefit and other
plans, practices, policies and programs and fringe benefits and perquisites on a basis no less favorable than that provided to other senior executives of the Company. 

(ii) Vacations. The Executive shall be eligible for up to five weeks of annual vacation to be accrued in accordance with the
Company’s policy for its other senior executives. 
 3. Termination of Employment 

(a) Death or Disability. The Executive’s employment shall terminate automatically upon the Executive’s death during the
Employment Period. If the Executive becomes Disabled during the Employment Period, the Company upon such event shall give to the Executive written notice of its intention to terminate the Executive’s employment. In such event, the
Executive’s employment with the Company shall terminate effective on the 30th day after receipt of such notice by the Executive (the “Disability Effective Date”), provided that, within the 30 days after such
receipt, the Executive shall not have returned to full-time performance of the Executive’s duties. For purposes of this Agreement, “Disability” or becoming “Disabled” shall mean the inability of
the Executive to perform the Executive’s duties with the Company on a full-time basis for 180 business days during any consecutive twelve month period as a result of incapacity due to mental or physical illness which is determined to be total
and permanent by a physician selected by the Company and acceptable to the Executive or the Executive’s legal representative. 

(b) Cause. The Company may terminate the Executive’s employment during the Employment Period with or without Cause. For
purposes of this Agreement, “Cause” shall mean the occurrence of any one or more of the following events unless the Executive has commenced and is diligently pursuing steps to correct the circumstances constituting Cause (in
those instances where such circumstances can be corrected) within fifteen (15) business days after receipt of the Notice of Termination and cures such circumstances in all material respects within forty-five (45) business days after
receipt of the Notice of Termination (as defined below): 
  

	 	(i)	the Executive’s willful and continued failure to substantially perform his duties with the Company as contemplated by Section 2(a)(i) (other than any such failure resulting from the Executive’s incapacity
due to physical or mental illness or any such failure after his issuance of a Notice of Termination for Good Reason), after a written demand for substantial performance is delivered to the Executive by the Board, which demand specifically identifies
the manner in which the Board believes that the Executive has not substantially performed his duties; 

  

	 	(ii)	a material breach by the Executive of his obligations under this Agreement resulting in substantial economic or financial injury to the Company; 

 

	 	(iii)	the Executive’s willful commission of an act of fraud, theft or dishonesty resulting in substantial economic or financial injury to the Company; 

 

	 	(iv)	the Executive’s conviction of, or entry by the Executive of a guilty or no contest plea to, the commission of a felony; or 

  

	 	(v)	the Executive willfully engages in misconduct that is materially injurious to the Company. 

  
 4 

 For purposes of this provision, no act or omission on the part of the Executive shall be considered
“willful” unless it is done or omitted in bad faith or without reasonable belief that the act or omission was in the best interests of the Company. Any act or omission that was directed or authorized by the Board, or approved, consented
to, or acquiesced to by the Board, or based on advice of counsel for the Company shall be conclusively presumed to have been done or omitted in good faith and in the best interests of the Company. The cessation of employment of the Executive shall
not be deemed to be for Cause unless and until there shall have been delivered to the Executive a copy of a resolution duly adopted by at least 66 2/3% of the Board (excluding the Executive and the Executive Chairman, to the extent either of them
are members of the Board) at a meeting of the Board called and held for such purpose (after reasonable notice is provided to the Executive and the Executive is given an opportunity, together with counsel, to be heard before the Board) finding that,
in the good faith opinion of the Board, the Executive is guilty of the conduct giving rise to Cause for termination, and specifying the particulars thereof in detail. 

(c) Good Reason. The Executive’s employment may be terminated by the Executive with or without Good Reason. For purposes of
this Agreement, “Good Reason” shall mean the occurrence of any of the following events without the written consent of the Executive: 

(i) any change in the Executive’s title or the assignment to the Executive of duties materially inconsistent with the
Executive’s title, position, status, reporting relationships, authority, duties or responsibilities as contemplated by Section 2(a)(i), or any other action by the Company which results in a material diminution or material adverse change in
the Executive’s title, position, status, reporting relationships, authority, duties or responsibilities, other than (x) insubstantial or inadvertent actions not taken in bad faith which are remedied by the Company within fifteen
(15) business days after receipt of notice thereof given by the Executive, or (y) other than allocations of or changes in duties and responsibilities between the Executive and the Executive Chairman; 

(ii) any material failure by the Company to comply with any of the provisions of this Agreement or any Related Agreement (as defined
below), other than insubstantial or inadvertent failures not in bad faith which are remedied by the Company promptly after receipt of notice thereof given by the Executive; 

(iii) any failure by the Company to comply with and satisfy Section 10(c); 

(iv) any failure by the Board to nominate the Executive for election as a director of the Company in accordance with
Section 2(a)(iii), or any failure of the Executive to be elected by the Company’s shareholders to be a member of the Board or to be elected by the Board as a member of investment committee of the Company; or 

(v) any requirement that the Executive’s principal place of employment be at a location more than 50 miles from his principal place
of employment on the date of this Agreement, resulting in a material increase in distance from the Executive’s residence to his new place of employment; 

  
 5 

 provided that the Executive’s resignation shall only constitute a resignation for Good Reason
hereunder if (x) the Executive provides the Company with a Notice of Termination (as defined below) within 90 days after the initial existence of the facts or circumstances constituting Good Reason, (y) the Company has failed to cure
such facts or circumstances within 30 days after receipt of the Notice of Termination, and (z) subject to the last sentence of Section 4(e), the Date of Termination (as defined below) occurs no later than 120 days after the
initial occurrence of the facts or circumstances constituting Good Reason. 
 (d) Notice of Termination. Any termination by the
Company or by the Executive shall be communicated by Notice of Termination to the other party hereto. For purposes of this Agreement, a “Notice of Termination” means a written notice which (i) indicates the specific
termination provision in this Agreement relied upon, (ii) to the extent applicable, 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 and (iii) if the Date of Termination (as defined below) is other than the date of receipt of such notice, specifies the Date of Termination. The failure by the Executive or the Company to set forth in the Notice of Termination any
fact or circumstance which contributes to a showing of Good Reason or Cause shall not waive any right of the Executive or the Company, respectively, hereunder or preclude the Executive or the Company, respectively, from asserting such fact or
circumstance in enforcing the Executive’s or the Company’s rights hereunder. 
 (e) Date of Termination.
“Date of Termination” means (i) if the Executive’s employment is terminated by the Company other than for Disability, the date of receipt of the Notice of Termination or any later date specified therein within
30 days of such notice, (ii) if the Executive’s employment is terminated by the Executive, 30 days after receipt of the Notice of Termination (provided, that, the Company may accelerate the Date of Termination to an earlier date
by providing the Executive with notice of such action, or, alternatively, the Company may place the Executive on paid leave during such period), (iii) if the Executive’s employment is terminated by reason of death or Disability, the Date
of Termination shall be the date of death of the Executive or the Disability Effective Date, as the case may be and (iv) if the Executive’s employment is terminated due to the non-renewal of the Agreement at the end of the Employment
Period, the Date of Termination shall be the last day of the Employment Period. Notwithstanding the foregoing, if within thirty (30) days after any Notice of Termination is given, the party receiving such Notice of Termination notifies the
other party that a dispute exists concerning the termination, the Date of Termination shall be the date on which the dispute is finally determined, either by mutual written agreement of the parties, by a binding and final arbitration award or by a
final judgment, order or decree of a court of competent jurisdiction (the time for appeal therefrom having expired and no appeal having been perfected). 

(f) No Resignation from Board upon Termination. Upon the termination of the Executive’s employment for any reason (other than
for Cause), the Executive shall have no obligation whatsoever to resign from the Board. A termination of the Executive’s employment shall mean a termination of services of both the Company and the Operating Company. 

  
 6 

 4. Obligations of the Company upon Termination 

(a) Other Than for Cause or For Good Reason. If, during the Employment Period, the Company terminates the Executive’s
employment other than for Cause or Disability or the Executive terminates his employment for Good Reason (each, a “Qualifying Termination”): 

(i) The Company shall pay to the Executive an amount in a single lump sum within 10 days after the end of the revocation period for the
Release Agreement provided in Section 4(e) below (provided, however, that the amounts payable pursuant to subparagraph (C) below, if any, will be paid at the same time the bonuses for the year in which the Date of Termination occurs are
paid), equal to the sum of — 
 (A) an amount equal to the Executive’s Annual Base Salary (at the rate then being paid to
Executive) accruing through the Date of Termination to the extent theretofore unpaid (the “Accrued Base Salary”) plus  

(B) the amount of any Annual Bonus that, had he remained employed, would otherwise have been paid to the Executive pursuant to
Section 2 (b)(ii) above for any fiscal year of the Company that ends on or before the Date of Termination to the extent not previously paid (the “Prior Year Bonus”), plus  

(C) (without duplication of the amount in clause (B)) a pro rata portion of the Annual Bonus for the partial fiscal year in which the Date of
Termination occurs in an amount equal to the product of (A) the Annual Bonus calculated as of the Date of Termination based on the extent to which the financial performance targets applicable to such Annual Bonus (pro rated based on the number
of days in such fiscal year through the Date of Termination) are actually achieved for the year, and (B) a fraction, the numerator of which is the number of days in the year of termination through the Date of Termination and the denominator of
which is 365 (the “Pro-Rated Annual Bonus”) plus  
 (D) an amount equal to two (2) times Annual
Base Salary. 
 (ii) During the period commencing on the Date of Termination and ending on the date 18 months after the Date of
Termination (the “COBRA Period”), provided that the Executive properly elects to receive group health insurance continuation coverage under Section 4980B of the Code and the regulations thereunder
(“COBRA”), the Company shall pay directly or reimburse the Executive for premiums for such coverage ; provided, however, that if the Executive becomes re-employed with another employer and is eligible to receive group health
insurance coverage under another employer’s plans, the Company’s obligations under this Section 4(a)(ii) shall be reduced to the extent comparable coverage is actually provided to the Executive and the Executive’s eligible family
members, and any such coverage shall be reported by the Executive to the Company. Notwithstanding the foregoing, (A) if any plan pursuant to which the Company is providing such coverage is not, or ceases prior to the expiration of the period of
continuation coverage to be, exempt from the application of Code Section 409A under Treasury Regulation Section 1.409A-1(a)(5), or (B) the Company is otherwise unable to continue to cover the Executive under its group health
plans, then, in either case, an amount equal to the monthly plan premium payment shall thereafter be paid to the Executive as currently taxable compensation in substantially equal monthly installments over the COBRA Period (or the remaining portion
thereof). 

  
 7 

 All Company equity awards and other performance incentive awards, other than awards provided pursuant to
Sections 2(b)(v) and (vi), (which shall vest as set forth in the applicable award agreement), shall fully vest on the Date of Termination to the extent not vested. The Executive shall retain any vested equity awards, which may not be revoked or
annulled by the Company. Each vested award (to the extent subject to exercise) shall be exercisable until the later of (A) the twelve month anniversary of the Date of Termination and (B) the four year anniversary of the date such award was
granted. Notwithstanding this Section 4(a), in the event that the Executive is terminated other than for Cause or the Executive terminates employment for Good Reason following a Transactional Change in Control (as defined in the Outperformance
Award Agreement) and where the Common Share Price (as defined in the Outperformance Award Agreement) does not represent at least 4.5% compound annual growth rate since the Effective Date, the amount payable by the Company pursuant to
Section 4(a)(i)(D) shall equal one (1) times the Annual Base Salary. 
 (b) Death; Disability. If, during the
Employment Period, the Executive’s employment shall terminate on account of death (other than via death after delivery of a valid Notice of Termination for Good Reason or without Cause) or Disability, the Company shall have no further
obligations to the Executive other than to pay to or provide the Executive (or his estate) the following: 
 (i) The Company shall pay
to or provide the Executive (or his estate) the following within 10 business days after the Executive’s death or the date on which the Executive becomes Disabled: (A) the Accrued Base Salary through the Date of Termination to the extent
theretofore unpaid, (B) the Prior Year Bonus to the extent theretofore unpaid, (C) the Pro Rated Annual Bonus (if any), and (D) an amount equal to one times Annual Base Salary; 

(ii) During the 12 month period following the Date of Termination, provided that the Executive’s estate or beneficiaries or the
Executive, as applicable, properly elects to receive group health insurance continuation coverage under COBRA, the Company shall pay directly or reimburse the Executive’s estate or beneficiaries or the Executive, as applicable, for premiums for
such coverage; provided, however, that if the Executive becomes re-employed with another employer and is eligible to receive group health insurance coverage under another employer’s plans, the Company’s obligations under this
Section 4(b)(ii) shall be reduced to the extent comparable coverage is actually provided to the Executive and the Executive’s eligible family members, and any such coverage shall be reported by the Executive to the Company. Notwithstanding
the foregoing, (A) if any plan pursuant to which the Company is providing such coverage is not, or ceases prior to the expiration of the period of continuation coverage to be, exempt from the application of Code Section 409A under Treasury
Regulation Section 1.409A-1(a)(5), or (B) the Company is otherwise unable to continue to cover the Executive under its group health plans, then, in either case, an amount equal to the monthly plan premium payment shall thereafter be
paid to the Executive as currently taxable compensation in substantially equal monthly installments over the 12 month period following the Date of Termination (or the remaining portion thereof); 

  
 8 

 All Company equity awards and other performance incentive awards, other than awards provided pursuant to
Sections 2(b)(v) and (vi) (which shall vest as set forth in the applicable award agreement) shall fully vest on the Date of Termination to the extent not vested. The Executive shall retain any vested equity awards, which may not be revoked
or annulled by the Company. Each vested award (to the extent subject to exercise) shall be exercisable until the later of (A) the twelve month anniversary of the Date of Termination and (B) the four year anniversary of the date such award
was granted. 
 (c) For Cause; Other than For Good Reason. If, during the Employment Period, the Company shall terminate the
Executive’s employment for Cause or the Executive terminates his employment without Good Reason (including the failure by the Executive to renew the Agreement at the end of the Employment Period after the Company offers to do so no less than
seventy-five (75) days prior to the end of the Employment Period, as it may be extended pursuant to an employment agreement with at least a three year term, aggregate cash and equity- and performance-based compensation at least as favorable as
the same provided for hereunder and otherwise on terms no less favorable to Executive as those set forth herein (any such non-renewal, an “Executive Non-Renewal”) the Company shall pay to or provide the Executive (or his
estate) the following within 10 business days after the Date of Termination: (A) the Accrued Base Salary through the Date of Termination to the extent theretofore unpaid and (B) in the event of an Executive Non-Renewal, the Prior Year
Bonus to the extent theretofore unpaid. The Executive shall retain any vested equity awards, which may not be revoked or annulled by the Company. Each vested award (to the extent subject to exercise) shall be exercisable (i) in the event of an
Executive Non-Renewal, until the later of (A) the twelve month anniversary of the Date of Termination and (B) the four year anniversary of the date such award was granted, or (ii) in the event of the termination of Executive’s
employment for Cause or without Good Reason (other than an Executive Non-Renewal), within ninety (90) days after the Date of Termination. 

(d) Expiration of Employment Period due to the Company’s Non-renewal of the Agreement. If the Executive’s employment with
the Company terminates by reason of the expiration of the Employment Period other than due to an Executive Non-Renewal, the Company shall pay to or provide the Executive the following within 10 business days after the Date of Termination: 

(i) the Accrued Base Salary through the Date of Termination to the extent theretofore unpaid; 

(ii) the Prior Year Bonus to the extent theretofore unpaid; 

(iii) Subject to execution of the Release Agreement provided in Section 4(e) below, the Company shall pay to the Executive an amount
equal to one (1) times the Annual Base Salary in a single lump sum within 10 days after the end of the revocation period for the Release Agreement; and 

  
 9 

 (iv) During the 12 month period following the Date of Termination, provided that the
Executive’s estate or beneficiaries or the Executive, as applicable, properly elects to receive group health insurance continuation coverage under COBRA, the Company shall pay directly or reimburse the Executive’s estate or beneficiaries
or the Executive, as applicable, for premiums for such coverage; provided, however, that if the Executive becomes re-employed with another employer and is eligible to receive group health insurance coverage under another employer’s plans, the
Company’s obligations under this Section 4(d)(iv) shall be reduced to the extent comparable coverage is actually provided to the Executive and the Executive’s eligible family members, and any such coverage shall be reported by the
Executive to the Company. Notwithstanding the foregoing, (A) if any plan pursuant to which the Company is providing such coverage is not, or ceases prior to the expiration of the period of continuation coverage to be, exempt from the
application of Code Section 409A under Treasury Regulation Section 1.409A-1(a)(5), or (B) the Company is otherwise unable to continue to cover the Executive under its group health plans, then, in either case, an amount equal to
the monthly plan premium payment shall thereafter be paid to the Executive as currently taxable compensation in substantially equal monthly installments over the 12 month period following the Date of Termination (or the remaining portion thereof).

