CONDENSED CONSOLIDATING FINANCIAL INFORMATION | CONDENSED CONSOLIDATING FINANCIAL INFORMATION In July 2014 and June 2013, the Co-Issuers issued the Senior Notes. The Senior Notes are fully and unconditionally guaranteed, jointly and severally, on a senior unsecured basis by SMLP and the Guarantor Subsidiaries (see Note 9). The following supplemental condensed consolidating financial information reflects SMLP's separate accounts, the combined accounts of the Co-Issuers, the combined accounts of the Guarantor Subsidiaries, the combined accounts of the Non-Guarantor Subsidiaries and the consolidating adjustments for the dates and periods indicated. For purposes of the following consolidating information: • each of SMLP and the Co-Issuers account for their subsidiary investments, if any, under the equity method of accounting and • the balances and results of operations associated with the assets, liabilities and expenses that were carved out of Summit Investments and allocated to SMLP in connection with the 2016 Drop Down have been attributed to SMLP during the common control period. Condensed Consolidating Balance Sheets. Balance sheets as of December 31, 2016 and 2015 follow. December 31, 2016 SMLP Co-Issuers Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating adjustments Total (In thousands) Assets Cash and cash equivalents $ 698 $ 51 $ 5,647 $ 1,032 $ — $ 7,428 Accounts receivable 53 — 89,584 7,727 — 97,364 Other current assets 1,526 — 2,328 455 — 4,309 Due from affiliate 14,896 38,013 369,995 — (422,904 ) — Total current assets 17,173 38,064 467,554 9,214 (422,904 ) 109,101 Property, plant and equipment, net 2,266 — 1,440,180 411,225 — 1,853,671 Intangible assets, net — — 396,930 24,522 — 421,452 Goodwill — — 16,211 — — 16,211 Investment in equity method investees — — — 707,415 — 707,415 Other noncurrent assets 1,993 5,198 138 — — 7,329 Investment in subsidiaries 2,132,757 3,347,393 — — (5,480,150 ) — Total assets $ 2,154,189 $ 3,390,655 $ 2,321,013 $ 1,152,376 $ (5,903,054 ) $ 3,115,179 Liabilities and Partners' Capital Trade accounts payable $ 978 $ — $ 9,901 $ 5,372 $ — $ 16,251 Accrued expenses 2,399 114 6,069 2,807 — 11,389 Due to affiliate 408,266 — — 14,896 (422,904 ) 258 Ad valorem taxes payable 16 — 9,717 855 — 10,588 Accrued interest — 17,483 — — — 17,483 Accrued environmental remediation — — — 4,301 — 4,301 Other current liabilities 6,718 — 3,798 955 — 11,471 Total current liabilities 418,377 17,597 29,485 29,186 (422,904 ) 71,741 Long-term debt — 1,240,301 — — — 1,240,301 Deferred Purchase Price Obligation 563,281 — — — — 563,281 Deferred revenue — — 57,465 — — 57,465 Noncurrent accrued environmental remediation — — — 5,152 — 5,152 Other noncurrent liabilities 2,858 — 4,602 106 — 7,566 Total liabilities 984,516 1,257,898 91,552 34,444 (422,904 ) 1,945,506 Total partners' capital 1,169,673 2,132,757 2,229,461 1,117,932 (5,480,150 ) 1,169,673 Total liabilities and partners' capital $ 2,154,189 $ 3,390,655 $ 2,321,013 $ 1,152,376 $ (5,903,054 ) $ 3,115,179 December 31, 2015 SMLP Co-Issuers Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating adjustments Total (In thousands) Assets Cash and cash equivalents $ 73 $ 12,407 $ 6,930 $ 2,383 $ — $ 21,793 Accounts receivable — — 84,021 5,560 — 89,581 Other current assets 540 — 2,672 361 — 3,573 Due from affiliate 3,168 151,443 207,651 — (362,262 ) — Total current assets 3,781 163,850 301,274 8,304 (362,262 ) 114,947 Property, plant and equipment, net 1,178 — 1,462,623 348,982 — 1,812,783 Intangible assets, net — — 438,093 23,217 — 461,310 Goodwill — — 16,211 — — 16,211 Investment in equity method investees — — — 751,168 — 751,168 Other noncurrent assets 3,480 4,611 162 — — 8,253 Investment in subsidiaries 2,438,395 3,222,187 — — (5,660,582 ) — Total assets $ 2,446,834 $ 3,390,648 $ 2,218,363 $ 1,131,671 $ (6,022,844 ) $ 3,164,672 Liabilities and Partners' Capital