Kinetik Holdings Inc.

12. SHARE-BASED COMPENSATION

The Company granted various Class A and Class C Shares, restricted stock units (“RSUs”) and performance stock units (“PSUs”) to members of the Board of Directors (the “Board”) and employees. The Class A Shares and Class C Shares and RSUs are subject to service requirements for vesting and the PSUs have both service requirements and market condition performance requirements for vesting. These units are recorded at grant-date fair value and compensation expense is recognized on a straight‑line or graded straight-line basis over the vesting period within “General and Administrative Expenses” of the Condensed Consolidated Statements of Operations in accordance with FASB ASC 718, Compensation - Stock Compensation. Forfeitures are recognized as they occur.

Class A Shares and Class C Shares

The table below summarizes Class A Share and Class C Share activities for the three months ended March 31, 2025:

The table below summarizes aggregate intrinsic value (market value at vesting date) and grant-date fair value of vested Class A Shares for the three months ended March 31, 2025:

No vesting or forfeiture occurred for Class C Shares for the three months ended March 31, 2025 and 2024. As of March 31, 2025, there were $18.7 million of unrecognized compensation costs related to unvested Class A Shares and Class C Shares. These costs are expected to be recognized over a weighted average period of 0.92 years.

Restricted Stock Units

RSUs were granted to certain executives and employees under the Kinetik Holdings Inc. Amended and Restated 2019 Omnibus Compensation Plan (the “2019 Plan”) with various service vesting requirements. Such RSUs may be settled only for shares of Class A Common Stock on aone-for-one basis, contingent upon continued employment.

The table below summarizes RSUs activities for the three months ended March 31, 2025:

(1)The number of shares and weighted average fair market value per share include RSUs issued to new employees that transitioned from ALTM as part of the merger as replacement awards.

The table below summarizes aggregate intrinsic value (market value at vesting date) and grant-date fair value of RSUs for the three months ended March 31, 2025 and 2024.

As of March 31, 2025, there were $24.4 million of unrecognized compensation costs related to the RSUs. These costs are expected to be recognized over a weighted average period of 1.78 years.

Performance Stock Units

The Company granted PSUs pursuant to the 2019 Plan to certain of its employees and executives. These PSUs vest and become earned upon the achievement of certain performance goals based on the Company’s annualized absolute total stockholder return and the Company’s relative total stockholder return as compared to the performance peer group during athree-year performance period. Depending on the results achieved during thethree-year performance period, the actual number of Class A Common Stock that a holder of the PSUs earns at the end of the performance period may range from 0% to 200% of the target number of PSUs granted. The fair value of the PSUs is determined using a Monte Carlo simulation at the grant date. The Company recognized compensation expense for PSUs on a straight-line basis over the performance period. Any PSU not earned at the end of the performance period will be forfeited.

The table below summarizes PSU activities for the three months ended March 31, 2025:

No vesting or forfeiture occurred for PSUs for the three months ended March 31, 2025 and 2024.

The table below presents a summary of the grant-date fair value assumptions used to value the PSUs granted during 2025:

As of March 31, 2025, there were $11.7 million of unrecognized compensation costs related to the PSUs. These costs are expected to be recognized over a weighted average period of 2.36 years.

With respect to the above Class A Shares, Class C Shares, RSUs and PSUs, the Company recorded compensation expenses of $20.7 million and $22.6 million for the three months ended March 31, 2025 and 2024, respectively. In addition, during the three months ended March 31, 2025, the Company modified certain equity awards in connection with a key employee retiring from the Company. The modifications allowed for continued vesting of unvested equity awards that would have otherwise been forfeited upon the former employee’s retirement. As a result of the modification, the Company will recognize $2.2 million in additional stock-based compensation cost, which will be amortized over the remaining term of respective equity awards.