 All Company equity awards and other performance incentive awards, other than awards provided pursuant to Sections 2(b)(v) and (vi) (which shall
vest as set forth in the applicable award agreement) shall fully vest on the Date of Termination to the extent not vested. The Executive shall retain any vested equity awards, which may not be revoked or annulled by the Company. Each vested award
(to the extent subject to exercise) shall be exercisable until the later of (A) the twelve month anniversary of the Date of Termination and (B) the four year anniversary of the date such award was granted. 

(e) Release Agreement. The Company shall not be required to make the payments and provide the benefits specified in this
Section 4 (other than the payment of any Accrued Base Salary) unless the Executive (or his estate, as applicable) executes and delivers to the Company an agreement releasing the Company, its affiliates and its officers, directors and employees
from all liability (other than the payments and benefits under this Agreement) in the form attached hereto as Exhibit E (the “Release Agreement”) within thirty (30) days after the Date of Termination and the
period for revocation of such Release Agreement shall have lapsed, which Release Agreement shall also provide that the Company shall release the Executive from all liability; provided, that in all events, subject to Executive’s execution and
delivery of the Release Agreement, the payments and benefits specified in this Section 4 will be made or provided before March 15 following the end of Executive’s first taxable year in which his right to such payment is no longer
subject to a substantial risk of forfeiture. 
 5. Application of Section 409A 

(a) If any compensation or benefits provided by this Agreement may result in the application of Section 409A of the Code, the Company
shall, in consultation with the Executive, modify the Agreement in the least restrictive manner necessary in order to, where applicable, (i) exclude such compensation from the definition of “deferred compensation” within the meaning
of such Section 409A or (ii) comply with the provisions of Section 409A, other applicable provision(s) of the Code and/or any rules, regulations or other regulatory guidance issued under such statutory provisions and to make such
modifications, in each case, without any diminution in the value of the payments to the Executive. 

  
 10 

 (b) Anything in this Agreement to the contrary notwithstanding, if (A) on the date of
termination of Executive’s employment with the Company or a subsidiary, any of the Company’s stock is publicly traded on an established securities market or otherwise (within the meaning of Section 409A(a)(2)(B)(i) of the Internal
Revenue Code, as amended (the “Code”)), (B) Executive is determined to be a “specified employee” within the meaning of Section 409A(a)(2)(B), (C) the payments exceed the amounts permitted to be paid
pursuant to Treasury Regulations section 1.409A-1(b)(9)(iii), and (D) such delay is required to avoid the imposition of the tax set forth in Section 409A(a)(1), as a result of such termination, the Executive would receive any payment that,
absent the application of this Section 5(b), would be subject to interest and additional tax imposed pursuant to Section 409A(a) as a result of the application of Section 409A(2)(B)(i), then no such payment shall be payable prior to
the date that is the earliest of (1) six (6) months and one day after the Executive’s termination date, (2) the Executive’s death or (3) such other date (the “Delay Period”) as will cause such
payment not to be subject to such interest and additional tax (with a catch-up payment equal to the sum of all amounts that have been delayed to be made as of the date of the initial payment). In particular, with respect to any lump sum payment
otherwise required hereunder, in the event of any delay in the payment date as a result of Section 409A(a)(2)(A)(i) and (B)(i), the Company will adjust the payments to reflect the deferred payment date by crediting interest thereon at the prime
rate in effect at the time such amount first becomes payable, as quoted by the Company’s principal bank. 
 (c) To the extent that
the provision of health insurance following the Date of Termination is so delayed, the Executive shall be entitled to COBRA continuation coverage under Section 4980B of the Code (“COBRA Coverage”) during such period of
delay, and the Company shall reimburse the Executive for any Company portions of such COBRA Coverage in the seventh month following the Date of Termination. 

(d) To the extent that any benefits to be provided during the Delay Period are considered deferred compensation under Code
Section 409A provided on account of a “separation from service,” and such benefits are not otherwise exempt from Section 409A, the Executive shall pay the cost of such benefits during the Delay Period, and the Company shall
reimburse the Executive, to the extent that such costs would otherwise have been paid by the Company or to the extent that such benefits would otherwise have been provided by the Company at no cost to the Executive, the Company’s share of the
cost of such benefits upon expiration of the Delay Period, and any remaining benefits shall be reimbursed or provided by the Company in accordance with the procedures specified herein. 

(e) Any provisions of this Agreement or any other compensation plan notwithstanding, the Company shall have no right to accelerate any
such payment hereunder or thereunder except to the extent permitted under Section 409A. 
 (f) For purposes of Section 409A,
each payment made after termination of employment, including COBRA continuation reimbursement payments, will be considered one of a series of separate payments. 

  
 11 

 (g) A termination of employment shall not be deemed to have occurred for purposes of any
provision of this Agreement providing for the payment of any amounts or benefits upon or following a termination of employment unless such termination is also a “separation from service” within the meaning of Section 409A and, for
purposes of any such provision of this Agreement, references to a “termination,” “termination of employment” or like terms shall mean “separation from service.” 

(h) Any amount that Executive is entitled to be reimbursed under this Agreement that may be treated as taxable compensation will be
reimbursed to Executive as promptly as practical and in any event not later than sixty (60) days after the end of the calendar year in which the expenses are incurred; provided that Executive shall have provided a reimbursement request to the
Company no later than thirty (30) days prior to the date the reimbursement is due. The amount of the expenses eligible for reimbursement during any calendar year will not affect the amount of expenses for reimbursement in any other calendar
year, except as may be required pursuant to an arrangement providing for the reimbursement of expenses referred to in Section 105(b) of the Code. 

(i) The Company shall not be obligated to reimburse Executive for any tax penalty or interest or provide a gross-up in connection with any
tax liability of Executive under Section 409A. 
 6. Parachute Payment Limitations 

Notwithstanding any other provision of this Agreement or of any other agreement, contract, or understanding heretofore or hereafter entered
into by the Executive and the Company or any of the Company’s affiliates, except an agreement, contract, or understanding hereafter entered into that expressly modifies or excludes application of this Section 6 (the “Other
Agreements”), and notwithstanding any formal or informal plan or other arrangement heretofore or hereafter adopted by the Company or any of the Company’s affiliates for the direct or indirect compensation of the Executive
(including groups or classes of participants or beneficiaries of which the Executive is a member), whether or not such compensation is deferred, is in cash, or is in the form of a benefit to or for the Executive (a “Benefit
Arrangement”), if the Executive is a “disqualified individual,” as defined in Section 280G(c) of the Code, any right to receive any payment or other benefit under this Agreement shall not become exercisable or vested
(i) to the extent that such right to exercise, vesting, payment, or benefit, taking into account all other rights, payments, or benefits to or for Executive under the Agreement, all Other Agreements, and all Benefit Arrangements, would cause
any payment or benefit to the Executive under this Agreement to be considered a “parachute payment” within the meaning of Section 280G(b)(2) of the Code as then in effect (a “Parachute Payment”) and
(ii) if, as a result of receiving a Parachute Payment, the aggregate after-tax amounts received by the Executive from the Company or any of the Company’s affiliates under this Agreement, all Other Agreements, and all Benefit Arrangements
would be less than the maximum after-tax amount that could be received by Executive without causing any such payment or benefit to be considered a Parachute Payment. In the event that the receipt of any such right to exercise, vesting, payment, or
benefit under this Agreement, in conjunction with all other rights, payments, or benefits to or for the Executive under the Agreement, any Other Agreement or any Benefit Arrangement would cause the Executive to be considered to have received a
Parachute Payment under this Agreement that would have the effect of decreasing the after-tax amount received by the Executive as described in clause (ii) of the preceding sentence, then the Executive shall have the right, in the
Executive’s sole discretion, to designate those rights, payments, or benefits under this Agreement, any Other Agreements, and any Benefit Arrangements that should be reduced or eliminated so as to avoid having the payment or benefit to the
Executive under this Agreement be deemed to be a Parachute Payment; provided, however, that, to the extent any payment or benefit constitutes deferred compensation under Section 409A, in order to comply with Section 409A, the reduction or
elimination will be performed in the following order: (A) reduction of cash payments; (B) reduction of COBRA benefits; (C) cancellation of acceleration of vesting on any equity awards for which the exercise price exceeds the then fair
market value of the underlying equity; and (D) cancellation of acceleration of vesting of equity awards not covered under (C) above; provided, however that in the event that acceleration of vesting of equity awards is to be cancelled, such
acceleration of vesting shall be cancelled in the reverse order of the date of grant of such equity awards, that is, later granted equity awards shall be canceled before earlier granted equity awards. 

  
 12 

 7. Non-Competition; Non-Solicitation; Confidential Information; Standstill 

(a) Non-Competition. Executive acknowledges that the services to be rendered by him to the Company are of a special and unique
character. In consideration of his employment hereunder, Executive agrees that, during the term of Executive’s employment with the Company and for a six-month period after the date the Executive’s employment is terminated for any reason,
provided in connection with a termination of employment pursuant to Sections 4(a) or (d), the Company is not in material breach in the performance of its obligations to the Executive pursuant to those Sections, the Executive shall not directly or
indirectly (without the prior written consent of the Company) engage, directly or indirectly, whether as principal, agent, representative, consultant, employee, partner, stockholder, limited partner, other investor or otherwise (other than a passive
investment of not more than two and one-half percent (2.5%) of the stock, equity or other ownership interest of any corporation, partnership or other entity) in any business entity primarily engaged, directly or indirectly through subsidiaries,
and the Executive shall not be personally engaged, directly or indirectly, in the business of hotel management within the United States of America or Western Europe. The Executive shall not pursue any prospects listed on a deal pipeline list
prepared by the Company and the Executive for a one-year period following the Date of Termination. Notwithstanding the foregoing, the Executive’s ownership of any equity interest in any business or entity in which he holds an equity interest as
of the date hereof, shall be considered a violation of this Section 7(a). 

  
 13 

 (b) Non-Solicitation. During the term of his employment with the Company pursuant to
this Agreement and for a one-year period after the Executive’s employment is terminated pursuant to this Agreement for any reason, provided the Company is not in material breach in the performance of its obligations to the Executive as of the
Date of Termination and is performing all of its obligations under Section 4 of this Agreement upon and following the Date of Termination, the Executive shall not, in any manner, directly or indirectly (without the prior written consent of the
Company), solicit, induce, or encourage any employee, consultant or agent of the Company or any of its subsidiaries to terminate their employment, agency, or other such business relationship with the Company and its subsidiaries or to cease to
render services to the Company and its subsidiaries and the Executive shall not initiate discussions with any such person for any such purpose or authorize or knowingly cooperate with or encourage the taking of any such actions by any other
individual or entity; provided, however, that this paragraph shall not preclude the hiring or retention of any such person by any other individual or entity who (i) responds to a general employment advertisement by newspaper or similar
advertisement, or (ii) is referred to another individual or entity by an employment agency or other similar entity, provided that Executive did not identify the person or the Company as a potential source of employees to such agency or similar
entity. During the term of Executive’s employment pursuant to this Agreement and for a six (6) month period after the Executive’s employment is terminated pursuant to this Agreement for any reason, provided the Company is not in
material breach in the performance of its obligations to the Executive as of the Date of Termination and is performing all of its obligations under Section 4 of this Agreement upon and following the Date of Termination, the Executive shall not,
in any manner (without the prior written consent of the Company), solicit, induce or encourage any customer, vendor, or other party doing business with the Company to terminate their business relationship with the Company and its subsidiaries or to
transfer their business from the Company or any of its subsidiaries, and the Executive shall not initiate discussions with any such person for any such purpose or authorize or knowingly cooperate with or encourage the taking of any such actions by
any other individual or entity. 
 (c) Treatment of Confidential Information. As a Company executive, Executive will acquire
Confidential Information (as defined below) in the course of Executive’s employment. Executive agrees that, in consideration of employment with the Company, Executive will treat such Confidential Information as strictly confidential. Executive
will not, directly or indirectly, at any time during employment with the Company or any time thereafter, and without regard to when or for what reason, if any, such employment shall terminate, use or cause to be used any such Confidential
Information, in connection with any activity or business except in the normal course of performing his designated duties for the Company. Executive shall not disclose or cause to be disclosed any such Confidential Information to any third parties
unless such disclosure is in accordance with the disclosure policies adopted by the Board or has been authorized in writing by the Board or except as may be required by law or legal process after providing the Company with prior written notice and
an opportunity to respond to such disclosure (unless such notice is prohibited by law). For purposes of this Agreement, “Confidential Information” shall mean confidential or proprietary information, knowledge or data
concerning the Company and its subsidiary companies’ businesses, strategies, operations, financial affairs, organizational matters, personnel matters, budgets, business plans, marketing plans, studies, policies, procedures, products, ideas,
processes, software systems, trade secrets and technical know-how. Notwithstanding the foregoing, Confidential Information shall not include information which (i) is or becomes generally available to the public or is, at the time in question,
in the public domain other than as a result of a disclosure by Executive not permitted hereunder, (ii) was available to Executive on a non-confidential basis prior to the date of this Agreement, or (iii) becomes available to Executive from
a source other than the Company, its agents or representatives (or former agents or representatives). 

  
 14 

 (d) Standstill. During the term of his employment and for a period of six months
after the date the Executive’s employment is terminated, Executive shall not, directly or indirectly or in concert with any other person, engage in any of the following: 
  

	 	(i)	purchase, offer to purchase, or agree to purchase or otherwise acquire, by means of a purchase, tender or exchange offer, business combination or in any other manner (including rights or options to acquire such
ownership), (x) beneficial ownership of any common stock of the Company (“Common Stock”), or securities convertible into or exchangeable for Common Stock of the Company, that would result in the Executive,
the Executive’s affiliates, and the members of any “group” of persons with which the Executive or his affiliates are acting in concert beneficially owning, in the aggregate (taking into account shares of Common Stock issuable upon
conversion or exchange of any securities held by such the Executive and such other persons), more than 14.9% of the voting power of the outstanding Common Stock, or (y) material beneficial ownership of any debt obligations on hotel properties
owned by the Company or any of its consolidated subsidiaries or any material assets owned by the Company or any of its consolidated subsidiaries; 

  

	 	(ii)	seek or propose to influence, advise, change or control the management, Board, governing instruments or policies or affairs of the Company or any of its affiliates, including, without limitation, by means of a
solicitation of proxies or seeking to influence, advise or direct the vote of any holder of voting securities of the Company; or 

  

	 	(iii)	be employed by any person that, directly or through its affiliates, engages in any of the foregoing. 

 Exercise
of options, conversion of LTIP Units, vesting and delivery of shares of Common Stock pursuant to equity or other awards, plans and arrangements and any other Common Stock received or otherwise acquired by the Executive in connection with or as a
result of the Executive’s employment with the Company or service on its Board are not prohibited by this Section 7(d). In addition, if persons with whom the Executive has in no way participated, assisted or cooperated with have taken
actions that would be prohibited by Sections 7(d) above such that the Company would be considered to be in “play” through no act of the Executive, the Executive will no longer be subject to the limitations of Sections 7(d). 

(e) Survival. Any termination of the Executive’s employment or of this Agreement (or breach of this Agreement by the Executive
or the Company) shall have no effect on the continuing effectiveness of this Section 7, Section 4, 5, 6 and Section 8 or any other provision hereof that by the nature of its terms is contemplated to survive any such termination. 

(f) Validity. The terms and provisions of this Section 7 are intended to be separate and divisible provisions and if, for any
reason, any one or more of them is held to be invalid or unenforceable, neither the validity nor the enforceability of any other provision of this Agreement shall thereby be affected. The parties hereto acknowledge that the potential restrictions on
the Executive’s future employment imposed by this Section 7 are reasonable in both duration and geographic scope and in all other respects. If for any reason any court of competent jurisdiction shall find any provisions of this
Section 7 unreasonable in duration or geographic scope or otherwise, the Executive and the Company agree that the restrictions and prohibitions contained herein shall be effective to the fullest extent allowed under applicable law in such
jurisdiction. 

  
 15 

 (g) Consideration. The parties acknowledge that this Agreement would not have been
entered into and the benefits described in Section 2, 4 or 6 would not have been promised in the absence of the Executive’s promises under this Section 7. 

