SC 13D 1 efc22-205_sc13d.htm

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

SCHEDULE 13D

Under the Securities Exchange Act of 1934
(Amendment No. )*

KINETIK HOLDINGS INC.
(Name of Issuer)

Class A Common Stock, par value $0.0001 per share
(Title of Class of Securities)

02215L209
(CUSIP Number)

Adil Rahmathulla
ISQ Global Fund II GP, LLC

600 Brickell Avenue, Penthouse

Miami, Florida 33131-3067
Tel: (786) 693-5700
(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)

February 22, 2022
(Date of Event Which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. □

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7 for other parties to whom copies are to be sent.

*	The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

	SCHEDULE 13D
CUSIP No. 02215L209		Page 2 of 23 Pages

1	NAMES OF REPORTING PERSONS
	ISQ Global Fund II GP, LLC

2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP			(a)	☐
				(b)	☒

3	SEC USE ONLY


4	SOURCE OF FUNDS (SEE INSTRUCTIONS)
	OO

5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(D) OR 2(E)				☐


6	CITIZENSHIP OR PLACE OF ORGANIZATION
	Delaware

NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER
			0

		8	SHARED VOTING POWER
			14,549,241 (1)(2)

		9	SOLE DISPOSITIVE POWER
			0

		10	SHARED DISPOSITIVE POWER
			14,549,241 (1)(2)

11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
	14,549,241 (1)(2)

12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)				☐


13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
	44.6% (3)

14	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
	OO

(1)

Includes 13,744,582 Common Units (as defined herein) and an equal number of paired shares of Class C Common Stock (as defined herein), which together may be redeemed by the holder for shares of Class A Common Stock (as defined herein) on a one-for-one basis.

(2)

Includes 804,659 shares of Class A Common Stock which the Reporting Persons may acquire under the terms of the Contribution Allocation Agreement (as defined herein).

(3)

Percentage ownership calculated based on the sum of (i) 16,246,460 shares of Class A Common Stock outstanding as of January 31, 2022, as reported in the Issuer’s annual report on Form 10-K filed on February 22, 2022, (ii) the 2,650,000 shares of Class A Common Stock issued in the Conversion (as defined herein), and (iii) the 13,744,582 shares of Class A Common Stock issuable to the Reporting Persons upon redemption of the Common Units and corresponding shares of Class C Common Stock owned by the Reporting Persons, which shares have been added to the total shares of Class A Common Stock outstanding pursuant to Rule 13d-3(d)(3)(1)(i) under the Act.

	SCHEDULE 13D
CUSIP No. 02215L209		Page 3 of 23 Pages

1	NAMES OF REPORTING PERSONS
	I Squared Capital, LLC

2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP			(a)	☐
				(b)	☒

3	SEC USE ONLY


4	SOURCE OF FUNDS (SEE INSTRUCTIONS)
	OO

5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(D) OR 2(E)				☐


6	CITIZENSHIP OR PLACE OF ORGANIZATION
	Cayman Islands

NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER
			0

		8	SHARED VOTING POWER
			14,549,241 (1)(2)

		9	SOLE DISPOSITIVE POWER
			0

		10	SHARED DISPOSITIVE POWER
			14,549,241 (1)(2)

11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
	14,549,241 (1)(2)

12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)				☐


13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
	44.6% (3)

14	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
	OO, HC

(1)

(2)

Includes 804,659 shares of Class A Common Stock which the Reporting Persons may acquire under the terms of the Contribution Allocation Agreement (as defined herein).

(3)

	SCHEDULE 13D
CUSIP No. 02215L209		Page 4 of 23 Pages

1	NAMES OF REPORTING PERSONS
	ISQ Holdings, LLC

2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP			(a)	☐
				(b)	☒

3	SEC USE ONLY


4	SOURCE OF FUNDS (SEE INSTRUCTIONS)
	OO

5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(D) OR 2(E)				☐


6	CITIZENSHIP OR PLACE OF ORGANIZATION
	Cayman Islands

NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER
			0

		8	SHARED VOTING POWER
			14,549,241 (1)(2)

		9	SOLE DISPOSITIVE POWER
			0

		10	SHARED DISPOSITIVE POWER
			14,549,241 (1)(2)

11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
	14,549,241 (1)(2)

12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)				☐


13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
	44.6% (3)

14	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
	OO, HC

(1)

(2)

Includes 804,659 shares of Class A Common Stock which the Reporting Persons may acquire under the terms of the Contribution Allocation Agreement (as defined herein).

(3)

	SCHEDULE 13D
CUSIP No. 02215L209		Page 5 of 23 Pages

Item 1.

Security and Issuer

This statement on Schedule 13D (this “Schedule 13D”) relates to the Class A common stock, par value $0.0001 per share (the “Class A Common Stock”), of Kinetik Holdings Inc., a Delaware corporation formerly known as Altus Midstream Company (the “Issuer”). The principal executive offices of the Issuer are located at 2700 Post Oak Boulevard, Suite 300, Houston, Texas 77056.

Item 2.

Identity and Background

(a-c, f) This Schedule 13D is being filed jointly, pursuant to Rule 13d-1(k) under the Act, by each of the following persons (each, a “Reporting Person” and, collectively, the “Reporting Persons”):

(i)

ISQ Global Fund II GP, LLC, a Delaware limited liability company (“Fund II GP”);

(ii)

I Squared Capital, LLC, a Cayman Islands limited liability company (“I Squared Capital”); and

(iii)

ISQ Holdings, LLC, a Cayman Islands limited liability company (“ISQ Holdings”).