Trade accounts payable $ 482 $ — $ 18,489 $ 21,837 $ — $ 40,808 Accrued expenses 1,478 — 4,832 466 — 6,776 Due to affiliate 360,243 — — 3,168 (362,262 ) 1,149 Deferred revenue — — 677 — — 677 Ad valorem taxes payable 9 — 9,881 381 — 10,271 Accrued interest — 17,483 — — — 17,483 Accrued environmental remediation — — — 7,900 — 7,900 Other current liabilities 3,080 — 2,573 868 — 6,521 Total current liabilities 365,292 17,483 36,452 34,620 (362,262 ) 91,585 Long-term debt 332,500 934,770 — — — 1,267,270 Deferred revenue — — 45,486 — — 45,486 Noncurrent accrued environmental remediation — — — 5,764 — 5,764 Other noncurrent liabilities 1,743 — 5,503 22 — 7,268 Total liabilities 699,535 952,253 87,441 40,406 (362,262 ) 1,417,373 Total partners' capital 1,747,299 2,438,395 2,130,922 1,091,265 (5,660,582 ) 1,747,299 Total liabilities and partners' capital $ 2,446,834 $ 3,390,648 $ 2,218,363 $ 1,131,671 $ (6,022,844 ) $ 3,164,672 Condensed Consolidating Statements of Operations. For the purposes of the following condensed consolidating statements of operations, we allocate general and administrative expenses recognized at the SMLP parent to the Guarantor Subsidiaries and Non-Guarantor Subsidiaries to reflect what those entities' results would have been had they operated on a stand-alone basis. Statements of operations for the years ended December 31, 2016, 2015 and 2014 follow. Year ended December 31, 2016 SMLP Co-Issuers Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating adjustments Total (In thousands) Revenues: Gathering services and related fees $ — $ — $ 288,399 $ 57,562 $ — $ 345,961 Natural gas, NGLs and condensate sales — — 35,833 — — 35,833 Other revenues — — 18,225 2,343 — 20,568 Total revenues — — 342,457 59,905 — 402,362 Costs and expenses: Cost of natural gas and NGLs — — 27,421 — — 27,421 Operation and maintenance — — 84,632 10,702 — 95,334 General and administrative — — 43,612 8,798 — 52,410 Depreciation and amortization 580 — 98,891 12,768 — 112,239 Transaction costs 1,321 — — — — 1,321 Loss (gain) on asset sales, net — — 99 (6 ) — 93 Long-lived asset impairment — — 1,235 529 — 1,764 Total costs and expenses 1,901 — 255,890 32,791 — 290,582 Other income 116 — — — — 116 Interest expense (1,441 ) (62,369 ) — — — (63,810 ) Deferred Purchase Price Obligation expense (55,854 ) — — — — (55,854 ) (Loss) income before income taxes and loss from equity method investees (59,080 ) (62,369 ) 86,567 27,114 — (7,768 ) Income tax expense (75 ) — — — — (75 ) Loss from equity method investees — — — (30,344 ) — (30,344 ) Equity in earnings of consolidated subsidiaries 20,968 83,337 — — (104,305 ) — Net (loss) income $ (38,187 ) $ 20,968 $ 86,567 $ (3,230 ) $ (104,305 ) $ (38,187 ) Year ended December 31, 2015 SMLP Co-Issuers Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating adjustments Total (In thousands) Revenues: Gathering services and related fees $ — $ — $ 310,830 $ 26,989 $ — $ 337,819 Natural gas, NGLs and condensate sales — — 42,079 — — 42,079 Other revenues — — 18,411 2,248 — 20,659 Total revenues — — 371,320 29,237 — 400,557 Costs and expenses: Cost of natural gas and NGLs — — 31,398 — — 31,398 Operation and maintenance — — 87,286 7,700 — 94,986 General and administrative — — 37,926 7,182 — 45,108 Depreciation and amortization 603 — 95,586 8,928 — 105,117 Transaction costs 1,342 — — — — 1,342 Environmental remediation — — — 21,800 — 21,800 Gain on asset sales, net — — (172 ) — — (172 ) Long-lived asset impairment — — 9,305 — — 9,305 Goodwill impairment — — 248,851 — — 248,851 Total costs and expenses 1,945 — 510,180 45,610 — 557,735 Other income 2 — — — — 2 Interest expense (10,494 ) (48,598 ) — — — (59,092 ) Loss before income taxes and loss from equity method investees (12,437 ) (48,598 ) (138,860 ) (16,373 ) — (216,268 ) Income tax benefit 603 — — — — 603 Loss from equity method investees — — — (6,563 ) — (6,563 ) Equity in earnings of consolidated subsidiaries (210,394 ) (161,796 ) — — 372,190 — Net loss $ (222,228 ) $ (210,394 ) $ (138,860 ) $ (22,936 ) $ 372,190 $ (222,228 ) Year ended December 31, 2014 SMLP Co-Issuers Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating adjustments Total (In thousands) Revenues: Gathering services and related fees $ — $ — $ 255,211 $ 12,267 $ — $ 267,478 Natural gas, NGLs and condensate sales — — 97,094 — — 97,094 Other revenues — — 20,398 2,199 — 22,597 Total revenues — — 372,703 14,466 — 387,169 Costs and expenses: Cost of natural gas and NGLs — — 72,415 — — 72,415 Operation and maintenance — — 88,927 5,942 — 94,869 General and administrative — — 40,447 2,834 — 43,281 Depreciation and amortization 588 — 86,762 3,528 — 90,878 Transaction costs 2,985 — — — — 2,985 Environmental remediation — — — 5,000 — 5,000 Loss on asset sales, net — — 442 — — 442 Long-lived asset impairment — — 5,505 — — 5,505 Goodwill impairment — — 54,199 — — 54,199 Total costs and expenses 3,573 — 348,697 17,304 — 369,574 Other income — — 1,189 — — 1,189 Interest expense (8,417 ) (40,169 ) — — — (48,586 ) (Loss) income before income taxes and loss from equity method investees (11,990 ) (40,169 ) 25,195 (2,838 ) — (29,802 ) Income tax (expense) benefit (1,680 ) — 826 — — (854 ) Loss from equity method investees — — — (16,712 ) — (16,712 ) Equity in earnings of consolidated subsidiaries (33,698 ) 6,471 — — 27,227 — Net (loss) income $ (47,368 ) $ (33,698 ) $ 26,021 $ (19,550 ) $ 27,227 $ (47,368 ) Condensed Consolidating Statements of Cash Flows. Statements of cash flows for the years ended December 31, 2016, 2015 and 2014 follow. Year ended December 31, 2016 SMLP Co-Issuers Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating adjustments Total (In thousands) Cash flows from operating activities: Net cash provided by (used in) operating activities $ 9,691 $ (58,254 ) $ 198,991 $ 80,067 $ — $ 230,495 Cash flows from investing activities: Capital expenditures (1,668 ) — (49,378 ) (91,673 ) — (142,719 ) Contributions to equity method investees — — — (31,582 ) — (31,582 ) Acquisitions of gathering systems from affiliate, net of acquired cash (359,431 ) — — — — (359,431 ) Other, net (394 ) — — — — (394 ) Advances to affiliates (15,697 ) (255,070 ) (150,775 ) — 421,542 — Net cash used in investing activities (377,190 ) (255,070 ) (200,153 ) (123,255 ) 421,542 (534,126 ) Cash flows from financing activities: Distributions to unitholders (167,504 ) — — — — (167,504 ) Borrowings under Revolving Credit Facility 12,000 508,300 — — — 520,300 Repayments under Revolving Credit Facility — (204,300 ) — — — (204,300 ) Debt issuance costs — (3,032 ) — — — (3,032 ) Proceeds from issuance of common units, net 125,233 — — — — 125,233 Contribution from General Partner 2,702 — — — — 2,702 Cash advance (to) from Summit Investments (from) to contributed subsidiaries, net (12,000 ) — — 24,214 — 12,214 Expenses paid by Summit Investments on behalf of contributed subsidiaries 3,030 — — 1,791 — 4,821 Other, net (1,182 ) — (121 ) 135 — (1,168 ) Advances from affiliates 405,845 — — 15,697 (421,542 ) — Net cash provided by (used in) financing activities 368,124 300,968 (121 ) 41,837 (421,542 ) 289,266 Net change in cash and cash equivalents 625 (12,356 ) (1,283 ) (1,351 ) — (14,365 ) Cash and cash equivalents, beginning of period 73 12,407 6,930 2,383 — 21,793 Cash and cash equivalents, end of period $ 698 $ 51 $ 5,647 $ 1,032 $ — $ 7,428 Year ended December 31, 2015 SMLP Co-Issuers Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating adjustments Total (In thousands) Cash flows from operating activities: Net cash provided by (used in) operating activities $ 409 $ (46,716 ) $ 202,324 $ 35,358 $ — $ 191,375 Cash flows from investing activities: Capital expenditures (429 ) — (118,458 ) (153,338 ) — (272,225 ) Contributions to