8. Indemnification 
 (a) If the
Executive is made a party, is threatened to be made a party, or reasonably anticipates being made a party, to any Proceeding (as defined below) by reason of the fact that he is or was a director, officer, executive, agent, manager, trustee,
consultant or representative of the Company or any of its affiliates or is or was serving at the request of the Company or any of its affiliates, or in connection with his service hereunder, as a director, officer, member, executive, agent, manager,
trustee, consultant or representative of another person or entity, or if any Claim (as defined below) is made, is threatened to be made, or is reasonably anticipated to be made, that arises out of or relates to the Executive’s service in any of
the foregoing capacities, then the Executive shall promptly be indemnified and held harmless to the fullest extent permitted or authorized by the Certificate of Incorporation or Bylaws of the Company, or if greater, by applicable law, against any
and all costs, expenses, liabilities and losses (including, without limitation, attorneys’ and other professional fees, judgments, interest, expenses of investigation, penalties, fines, ERISA excise taxes or penalties and amounts paid or to be
paid in settlement) incurred or suffered by the Executive in connection therewith or in connection with seeking to enforce his rights under this Section 8, and such indemnification shall continue as to the Executive even if he has ceased to be
a director, officer, member, executive, agent, manager, trustee, consultant or representative of the Company or other person or entity and shall inure to the benefit of the Executive’s heirs, executors and administrators. The Executive shall be
entitled to prompt advancement of any and all costs and expenses (including, without limitation, attorneys’ and other professional fees and other charges) incurred by him in connection with any such Proceeding or Claim, or in connection with
seeking to enforce his rights under this Section 8, any such advancement to be made within 15 days after he gives written notice, supported by reasonable documentation, requesting such advancement. Such notice shall include, to the extent
required by applicable law, an undertaking by the Executive to repay the amount advanced if he is ultimately determined not to be entitled to indemnification against such costs and expenses. Nothing in this Agreement shall operate to limit or
extinguish any right to indemnification, advancement of expenses, or contribution that the Executive would otherwise have (including, without limitation, by agreement or under applicable law). For purposes of this Agreement,
“Claim” shall include, without limitation, any claim, demand, request, investigation, dispute, controversy, threat, discovery request, or request for testimony or information and
“Proceeding” shall include, without limitation, any actual, threatened, or reasonably anticipated, action, suit or proceeding, whether civil, criminal, administrative, investigative, appellate, formal, informal
or other. 
 (b) A directors’ and officers’ liability insurance policy (or policies) shall be kept in place, during the
Employment Period and thereafter until the later of (x) the sixth anniversary of the date on which the Executive’s employment with the Company terminates and (y) the date on which all claims against the Executive that would otherwise
be covered by the policy (or policies) would become fully time barred, providing coverage to the Executive that is no less favorable to him in any respect (including, without limitation, with respect to scope, exclusions, amounts, and deductibles)
than the coverage then being provided to any other present or former senior executive or director of the Company. 

  
 16 

 9. Other Matters 

(a) The Executive represents and warrants that, as of the Effective Date, the only direct or indirect investment or other economic
relationships between Executive, on the one hand, and Ronald W. Burkle, Yucaipa American Alliance Fund II. L.P., or any of their respective affiliates, on the other hand regarding the Company and its subsidiaries consists of a passive investment in
a fund over which Executive has no direct or indirect control or authority. During the Employment Period, Executive shall not, directly or indirectly, make or own any investment in or engage in any economic relationship with any of Ronald W. Burkle,
Yucaipa American Alliance Fund II. L.P., or any of their respective affiliates other than the investments, including the investment referred to in the preceding sentence, owned by Executive as of the Effective Date. 

(b) During the Employment Period, the Executive shall recuse himself from all matters, involving the Company or any of its subsidiaries,
on the one hand, and any of Ronald W. Burkle, Yucaipa American Alliance Fund II. L.P., or any of their respective affiliates, on the other hand, including any consideration or voting with respect to such matters by the Board. 

10. Successors 
 (a) This Agreement
is personal to the Executive and without the prior written consent of the Company shall not be assignable by the Executive otherwise than by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be
enforceable by the Executive’s legal representatives. 
 (b) This Agreement shall inure to the benefit of and be binding upon the
Company and its successors and assigns, provided that the Company may not assign this Agreement other than as described in Section 10(c) below. 

(c) The Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to assume expressly and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place.
As used in this Agreement, “Company” shall mean the Company as hereinbefore defined and any successor to its business and/or assets as aforesaid. 

  
 17 

 11. Disputes 

(a) Mandatory Arbitration. Subject to the provisions of this Section 11, any controversy or claim between the Executive and
the Company arising out of or relating to or concerning this Agreement (including the covenants contained in Section 7) or any aspect of the Executive’s employment with the Company or the termination of that employment (together, an
“Employment Matter”) will be finally settled by arbitration in the County of New York administered by the American Arbitration Association (the “AAA”) under its Commercial Arbitration Rules then in
effect. However, the AAA’s Commercial Arbitration Rules will be modified in the following ways: (i) notwithstanding any provision of the AAA rules to the contrary, the arbitration shall be heard by a panel of three neutral arbitrators,
with each party appointing one arbitrator, who shall jointly appoint a third, (ii) each arbitrator will agree to treat as confidential evidence and other information presented to them, (iii) there will be no authority to award punitive
damages (and the Executive and the Company agree not to request any such award), (iv) the optional Rules for Emergency Measures of Protections will apply, (v) there will be no authority to amend or modify the terms of this Agreement except
as provided in Section 12(a) (and the Executive and the Company agree not to request any such amendment or modification) and (vi) a decision must be rendered within ten business days of the parties’ closing statements or submission of
post-hearing briefs. The Executive and the Company agree that, to the extent permitted by law, a decision made by the arbitration panel with respect to any Employment Matter will be conclusive and binding on the Executive and the Company. 

(b) Injunctions and Enforcement of Arbitration Awards. The Executive or the Company may bring an action or special proceeding in a
state or federal court of competent jurisdiction sitting in the County of New York to enforce any arbitration award under Section 11(a). Also, the Company may bring such an action or proceeding, in addition to its rights under
Section 11(a) and whether or not an arbitration proceeding has been or is ever initiated, to temporarily, preliminarily or permanently enforce any part of Section 7. The Executive agrees that (i) violating any part of Section 7
would cause damage to the Company that cannot be measured or repaired, (ii) the Company therefore is entitled to seek an injunction, restraining order or other equitable relief restraining any actual or threatened violation of Section 7,
(iii) no bond will need to be posted for the Company to receive such an injunction, order or other relief and (iv) no proof will be required that monetary damages for violations of Section 7 would be difficult to calculate and that
remedies at law would be inadequate. 
 (c) Jurisdiction and Choice of Forum. The Executive and the Company irrevocably submit to
the exclusive jurisdiction of any state or federal court located in the County of New York over any Employment Matter that is not otherwise arbitrated or resolved according to Section 11(a). This includes any action or proceeding to compel
arbitration or to enforce an arbitration award. Both the Executive and the Company (i) acknowledge that the forum stated in this Section 11(c) has a reasonable relation to this Agreement and to the relationship between the Executive and
the Company and that the submission to the forum will apply even if the forum chooses to apply non-forum law, (ii) waive, to the extent permitted by law, any objection to personal jurisdiction or to the laying of venue of any action or
proceeding covered by this Section 11(c) in the forum stated in this Section 11(c), (iii) agree not to commence any such action or proceeding in any forum other than the forum stated in this Section 11(c) and (iv) agree
that, to the extent permitted by law, a final and non-appealable judgment in any such action or proceeding in any such court will be conclusive and binding on the Executive and the Company. However, nothing in this Agreement precludes the Executive
or the Company from bringing any action or proceeding in any court for the purpose of enforcing the provisions of Section 11(a) and this Section 11(c). 

(d) Waiver of Jury Trial. To the extent permitted by law, the Executive and the Company waive any and all rights to a jury trial
with respect to any Employment Matter. 

  
 18 

 (e) Costs. The Company will reimburse as incurred any reasonable expenses, including
reasonable attorney’s fees, the Executive incurs as a result of any Employment Matter, provided that if the Executive is not the prevailing party on at least one material issue in the Employment Matter, the Executive shall promptly return any
such reimbursements. In addition, if the Executive is not the prevailing party on at least one material issue in the Employment Matter, the Executive shall promptly reimburse the Company any reasonable expenses, including reasonable attorney’s
fees, the Company has incurred as a result of the Employment Matter, provided that such reimbursement shall not exceed fifty percent (50%) of the expenses, including attorney’s fees, incurred by the Executive. 

12. Miscellaneous 
 (a) Amendment;
Waiver. This Agreement may not be amended or modified, or any provision hereof waived, other than by a written agreement executed by the parties hereto or any of their respective successors and assigns. 

(b) Notices. All notices and other communications hereunder shall be in writing and shall be given by hand delivery to the other
party or by overnight courier or registered or certified mail, return receipt requested, postage prepaid, addressed as follows: 
 If to the Executive: 

at the Executive’s primary residential address 
 as shown on
the records of the Company 
 If to the Company: 
 Morgans Hotel
Group Co. 
 475 Tenth Avenue New York, NY 10018 
 Attention:
General Counsel 
 or to such other address as either party shall have furnished to the other in writing in accordance herewith. Notice and communications
shall be effective when actually received by the addressee provided that any notice made by hand delivery shall be deemed to have been received on the date it is actually delivered, any notice made by overnight courier shall be deemed
to have been received on the date after such notice was so sent and any notice made by registered or certified mail, return receipt shall be deemed to have been received on the date that is five (5) business days after such notice was so sent.

 (c) Severability. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or
enforceability of any other provision of this Agreement. 
 (d) Withholding. The Company may withhold from any amounts payable
under this Agreement such Federal, state, local or foreign taxes as shall be required to be withheld pursuant to any applicable law or regulation. 

  
 19 

 (e) Full Settlement. The Company’s obligation to make the payments provided for
in this Agreement and otherwise to perform its obligations hereunder shall not be affected by any set-off, counterclaim, recoupment, defense or other claim, right or action which the Company may have against the Executive or others. The Executive
shall not be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to the Executive under any of the provisions of this Agreement, and such amounts shall not be reduced whether or not the Executive
obtains other employment. 
 (f) Governing Law. This Agreement will be governed by and construed in accordance with the law of
the State of New York applicable to contracts made and to be performed entirely within that State. 
 (g) No Waiver. The
Executive’s or the Company’s failure to insist upon strict compliance with any provision of this Agreement or the failure to assert any right the Executive or the Company may have hereunder, including, without limitation, the right of the
Executive to terminate employment for Good Reason (subject to the proviso at the end of Section 3(c)) or the Company’s right to terminate the Executive for Cause (subject to the limitation in the last sentence of Section 3(b)), shall
not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement. 
 (h) Entire Agreement;
Conflict. This Agreement, together with the Stock Option Agreement, LTIP Agreement, Outperformance Award Agreement, and Promoted Interest Pool Award Agreement (collectively, the “Related Agreements”), constitutes the
final, complete and exclusive agreement between the Executive and the Company with respect to the subject matter hereof and replaces and supersedes any and all other agreements, offers or promises, whether oral or written, between the parties
concerning the subject matter hereof. In the event of any conflict or inconsistency between the provisions of, or definitions contained in, this Agreement, on the one hand, and any Related Agreement or any other agreement or instrument related to
the Executive’s employment to which he is subject, on the other hand, the provisions or definitions, as the case may be, the terms of the Related Agreements shall govern (notwithstanding the termination hereof) but this Agreement shall govern
if in conflict with any plan document or other document or instrument related thereto (other than a Related Agreement). 

(i) Section References. Any reference to a Section herein is a reference to a section of this Agreement unless otherwise
stated. 
 (j) Counterparts. This Agreement may be executed in several counterparts, each of which shall be deemed an original,
but all of which shall constitute one and the same document. 
 THE REMAINDER OF THIS PAGE LEFT INTENTIONALLY BLANK. 

SIGNATURES APPEAR ON THE NEXT PAGE. 

  
 20 

 IN WITNESS WHEREOF, the Executive has hereunto set the Executive’s hand and, pursuant to the
authorization from its Board of Directors, the Company has caused these presents to be executed in its name on its behalf, all as of the day and year first above written. 
  

							
	EMPLOYER:	 	EXECUTIVE:
			
	MORGANS HOTEL GROUP CO.	 		 	
				
	By:	 	/s/ Jeffrey M. Gault	 		 	/s/ Michael Gross
		 	Name: Jeffrey M. Gault	 		 	Michael Gross

  
 21 

 Exhibit C 

MORGANS HOTEL GROUP CO. 

AMENDED AND RESTATED 2007 OMNIBUS INCENTIVE PLAN 

RESTRICTED STOCK UNIT AGREEMENT 

Morgans Hotel Group Co. (the “Company”), hereby grants restricted stock units relating to shares of its common stock (the
“Stock”), to the individual named below as the Grantee, subject to the vesting conditions set forth in the attachment. Additional terms and conditions of the grant are set forth in this cover sheet, in the attachment and in the
Company’s Amended and Restated 2007 Omnibus Incentive Plan (the “Plan”). 
  

			
	 Grant Date: August 30, 2013
	  	
		
	Name of Grantee: Michael Gross	  	 State of Residence:
 New
York

		
	 Grantee’s Social Security Number:
            -            -            
	  	
		
	 Number of Restricted Stock Units (RSUs) Covered by Grant: 58,334
	  	
		
	 Vesting Start Date: Grant Date
	  	
		
	 Vesting Schedule:
	  	

  

					
	 Vesting Date
	  	Number of RSUs that vest, as
a percentage of the number of
RSUs granted	 
	 Grant Date
	  	 	100	% 

 You agree to all of the terms and conditions described in this Agreement and in the Plan (a copy of
which will be provided on request). You acknowledge that you have carefully reviewed the Plan and agree that the Plan will control in the event any provision of this Agreement should appear to be inconsistent with the terms of the Plan. 

This is not a stock certificate or a negotiable instrument. 

 MORGANS HOTEL GROUP CO. 

AMENDED AND RESTATED 2007 OMNIBUS INCENTIVE PLAN 

RESTRICTED STOCK UNIT AGREEMENT 
  

			
	 Restricted Stock Unit Transferability
	  	This grant is an award of stock units in the number of units set forth on the cover sheet, subject to the vesting conditions described below (“Restricted Stock Units”). Your Restricted Stock Units may not be
transferred, assigned, pledged or hypothecated, whether by operation of law or otherwise, nor may the Restricted Stock Units be made subject to execution, attachment or similar process. Nothing herein limits your right to transfer, assign, pledge,
hypothecate or otherwise deal with the vested shares of Stock represented by the vested Restricted Stock Units.
		
	 Definitions
	  	Capitalized terms not defined in this Agreement are defined in the Plan, and have the meaning set forth in the Plan.
		
	 Vesting
	  	Your Restricted Stock Unit grant vests as to the number of Stock Units indicated in the vesting schedule on the cover sheet, on the Vesting Dates shown on the cover
sheet.

  
 2 

			
	 Forfeiture
	  	In the event you fail to comply in all material respects with your Continuing Obligations (as that term is defined in your Separation Agreement of August 30, 2013, the “Separation Agreement”) and your obligations under
Section 10 of the Separation Agreement during the one year period following the Separation Date (as such term is defined in the Separation Agreement), then, following five business days’ notice of the alleged failure setting forth in reasonable
detail the nature of the alleged failure, given within twelve (12) months following the one (1) year anniversary of the Separation Date, and solely with respect to any alleged failure under Section 10 of the Separation Agreement if such failure is
not cured within ten (10) days after the giving of the notice (if and to the extent such alleged failure under said Section 10 is amenable to cure), and in addition to any other legal or equitable remedies the Company may have: (i) you will
automatically forfeit and immediately deliver to the Company all Restricted Stock Units granted pursuant to this Agreement and any shares of Stock delivered in respect thereof following vesting and settlement of the award and (ii) with respect to
any such shares of Stock which you have sold, you will reimburse the Company for the amount received on account of such sale (excluding for purposes of sub-clauses (i) and (ii) of this paragraph any shares of Stock withheld or received by the
Company from you to satisfy withholding tax obligations or sold by you to satisfy such withholding tax obligations as provided elsewhere in this Agreement in the section entitled “Withholding Taxes”).
		
	 Book Entry of Stock Pursuant to Vested Units
	  	A book entry for the vested shares of Stock represented by the Restricted Stock Units will be made for you and the shares will be credited to your account with the plan administrator by the Company within three (3) days of the
Vesting Date.