This Schedule 13D relates to the common units representing limited partner interests (“Common Units”) in Kinetic Holdings LP, a Delaware limited partnership and subsidiary of the Issuer and an equal number of paired shares of Class C Common Stock, par value $0.0001 per share (“Class C Common Stock”) of the Issuer, distributed to Buzzard Midstream LLC from New Raptor (as defined in Item 4 below) in connection with the consummation of the transactions contemplated by the Contribution Agreement (as defined in Item 4 below). Fund II GP is the general partner of the members of the indirect owners of Buzzard Midstream LLC and, in such capacity, exercises voting and investment power over the securities directly held by Buzzard Midstream LLC. The primary business purpose of Fund II GP is to serve as general partner to various investment funds that specialize in infrastructure and related assets. I Squared Capital is the sole member of Fund II GP. ISQ Holdings is the managing member of I Squared Capital. Each of Sadek Magdi Wahba, Gautam Bhandari and Adil Rahmathulla is a member of ISQ Holdings but, in reliance on the “rule of three”, disclaim beneficial ownership over the shares of Class A Common Stock reported herein as beneficially owned by the Reporting Persons.

The address of the principal business office of each of the Reporting Persons is 600 Brickell Avenue, Penthouse, Miami, Florida 33131-3067.

(d) During the last five years, none of the Reporting Persons has been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors).

(e) During the last five years, none of the Reporting Persons has been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and, as a result of such proceeding, was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.

Item 3.

Source and Amount of Funds or Other Consideration

The response to Item 4 of this Schedule 13D is hereby incorporated by reference herein.

The Common Units, shares of Class C Common Stock and shares of Class A Common Stock to which this Schedule 13D relates have not been purchased by the Reporting Persons. Instead, the 13,744,582 Common Units and corresponding shares of Class C Common Stock held directly by Buzzard Midstream LLC were distributed to Buzzard Midstream LLC, in kind and pro rata, from New Raptor (as defined in Item 4 below) pursuant to the Distribution (as defined in Item 4 below). The 804,659 shares of Class A Common Stock that Buzzard Midstream LLC has the right to acquire pursuant to the Consideration Allocation Rights (as defined in Item 4 below) are subject to the terms and conditions of the Consideration Allocation Agreement and relevant Restricted Stock Agreements (each as defined in Item 4 below).

Item 4.

Purpose of Transaction

The Reporting Persons acquired the securities reported herein in connection with the transactions described below, for investment purposes and subject to the terms and conditions set forth in the agreements described below.

Contribution Agreement and Closing

On February 22, 2022 (the “Closing”), the transactions contemplated by the contribution agreement dated October 21, 2021 (the “Contribution Agreement”) by and among the Issuer, Altus Midstream LP (the “Partnership”), New BCP Raptor Holdco, LLC (“New Raptor”), and, solely for the purposes set forth therein, BCP Raptor Holdco, LP (“Raptor”) were consummated. Pursuant to the Contribution Agreement, New Raptor contributed all of the equity interests of Raptor and BCP Raptor Holdco GP, LLC (“Raptor GP”) to the Partnership in exchange for 50,000,000 common units representing limited partner interests in the Partnership (“Common Units”) and a corresponding 50,000,000 shares of shares of Class C common stock, par value $0.0001 per share, of the Issuer (the “Class C Common Stock” and, together with the Class A Common Stock, the “Common Stock”).

In connection with the receipt of the such Common Units and shares of Class C Common Stock, 2,650,000 Common Units were redeemed on a one-for-one basis for shares of Class A Common Stock (the “Conversion”), with those shares being subject to forfeiture back to the Issuer in certain circumstances (“Restricted Shares”), and an equal number of paired shares of Class C Common Stock were cancelled. The Issuer agreed that it would re-issue, on a one-for-one basis, shares of Class A Common Stock to the extent Restricted Shares are forfeited (such rights, “Consideration Allocation Rights,” and together with the Common Units and Class C Common Stock received at Closing, the “Equity Consideration”). As discussed below, Class A Common Stock will be issued pursuant to Consideration Allocation Rights solely to the extent a corresponding forfeiture of Restricted Shares has occurred.

	SCHEDULE 13D
CUSIP No. 02215L209		Page 6 of 23 Pages

New Raptor then distributed the Equity Consideration on a pro rata basis, subject to certain transfer restrictions and, in the case of the Restricted Shares of Class A Common Stock, forfeiture provisions set forth on the legends thereto (the “Distribution”). In connection with Distribution, Buzzard Midstream LLC received 13,744,582 Common Units and an equal number of paired shares of Class C Common Stock.

The transactions contemplated by the Contribution Agreement, the Conversion and the Distribution are collectively referred to herein as the “Transactions.”

Pursuant to the Contribution Agreement, in connection with the Closing, the Issuer agreed to cause its board of directors (the “Board”) to consist of: (i) the chief executive officer of the Issuer following Closing; (ii) three (3) directors designated by Blackstone Energy Partners II L.P. (“Blackstone Energy”), an affiliate of Blackstone Inc (“Blackstone”); (iii) two (2) directors designated by ISQ Global Infrastructure Fund II L.P., whose general partner is Fund II GP and who is under common control with Buzzard Midstream LLC (collectively, “ISQ”); (iv) one (1) director designated by APA Corporation (“Apache”); and (v) four (4) directors that would qualify as independent for purposes of service on the audit committee of the Issuer under NASDAQ rules, the Act, and the Sarbanes-Oxley Act of 2002, two (2) of whom shall be designated by Apache and two (2) of whom shall be designated by New Raptor; provided, that each of Apache and New Raptor shall have one (1) (but no more than one (1)) opportunity to veto one (1) of such other person’s designees under this clause (v) in its sole discretion but shall have no further veto or similar right with respect to any other designee of such person under this clause (v) (collectively, the “Contribution Agreement Board Composition”).