equity method investees — — — (86,200 ) — (86,200 ) Acquisitions of gathering systems from affiliate, net of acquired cash (288,618 ) — — — — (288,618 ) Other, net — — 323 — — 323 Advances to affiliates (2,589 ) (88,221 ) (110,003 ) — 200,813 — Net cash used in investing activities (291,636 ) (88,221 ) (228,138 ) (239,538 ) 200,813 (646,720 ) Cash flows from financing activities: Distributions to unitholders (152,074 ) — — — — (152,074 ) Borrowings under Revolving Credit Facility 180,000 187,000 — — — 367,000 Repayments under Revolving Credit Facility (100,000 ) (51,000 ) — — — (151,000 ) Repayments under term loan (182,500 ) — — — — (182,500 ) Debt issuance costs (135 ) (277 ) — — — (412 ) Proceeds from issuance of common units, net 221,977 — — — — 221,977 Contribution from General Partner 4,737 — — — — 4,737 Cash advance from Summit Investments to contributed subsidiaries, net 102,500 — 21,719 196,308 — 320,527 Expenses paid by Summit Investments on behalf of contributed subsidiaries 12,655 — 3,864 6,360 — 22,879 Other, net (1,615 ) — (192 ) — — (1,807 ) Advances from affiliates 198,224 — — 2,589 (200,813 ) — Net cash provided by financing activities 283,769 135,723 25,391 205,257 (200,813 ) 449,327 Net change in cash and cash equivalents (7,458 ) 786 (423 ) 1,077 — (6,018 ) Cash and cash equivalents, beginning of period 7,531 11,621 7,353 1,306 — 27,811 Cash and cash equivalents, end of period $ 73 $ 12,407 $ 6,930 $ 2,383 $ — $ 21,793 Year ended December 31, 2014 SMLP Co-Issuers Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating adjustments Total (In thousands) Cash flows from operating activities: Net cash (used in) provided by operating activities $ (3,658 ) $ (30,689 ) $ 179,685 $ 7,615 $ — $ 152,953 Cash flows from investing activities: Capital expenditures (460 ) — (220,360 ) (122,560 ) — (343,380 ) Initial contribution to Ohio Gathering — — — (8,360 ) — (8,360 ) Acquisition of Ohio Gathering Option — — — (190,000 ) — (190,000 ) Option Exercise — — — (382,385 ) — (382,385 ) Contributions to equity method investees — — — (145,131 ) — (145,131 ) Acquisition of gathering systems — — (10,872 ) — — (10,872 ) Acquisitions of gathering systems from affiliate, net of acquired cash (305,000 ) — — — — (305,000 ) Other, net — — 325 — — 325 Advances to affiliates (183 ) (174,495 ) (47,271 ) — 221,949 — Net cash used in investing activities (305,643 ) (174,495 ) (278,178 ) (848,436 ) 221,949 (1,384,803 ) Year ended December 31, 2014 SMLP Co-Issuers Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating adjustments Total (In thousands) Cash flows from financing activities: Distributions to unitholders (122,224 ) — — — — (122,224 ) Borrowings under Revolving Credit Facility 57,000 237,295 — — — 294,295 Repayments under Revolving Credit Facility (115,000 ) (315,295 ) — — — (430,295 ) Borrowings under term loan 400,000 — — — — 400,000 Repayments under term loan (100,000 ) — — — — (100,000 ) Debt issuance costs (3,003 ) (5,320 ) — — — (8,323 ) Proceeds from issuance of common units, net 197,806 — — — — 197,806 Contribution from General Partner 4,235 — — — — 4,235 Cash advance (to) from Summit Investments (from) to contributed subsidiaries, net (242,000 ) — 81,421 834,962 — 674,383 Expenses paid by Summit Investments on behalf of contributed subsidiaries 12,845 — 10,483 1,556 — 24,884 Issuance of senior notes — 300,000 — — — 300,000 Repurchase of equity-based compensation awards (228 ) — — — — (228 ) Other, net (656 ) — — — — (656 ) Advances from affiliates 221,766 — — 183 (221,949 ) — Net cash provided by financing activities 310,541 216,680 91,904 836,701 (221,949 ) 1,233,877 Net change in cash and cash equivalents 1,240 11,496 (6,589 ) (4,120 ) — 2,027 Cash and cash equivalents, beginning of period 6,291 125 13,942 5,426 — 25,784 Cash and cash equivalents, end of period $ 7,531 $ 11,621 $ 7,353 $ 1,306 $ — $ 27,811 |