  
 3 

			
	 Withholding Taxes
	  	You agree, as a condition of this grant, that you will make acceptable arrangements, which must be consistent with and permitted by the rules and regulations established by the Company and the plan administrator, to pay any
withholding or other taxes that may be due as a result of vesting in Restricted Stock Units or your acquisition of Stock under this grant. In the event that the Company determines that any federal, state, local or foreign tax or withholding payment
is required relating to this grant, you will either: (i) arrange such payments to the Company, or (ii) immediately forfeit such number of shares of Stock subject to the Restricted Stock Units granted pursuant to this Agreement in an amount equal to
the withholding or other taxes due. The Company will also permit you to pay the withholding or other taxes due as a result of the vesting of your Restricted Stock Units by delivery (on a form reasonably acceptable to the Company) of an irrevocable
direction to a licensed securities broker selected by the Company to sell shares of Stock and to deliver all or part of the sales proceeds to the Company in payment of the withholding taxes, or alternatively, by the Company withholding or receiving
shares of Stock and making cash payments in respect thereof in satisfaction of your withholding and other tax obligations, and only the minimum number of shares of Stock deliverable in connection with such vesting or acquisition that is necessary to
satisfy statutory withholding requirements will be paid to the Company or withheld as the case may be.
		
	 Retention Rights
	  	This Agreement does not give you the right to be retained or employed by the Company (or any Affiliates) in any capacity.
		
	 Shareholder Rights
	  	You do not have any of the rights of a shareholder with respect to the Restricted Stock Units unless and until the Stock relating to the Restricted Stock Units has been transferred to you. In the event of a cash dividend on
outstanding Stock, you will be entitled to receive a cash payment for each Restricted Stock Unit. The Company may in its sole discretion require that dividends will be reinvested in additional stock units at Fair Market Value on the dividend payment
date, subject to vesting and delivered at the same time as the Restricted Stock Units.

  
 4 

			
	 Adjustments
	  	In the event of a stock split, a stock dividend or a similar change in the Company stock, the number of Restricted Stock Units covered by this grant will be adjusted (and rounded down to the nearest whole number) in accordance
with the terms of the Plan.
		
	 Applicable Law
	  	This Agreement will be interpreted and enforced under the laws of the State of Delaware, other than any conflicts or choice of law rule or principle that might otherwise refer construction or interpretation of this Agreement to
the substantive law of another jurisdiction.
		
	 Data Privacy
	  	In order to administer the Plan, the Company may process personal data about you. Such data includes, but is not limited to the information provided in this Agreement and any changes thereto, other appropriate personal and
financial data about you such as home address and business addresses and other contact information, payroll information and any other information that might be deemed appropriate by the Company to facilitate the administration of the Plan.
		
		  	By accepting these Restricted Stock Units, you give explicit consent to the Company to process any such personal data. You also give explicit consent to the Company to transfer any such personal data outside the country in which
you are employed, including with respect to non-U.S. resident grantees, to the United States, to transferees who shall include the Company and other persons who are designated by the Company to administer the Plan.
		
	 Consent to Electronic Delivery
	  	The Company may choose to deliver certain statutory materials relating to the Plan in electronic form. By accepting this grant you agree that the Company may deliver the Plan prospectus and the Company’s annual report to you
in an electronic format. If at any time you would prefer to receive paper copies of these documents, as you are entitled to receive, the Company would be pleased to provide copies.
		
	 Electronic Signature
	  	All references to signatures and delivery of documents in this Agreement can be satisfied by procedures the Company has established or may establish for an electronic signature system for delivery and acceptance of any such
documents, including this Agreement. Your electronic signature is the same as, and shall have the same force and effect as, your manual signature. Any such procedures and delivery may be effected by a third party engaged by the Company to provide
administrative services related to the Plan.

  
 5 

			
	 The Plan
	  	The text of the Plan is incorporated in this Agreement by reference.
		
		  	This Agreement and the Plan, together with the Separation Agreement between you and the Company dated as of August 30, 2013, constitute the entire understanding between you and the Company regarding this grant of Restricted Stock
Units. Any prior agreements, commitments or negotiations concerning this grant are superseded.

  
 6 

			
	Accepted and agreed:
	
	MORGANS HOTEL GROUP CO.
		
	By:	 	/s/ Jason T. Kalisman
		 	Date: August 30, 2013
		 	Print Name: Jason T. Kalisman
		 	Print Title: Interim Chief Executive Officer

  

					
	MICHAEL GROSS
		
	Signature:	 	 /s/ Michael Gross

	Date:	 	August 30, 2013	 	

  
 7 

 Exhibit D 

MORGANS HOTEL GROUP CO. 

AMENDED AND RESTATED 2007 OMNIBUS INCENTIVE PLAN 

RESTRICTED STOCK UNIT AGREEMENT 

Morgans Hotel Group Co. (the “Company”), hereby grants restricted stock units relating to shares of its common stock (the
“Stock”), to the individual named below as the Grantee, subject to the vesting conditions set forth in the attachment. Additional terms and conditions of the grant are set forth in this cover sheet, in the attachment and in the
Company’s Amended and Restated 2007 Omnibus Incentive Plan (the “Plan”). 
  

			
	 Grant Date: August 30, 2013
	  	
		
	Name of Grantee: Michael Gross	  	 State of Residence:
 New
York

		
	 Grantee’s Social Security Number:
            -            -            
	  	
		
	 Number of Restricted Stock Units (RSUs) Covered by Grant: 25,000
	  	
		
	 Vesting Start Date: Grant Date
	  	
		
	 Vesting Schedule:
	  	

  

					
	 Vesting Date
	  	Number of RSUs that vest, as
a percentage of the number
of RSUs granted	 
	 The 1 year anniversary of the Vesting Start Date
	  	 	100	% 

 You agree to all of the terms and conditions described in this Agreement and in the Plan (a copy of
which will be provided on request). You acknowledge that you have carefully reviewed the Plan and agree that the Plan will control in the event any provision of this Agreement should appear to be inconsistent with the terms of the Plan. 

This is not a stock certificate or a negotiable instrument. 

 MORGANS HOTEL GROUP CO. 

AMENDED AND RESTATED 2007 OMNIBUS INCENTIVE PLAN 

RESTRICTED STOCK UNIT AGREEMENT 
  

			
	 Restricted Stock Unit Transferability
	  	This grant is an award of stock units in the number of units set forth on the cover sheet, subject to the vesting conditions described below (“Restricted Stock Units”). Your Restricted Stock Units may not be
transferred, assigned, pledged or hypothecated, whether by operation of law or otherwise, nor may the Restricted Stock Units be made subject to execution, attachment or similar process. Nothing herein limits your right to transfer, assign, pledge,
hypothecate or otherwise deal with the vested shares of Stock represented by the vested Restricted Stock Units.
		
	 Definitions
	  	Capitalized terms not defined in this Agreement are defined in the Plan, and have the meaning set forth in the Plan.
		
	 Vesting
	  	Your Restricted Stock Unit grant vests as to the number of Stock Units indicated in the vesting schedule on the cover sheet, on the Vesting Dates shown on the cover
sheet.

			
	 Forfeiture
	  	In the event you fail to comply in all material respects with your Continuing Obligations (as that term is defined in your Separation Agreement of August 30, 2013, the “Separation Agreement”) and your obligations under
Section 10 of the Separation Agreement during the one year period following the Separation Date (as such term is defined in the Separation Agreement), then, following five business days’ notice of the alleged failure setting forth in reasonable
detail the nature of the alleged failure, given within twelve (12) months following the one (1) year anniversary of the Separation Date, and solely with respect to any alleged failure under Section 10 of the Separation Agreement if such failure is
not cured within ten (10) days after the giving of the notice (if and to the extent such alleged failure under said Section 10 is amenable to cure), then in addition to any other legal or equitable remedies the Company may have: (i) you will
automatically forfeit and immediately deliver to the Company all Restricted Stock Units granted pursuant to this Agreement and any shares of Stock delivered in respect thereof following vesting and settlement of the award and (ii) with respect to
any such shares of Stock which you have sold (excluding for such purpose any shares of Stock used to satisfy withholding tax obligations), you will reimburse the Company for the amount received on account of such sale.
		
	 Book Entry of Stock Pursuant to Vested Units
	  	A book entry for the vested shares of Stock represented by the Restricted Stock Units will be made for you and the shares will be credited to your account with the plan administrator by the Company within three (3) days of the
Vesting Date.

			
	 Withholding Taxes
	  	You agree, as a condition of this grant, that you will make acceptable arrangements, which must be consistent with and permitted by the rules and regulations established by the Company and the plan administrator, to pay any
withholding or other taxes that may be due as a result of vesting in Restricted Stock Units or your acquisition of Stock under this grant. In the event that the Company determines that any federal, state, local or foreign tax or withholding payment
is required relating to this grant, you will either: (i) arrange such payments to the Company, or (ii) immediately forfeit such number of shares of Stock subject to the Restricted Stock Units granted pursuant to this Agreement in an amount equal to
the withholding or other taxes due. In addition, in the Company’s sole discretion and consistent with the Company’s rules and regulations, the Company may permit you to pay the withholding or other taxes due as a result of the vesting of
your Restricted Stock Units by delivery (on a form acceptable to the Board) of an irrevocable direction to a licensed securities broker selected by the Company to sell shares of Stock and to deliver all or part of the sales proceeds to the Company
in payment of the withholding taxes.
		
	 Retention Rights
	  	This Agreement does not give you the right to be retained or employed by the Company (or any Affiliates) in any capacity.
		
	 Shareholder Rights
	  	You do not have any of the rights of a shareholder with respect to the Restricted Stock Units unless and until the Stock relating to the Restricted Stock Units has been transferred to you. In the event of a cash dividend on
outstanding Stock, you will be entitled to receive a cash payment for each Restricted Stock Unit. The Company may in its sole discretion require that dividends will be reinvested in additional stock units at Fair Market Value on the dividend payment
date, subject to vesting and delivered at the same time as the Restricted Stock Units.
		
	 Adjustments
	  	In the event of a stock split, a stock dividend or a similar change in the Company stock, the number of Restricted Stock Units covered by this grant will be adjusted (and rounded down to the nearest whole number) in accordance
with the terms of the Plan.

			
	 Applicable Law
	  	This Agreement will be interpreted and enforced under the laws of the State of Delaware, other than any conflicts or choice of law rule or principle that might otherwise refer construction or interpretation of this Agreement to
the substantive law of another jurisdiction.
		
	 Data Privacy
	  	In order to administer the Plan, the Company may process personal data about you. Such data includes, but is not limited to the information provided in this Agreement and any changes thereto, other appropriate personal and
financial data about you such as home address and business addresses and other contact information, payroll information and any other information that might be deemed appropriate by the Company to facilitate the administration of the Plan.
		
		  	By accepting these Restricted Stock Units, you give explicit consent to the Company to process any such personal data. You also give explicit consent to the Company to transfer any such personal data outside the country in which
you are employed, including with respect to non-U.S. resident grantees, to the United States, to transferees who shall include the Company and other persons who are designated by the Company to administer the Plan.
		
	 Consent to Electronic Delivery
	  	The Company may choose to deliver certain statutory materials relating to the Plan in electronic form. By accepting this grant you agree that the Company may deliver the Plan prospectus and the Company’s annual report to you
in an electronic format. If at any time you would prefer to receive paper copies of these documents, as you are entitled to receive, the Company would be pleased to provide copies.
		
	 Electronic Signature
	  	All references to signatures and delivery of documents in this Agreement can be satisfied by procedures the Company has established or may establish for an electronic signature system for delivery and acceptance of any such
documents, including this Agreement. Your electronic signature is the same as, and shall have the same force and effect as, your manual signature. Any such procedures and delivery may be effected by a third party engaged by the Company to provide
administrative services related to the Plan.
		
	 The Plan
	  	The text of the Plan is incorporated in this Agreement by reference.
		
		  	This Agreement and the Plan, together with the Separation Agreement between you and the Company dated as of August 30, 2013, constitute the entire understanding between you and the Company regarding this grant of Restricted Stock
Units. Any prior agreements, commitments or negotiations concerning this grant are superseded.

			
	Accepted and agreed:
	
	MORGANS HOTEL GROUP CO.
		
	By:	 	/s/ Jason T. Kalisman
		 	Date: August 30, 2013
		 	Print Name: Jason T. Kalisman
		 	Print Title: Interim Chief Executive Officer

  

					
	MICHAEL GROSS
		
	Signature:	 	 /s/ Michael Gross

	Date:	 	August 30, 2013EX-10.5

 Exhibit 10.5 

Amended and Restated 

Agreement of Limited Partnership 

of 
 Midcoast Operating,
L.P. 
 This Amended and Restated Agreement of Limited Partnership (this “Agreement”) of Midcoast Operating, L.P. (the
“Partnership”), effective as of [ — ], 2013 (the “Effective Date”), is entered into by and among Midcoast OLP GP, L.L.C., a Delaware limited liability
company (the “General Partner”), Midcoast Energy Partners, L.P., a Delaware limited partnership (“MEP”), and Enbridge Energy Partners, L.P., a Delaware limited partnership (“EEP” and, together with
MEP, the “Limited Partners”). 
 WHEREAS, the General Partner and Enbridge Energy Company, Inc., a Delaware corporation
(“EECI”), entered into an Agreement of Limited Partnership with respect to the Partnership dated October 10, 2002 (the “Original Agreement”); 

WHEREAS, EECI assigned all of its limited partner interest in the Partnership to EEP on October 17, 2002; 

WHEREAS, EEP assigned all of its limited partner interest in the Partnership to Enbridge Midcoast Limited Holdings, L.L.C., a Delaware limited
liability company (“EMLH”) on December 30, 2002; 
 WHEREAS, EMLH assigned all of its limited partner interest in the
Partnership to EEP on January 1, 2010; 
 WHEREAS, as of the Effective Date, pursuant to and as described in the Contribution Agreement
(as defined below), EEP conveyed (i) a 38.999% limited partner interest in the Partnership to MEP and (ii) a 100% limited liability company interest in the General Partner to MEP; and 

WHEREAS, the General Partner and the Limited Partners wish to amend and restate the Original Agreement in its entirety and continue the
Partnership without winding up and termination. 
 NOW, THEREFORE, in consideration of the mutual covenants and obligations set forth in
this Agreement, and for other good and valuable consideration, the receipt of which is hereby acknowledged, the General Partner and the Limited Partners hereby agree as follows: 

Article 1 
 Definitions
and Construction 
 1.01 Definitions. The following terms have the following meanings when used in this Agreement. 

  
 Page 1 of 31 

 “Adjusted Capital Account” means, with respect to any Partner, the balance in
such Partner’s Capital Account as of the end of the relevant Allocation Year, after giving effect to the following adjustments: 
  

	 	(a)	Credit to such Capital Account any amounts which such Partner is deemed obligated to restore pursuant to the penultimate sentences of Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5); and 

 

	 	(b)	Debit to such Capital Account the items described in Regulations Sections 1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5), and 1.704- 1(b)(2)(ii)(d)(6). 

The foregoing definition of Adjusted Capital Account is intended to comply with the provisions of Regulations
Section 1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith. 
 “Adjusted Capital Account Deficit”
means, with respect to any Partner, the deficit balance, if any, in such Partner’s Adjusted Capital Account as of the end of the relevant Allocation Year. 

“Affiliate” means, with respect to any Person, any other Person that directly or indirectly through one or more
intermediaries controls, is controlled by or is under common control with, the Person in question. 
 “Agreement” means
this Amended and Restated Agreement of Limited Partnership of Midcoast Operating, L.P., as amended from time to time. 
 “Allocation
Year” means (a) each calendar year ending on December 31st or (b) any portion thereof for which the Partnership is required to allocate Profits, Losses, and other items of Partnership income, gain, loss, or deduction pursuant
to Article 5. 
 “Applicable Law” means any applicable statute, law, regulation, ordinance, rule, judgment,
rule of law, order, decree, permit, approval, concession, grant, franchise, license, agreement, requirement, or other governmental restriction or any similar form of decision, of, or any provision or condition of any permit, license or other
operating authorization issued under any of the foregoing by, or any determination by any Governmental Authority having or asserting jurisdiction over the matter or matters in question, whether now or hereafter in effect and in each case as amended
(including without limitation, all of the terms and provisions of the common law of such Governmental Authority), as interpreted and enforced at the time in question. 