The two directors designated by ISQ were Thomas Lefebvre and Joseph Payne, each of whom is an employee of an affiliate of ISQ. ISQ’s continuing right to designate directors to the Board depends, in part, on its beneficial ownership of the outstanding Common Stock, as set forth in the A&R Stockholders Agreement (defined and described below).

Also in connection with Closing, pursuant to the Contribution Agreement and following receipt of requisite stockholder approval on February 10, 2022, the Issuer executed and submitted the Third Amended and Restated Certificate of Incorporation and duly adopted the Amended and Restated Bylaws, in each case in a form attached to the Contribution Agreement, which provide, among other things and subject to certain limitations and exceptions, (i) stockholders of the Issuer may act by written consent in lieu of holding a meeting of the stockholders, (ii) stockholders of the Issuer that own more than 10% of the outstanding shares of Common Stock may call a special meeting of the stockholders, (iii) directors on the Board may be removed with or without cause and (iv) revisions to the Corporate Opportunities article in the Issuer’s Second Amended and Restated Certificate of Incorporation (collectively, the “Amendments to the Certificate of Incorporation”).

The foregoing description of the Contribution Agreement does not purport to be complete and is subject to, and is qualified in its entirety by, the full text of the Contribution Agreement, which is filed as Exhibit B to this Schedule 13D and is also incorporated herein by reference.

Consideration Allocation Agreement

In connection with the Closing, certain members of management of Raptor (each, a “Grantee”) entered into a Restricted Stock Agreement with the Issuer (the “Restricted Stock Agreements”) which imposed certain restrictions on the shares of Class A Common Stock and/or Common Units and corresponding shares of Class C Common Stock distributed to the Grantee as their pro rata allocation of the consideration from the Contribution Agreement (“Awards”).

Also in connection with the Closing, on February 22, 2022, the Issuer, Buzzard Midstream LLC, BCP Raptor Aggregator, LP, BX Permian Pipeline Aggregator LP and certain individuals identified therein entered into a Consideration Allocation Agreement (the “Consideration Allocation Agreement”) pursuant to which the non-Issuer parties received the Consideration Allocation Rights, the terms of which entitle the holders thereof to receive, on a one-for-one basis, additional shares of Class A Common Stock originally issued as consideration in connection with the Transactions to the extent such shares of Class A Common Stock originally issued as consideration are forfeited by the original holders thereof. Forfeiture of Awards under the Restricted Stock Agreements may occur as follows: (i) with respect to 197,708 shares of Class A Common Stock (the “MOIC Restricted Shares”), if Buzzard Midstream LLC and its affiliates receive less than $882,887,056.14 in cash proceeds from Transfers (as such term is defined in the relevant Restricted Stock Agreement ) of Common Units and/or Common Stock effected between the Closing and February 25, 2028, and (ii) with respect to the remaining Awards, due to termination of service or employment by February 25, 2025 or February 25, 2026.

Specifically, the parties to the Consideration Allocation Agreement agreed that, solely to the extent that any Award is forfeited by a Grantee, in whole or in part, from and after February 22, 2022 pursuant to the applicable Restricted Stock Agreement (a “Forfeited Award”), the number of shares subject to such Forfeited Award shall be re-allocated as follows: (i) with respect to any forfeited MOIC Restricted Shares, including any former MOIC Restricted Shares that become Ordinary Restricted Shares (as defined in the applicable Restricted Stock Agreement) pursuant to the applicable Restricted Stock Agreement, 100% to Buzzard Midstream LLC and its affiliates, (ii) with respect to any forfeited Ordinary Restricted Shares, 18.53% to Buzzard Midstream LLC and its affiliates, and the remainder of any such Ordinary Restricted Shares to the holders identified in Schedule I of the Consideration Allocation Agreement (the “Holders”) other than Buzzard Midstream LLC, pro rata in proportion to their respective percentage interests (as adjusted accordingly) as set forth opposite such Holders’ names on Schedule I and (iii) with respect to any forfeited Restricted Shares not covered by clauses (i) and (ii), to each of the Holders, pro rata in proportion to their respective percentage interests as set forth opposite such Holders’ names on Schedule I (collectively, the “Re-Allocation Issuances”), which Re-Allocation Issuances shall be in the form of unrestricted shares of Class A Common Stock (other than restrictions imposed by federal and state securities laws or any contractual restrictions applicable to the Holders) and shall be delivered by the Issuer to the applicable Holder(s) quarterly, on the date that is one (1) business day immediately prior to the dividend record date for the applicable calendar quarter.

	SCHEDULE 13D
CUSIP No. 02215L209		Page 7 of 23 Pages

Pursuant to the Contribution Allocation Agreement, Buzzard Midstream LLC received Consideration Allocation Rights to acquire up to an additional 804,659 shares of Class A Common Stock. Such shares of Class A Common Stock will be issued solely to the extent a corresponding forfeiture of specified shares has occurred pursuant to the terms of the relevant Restricted Stock Agreements.