  
 Page 2 of 31 

 “Capital Account” means, with respect to any Partner of the Partnership, the
Capital Account maintained for such Partner in accordance with the following provisions: 
  

	 	(a)	To each Partner’s Capital Account there shall be credited (i) such Partner’s Capital Contributions, (ii) such Partner’s distributive share of Profits and any items in the nature of income or
gain that are specially allocated to such Partner pursuant to Sections 5.03 or 5.04, and (iii) the amount of any Liabilities of the Partnership assumed by such Partner or that are secured by any Property distributed to such
Partner; 

  

	 	(b)	To each Partner’s Capital Account there shall be debited (i) the amount of cash and the Gross Asset Value of any Partnership Property distributed to such Partner pursuant to any provision of this Agreement,
(ii) such Partner’s distributive share of Losses and any items in the nature of deduction, expense, or loss which are specially allocated to such Partner pursuant to Sections 5.03 or 5.04, and (iii) the amount of any
Liabilities of such Partner assumed by the Partnership or that are secured by any Property contributed by such Partner to the Partnership; 

  

	 	(c)	In the event a Partnership Interest is transferred in accordance with the terms of this Agreement, the transferee shall succeed to the Capital Account of the transferor to the extent it relates to the transferred
interest; and 

  

	 	(d)	In determining the amount of any Liability for purposes of subparagraphs (a) and (b) above there shall be taken into account Code Section 752(c) and any other applicable provisions of the Code and
Regulations. 

 The foregoing provisions and the other provisions of this Agreement relating to the maintenance of Capital
Accounts are intended to comply with Regulations Section 1.704-1(b), and shall be interpreted and applied in a manner consistent with such Regulations. In the event the Tax Matters Partner shall determine in good faith and on a commercially
reasonable basis that it is prudent to modify the manner in which the Capital Accounts, or any debits or credits thereto, are computed in order to comply with such Regulations, the Tax Matters Partner may make such modification; provided that
the Tax Matters Partner shall promptly give each other Partner written notice of such modification. The Tax Matters Partner also shall, in good faith and on a commercially reasonable basis, (A) make any adjustments to the Capital Accounts that
are necessary or appropriate to maintain equality between the aggregate Capital Accounts of the Partners and the amount of capital reflected on the Partnership’s balance sheet, as computed for book purposes, in accordance with Regulations
Section 1.704-1(b)(2)(iv)(q) and (B) make any appropriate modifications to the Capital Accounts in the event unanticipated events might otherwise cause this Agreement not to comply with Regulations Section 1.704-1(b). 

“Capital Contributions” means, with respect to any Partner, (a) the amount of cash, cash equivalents or the initial
Gross Asset Value of any Property (other than cash) contributed or deemed contributed to the Partnership by such Partner or (b) current distributions that a Partner is entitled to receive but otherwise waives. 

  
 Page 3 of 31 

 “Capital Lease” means any lease of (or other arrangement conveying the right to
use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as a capital lease on a consolidated balance sheet of the Partnership and its subsidiaries in accordance with GAAP. 

“Certificate” means the certificate of limited partnership, as amended, of the Partnership filed in accordance with the TBOC.

 “Code” means the Internal Revenue Code of 1986, as amended and in effect from time to time. Any reference herein to a
specific section or sections of the Code shall be deemed to include a reference to any corresponding provision of any successor law. 

“Contribution Agreement” means the Contribution, Conveyance and Assumption Agreement, dated as of [ — ], 2013, by and among [the General Partner, the Limited Partners and the Partnership]. 

“Covered Person” means any Partner, any Affiliate of a Partner or any officers, directors, shareholders, members, partners,
employees, representatives or agents of a Partner or their respective Affiliates, or any Representative, or any employee, officer or agent of the Partnership or its Subsidiaries. 

“Depreciation” means, for each Allocation Year, an amount equal to the depreciation, amortization, depletion or other cost
recovery deduction allowable with respect to an asset for such Allocation Year for federal income tax purposes, except that with respect to any asset whose Gross Asset Value differs from its adjusted tax basis for federal income tax purposes at the
beginning of such Allocation Year, Depreciation shall be an amount that bears the same ratio to such beginning Gross Asset Value as the federal income tax depreciation, amortization, or other cost recovery deduction for such Allocation Year bears to
such beginning adjusted tax basis; provided, however, that if the adjusted basis for federal income tax purposes of an asset at the beginning of such Allocation Year is zero, Depreciation shall be determined with reference to such beginning
Gross Asset Value using any reasonable method selected by the General Partner. 
 “Distributable Cash” means, with respect
to any Quarter: (a) the sum of all cash and cash equivalents of the Partnership and its Subsidiaries on hand at the end of such Quarter; less (b) the amount of any cash reserves established by the General Partner to (i) provide for
the proper conduct of the business of the Partnership and its Subsidiaries (including reserves for future capital expenditures and for anticipated future credit needs of the Partnership and its Subsidiaries) subsequent to such Quarter; or
(ii) comply with Applicable Law or any loan agreement, security agreement, mortgage, debt instrument or other agreement or obligation to which the Partnership or any of its Subsidiaries is a party or by which any of them is bound or any of
their respective assets are subject. 
 “EEP” has the meaning set forth in the preamble of this Agreement. 

  
 Page 4 of 31 

 “Effective Date” has the meaning set forth in the preamble of this Agreement.

 “Fiscal Year” means a calendar year. 

“Full Participant” has the meaning set forth in Section 4.02(c). 

“GAAP” means generally accepted accounting principles in the United States. 

“General Partner” means Midcoast OLP GP, L.L.C., a Delaware limited liability company, and its successors and permitted
assigns that are admitted to the Partnership as general partner and any additional general partner of the Partnership, each in its capacity as general partner of the Partnership. 

“General Partner Interest” means the ownership interest of the General Partner in the Partnership, and includes any and all
benefits to which the General Partner is entitled as provided in this Agreement, together with all obligations of the General Partner to comply with the terms and provisions of this Agreement. 

“Governmental Authority” means any federal, state, local or foreign government or any provincial, departmental or other
political subdivision thereof, or any entity, body or authority exercising executive, legislative, judicial, regulatory, administrative or other governmental functions or any court, department, commission, board, bureau, agency, instrumentality or
administrative body of any of the foregoing. 
 “Gross Asset Value” means, with respect to any asset, the asset’s
adjusted basis for federal income tax purposes, except as follows: 
  

	 	(a)	The initial Gross Asset Value of any Property contributed by a Partner to the Partnership shall be the gross fair market value of such asset as agreed to by each Partner or, in the absence of any such agreement, as
determined by the General Partner; 

  

	 	(b)	The Gross Asset Values of all items of Property shall be adjusted to equal their respective fair market values as determined by the General Partner as of the following times: (i) the acquisition of an additional
interest in the Partnership by any new or existing Partner in exchange for more than a de minimis Capital Contribution, (ii) the distribution by the Partnership to a Partner of more than a de minimis amount of Property as
consideration for an interest in the Partnership, (iii) the issuance of additional Partnership Interests as consideration for the provision of services, and (iv) the liquidation of the Partnership within the meaning of Regulations
Section 1.704-1(b)(2)(ii)(g); 

  

	 	(c)	The Gross Asset Value of any item of Property distributed to any Partner shall be adjusted to equal the fair market value of such item on the date of distribution as determined by the General Partner; and

  
 Page 5 of 31 

	 	(d)	The Gross Asset Value of each item of Property shall be increased (or decreased) to reflect any adjustments to the adjusted basis of such assets pursuant to Code Sections 734(b) or 743(b), but only to the extent that
such adjustments are taken into account in determining Capital Accounts pursuant to Regulations Section 1.704-1(b)(2)(iv)(m) and subparagraph (vi) of the definition of Profits and Losses; provided, however, that Gross Asset Values
shall not be adjusted pursuant to this subparagraph (d) to the extent that an adjustment pursuant to subparagraph (b) is required in connection with a transaction that would otherwise result in an adjustment pursuant to this subparagraph
(d). 

 If the Gross Asset Value of an asset has been determined or adjusted pursuant to subparagraph (a), (b), or (d), such
Gross Asset Value shall thereafter be adjusted by the Depreciation taken into account with respect to such asset, for purposes of computing Profits and Losses. 

“Guarantees” by any Person means any obligation, contingent or otherwise, of such Person directly or indirectly guaranteeing
any Indebtedness or other obligation of any other Person or in any manner, providing for the payment of any Indebtedness or other obligation of any other Person or otherwise protecting the holder of such Indebtedness or other obligations against
loss (whether arising by virtue of partnership agreements, by obtaining letters of credit, by agreement to keep-well, to purchase assets, goods, securities or services, or to take-or-pay or otherwise); provided that the term
“Guarantee” shall not include endorsements for collection or deposit in the ordinary course of business. 

“Indebtedness” of any Person means, without duplication, (a) all obligations of such Person for borrowed money or with
respect to deposits or advances of any kind, (b) all obligations of such Person evidenced by bonds, debentures, notes or similar instruments, (c) all obligations of such Person upon which interest charges are customarily paid, (d) all
obligations of such Person under conditional sale or other title retention agreements relating to property or assets purchased by such Person, (e) all obligations of such Person issued or assumed as the deferred purchase price of property or
services (excluding trade accounts payable, trade advertising and accrued obligations), (f) all Indebtedness of others secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by)
any lien on property owned or acquired by such Person, whether or not the obligations secured thereby have been assumed, (g) all Guarantees by such Person of Indebtedness of others, (h) all Capital Lease obligations of such Person,
(i) all obligations of such Person in respect of interest rate protection agreements, foreign currency exchange agreements or other interest rate hedging arrangements and (j) all obligations of such Person as an account party in respect of
letters of credit and bankers’ acceptances. The Indebtedness of any Person shall include the Indebtedness of any partnership in which such Person is a general partner, other than to the extent that the instrument or agreement evidencing such
Indebtedness expressly limits the Liability of such Person in respect thereof. 
 “Liability” means any Indebtedness,
obligation or other liability, whether arising under Applicable Law, contract or otherwise, known or unknown, fixed or contingent, real or potential, tangible or intangible, now existing or hereafter arising. 

  
 Page 6 of 31 

 “Limited Partner” means each of MEP and EEP, and their respective successors and
permitted assigns that are admitted as a limited partner of the Partnership and each additional Person who becomes a limited partner of the Partnership pursuant to the terms of this Agreement in each case, in such Person’s capacity as a limited
partner of the Partnership. 
 “Limited Partner Interest” means an interest of a Limited Partner in the Partnership (in its
capacity as a limited partner without reference to any General Partner Interest held by it), and includes any and all benefits to which such Limited Partner is entitled as provided in this Agreement, together with all obligations of such Limited
Partner pursuant to the terms and provisions of this Agreement. 
 “MEP” has the meaning set forth in the preamble of this
Agreement. 
 “MEP Limited Partnership Agreement” means that certain First Amended and Restated Agreement of Limited
Partnership of MEP dated as of the Effective Date by and between Midcoast Holdings, L.L.C., a Delaware limited liability company, and EEP. 

“Minimum Gain” has the meaning set forth in Regulations Sections 1.704-2(b)(2) and 1.704-2(d). 

“Nonrecourse Deductions” has the meaning set forth in Regulations Section 1.704-2(b)(1) and 1.704-2(c). 

“Nonrecourse Liability” has the meaning set forth in Regulations Section 1.704-2(b)(3). 

“Non-Funding Partner” has the meaning set forth in Section 4.02(c). 

“Partner Nonrecourse Debt” has the meaning set forth in Regulations Section 1.704-2(b)(4). 

“Partner Nonrecourse Debt Minimum Gain” means an amount, with respect to each Partner Nonrecourse Debt, equal to the Minimum
Gain that would result if such Partner Nonrecourse Debt were treated as a Nonrecourse Liability, determined in accordance with Regulations Section 1.704-2(i)(3). 

“Partner Nonrecourse Deductions” has the meaning set forth in Regulations Sections 1.704-2(i)(1) and 1.704-2(i)(2). 

“Partner” means the General Partner or a Limited Partner. 

“Partnership” means Midcoast Operating, L.P., the Texas limited partnership governed by this Agreement. 

  
 Page 7 of 31 

 “Partnership Interest” means any equity interest in the Partnership, including
any class or series of equity interest, which shall include any Limited Partner Interests and the General Partner Interest. 

“Percentage Interests” has the meaning set forth in Section 3.01. 

“Person” means any natural person, trust, estate, unincorporated organization, firm, corporation, association, partnership,
joint venture, joint stock company, limited liability company or Governmental Authority, whether acting in an individual, fiduciary or other capacity. 

“Profits” and “Losses” mean, for each Allocation Year, an amount equal to the Partnership’s taxable
income or loss for such Allocation Year, determined in accordance with Code Section 703(a) (for this purpose, all items of income, gain, loss, or deduction required to be stated separately pursuant to Code Section 703(a)(1) shall be
included in taxable income or loss), with the following adjustments (without duplication): 
  

	 	(a)	The Partnership shall be treated as owning directly its proportionate share (as determined by the General Partner) of any other partnership, limited liability company, unincorporated business or other entity classified
as a partnership or disregarded entity for U.S. Federal income tax purposes of which the Partnership is, directly or indirectly, a partner, member, or other equity-holder. 

 

	 	(b)	Any income of the Partnership that is exempt from federal income tax and not otherwise taken into account in computing Profits or Losses pursuant to this definition of Profits and Losses shall be added to such taxable
income or loss; 

  

	 	(c)	Any expenditures of the Partnership described in Code Section 705(a)(2)(B) or treated as Code Section 705(a)(2)(B) expenditures pursuant to Regulations Section 1.704-1(b)(2)(iv)(i), and not otherwise
taken into account in computing Profits or Losses pursuant to this definition of Profits and Losses shall be subtracted from such taxable income or loss; 

  

	 	(d)	In the event the Gross Asset Value of any item of Property is adjusted pursuant to subparagraph (b) or (c) of the definition of Gross Asset Value, the amount of such adjustment shall be treated as an item of
gain (if the adjustment increases the Gross Asset Value of the item of Property) or an item of loss (if the adjustment decreases the Gross Asset Value of the item of Property) from the disposition of such asset and shall be taken into account for
purposes of computing Profits or Losses; 

  

	 	(e)	 Gain or loss resulting from any disposition of any Property with respect 

  
 Page 8 of 31 

	 	
to which gain or loss is recognized for federal income tax purposes shall be computed by reference to the Gross Asset Value of the item of Property disposed of, notwithstanding that the adjusted
tax basis of such Property differs from its Gross Asset Value; 

  

	 	(f)	In lieu of the depreciation, amortization, and other cost recovery deductions taken into account in computing such taxable income or loss, there shall be taken into account Depreciation for such Allocation Year,
computed in accordance with the definition of Depreciation; 

  

	 	(g)	To the extent an adjustment to the adjusted tax basis of any item of Property pursuant to Code Sections 734(b) or 743(b) is required, pursuant to Regulations Section 1.704-1(b)(2)(iv)(m)(4), to be taken into
account in determining Capital Accounts as a result of a distribution other than in liquidation of a Partner’s Partnership Interest, the amount of such adjustment shall be treated as an item of gain (if the adjustment increases the basis of the
item of Property) or loss (if the adjustment decreases such basis) from the disposition of such item of Property and shall be taken into account for purposes of computing Profits or Losses; and 

 

	 	(h)	Notwithstanding any other provision of this definition, any items that are specially allocated pursuant to Sections 5.03 or 5.04 shall not be taken into account in computing Profits or Losses.

 The amounts of the items of Partnership income, gain, loss, or deduction available to be specially allocated pursuant to Sections
5.03 and 5.04 shall be determined by applying rules analogous to those set forth in subparagraphs (a) through (h) above. For the avoidance of doubt, any guaranteed payment that accrues with respect to an Allocation Year will be
treated as an item of deduction of the Partnership for purposes of computing Profits and Losses in accordance with the provisions of Regulations Section 1.707-1(c). 

“Property” means all real and personal property acquired by the Partnership, including cash, and any improvements thereto,
and shall include both tangible and intangible property. 
 “Quarter” means, unless the context requires otherwise, a
fiscal quarter of the Partnership, or, with respect to the fiscal quarter of the Partnership which includes the Effective Date, the portion of such fiscal quarter from and after the Effective Date. 

“Regulations” means the Income Tax Regulations, including Temporary Regulations, promulgated under the Code, as such
regulations are amended from time to time. 
 “Regulatory Allocations” has the meaning set forth in
Section 5.04. 
 “Representative” has the meaning set forth in Section 8.03(a). 

  
 Page 9 of 31 

 “Subsidiary” means, with respect to any Person, (a) a corporation of which
more than 50% of the voting power of shares entitled (without regard to the occurrence of any contingency) to vote in the election of directors or other governing body of such corporation is owned, directly or indirectly, at the date of
determination, by such Person, by one or more Subsidiaries of such Person or a combination thereof, (b) a partnership (whether general or limited) in which such Person or a Subsidiary of such Person is, at the date of determination, a general
or limited partner of such partnership, but only if more than 50% of the partnership interests of such partnership (considering all of the partnership interests of the partnership as a single class) is owned, directly or indirectly, at the date of
determination, by such Person, by one or more Subsidiaries of such Person, or a combination thereof; or (c) any other Person (other than a corporation or a partnership) in which such Person, one or more Subsidiaries of such Person, or a
combination thereof, directly or indirectly, at the date of determination, has (i) at least a majority ownership interest or (ii) the power to elect or direct the election of a majority of the directors or other governing body of such
Person. 
 “Tax Matters Partner” has the meaning set forth in Section 5.09(a). 

“TBOC” means the Texas Business Organizations Code, as amended, supplemented or restated from time to time, and any
predecessor or successor to such statute. 
 “Unanimous Approval Matter” has the meaning set forth in
Section 8.02. 
 1.02 Construction. Unless the context clearly indicates otherwise: 

(a) the gender (or lack of gender) of all words used in this Agreement includes the masculine, feminine, and neuter; 

(b) references to Articles and Sections refer to Articles and Sections of this Agreement; 

(c) references to money refer to legal currency of the United States of America; 

(d) accounting terms shall be construed in accordance with GAAP; 

(e) the words “herein,” “hereof” and “hereunder” and other words of similar import refer to this Agreement as a
whole and not to any particular paragraph, subparagraph, section, subsection or other subdivision and the words “include,” “includes” and “including” shall be deemed to be followed by the words “without
limitation”; 
 (f) headings are for reference purposes only and are not intended to describe, interpret, define, or limit the scope,
extent, or intent of this Agreement or any provision; and 
 (g) each party agrees that, to the fullest extent permitted by law, any rule of
construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation or construction of this Agreement. 

  
 Page 10 of 31 

 Article 2 

Business, Purpose, and Term of Partnership 

2.01 Formation and Continuation. The Partnership was formed as a limited partnership by the filing of the Certificate with the Texas
Secretary of State and the entry into the Original Agreement and is and shall be governed by the provisions of the TBOC, as modified by the terms and conditions set forth in this Agreement. Except as provided in this Agreement, the rights, duties,
liabilities and powers of the Partners shall be as provided in the TBOC. The Partners hereby continue the Partnership under this Agreement without interruption, winding up or termination. 

2.02 Name. The name of the Partnership shall be “Midcoast Operating, L.P.,” and all business shall be conducted in such name.
The General Partner in its sole discretion may change the name of the Partnership at any time and may amend this Agreement and the Certificate to effect such name change, notwithstanding Section 13.06. 

2.03 Registered Agent and Office. The registered office of the Partnership in the State of Texas is CT Corporation System, 1021 Main
Street, Suite 1150, Houston, Texas 77002. The registered agent at such address is CT Corporation System. The principal office of the Partnership shall be located at 1100 Louisiana Street, Suite 3300, Houston, Texas 77002 and may be changed by the
General Partner from time to time in its sole discretion. 
 2.04 Purpose and Powers. The purpose of the Partnership is to engage in
any lawful act or activity for which limited partnerships may be formed under the TBOC (either directly or indirectly through one or more Subsidiaries). In furtherance of its purposes, but subject to all of the provisions of this Agreement, the
Partnership shall have all of the powers and rights conferred on limited partnerships formed under the TBOC. 
 2.05 Term. The term
of the Partnership commenced upon the filing of the Certificate as described in Section 2.06 and shall continue until the winding up and termination of the Partnership in accordance with the provisions of Article 12. The existence
of the Partnership as a separate legal entity shall continue until the cancellation of the Certificate (as amended from time to time) in the manner provided in the TBOC. 

2.06 Filings. The Certificate was initially filed as required by and in conformance with the TBOC on or about October 10, 2002.
The General Partner shall further cause to be executed, filed and recorded and shall cause to be published, if required by Applicable Law, such other certificates or other instruments as may be necessary or appropriate under the Applicable Law of
any state in which the Partnership does business. 
 Article 3 

Partners 
 3.01
Partners; Percentage Interests. The names and addresses of the Partners, their respective percentage interests in the Partnership (“Percentage Interests”), and type of Partnership Interest held are as set forth on Schedule
A. 

  
 Page 11 of 31 

 3.02 Adjustments in Percentage Interests. The respective Percentage Interests of the
Partners shall be adjusted, and the General Partner shall amend Schedule A to reflect such adjustments: (a) at the time of any transfer of all or a portion of such Partner’s Partnership Interest pursuant to Section 9.01;
(b) at the time of the admission of each new Partner in accordance with this Agreement, in each case to take into account such transfer or admission of a new Partner, and (c) as may be required pursuant to Section 4.02(c). 

Article 4 
 Capital
Contributions 
 4.01 Capitalization of the Partnership. Subject to Section 8.02, the Partnership is authorized to
issue two classes of Partnership Interests. The Partnership Interests shall be designated as General Partner Interests and Limited Partner Interests, each having such rights, powers, preferences and designations as set forth in this Agreement. 

4.02 Capital Contributions. 

(a) Organizational Capital Contributions and Subsequent Transfers. In connection with the formation of the Partnership under the TBOC,
the General Partner made an initial Capital Contribution to the Partnership in the amount of $[ — ], for a 0.001% General Partner Interest and has been admitted as, and hereby continues as,
the General Partner of the Partnership, and EECI made an initial Capital Contribution to the Partnership in the amount of $[ — ] for a 99.999% Limited Partner Interest. Pursuant to that
certain Assignment of Partnership Interest dated October 17, 2002, EECI transferred all of its Limited Partner Interest in the Partnership to EEP. Pursuant to that certain Assignment of Ownership Interest dated December 30, 2002, EEP
transferred all of its Limited Partner Interest in the Partnership to EMLH. Pursuant to that Assignment of Ownership Interest dated January 1, 2010, EMLH transferred all of its Limited Partner Interest in the Partnership to EEP. 

(b) Contributions on the Effective Date. On the Effective Date, following the contributions set forth in the Contribution Agreement,
the General Partner continues to own a 0.001% General Partner Interest, subject to all of the rights, privileges and duties of the General Partner under this Agreement, EEP owns a 61.0% Limited Partner Interest, subject to all of the rights,
privileges and duties of Limited Partners under this Agreement and MEP owns a 38.999% Limited Partner Interest, subject to all of the rights, privileges and duties of Limited Partners under this Agreement. 

(c) Additional Capital Contributions. The General Partner may, at any time, request that the Partners make additional Capital
Contributions to the Partnership at such times and in such amounts as determined by the General Partner (a “ Capital Request”). Within [ten (10)] days of a Capital Request, each Partner may, but shall not be required to, make
Capital Contributions pro rata in accordance with each Partner’s respective Percentage Interest. With respect to any Capital Request, any Partner may provide written notice, within [five (5)] days after the Capital Request, to the General
Partner of its election either (i) not to make Capital Contributions in an amount equal to its pro rata share (based on the relative Percentage Interests 

  
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of each Partner) of the Capital Request or (ii) to make Capital Contributions in an amount less than its pro rata share (based on the relative Percentage Interests of each Partner) of the
Capital Request (a “Non-Funding Partner”). In the event a Partner is a Non-Funding Partner, each Partner making a Capital Contribution pro rata in accordance with its respective Percentage Interest (each, a “Full
Participant”) shall have the option to make additional Capital Contributions representing its proportionate share (based on the relative Percentage Interests of each Full Participant) of any amount not contributed by the Non-Funding
Partner. To the extent a Non-Funding Partner makes an election in accordance with Section 4.02(c)(i) or (c)(ii), such Non-Funding Partner’s Percentage Interest shall be proportionately reduced and each Full Participant’s
Percentage Interest shall be proportionately increased. This Agreement shall be amended without further action by the Partners, by the replacement of Schedule A appropriately amended to reflect any change in the Percentage Interests of the
Partners made pursuant to this Section 4.02(c). 
 (d) No Third Party Beneficiaries. The provisions of this Agreement,
including this Section 4.02, are intended solely to benefit the Partners and, to the fullest extent permitted by Applicable Law, shall not be construed as conferring any benefit upon any creditor of the Partnership, and no such creditor
of the Partnership shall be a third-party beneficiary of this Agreement, and no Partner shall have any duty or obligation to any creditor of the Partnership to issue any call for or contribute any capital pursuant to this Agreement. 

4.03 Withdrawal of Capital; Interest. No Partner may withdraw capital or receive any distributions from the Partnership except as
specifically provided herein. No interest shall be paid by the Partnership on any capital contributions. 
 Article 5 

Allocations and Other Tax Matters 

5.01 Profits. After giving effect to the special allocations set forth in Sections 5.03 and 5.04, and any allocation of
Profits set forth in Section 5.03(b), Profits for any Allocation Year shall be allocated among the Partners in proportion to their respective Percentage Interests. 

5.02 Losses. 
 (a) After
giving effect to the special allocations set forth in Sections 5.03 and 5.04, Losses for any Allocation Year shall be allocated among the Partners in proportion to their respective Percentage Interests. 

(b) The Losses allocated pursuant to Section 5.02(a) shall not exceed the maximum amount of Losses that can be so allocated
without causing any Partner to have an Adjusted Capital Account Deficit at the end of any Allocation Year. In the event some but not all of the Partners would have Adjusted Capital Account Deficits as a result of an allocation of Losses pursuant to
Section 5.02(a), Losses that would otherwise be allocated to a Partner pursuant to Section 5.02(a) but for the limitation set forth in this Section 5.02(b) shall be allocated to the remaining Partners in
proportion to their relative Percentage Interests. All remaining Losses in 

  
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excess of the limitation set forth in this Section 5.02(b) shall be allocated to the General Partner. Profits for any Allocation Year subsequent to an Allocation Year for which the
limitation set forth in this Section 5.02(b) was applicable shall be allocated (i) first, to reverse any Losses allocated to the General Partner pursuant to the third sentence of this Section 5.02(b), and
(ii) second, to reverse any Losses allocated to the Partners pursuant to the second sentence of this Section 5.02(b) and in proportion to how such Losses were allocated. 

5.03 Special Allocations. The following special allocations shall be made in the following order: 

(a) Minimum Gain Chargeback. Except as otherwise provided in Regulations Section 1.704-2(f), notwithstanding any other provision
of this Article 5, if there is a net decrease in Minimum Gain during any Allocation Year, each Partner shall be specially allocated items of Partnership income and gain for such Allocation Year (and, if necessary, subsequent Allocation Years)
in an amount equal to such Partner’s share of the net decrease in Minimum Gain, determined in accordance with Regulations Section 1.704-2(g). Allocations pursuant to the previous sentence shall be made in proportion to the respective
amounts required to be allocated to each Partner pursuant thereto. The items to be so allocated shall be determined in accordance with Regulations Sections 1.704-2(f)(6) and 1.704-2(g)(2). This Section 5.03(a) is intended to comply with
the minimum gain chargeback requirement in Regulations Section 1.704-2(f) and shall be interpreted consistently therewith. 
 (b)
Partner Minimum Gain Chargeback. Except as otherwise provided in Regulations Section 1.704-2(i)(4), notwithstanding any other provision of this Article 5, if there is a net decrease in Partner Nonrecourse Debt Minimum Gain
attributable to a Partner Nonrecourse Debt during any Allocation Year, each Partner who has a share of the Partner Nonrecourse Debt Minimum Gain attributable to such Partner Nonrecourse Debt, determined in accordance with Regulations
Section 1.704-2(i)(5), shall be specially allocated items of Partnership income and gain for such Allocation Year (and, if necessary, subsequent Allocation Years) in an amount equal to such Partner’s share of the net decrease in Partner
Nonrecourse Debt Minimum Gain attributable to such Partner Nonrecourse Debt, determined in accordance with Regulations Section 1.704-2(i)(4). Allocations pursuant to the previous sentence shall be made in proportion to the respective amounts
required to be allocated to each Partner pursuant thereto. The items to be so allocated shall be determined in accordance with Regulations Sections 1.704-2(i)(4) and 1.704-2(j)(2). This Section 5.03(b) is intended to comply with the
minimum gain chargeback requirement in Regulations Section 1.704-2(i)(4) and shall be interpreted consistently therewith. 
 (c)
Qualified Income Offset. In the event that any Partner unexpectedly receives any adjustments, allocations, or distributions described in Regulations Sections 1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5), or 1.704-1(b)(2)(ii)(d)(6), items
of Partnership income and gain shall be allocated to such Partner in an amount and manner sufficient to eliminate, to the extent required by the Regulations, the Adjusted Capital Account Deficit of such Partner as quickly as possible; provided
that an allocation pursuant to this Section 5.03(c) shall be made only if and to the extent that such Partner would have an Adjusted Capital Account Deficit after all other allocations provided for in this Article 5 have been
tentatively made as if this Section 5.03(c) were not in this Agreement. 

  
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 (d) Gross Income Allocation. In the event that any Partner has an Adjusted Capital Account
Deficit at the end of any Allocation Year, each such Partner shall be allocated items of Partnership income and gain in the amount of such deficit as quickly as possible; provided that an allocation pursuant to this
Section 5.03(d) shall be made only if and to the extent that such Partner would have an Adjusted Capital Account Deficit after all other allocations provided for in this Article 5 have been tentatively made as if
Section 5.03(c) and this Section 5.03(d) were not in this Agreement. 
 (e) Nonrecourse Deductions.
Nonrecourse Deductions for any Allocation Year shall be allocated among the Partner in proportion to their respective Percentage Interests. 

(f) Partner Nonrecourse Deductions. Any Partner Nonrecourse Deductions for any Allocation Year shall be specially allocated to the
Partner who bears the economic risk of loss with respect to the Partner Nonrecourse Debt to which such Partner Nonrecourse Deductions are attributable in accordance with Regulations Section 1.704-2(i)(1). 

(g) Nonrecourse Liabilities. Nonrecourse Liabilities of the Partnership described in Regulations Section 1.752-3(a)(3) shall be
allocated among the Partners in the manner chosen by the General Partner and consistent with such section of the Regulations. 
 (h)
Section 754 Adjustments. To the extent an adjustment to the adjusted tax basis of any Partnership asset, pursuant to Code Section 734(b) or Code Section 743(b) is required, pursuant to Regulations
Section 1.704-1(b)(2)(iv)(m)(2) or 1.704-1(b)(2)(iv)(m)(4), to be taken into account in determining Capital Accounts as the result of a distribution to a Partner in complete liquidation of such Partner’s Partnership Interest, the amount of
such adjustment to Capital Accounts shall be treated as an item of gain (if the adjustment increases the basis of the asset) or loss (if the adjustment decreases such basis) and such gain or loss shall be specially allocated to the Partners in
accordance with their interests in the Partnership in the event Regulations Section 1.704-1(b)(2)(iv)(m)(2) applies, or to the Partner to whom such distribution was made in the event Regulations Section 1.704-1(b)(2)(iv)(m)(4) applies.

 5.04 Curative Allocations. The allocations set forth in Section 5.03 (the “Regulatory Allocations”)
are intended to comply with certain requirements of the Regulations. It is the intent of the Partners that, to the extent possible, the Regulatory Allocations shall be offset either with special allocations of other items of Partnership income,
gain, loss, or deduction pursuant to this Section 5.04. Therefore, notwithstanding any other provision of this Article 5 (other than the Regulatory Allocations), the Tax Matters Partner shall make such offsetting special
allocations of Partnership income, gain, loss, or deduction in whatever manner it determines appropriate so that, after such offsetting allocations are made, each Partner’s Capital Account balance is, to the extent possible, equal to the
Capital Account balance such Partner would have had if the Regulatory Allocations were not part of this Agreement and all Partnership items were allocated pursuant to Sections 5.01, 5.02, and 5.03 (other than the Regulatory
Allocations). In exercising its discretion under this Section 5.04, the Tax Matters Partner shall take into account future Regulatory Allocations that, although not yet made, are likely to offset other Regulatory Allocations previously
made. 

  
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 5.05 Other Allocation Rules. 

(a) Profits, Losses, and any other items of income, gain, loss, or deduction shall be allocated to the Partners pursuant to this Article
5 as of the last day of each Fiscal Year; provided that Profits, Losses, and such other items shall also be allocated at such times as the Gross Asset Values of the Partnership’s assets are adjusted pursuant to subparagraph
(b) of the definition of “Gross Asset Value” in Section 1.01. 
 (b) For purposes of determining the Profits,
Losses, or any other items allocable to any period, Profits, Losses, and any such other items shall be determined by the General Partner using any reasonable method under Code Section 706 and the Regulations thereunder. 