The foregoing description of each of the Restricted Stock Agreements and Consideration Allocation Agreement does not purport to be complete and is subject to, and is qualified in its entirety by, the full text of each of the form of each Restricted Stock Agreement and the form of Consideration Allocation Agreement, each of which is filed as Exhibit C, Exhibit D and Exhibit E, respectively, and is also incorporated herein by reference.

Amended and Restated Stockholders Agreement

On February 22, 2022, the Issuer entered into an amended and restated stockholders agreement dated October 21, 2021 (“A&R SHA”) with Apache, Apache Midstream LLC (“Apache Midstream”), New Raptor, BCP Aggregator, BX Permian, Buzzard Midstream LLC and the other parties thereto (“Subject Shareholders”) and, solely for purposes of Sections 2(a)(iv) and 2(a)(v), Raptor.

The A&R SHA provides for continuing director nomination rights for each of Apache, Blackstone and Buzzard Midstream LLC. Specifically, Buzzard Midstream LLC will have the right to designate two directors for so long as ISQ and its affiliates beneficially own 20% or more of the outstanding Common Stock and one director for so long as Buzzard Midstream LLC and its affiliates beneficially own 10% or more but less than 20% of the outstanding Common Stock.

Pursuant to the A&R SHA, the Subject Shareholders and Apache Midstream each agreed with the Issuer, subject to certain limitations and exceptions, not to Transfer (as defined in the A&R SHA) Subject Securities (as defined in the A&R SHA) for 12 months following the Closing.

The A&R SHA also provides that, subject to applicable law and other limitations, following Closing the Issuer shall not reduce its dividends on shares of Class A Common Stock below $1.50 a quarter through December 31, 2023 without the prior written consent of Apache Midstream and certain affiliates of Blackstone and Buzzard Midstream LLC for so long as such persons are entitled to nominate a director pursuant to the A&R SHA. Pursuant to the A&R SHA, any Covered Related Party Transaction (as defined in the A&R SHA) following Closing requires the prior approval of 66% or more of the disinterested directors on the Board, as determined by the Board. Finally, pursuant to the A&R SHA, the parties agreed to negotiate and enter into the DRIP Agreement, defined and described below.

The A&R SHA terminates automatically as to a party upon the later of (i) twelve months following the Closing and (ii) when such party (including such party’s affiliates) ceases to beneficially own at least 10% of the outstanding shares of Common Stock.

The foregoing description of the A&R SHA does not purport to be complete and is qualified in its entirety by the full text of each of the A&R SHA, which is filed as Exhibit F and is also incorporated herein by reference.

Voting Agreement

The Issuer also entered into a voting agreement with Buzzard Midstream LLC (the “Voting Agreement”), which became effective at Closing, pursuant to which Buzzard Midstream LLC agreed to vote all shares of Common Stock held of record by it (and beneficially owned by the Reporting Persons) in favor of individuals designated to the Board pursuant to the A&R SHA. Apache and Apache Midstream as well as an affiliate of Blackstone also entered into a similar voting agreement with the Issuer.

The foregoing description of the Voting Agreement does not purport to be complete and is qualified in its entirety by the full text of each of the Voting Agreement, which is filed as Exhibit G and is also incorporated herein by reference.

Second Amended and Restated Registration Rights Agreement

On February 22, 2022, the Issuer entered into a Second Amended and Restated Registration Rights Agreement (as amended and restated, the “Second A&R RRA”) with Apache Midstream, BCP Aggregator, BX Permian, Buzzard Midstream LLC, and the other parties listed on the signature pages thereto (collectively, with their respective permitted transferees, the “Principal Holders”) and certain individual holders party thereto (the “Existing Holders” and, together with the principal holders, the “RRA Holders”), which amended and restated the existing amended and restated registration rights agreement, dated as of November 9, 2018, among the Issuer, Kayne Anderson Sponsor, LLC, and Apache Midstream.

The Second A&R RRA provides the RRA Holders with certain registration rights with respect to (i) the private placement warrants (including any shares of Class A Common Stock issued or issuable upon the exercise of such private placement warrants) held by any Existing Holders, (ii) any outstanding shares of Class A Common Stock or any other equity security (including the shares of Class A Common Stock issued or issuable upon the exercise of any other equity security) of the Issuer owned by any RRA Holder as of the date of the Second A&R RRA, (iii) the shares of Class A Common Stock issued or issuable upon the redemption or exchange of any Common Units and Class C Common Stock owned by any RRA Holder, in each case in accordance with the terms of the Partnership’s partnership agreement, (iv) any shares of Class A Common Stock issued or issuable upon the exercise of any warrants held by Apache Midstream, (v) any other equity security of the Issuer issued or issuable with respect to any registrable security by way of a stock dividend or stock split or in connection with a combination of shares, recapitalization, merger, consolidation, or reorganization, (vi) the shares of Common Stock, if any, issued to Apache Midstream in connection with the earn-out consideration pursuant to the contribution agreement dated August 8, 2018 among the Issuer, the Partnership, Apache Midstream, and the other parties thereto, and (vii) any shares of Class A Common Stock issued to any RRA Holder in connection with the dividend reinvestment plan (collectively, “registrable securities”).

	SCHEDULE 13D
CUSIP No. 02215L209		Page 8 of 23 Pages

The Second A&R RRA will require the Issuer to file, within 90 days of Closing, a registration statement on Form S-3 (or, if Form S-3 is not then available, on Form S-1) to permit the public resale of all registrable securities held by the Principal Holders, other than any registrable securities that are registered for sale on a registration statement filed prior to the execution of the Second A&R RRA and effective as of the Closing.