5.06 Tax Allocations: Code Section 704(c). 

(a) Except as otherwise provided in this Section 5.06, each item of income, gain, loss and deduction of the Partnership for
federal income tax purposes shall be allocated among the Partners in the same manner as such items are allocated for book purposes under this Article 5. In accordance with Code Section 704(c) and the Regulations thereunder, income, gain,
loss, and deduction with respect to any Property contributed to the capital of the Partnership shall, solely for tax purposes, be allocated among the Partners so as to take account of any variation between the adjusted basis of such Property to the
Partnership for federal income tax purposes and its initial Gross Asset Value (computed in accordance with the definition of Gross Asset Value). Such allocation shall be made in accordance with the “remedial method” described by
Regulations Section 1.704-3(d). 
 (b) In the event the Gross Asset Value of any Property is adjusted pursuant to subparagraph
(b) of the definition of Gross Asset Value, subsequent allocations of income, gain, loss, and deduction with respect to such Property shall take account of any variation between the adjusted basis of such Property for federal income tax
purposes and its Gross Asset Value in the same manner as under Code Section 704(c) and the Regulations thereunder. Such allocation shall be made in accordance with the “remedial method” described by Regulations
Section 1.704-3(d). 
 (c) In accordance with Treasury Regulations Sections 1.1245-1(e) and 1.250-1(f), any gain allocated to the
Partners upon the sale or other taxable disposition of any Partnership asset shall, to the extent possible, after taking into account other required allocations of gain pursuant to this Section 5.06(c), be characterized as
“recapture income” in the same proportions and to the same extent as such Partners (or their predecessors in interest) have been allocated any deductions directly or indirectly giving rise to the treatment of such gains as “recapture
income.” 
 (d) Any elections or other decisions relating to such allocations shall be made by the General Partner in any manner that
reasonably reflects the purpose and intention of this Agreement. Allocations pursuant to this Section 5.06 are solely for purposes of federal, state, 

  
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and local taxes and shall not affect, or in any way be taken into account in computing, any Partner’s Capital Account or share of Profits, Losses, other items, or distributions pursuant to
any provision of this Agreement. 
 5.07 Tax Elections. 

(a) The Partners intend that the Partnership be treated as a partnership or a “disregarded entity” for federal income tax purposes.
Accordingly, neither the Tax Matters Partner nor any Limited Partner shall file any election or return on its own behalf or on behalf of the Partnership that is inconsistent with that intent. 

(b) The Partnership shall make the election under Code Section 754 in accordance with the applicable Regulations issued thereunder,
subject to the reservation of the right to seek to revoke any such election upon the General Partner’s determination that such revocation is in the best interests of the Partners. 

(c) Any elections or other decisions relating to tax matters that are not expressly provided herein, shall be made jointly by the Partners in
any manner that reasonably reflects the purpose and intention of this Agreement. 
 5.08 Tax Returns. 

(a) The Tax Matters Partner shall cause to be prepared and timely filed all federal, state, local and foreign income tax returns and reports
required to be filed by the Partnership and its subsidiaries. The Partnership shall provide copies of all the Partnership’s federal, state, local and foreign tax returns (and any schedules or other required filings related to such returns) that
reflect items of income, gain, deduction, loss or credit that flow to separate Partner returns, to the Partners for their review and comment prior to filing, except as otherwise agreed by the Partners. The Partners agree in good faith to resolve any
difference in the tax treatment of any item affecting such returns and schedules. However, if the Partners are unable to resolve the dispute, the position of the Tax Matters Partner shall be followed if nationally recognized tax counsel acceptable
to the Partners provides an opinion that substantial authority exists for such position. Substantial authority shall be given the meaning ascribed to it in Code Section 6662. If the Partners are unable to resolve the dispute prior to the due
date for filing the return, including approved extensions, the position of the Tax Matters Partner shall be followed, and amended returns shall be filed if necessary at such time the dispute is resolved. The costs of the dispute shall be borne by
the Partnership. The Partners agree to file their separate federal income tax returns in a manner consistent with the Partnership’s return, the provisions of this Agreement and in accordance with Applicable Law. 

(b) The Partners shall provide each other with copies of all correspondence or summaries of other communications with the Internal Revenue
Service or any state, local or foreign taxing authority (other than routine correspondence and communications) regarding the tax treatment of the Partnership’s operations. No Partner shall enter into settlement negotiations with the Internal
Revenue Service or any state, local or foreign taxing authority with respect to any issue concerning the Partnership’s income, gains, losses, deductions or credits if the tax 

  
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adjustment attributable to such issue (assuming the then current aggregate tax rate) would be $2 million or greater, without first giving reasonable advance notice of such intended action to the
other Partners. 
 5.09 Tax Matters Partner. 

(a) The General Partner shall be the “Tax Matters Partner” of the Partnership within the meaning of Section 6231(a)(7)
of the Code, and shall act in any similar capacity under the Applicable Law of any state, local or foreign jurisdiction, but only with respect to returns for which items of income, gain, loss, deduction or credit flow to the separate returns of the
Partners. 
 (b) The Tax Matters Partner shall incur no Liability (except as a result of the gross negligence or willful misconduct of the
Tax Matters Partner) to the Partnership or the other Partners including, but not limited to, Liability for any additional taxes, interest or penalties owed by the other Partners due to adjustments of Partnership items of income, gain, loss,
deduction or credit at the Partnership level. 
 5.10 Duties of Tax Matters Partner. 

(a) The Tax Matters Partner shall cooperate with the other Partners and shall promptly provide the other Partners with copies of notices or
other materials from, and inform the other Partners of discussions engaged with, the Internal Revenue Service or any state, local or foreign taxing authority and shall provide the other Partners with notice of all scheduled proceedings, including
meetings with agents of the Internal Revenue Service or any state, local or foreign taxing authority, technical advice conferences, appellate hearings, and similar conferences and hearings, as soon as possible after receiving notice of the
scheduling of such proceedings, but in any case prior to the date of such scheduled proceedings. 
 (b) The Tax Matters Partner is
authorized and required to represent the Partnership (at the Partnership’s expense) in connection with all examinations of the Partnership’s affairs by tax authorities, including resulting administrative and judicial proceedings, and to
expend Partnership funds for professional services and costs associated therewith. Each Partner agrees to cooperate with the Tax Matters Partner and to do or refrain from doing any and all things reasonably required by the Tax Matters Partner to
conduct such proceedings. 
 (c) The Tax Matters Partner shall not extend the period of limitations or assessments without the consent of
the other Partners, which consent shall not be unreasonably withheld. 
 (d) The Tax Matters Partner may request extensions to file any tax
return or statement without the written consent of, but shall so inform, the other Partners. 
 5.11 Survival of Provisions. The
provisions of this Agreement regarding the Partnership’s tax returns and Tax Matters Partner shall survive the termination of the Partnership and the transfer of any Partner’s interest in the Partnership and shall remain in effect for the
period of time necessary to resolve any and all matters regarding the federal, state, local and foreign taxation of the Partnership and items of Partnership income, gain, loss, deduction and credit. 

  
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 Article 6 

Distributions 
 6.01
Distributions of Distributable Cash. Within 45 days following the end of each Quarter commencing with the Quarter ending [December 31, 2013], the Partnership shall distribute to the Partners pro rata in accordance with their respective
Percentage Interests an amount equal to 100% of Distributable Cash. Notwithstanding any other provision of this Agreement, the Partnership shall not make a distribution to the Partners on account of their interests in the Partnership if such
distribution would violate the TBOC or other applicable law. 
 6.02 Liquidating Distributions. Notwithstanding any other provision
of this Article 6, distributions with respect to the Quarter in which the winding up and termination of the Partnership occurs shall be made in accordance with Article 12. 

6.03 Distribution in Kind. The Partnership shall not distribute to the Partners any assets in kind unless approved by the Partners in
accordance with this Agreement. If cash and property in kind are to be distributed simultaneously, the Partnership shall distribute such cash and property in kind in the same proportion to each Partner, unless otherwise approved by the Partners in
accordance with this Agreement. 
 Article 7 

Books and Records 
 7.01
Books and Records; Examination. The General Partner shall keep or cause to be kept such books of account and records with respect to the Partnership’s business as it may deem necessary and appropriate. Each Partner and its duly authorized
representatives shall have the right, for any purpose reasonably related to its interest in the Partnership, at any time to examine, or to appoint independent certified public accountants (the fees of which shall be paid by such Partner) to examine,
the books, records and accounts of the Partnership and its Subsidiaries, their operations and all other matters that such Partner may wish to examine, including, without limitation, all documentation relating to actual or proposed transactions
between the Partnership and any Partner or any Affiliate of a Partner. The Partnership’s books of account shall be kept using the method of accounting determined by the General Partner in its sole discretion. 

7.02 Reports. The General Partner shall prepare and send to each Partner (at the same time) promptly such financial information of the
Partnership as a Partner shall from time to time reasonably request, for any purpose reasonably related to its interest in the Partnership. The General Partner shall, for any purpose reasonably related to a Partner’s interest in the
Partnership, permit examination and audit of the Partnership’s books and records by both the internal and independent auditors of its Partners. 

  
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 Article 8 

Management and Voting 

8.01 Management. The General Partner shall conduct, direct and manage the business of the Partnership. Except as otherwise expressly
provided in this Agreement, all management powers over the business and affairs of the Partnership shall be exclusively vested in the General Partner, and no Limited Partner shall have any management power over the business and affairs of the
Partnership. In addition to the powers now or hereafter granted a general partner of a limited partnership under Applicable Law or which are granted to the General Partner under any other provision of this Agreement, the General Partner, subject to
Section 8.02, shall have full power and authority to do all things on such terms as it, in its sole discretion, may deem necessary or appropriate to conduct the business of the Partnership and to effectuate the purposes set forth in
Section 2.04. The Partnership shall reimburse the General Partner, on a monthly basis or such other basis as the General Partner may determine, for all direct and indirect costs and expenses incurred by the General Partner or payments
made by the General Partner, in its capacity as the general partner of the Partnership, for and on behalf of the Partnership. 
 8.02
Matters Constituting Unanimous Approval Matters. Notwithstanding anything in this Agreement to the contrary, and subject to the provisions of Section 8.03(c), each of the following matters, and only the following matters, shall
constitute a “Unanimous Approval Matter” which requires the prior approval of the Partners pursuant to Section 8.03(c): 

(a) any merger, consolidation, reorganization or similar transaction between or among the Partnership and any Person (other than a transaction
between the Partnership and a direct or indirect wholly owned Subsidiary of the Partnership) or any sale or lease of all or substantially all of the Partnership’s assets to any Person (other than a direct or indirect wholly owned Subsidiary of
the Partnership); 
 (b) the creation of any new class of Partnership Interests or the issuance of any additional Partnership Interests or
the issuance of any security that is convertible into or exchangeable for a Partnership Interest; 
 (c) the admission or withdrawal of any
Person as a Partner other than pursuant to the third sentence of Section 9.02 or Section 9.04, or pursuant to any transfer of Partnership Interests pursuant to Section 9.01(b) or (c), as applicable; 

(d) the commencement of a voluntary case with respect to the Partnership or any of its Subsidiaries under any applicable bankruptcy,
insolvency or other similar Applicable Law now or hereafter in effect, or the consent to the entry of an order for relief in an involuntary case under any such Applicable Law, or the consent to the appointment of or the taking possession by a
receiver, liquidator, assignee, custodian, trustee or sequestrator (or similar official) of the Partnership or any of its Subsidiaries or for any substantial part of the Partnership’s or any of its Subsidiaries’ property, or the making of
any general assignment for the benefit of creditors; 
 (e) the modification, alteration or amendment of the amount, timing, frequency or
method of calculation of distributions to the Partners from that provided in Article 6; 

  
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 (f)(i) the approval of any distribution by the Partnership to the Partners of any assets in kind,
(ii) the approval of any distribution by the Partnership to the Partners of cash or property in kind on a non-pro rata basis, and (iii) the determination of the value assigned to distributions of property in kind; and 

(g) any other matter expressly requiring the approval of all Partners herein or otherwise referencing any determination, decision, approval or
other form of authorization by the Partners in accordance with this Agreement. 
 8.03 Meetings and Voting. 

(a) Representatives. For purposes of this Article 8, each Partner shall be represented by a designated representative (each, a
“Representative”), who shall be appointed by, and may be removed with or without cause by, the Partner that approved such Person. Each Representative shall have the full authority to act on behalf of the Partner who designated such
Representative. To the fullest extent permitted by Applicable Law, each Representative shall be deemed the agent of the Partner that appointed him, and each Representative shall not be an agent of the Partnership or the other Partners. The action of
a Representative at a meeting of the Partners (or through a written consent) shall bind the Partner that designated that Representative, and the other Partners shall be entitled to rely upon such action without further inquiry or investigation as to
the actual authority (or lack thereof) of such Representative. 
 (b) Meetings and Voting. Meetings of Partners shall be at such
times and locations as the General Partner shall determine in its sole discretion. The General Partner shall provide notice to the Limited Partners of any meetings of Partners in any manner that it deems reasonable and appropriate under the
circumstances. Each Partner, acting through its Representative, shall be entitled to cast one vote on all matters requiring a vote of the Partners under this Agreement. In exercising their voting rights under this Agreement, the Representatives may
act at a meeting in person or by proxy or by unanimous written consent without a meeting. 
 (c) Unanimous Approval Matters. All
Unanimous Approval Matters shall be approved by the unanimous affirmative vote of the Representatives. The parties acknowledge and agree that all references in this Agreement to any determination, decision, approval or other form of authorization by
all Partners or each of the Partners shall be deemed to mean that such determination, decision, approval or other form of authorization shall constitute a Unanimous Approval Matter that requires the unanimous approval of the Partners in accordance
with this Section 8.03(c). 
 8.04 Reliance by Third Parties. Persons dealing with the Partnership are entitled to rely
conclusively upon the power and authority of the General Partner set forth in this Agreement. Neither a Limited Partner nor its Representative shall have the authority to bind the Partnership or any of its Subsidiaries. 

  
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 Article 9 

Transfer of Partnership Interests 

9.01 Restrictions on Transfers. 

(a) General. Except as expressly provided by this Article 9, no Partner shall transfer all or any part of its Partnership
Interests to any Person without first obtaining the written approval of each of the other Partners, which approval may be granted or withheld in their sole discretion. 

(b) Transfer by EEP. EEP may transfer all or part of its Partnership Interests to any Person without the approval of any other Partner.

 (c) Transfer by Operation of Law. In the event a Partner shall be party to a merger, consolidation or similar business combination
transaction with another Person or sell all or substantially all its assets to another Person, such Partner may transfer all or part of its Partnership Interests to such other Person without the approval of any other Partner. 

(d) Consequences of an Unpermitted Transfer. Any transfer of a Partner’s Partnership Interest in violation of the applicable
provisions of this Agreement shall be void. 
 9.02 Conditions for Admission. No transferee of all or a portion of the Partnership
Interests of any Partner shall be admitted as a Partner hereunder unless such Partnership Interests are transferred in compliance with the applicable provisions of this Agreement. Each such transferee shall have executed and delivered to the
Partnership such instruments as the General Partner deem necessary or appropriate in its reasonable discretion to effectuate the admission of such transferee as a Partner and to confirm the agreement of such transferee to be bound by all the terms
and provisions of this Agreement. The admission of a transferee shall be effective immediately prior to such transfer, and immediately following such admission, the transferor shall cease to be a Partner (to the extent it transferred its entire
Partnership Interest). If the General Partner transfers its entire interest in the Partnership, the transferee General Partner, to the extent admitted as a substitute General Partner, is hereby authorized to, and shall, continue the Partnership
without winding up and termination. 
 9.03 Allocations and Distributions. Subject to applicable Regulations, upon the transfer of
all the Partnership Interests of a Partner as herein provided, the Profit or Loss of the Partnership attributable to the Partnership Interests so transferred for the Fiscal Year in which such transfer occurs shall be allocated between the transferor
and transferee as of the effective date of the assignment, and such allocation shall be based upon any permissible method that is determined by the General Partner and that is provided for in Code Section 706 and the Regulations issued
thereunder. 
 9.04 Restriction on Resignation or Withdrawal. Except in connection with a transfer permitted pursuant to
Section 9.01, no Partner shall withdraw from the Partnership without the consent of each of the other Partners. To the extent permitted by law, any purported withdrawal from the Partnership in violation of this Section 9.04
shall be null and void. 

  
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 Article 10 

Liability, Exculpation and Indemnification 

10.01 Liability for Partnership Obligations. Except as otherwise required by the TBOC, the Liabilities of the Partnership shall be
solely the Liabilities of the Partnership, and no Covered Person (other than the General Partner) shall be obligated personally for any such Liability of the Partnership solely by reason of being a Covered Person. 