Demand Registration, Underwritten Offering and Piggyback Rights

RRA Holders will also be entitled to certain demand rights, pursuant to which RRA Holders will also be entitled to require the Issuer to effectuate a distribution of any or all of its registrable securities by means of an underwritten offering, provided that the Issuer will not be obligated to effect an underwritten offering unless the dollar amount of the registrable securities of the demanding RRA Holders and their respective affiliates to be included therein is reasonably likely to result in gross sale proceeds that exceed the Minimum Amount.

Lock-Up Period

Subject to certain limitations, including as required in connection with the initial registration of registrable securities on Form S-3 (or Form S-1 if Form S-3 is not then available) pursuant to the Second A&R RRA, no registration shall be effected or permitted with respect to any registrable securities held by any RRA Holder until after the expiration of the lock-up period, which occurs, with respect to the Principal Holders, 12 months after the Closing.

Priority Window

The Principal Holders have agreed that, for a period of time after the 12-month lock-up period, Buzzard Midstream LLC will have certain priority registration rights over each of Apache and Blackstone (and their permitted transferees), subject, in each case, to certain limitations contained in the Second A&R RRA.

The foregoing description of the Second A&R RRA does not purport to be complete and is subject to, and is qualified in its entirety by, the full text of the Second A&R RRA, which is filed as Exhibit H and is also incorporated herein by reference.

Dividend and Distribution Reinvestment Agreement

On February 22, 2022, in connection with Closing, the Issuer entered into a Dividend and Distribution Reinvestment Agreement (the “DRIP Agreement”) with the Partnership, Apache, Apache Midstream, Buzzard Midstream LLC, BCP Raptor Aggregator, LP, BX Permian Pipeline Aggregator LP, New Raptor and certain other individuals associated with New Raptor (collectively, the “Reinvestment Holders”). The Drip Agreement obligates each Reinvestment Holder to reinvest in shares of Class A Common Stock at least 20% of all distributions on Common Units or dividends on shares of Class A Common Stock held by such Reinvestment Holder immediately after the Closing, including shares of Class A Common Stock received at a later date in exchange for Common Units held immediately after Closing (the “Mandatory DRIP”). The Reinvestment Agreement provides the audit committee of the Board with the authority to at any time increase the percentage of the mandatory dividend reinvestment to up to 100% of such distributions or dividends or decrease such percentage to not less than 20%. The mandatory obligations of each Reinvestment Holder will continue from Closing until the earliest of (i) March 31, 2024, (ii) the date dividends and distributions are paid by the Issuer and the Partnership, respectively, in respect of the quarter ending December 31, 2023, and (iii) such other date determined by the audit committee of the Board. All shares of Class A Common Stock issued in connection with the Mandatory DRIP will be valued at a 3% discount to the volume weighted average price for the five trading days immediately preceding, but excluding, the applicable dividend or distribution date.

The foregoing description of the DRIP Agreement does not purport to be complete and is subject to, and is qualified in its entirety by, the full text of the DRIP Agreement, which is filed as Exhibit I and is also incorporated herein by reference.

Third Amended and Restated Agreement of Limited Partnership of the Partnership

On February 22, 2022, the Third Amended and Restated Agreement of Limited Partnership of the Partnership dated October 21, 2021 (the “Third A&R LPA”) became effective as a result of the Closing of the Transactions. The Third A&R LPA provides for, among other things, admission of New Raptor, the BX Holders and Buzzard Midstream LLC as limited partners thereunder, updates to certain tax-related provisions, and amendment of certain provisions relating to the Series A Preferred Units.

Pursuant to the Third A&R LPA, each holder of Common Units (other than the Issuer) generally has the right to cause the Partnership to redeem all or a portion of its Common Units in exchange for shares of Class A Common Stock or, at the Partnership’s option, an equivalent amount of cash; provided that the Issuer may, at its option, effect a direct exchange of cash or Class A Common Stock for such Common Units in lieu of such a redemption by the Partnership. Upon any redemption or exchange of Common Units, an equal number of paired shares of Class C Common Stock will be cancelled.

	SCHEDULE 13D
CUSIP No. 02215L209		Page 9 of 23 Pages

The foregoing description of the Third A&R LPA does not purport to be complete and is subject to, and is qualified in its entirety by, the full text of the Third A&R LPA, which is filed as Exhibit J and is also incorporated herein by reference.

Tag Right Letter Agreement

In connection with the Closing, on February 25, 2022, Buzzard Midstream LLC entered into a tag-along right letter agreement (“Tag Right Letter Agreement”) with each of BCP Raptor Aggregator, LP and BX Permian Pipeline Aggregator LP (together, the “Blackstone Parties”) pursuant to which, in the event of any direct or indirect sale by either the Blackstone Parties or Buzzard Midstream LLC of 10% or more of the outstanding Common Stock of the Issuer to a non-affiliate, the other party has certain tag along rights to participate in such sale.

The foregoing description of the Tag Right Letter Agreement does not purport to be complete and is subject to, and is qualified in its entirety by, the full text of the Tag Right Letter Agreement, which is filed as Exhibit K and is also incorporated herein by reference.