10.02 Disclaimer of Duties and Exculpation. 

(a) Except as otherwise expressly provided in this Agreement, no Covered Person shall have any duty (fiduciary or otherwise) or obligation to
the Partnership, the Partners or to any other Person bound by this Agreement, and in taking, or refraining from taking, any action required or permitted under this Agreement or under Applicable Law, each Covered Person shall be entitled to consider
only such interests and factors as such Covered Person deems advisable, including its own interests, and need not consider any interest of or factors affecting, any other Covered Person or the Partnership notwithstanding any duty otherwise existing
at law or in equity. To the extent that a Covered Person is required or permitted under this Agreement to act in “good faith” or under another express standard, such Covered Person shall act under such express standard and shall not be
subject to any other or different standard under this Agreement or otherwise existing under Applicable Law or in equity. 
 (b) The
provisions of this Agreement, to the extent that they restrict or eliminate the duties (including fiduciary duties) and Liabilities of a Covered Person otherwise existing under Applicable Law or in equity, are agreed by the Partners to replace such
other duties and Liabilities of such Covered Person in their entirety, and no Covered Person shall be liable to the Partnership, the Partners or any other Person bound by this Agreement for its good faith reliance on the provisions of this
Agreement. 
 (c) To the fullest extent permitted by law, no Covered Person shall be liable to the Partnership, the Partners or any other
Person bound by this Agreement for any cost, expense, loss, damage, claim or Liability incurred by reason of any act or omission performed or omitted by such Covered Person in such capacity, whether or not such Person continues to be a Covered
Person at the time of such cost, expense, loss, damage, claim or Liability is incurred or imposed, if the Covered Person acted in good faith reliance on the provisions of this Agreement, and, with respect to any criminal action or proceeding, such
Covered Person had no reasonable cause to believe its conduct was unlawful. 
 (d) A Covered Person shall be fully protected from liability
to the Partnership, the Partners and any other Person bound by this Agreement in acting or refraining from acting in good faith reliance upon the records of the Partnership and such other information, opinions, reports or statements presented to the
Partnership by any Person as to any matters the Covered Person reasonably believes are within such other Person’s professional or expert competence and who has been selected with reasonable care by or on behalf of the Partnership, including
information, opinions, reports or statements as to the value and amount of the assets, Liabilities, Profits and Losses of the Partnership. 

  
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 10.03 Indemnification. 

(a) To the fullest extent permitted by law but subject to the limitations expressly provided in this Agreement, all Covered Persons
shall be indemnified and held harmless by the Partnership from and against any and all losses, claims, damages, liabilities, joint or several, expenses (including legal fees and expenses), judgments, fines, penalties, interest, settlements or other
amounts arising from any and all threatened, pending or completed claims, demands, actions, suits or proceedings, whether civil, criminal, administrative or investigative, and whether formal or informal and including appeals, in which any Covered
Person may be involved, or is threatened to be involved, as a party or otherwise, by reason of its status as a Covered Person and acting (or refraining to act) in such capacity on behalf of or for the benefit of the Partnership;
provided, that the Covered Person shall not be indemnified and held harmless pursuant to this Agreement if there has been a final and non-appealable judgment entered by a court of competent jurisdiction determining that, in
respect of the matter for which the Covered Person is seeking indemnification pursuant to this Agreement, the Covered Person acted in bad faith or engaged in intentional fraud, willful misconduct or, in the case of a criminal matter, acted with
knowledge that the Covered Person’s conduct was unlawful. Any indemnification pursuant to this Section 10.03 shall be made only out of the assets of the Partnership, it being agreed that the General Partner shall not be personally
liable for such indemnification and shall have no obligation to contribute or loan any monies or property to the Partnership to enable it to effectuate such indemnification.  

(b) To the fullest extent permitted by law, expenses (including legal fees and expenses) incurred by a Covered Person who is indemnified
pursuant to Section 10.03(a) in defending any claim, demand, action, suit or proceeding shall, from time to time, be advanced by the Partnership prior to a final and non-appealable judgment entered by a court of competent jurisdiction
determining that, in respect of the matter for which the Covered Person is seeking indemnification pursuant to this Section 10.03, the Covered Person is not entitled to be indemnified upon receipt by the Partnership of any undertaking by
or on behalf of the Covered Person to repay such amount if it shall be ultimately determined that the Covered Person is not entitled to be indemnified as authorized by this Section 10.03. 

(c) The indemnification provided by this Section 10.03 shall be in addition to any other rights to which a Covered Person may be
entitled under any agreement, as a matter of law, in equity or otherwise, both as to actions in the Covered Person’s capacity as a Covered Person and as to actions in any other capacity, and shall continue as to a Covered Person who has ceased
to serve in such capacity and shall inure to the benefit of the heirs, successors, assigns and administrators of the Covered Person. 

  
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 Article 11 

Conflicts of Interest 

11.01 Transactions with Affiliates. The Partnership and its Subsidiaries shall be permitted to enter into or renew or extend the term
of any agreement or transaction with a Partner or an Affiliate of a Partner on such terms and conditions as the General Partner shall approve in its sole discretion, without the approval of any Limited Partner. 

11.02 Outside Activities. Notwithstanding anything to the contrary in this Agreement or any duty otherwise existing at law or in
equity, (a) the engaging in activities by any Covered Person that are competitive with the business of the Partnership is hereby approved by all Partners, (b) it shall be deemed not to be a breach of any fiduciary duty or any other duty or
obligation of a Partner under this Agreement or otherwise existing under Applicable Law or in equity for such Covered Person to engage in such activities in preference to or to the exclusion of the Partnership, (c) a Covered Person shall have
no obligation under this Agreement or as a result of any duty (including any fiduciary duty) otherwise existing under Applicable Law or in equity, to present business opportunities to the Partnership and (d) the doctrine of corporate
opportunity, or any analogous doctrine, shall not apply to any Covered Person; provided such Covered Person does not engage in such activity as a result of or using confidential or proprietary information provided by or on behalf of the
Partnership to such Covered Person. 
 Article 12 

Winding Up and Termination 

12.01 Event Requiring Winding Up. The Partnership shall be terminated and its business and affairs wound up upon the earliest to occur
of any one of the following events: 
 (a) at any time there are no limited partners of the Partnership, unless the business of the
Partnership is continued in accordance with the TBOC; 
 (b) the written consent of all the Partners; 

(c) the withdrawal of the General Partner in accordance with Section 153.155 of the TBOC; or 

(d) the entry of a judicial decree requiring the winding up, dissolution or termination of the Partnership pursuant to the TBOC. 

The bankruptcy, involuntary liquidation or dissolution of a Partner shall cause that Partner to cease to be a partner of the Partnership. Notwithstanding the
foregoing, the Partnership shall not be terminated and its business and affairs shall not be wound up upon the occurrence of any event specified in clause (c) above if, at the time of occurrence of such event, there is at least one remaining
general partner who is hereby authorized to, and shall, carry on the business of the Partnership, or if within ninety (90) days after the date on which such event occurs, the remaining Partners elect in writing to continue the business of the
Partnership and to the appointment, effective as of the date of such event, if required, of one or more additional general partners of the Partnership. Except as provided in this paragraph, and to the fullest extent permitted by the TBOC, the
occurrence of an event that causes a Partner to cease to be a partner of the Partnership shall not, in and of itself, cause the Partnership to be terminated or its business or affairs to be wound up, and upon the occurrence of such an event, the
business of the Partnership shall, to the extent permitted by the TBOC, continue without termination. 

  
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 12.02 Winding Up Procedures of Partnership. The Partnership’s business shall be wound
up in an orderly manner. The General Partner shall (unless the General Partner (or, if no General Partner, the remaining Limited Partners) elects to appoint a liquidating trustee) wind up the affairs of the Partnership pursuant to this Agreement. In
performing its duties, the General Partner or liquidating trustee is authorized to sell, distribute, exchange or otherwise dispose of the assets of the Partnership in accordance with the TBOC and in any reasonable manner that the General Partner or
liquidating trustee shall determine to be in the best interest of the Partners or their successors-in-interest. The General Partner or liquidating trustee shall take full account of the Partnership’s Liabilities and Property and shall cause the
Property or the proceeds from the sale thereof, to the extent sufficient therefor, to be applied and distributed, to the maximum extent permitted by Applicable Law, in the following order: 

(a) First, to creditors, including Partners who are creditors, to the extent permitted by law, in satisfaction of all of the
Partnership’s Liabilities (whether by payment or the making of reasonable provision for payment thereof to the extent required by Section 153.504 of the TBOC), other than Liabilities for distribution to Partners under Sections 153.111 or
153.209 of the TBOC; 
 (b) Second, to the Partners and former Partners of the Partnership in satisfaction of Liabilities for distribution
under Sections 153.111 or 153.209 of the TBOC; and 
 (c) The balance, if any, to the Partners in accordance with the positive balance in
their Capital Accounts, after giving effect to all contributions, distributions, and allocations for all periods. 
 12.03 Compliance
with Certain Requirements of Regulations; Deficit Capital Accounts. In the event the Partnership is “liquidated” within the meaning of Regulations Section 1.704-1(b)(2)(ii)(g), distributions shall be made pursuant to this
Article 12 to the Partners who have positive Capital Accounts in compliance with Regulations Section 1.704- 1(b)(2)(ii)(b)(2). If any Limited Partner has a deficit balance in its Capital Account (after giving effect to all contributions,
distributions, and allocations for all Allocation Years, including the Allocation Year during which such liquidation occurs), such Limited Partner shall have no obligation to make any contribution to the capital of the Partnership with respect to
such deficit, and such deficit shall not be considered a debt owed to the Partnership or to any other Person for any purpose whatsoever. 

12.04 Deemed Distribution and Recontribution. Notwithstanding any other provision of this Article 12, in the event the
Partnership is liquidated within the meaning of Regulations Section 1.704-1(b)(2)(ii)(g) but no actual event requiring winding up under the TBOC has occurred, the Property shall not be liquidated, the Partnership’s debts and other
Liabilities shall not be paid or discharged, and the Partnership’s affairs shall not be wound up. Instead, solely for federal income tax purposes, the Partnership shall be deemed to have contributed all its Property and Liabilities to a new
limited partnership in exchange for an interest in such new limited partnership and, immediately thereafter, the Partnership will be deemed to liquidate by distributing interests in the new limited partnership to the Partners. 

  
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 12.05 Distribution of Property. In the event the General Partner determines that it is
necessary in connection with the winding up of the Partnership to make a distribution of property in kind, such property shall be transferred and conveyed to the Partners so as to vest in each of them as a tenant in common an undivided interest in
the whole of such property, but otherwise in accordance with Section 12.03. 
 12.06 Termination of Partnership. The
Partnership shall terminate when all assets of the Partnership, after payment of or due provision for all Liabilities of the Partnership, shall have been distributed to the Partners in the manner provided for in this Agreement, and the Certificate
shall have been canceled in the manner provided by the TBOC. 
 Article 13 

Miscellaneous 
 13.01
Notices. Any notice, consent or approval to be given under this Agreement shall be in writing and shall be deemed to have been given if delivered: (a) personally by a reputable courier service that requires a signature upon delivery;
(b) by mailing the same via registered or certified first-class mail, postage prepaid, return receipt requested; or (c) by telecopying or transmitting by electronic mail the same with receipt confirmation to the intended recipient. Any
such writing will be deemed to have been given: (i) as of the date of personal delivery via courier as described above; (ii) as of the third calendar day after depositing the same into the custody of the postal service as evidenced by the
date-stamped receipt issued upon deposit of the same into the mails as described above; and (iii) as of the date and time electronically transmitted in the case of telecopy or electronic mail delivery as described above, in each case addressed
to the intended party at the address set forth below: 
 To Midcoast OLP GP, L.L.C.: 

Midcoast OLP GP, L.L.C. 
 1100 Louisiana Street, Suite 3300 

Houston, Texas 77002 
 Attention: [ — ] 
 Phone: [ — ] 

E-mail: [ — ] 

To Midcoast Energy Partners, L.P.: 
 Midcoast Energy
Partners, L.P. 
 1100 Louisiana Street, Suite 3300 
 Houston,
Texas 77002 
 Attention: [ — ] 

Phone: [ — ] 

E-mail: [ — ] 

  
 Page 27 of 31 

 To Enbridge Energy Partners, L.P.: 

Enbridge Energy Partners, L.P. 
 1100 Louisiana Street, Suite
3300 
 Houston, Texas 77002 
 Attention: [ — ] 
 Phone: [ — ] 

E-mail: [ — ] 

Any Partner may designate different addresses or telephone numbers by notice to the other Partners. 

13.02 Merger and Entire Agreement. This Agreement constitutes the entire Agreement of the Partners and supersedes any prior
understandings, agreements, or representations by or among the Partners, written or oral, to the extent they relate in any way to the subject matter hereof, including the Original Agreement. 

13.03 Assignment. A Partner shall not assign all or any of its rights, obligations or benefits under this Agreement to any other Person
otherwise than (a) in connection with a transfer of its Partnership Interests pursuant to Article 9, or (b) with the prior written consent of each of the other Partners, which consent may be withheld in such Partner’s sole
discretion, and any attempted assignment not in compliance with Article 9 or this Section 13.03 shall be void. 

13.04 Parties in Interest. This Agreement shall inure to the benefit of, and be binding upon, the Partners and their respective
successors, legal representatives and permitted assigns. 
 13.05 Counterparts. This Agreement may be executed in counterparts, each
of which shall be deemed an original, but all of which together shall constitute one and the same instrument. 
 13.06 Amendment; Waiver.
This Agreement may not be amended except in a written instrument signed by each of the Partners and expressly stating it is an amendment to this Agreement. Any failure or delay on the part of any Partner in exercising any power or right
hereunder shall not operate as a waiver thereof, nor shall any single or partial exercise of any such right or power preclude any other or further exercise thereof or the exercise of any other right or power hereunder or otherwise available under
Applicable Law or in equity. 
 13.07 Severability. If any term, provision, covenant, or restriction in this Agreement or the
application thereof to any Person or circumstance, at any time or to any extent, is held by a court of competent jurisdiction or other Governmental Authority to be invalid, void or unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Agreement (or the application of such provision in other jurisdictions or to Persons or circumstances other than those to which it was held invalid or unenforceable) shall in no way be affected, impaired or invalidated, and to
the extent permitted by Applicable Law, any such 

  
 Page 28 of 31 

 
term, provision, covenant or restriction shall be restricted in applicability or reformed to the minimum extent required for such to be enforceable. This provision shall be interpreted and
enforced to give effect to the original written intent of the Partners prior to the determination of such invalidity or unenforceability. 

13.08 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS, WITHOUT GIVING
EFFECT TO THE PRINCIPLES OF CONFLICTS OF LAW THEREOF. ANY RIGHT TO TRIAL BY JURY WITH RESPECT TO ANY CLAIM OR PROCEEDING RELATED TO OR ARISING OUT OF THIS AGREEMENT, OR ANY TRANSACTION OR CONDUCT IN CONNECTION HEREWITH, IS HEREBY WAIVED BY EACH OF
THE PARTNERS. 
 13.09 No Bill for Accounting. To the fullest extent permitted by law, in no event shall any Partner have any
right to file a bill for an accounting or any similar proceeding. 
 13.10 Waiver of Partition. Each Partner hereby waives any right
to partition of the Partnership property. 
 13.11 Section Headings. The section headings of this Agreement are for reference
purposes only and are to be given no effect in the construction or interpretation of this Agreement. 
 13.12 Third Parties. Nothing
herein expressed or implied is intended or shall be construed to confer upon or give any Person (other than Covered Persons) other than the Partners and their respective successors, legal representatives and permitted assigns any rights, remedies or
basis for reliance upon, under or by reason of this Agreement. 

  
 Page 29 of 31 

 IN WITNESS WHEREOF, the parties have signed this Agreement as of the Effective Date. 

 

			
	GENERAL PARTNER:
	
	Midcoast OLP GP, L.L.C.
		
	 By:
	 	  

	 Name:
	 	
	 Title:
	 	
	
	LIMITED PARTNERS:
	
	Midcoast Energy Partners, L.P.
		
	 By:
	 	  

	 Name:
	 	
	 Title:
	 	
	
	Enbridge Energy Partners, L.P.
		
	 By:
	 	  

	 Name:
	 	
	 Title:
	 	

 Signature page to Midcoast Operating, L.P. Amended and Restated Limited Partnership Agreement 

 Schedule A 
  

							
	 Partners
	  	 Percentage
Interest
	 	 	 Type of Interest

	 Midcoast OLP GP, L.L.C.

1100 Louisiana Street, Suite 3300

Houston, Texas 77002
	  	 	0.001	% 	 	General Partner
	 Midcoast Energy Partners, L.P.

1100 Louisiana Street, Suite 3300

Houston, Texas 77002
	  	 	38.999	% 	 	Limited Partner
	 Enbridge Energy Partners, L.P.

1100 Louisiana Street, Suite 3300

Houston, Texas 77002
	  	 	61.0	% 	 	Limited Partner

 Signature page to Midcoast Operating, L.P. Amended and Restated Limited Partnership Agreement

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