* * *

The Reporting Persons intend to review on a continuing basis their investment in the Issuer. The Reporting Persons, including through their affiliates, may communicate or otherwise engage with the Board, members of management, other stockholders, advisors or other persons from time to time with respect to, among other things, operational, strategic, financial or governance matters, including but not limited to the evaluation of possible joint ventures, strategic alternatives and other opportunities to maximize stockholder value. The Reporting Persons, including through their affiliates, may also discuss, consider or formulate a plan or proposal which may relate to or result in: (i) the purchase of additional securities of the Issuer or related derivatives of the Issuer in the open market, in privately negotiated transactions or otherwise; (ii) the sale of all or a portion of the securities of the Issuer or related derivatives of the Issuer now beneficially owned or hereafter acquired by them; (iii) an extraordinary corporate transaction, such as a merger, business combination, reorganization or liquidation, involving the Issuer or any of its subsidiaries; (iv) a purchase, sale or transfer of a material amount of the assets of the Issuer or any of its subsidiaries; (v) a change in the present board of directors or management of the Issuer, including any plans or proposals to change the number or term of directors or to fill any existing vacancies on the board; (vi) a material change in the present capitalization or dividend policy of the Issuer; (vii) any other material change in the Issuer’s business or corporate structure; (viii) a change in the Issuer’s charter or bylaws or other instrument corresponding thereto or other action which may impede the acquisition of control of the Issuer by any person; (ix) causing a class of the Issuer’s securities to be delisted from a national securities exchange or deregistered under the Act; or (x) any action similar to any of those enumerated above. Such discussions and actions may be preliminary and exploratory in nature, and not rise to the level of a plan or proposal, and are subject to the agreements described herein. Any transaction that the Reporting Persons may pursue may be made at any time and from time to time without prior notice and will depend on a variety of factors, including, without limitation, the price and availability of the Issuer’s securities, subsequent developments affecting the Issuer, the Issuer’s business and the Issuer’s prospects, other investment and business opportunities available to the Reporting Persons, general industry and economic conditions, the securities markets in general, tax considerations and other factors deemed relevant by the Reporting Persons.

Towards that end, in each of his capacity as a director on the Board, each of Mr. Lefebvre and Mr. Payne may have influence over the corporate activities of the Issuer, including activities that may relate to items described in subparagraphs (a) through (j) of Item 4 of Schedule 13D.

Except as described in this Schedule 13D, the Reporting Persons do not have any present plans or proposals that relate to or would result in any of the actions described in subparagraphs (a) through (j) of Item 4 of Schedule 13D, although, subject to the agreements described herein, the Reporting Persons, at any time, and from time to time, may review, reconsider and change their position and/or change their purpose and/or develop such plans and may seek to influence management of the Issuer or the Board with respect to the business and affairs of the Issuer and may from time to time consider pursuing or proposing such matters with advisors, the Issuer, or other persons.

Item 5.

Interest in Securities of the Issuer

(a) and (b) As of the date hereof, each of the Reporting Persons may be deemed the beneficial owner of 14,549,241 shares of Class A Common Stock, which represents approximately 44.6% of the Class A Common Stock outstanding, as calculated pursuant to Rule 13d-3(d)(1)(i) under the Act. This amount consists of (i) 13,744,582 Common Units and an equal number of paired shares of Class C Common Stock, which together may be redeemed by the holder for shares of Class A Common Stock on a one-for-one basis (or, at the Partnership’s option, an equivalent amount of cash), and (ii) 804,659 shares of Class A Common Stock which the Reporting Persons may acquire under the terms of the Contribution Allocation Agreement (as defined herein).

Each of the Reporting Persons may be deemed to have shared, not sole, power to vote or to direct the vote, and shared, not sole, power to dispose or to direct the disposition, of the 14,549,241 shares of Class A Common Stock reported herein as beneficially owned by the Reporting Persons.

	SCHEDULE 13D
CUSIP No. 02215L209		Page 10 of 23 Pages

The percentage ownership reported herein is calculated based on the sum of (i) 16,246,460 shares of Class A Common Stock outstanding as of January 31, 2022, as reported in the Issuer’s annual report on Form 10-K filed on February 22, 2022, (ii) the 2,650,000 shares of Class A Common Stock issued in the Conversion (as defined herein), and (iii) the 13,744,582 shares of Class A Common Stock issuable to the Reporting Persons upon redemption of the Common Units and corresponding number of Class C Common Stock owned by the Reporting Persons, which shares have been added to the total shares of Class A Common Stock outstanding pursuant to Rule 13d-3(d)(3)(1)(i) under the Act.

In discussing certain agreements and arrangements in Item 4 of this Schedule 13D, the Reporting Persons (including through certain of their affiliates) describe arrangements involving Blackstone and Apache and certain of their respective affiliates. However, neither the filing of this Schedule 13D nor any of its contents shall be deemed to constitute an admission that the Reporting Persons are members of a “group” for purposes of Section 13(d) of the Act with such other persons. Each Reporting Person disclaims being a member of a “group” with Blackstone, Apache and/or their respective affiliates and further disclaims beneficial ownership of the shares of Class A Common Stock that may be deemed to be beneficially owned by such persons.

(c) Except as set forth in Item 4 of this Schedule 13D, none of the Reporting Persons has effected any transaction in Class A Common Stock in the past 60 days.

(d) To the best of their knowledge, the Reporting Persons are not aware of any other persons, other than the Reporting Persons and their affiliates, members, partners and/or investors, who have the right to receive dividends from, or the proceeds from the sale of, any shares of Class A Common Stock reported herein.

(e) This Item 5(e) is not applicable.

Item 6.

Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer

The response to Item 4 of this Schedule 13D is hereby incorporated by reference herein.

The Reporting Persons have entered into a Joint Filing Agreement, filed as Exhibit A to this Schedule 13D, pursuant to which they have agreed to file this Schedule 13D, including any amendments thereto, jointly pursuant to Rule 13d-1(k) under the Act.

Except as otherwise set forth in this Schedule 13D, there are no contracts, arrangements, understandings or relationships between the Reporting Persons and any other person with respect to any securities of the Issuer.

Item 7.

Material to be Filed as Exhibits

Exhibit A

Joint Filing Agreement, by and among the Reporting Persons, dated March 4, 2022 (filed herewith).

Exhibit B

Contribution Agreement, dated October 21, 2021, by and among Altus Midstream Company, Altus Midstream LP, New BCP Raptor Holdco, LLC, and BCP Raptor Holdco, LP (incorporated by reference to Exhibit 2.1 to the Issuer’s Current Report on Form 8-K filed on October 21, 2021).

Exhibit C

Form of Consideration Allocation Agreement, dated as of February 22, 2022, by and among Altus Midstream Company, Buzzard Midstream LLC, BX Permian Pipeline Aggregator LP, BCP Raptor Aggregator, LP, Jamie Welch, Chris Evans, Tyler Milam and Misty Williams (filed herewith).

Exhibit D

Form of Standalone Restricted Stock Agreement – Welch (filed herewith).

Exhibit E

Form of Restricted Stock Agreement (filed herewith).

Exhibit F

Amended and Restated Stockholders Agreement, dated October 21, 2021, by and among APA Corporation, Apache Midstream LLC, Altus Midstream Company, New BCP Raptor Holdco, LLC, Raptor Aggregator, LP, BX Permian Pipeline Aggregator, LP, Buzzard Midstream LLC, and BCP Raptor Holdco, LP. (incorporated by reference to Exhibit 4.1 to the Issuer’s Current Report on Form 8-K filed on February 28, 2022).

Exhibit G

Voting Agreement, dated as of October 21, 2021, by and among Buzzard Midstream LLC and Altus Midstream Company (incorporated by reference to Exhibit 10.5 to the Issuer’s Current Report on Form 8-K filed on February 28, 2022).

Exhibit H

Second Amended and Restated Registration Rights Agreement, dated February 22, 2022, by and among Altus Midstream Company, Apache Midstream LLC, Raptor Aggregator, LP, BX Permian Pipeline Aggregator, LP, Buzzard Midstream LLC and the other holders party thereto (incorporated by reference to Exhibit 4.2 to the Issuer’s Current Report on Form 8-K filed on February 28, 2022).

Exhibit I

Dividend and Distribution Reinvestment Agreement, dated February 22, 2022, by and among Altus Midstream Company, Altus Midstream LP, APA Corporation, Apache Midstream LLC, Buzzard Midstream LLC, Raptor Aggregator, LP, BX Permian Pipeline Aggregator, LP and each of the other parties set forth on the signature pages thereto (incorporated by reference to Exhibit 10.2 to the Issuer’s Current Report on Form 8-K filed on February 28, 2022).

Exhibit J

Third Amended and Restated Agreement of Limited Partnership of Altus Midstream LP (n/k/a Kinetik Holdings LP), dated October 21, 2021 incorporated by reference to Exhibit 10.1 to the Issuer’s Current Report on Form 8-K filed on February 28, 2022).

Exhibit K

Tag Right Letter Agreement dated February 25, 2022, by and among BCP Raptor Aggregator, LP, BX Permian Pipeline Aggregator LP and Buzzard Midstream LLC (filed herewith).

	SCHEDULE 13D
CUSIP No. 02215L209		Page 11 of 11 Pages

SIGNATURE

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

Dated: March 4, 2022

	ISQ Global Fund II GP, LLC

	By:	/s/ Adil Rahmathulla
		Name: Adil Rahmathulla
		Title: Director

	I Squared Capital, LLC

	By:	ISQ Holdings, LLC, its managing member

	By:	/s/ Adil Rahmathulla
		Name: Adil Rahmathulla
		Title: Manager

	ISQ Holdings, LLC

	By:	/s/ Adil Rahmathulla
		Name: Adil Rahmathulla
		Title: Manager

Exhibit A

JOINT FILING AGREEMENT

The undersigned hereby agree that the statement on Schedule 13D with respect to the Class A Common Stock of Kinetik Holdings Inc., dated as of March 4, 2022 is, and any amendments thereto (including amendments on Schedule 13G) signed by each of the undersigned shall be, filed on behalf of each of us pursuant to and in accordance with the provisions of Rule 13d-1(k) under the Securities Exchange Act of 1934, as amended.

Dated: March 4, 2022

	ISQ Global Fund II GP, LLC

	By:	/s/ Adil Rahmathulla
		Name: Adil Rahmathulla
		Title: Director

	I Squared Capital, LLC

	By:	ISQ Holdings, LLC, its managing member

	By:	/s/ Adil Rahmathulla
		Name: Adil Rahmathulla
		Title: Manager

	ISQ Holdings, LLC

	By:	/s/ Adil Rahmathulla
		Name: Adil Rahmathulla
		Title: Manager

Exhibit C

CONSIDERATION ALLOCATION AGREEMENT

February 22, 2022

Ladies and Gentlemen:

Reference is made to that certain Contribution Agreement by and among Altus Midstream Company, a Delaware corporation (the “Company”), Altus Midstream LP, a Delaware limited partnership, New BCP Raptor Holdco, LLC, a Delaware limited liability company, and solely for the purposes set forth therein, BCP Raptor Holdco, LP, a Delaware limited partnership (“Raptor”), dated October 21, 2021 (the “Contribution Agreement”). Capitalized terms used in this Consideration Allocation Agreement (this “Consideration Allocation Agreement”) but not otherwise defined herein shall have the meanings ascribed to such terms in the Contribution Agreement. This Consideration Allocation Agreement shall be effective upon Closing.

In connection with the transactions contemplated by the Contribution Agreement, certain members of management of Raptor holding Class A-1, Class A-2 and Class A-3 units in Raptor (“Grantees”) were distributed awards (“Awards”) of shares of Company Class A Common Stock and/or Common Units and corresponding shares of Company Class C Common Stock as their pro rata allocation of the consideration from the Contribution Agreement, subject to the restrictions set forth in those certain Restricted Stock Agreements between each Grantee and the Company, dated as of the date hereof (the “Restricted Stock Agreements”) (and such securities, the “Restricted Shares”), which restrictions, together with this Consideration Allocation Agreement, are intended to give effect to the allocation of the Contribution Agreement consideration agreed upon by the Grantees and Holders (as defined below).

The parties to this Consideration Allocation Agreement hereby acknowledge and agree that, solely to the extent that any Award is forfeited by a Grantee, in whole or in part, from and after the date hereof pursuant to the applicable Restricted Stock Agreement (a “Forfeited Award”), the number of Restricted Shares subject to such Forfeited Award shall be re-allocated to each of the holders set forth on Schedule I hereto (the “Holders”) as follows: (i) with respect to any forfeited MOIC Restricted Shares (as defined in the applicable Restricted Stock Agreement), including any former MOIC Restricted Shares that become Ordinary Restricted Shares (as defined in the applicable Restricted Stock Agreement) pursuant to the applicable Restricted Stock Agreement, 100% to ISQ (as defined in the applicable Restricted Stock Agreement), (ii) with respect to any forfeited Ordinary Restricted Shares, 18.53% to ISQ and the remainder of any such Ordinary Restricted Shares to the Holders (other than ISQ), pro rata in proportion to their respective percentage interests (as adjusted accordingly) as set forth opposite such Holders’ names on Schedule I hereto and (iii) with respect to any forfeited Restricted Shares not covered by clauses (i) and (ii), to each of the Holders, pro rata in proportion to their respective percentage interests as set forth opposite such Holders’ names on Schedule I hereto (collectively, the “Re-Allocation Issuances”), which Re-Allocation Issuances shall be in the form of unrestricted shares of Company Class A Common Stock (other than restrictions imposed by federal and state securities Laws or any contractual restrictions applicable to the Holders) and shall be delivered by the Company to the applicable Holder(s) quarterly, on the date that is two (2) Business Days immediately prior to the dividend record date for the applicable calendar quarter; provided, that for the avoidance of doubt, no Holder will be entitled to any shares of Company Class A Common Stock or any other class or series of capital stock of the Company under this Consideration Allocation Agreement to the extent a corresponding forfeiture of Restricted Shares does not occur. The Company shall effect all Re-Allocation Issuances hereunder by delivering one or more certificates for such shares of Company Class A Common Stock in the name of the applicable Holder(s) or by entering such shares of Company Class A Common Stock in book-entry form in the name of the applicable Holder(s), as determined by the Company Board in its sole discretion or as required by applicable Law or regulation. The value of shares of Company Class A Common Stock delivered hereunder shall not bear any interest owing to the passage of time. No action taken pursuant to or in accordance with this Consideration Allocation Agreement shall be construed to create a trust or a funded or secured obligation of any kind. It is acknowledged and agreed by the parties to this Consideration Allocation Agreement that any Holder’s rights to Re-Allocation Issuances under this Consideration Allocation Agreement may be Transferred (as defined in such Holder’s Restricted Stock Agreement) by such Holder to Affiliates or equity holders thereof from time to time, and the Company shall update Schedule I hereto from time to time to reflect any such Transfer.

This Consideration Allocation Agreement shall be governed by and construed in accordance with the Laws of the State of Delaware, without giving effect to any conflict of Law provisions thereof, except to the extent Delaware Law is preempted by federal Law.

This Consideration Allocation Agreement may be executed by in counterparts, each of which shall be deemed to be an original and all of which together shall constitute one and the same agreement. Counterparts may be delivered via e-mail (including PDF format with a scanned signature or any electronic signature complying with the U.S. Federal ESIGN Act of 2000, e.g., www.docusign.com) or other transmission method, and any counterpart so delivered will be deemed to have been duly and validly delivered and be valid and effective for all purposes.

This Consideration Allocation Agreement may not be modified or amended, and no provision hereof may be waived, except by mutual written agreement between the parties to this Consideration Allocation Agreement. The Company shall not modify, amend or waive any provision of any Restricted Stock Agreement (including accelerating the vesting of any Restricted Shares or taking action under Section 28 thereof) without the written consent of ISQ and the Blackstone Partners (as defined in the Restricted Stock Agreements).

[Signature Page Follows]

This Consideration Allocation Agreement has been entered into on the date first set forth above and signed for and on behalf of:

	COMPANY:

	ALTUS MIDSTREAM COMPANY

	By:
	Name:
	Title:

SEC Form SC 13D filed by Kinetik Holdings Inc.