CONDENSED CONSOLIDATING FINANCIAL INFORMATION | CONDENSED CONSOLIDATING FINANCIAL INFORMATION 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 June 30, 2017 and December 31, 2016 follow. June 30, 2017 SMLP Co-Issuers Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating adjustments Total (In thousands) Assets Cash and cash equivalents $ 228 $ 79 $ 1,921 $ 360 $ — $ 2,588 Accounts receivable 22 — 45,240 10,575 — 55,837 Other current assets 950 — 1,095 219 — 2,264 Due from affiliate 9,360 14,995 467,452 — (491,807 ) — Total current assets 10,560 15,074 515,708 11,154 (491,807 ) 60,689 Property, plant and equipment, net 9,381 — 1,429,927 420,645 — 1,859,953 Intangible assets, net — — 377,216 24,804 — 402,020 Goodwill — — 16,211 — — 16,211 Investment in equity method investees — — — 701,020 — 701,020 Other noncurrent assets 2,628 11,674 155 — — 14,457 Investment in subsidiaries 2,159,778 3,430,690 — — (5,590,468 ) — Total assets $ 2,182,347 $ 3,457,438 $ 2,339,217 $ 1,157,623 $ (6,082,275 ) $ 3,054,350 Liabilities and Partners' Capital Trade accounts payable $ 703 $ — $ 4,852 $ 4,772 $ — $ 10,327 Accrued expenses 1,729 — 6,020 529 — 8,278 Due to affiliate 482,917 — — 9,360 (491,807 ) 470 Deferred revenue — — 4,745 — — 4,745 Ad valorem taxes payable — — 6,870 425 — 7,295 Accrued interest — 17,015 — — — 17,015 Accrued environmental remediation — — — 6,183 — 6,183 Other current liabilities 3,275 — 2,643 387 — 6,305 Total current liabilities 488,624 17,015 25,130 21,656 (491,807 ) 60,618 Long-term debt — 1,280,645 — — — 1,280,645 Deferred Purchase Price Obligation 579,106 — — — — 579,106 Deferred revenue — — 13,049 — — 13,049 Noncurrent accrued environmental remediation — — — 2,346 — 2,346 Other noncurrent liabilities 3,718 — 3,834 135 7,687 Total liabilities 1,071,448 1,297,660 42,013 24,137 (491,807 ) 1,943,451 Total partners' capital 1,110,899 2,159,778 2,297,204 1,133,486 (5,590,468 ) 1,110,899 Total liabilities and partners' capital $ 2,182,347 $ 3,457,438 $ 2,339,217 $ 1,157,623 $ (6,082,275 ) $ 3,054,350 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 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 three and six months ended June 30, 2017 and 2016 follow. Three months ended June 30, 2017 SMLP Co-Issuers Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating adjustments Total (In thousands) Revenues: Gathering services and related fees $ — $ — $ 65,654 $ 19,147 $ — $ 84,801 Natural gas, NGLs and condensate sales — — 10,407 188 — 10,595 Other revenues — — 5,880 516 — 6,396 Total revenues — — 81,941 19,851 — 101,792 Costs and expenses: Cost of natural gas and NGLs — — 9,079 20 — 9,099 Operation and maintenance — — 20,917 3,099 — 24,016 General and administrative — — 10,544 2,405 — 12,949 Depreciation and amortization 154 — 24,624 3,910 — 28,688 Transaction costs 119 — — — — 119 Loss on asset sales, net — — 65 2 — 67 Long-lived asset impairment — — 2 1 — 3 Total costs and expenses 273 — 65,231 9,437 — 74,941 Other income 64 — — — — 64 Interest expense — (17,553 ) — — — (17,553 ) Deferred Purchase Price Obligation 5,058 — — — — 5,058 Income (loss) before income taxes and loss from equity method investees 4,849 (17,553 ) 16,710 10,414 — 14,420 Income tax benefit 211 — — — — 211 Loss from equity method investees — — — (3,385 ) — (3,385 ) Equity in earnings of consolidated subsidiaries 6,186 23,739 — — (29,925 ) — Net income $ 11,246 $ 6,186 $ 16,710 $ 7,029 $ (29,925 ) $ 11,246 Three months ended June 30, 2016 SMLP Co-Issuers Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating adjustments Total (In thousands) Revenues: Gathering services and related fees $ — $ — $ 62,677 $ 13,510 $ — $ 76,187 Natural gas, NGLs and condensate sales — — 8,581 — — 8,581 Other revenues — — 4,306 561 — 4,867 Total revenues — — 75,564 14,071 — 89,635 Costs and expenses: Cost of natural gas and NGLs — — 6,864 — — 6,864 Operation and maintenance — — 21,042 2,368 — 23,410 General and administrative — — 10,761 2,115 — 12,876 Depreciation and amortization 154 — 24,757 3,052 — 27,963 Transaction costs 122 — — — — 122 Loss on asset sales, net — — 74 — — 74 Long-lived asset impairment — — 40 529 — 569 Total costs and expenses 276 — 63,538 8,064 — 71,878 Other income 19 — — — — 19 Interest expense — (16,035 ) — — — (16,035 ) Deferred Purchase Price Obligation (17,465 ) — — — — (17,465 ) (Loss) income before income taxes and loss from equity method investees (17,722 ) (16,035 ) 12,026 6,007 — (15,724 ) Income tax expense (360 ) — — — — (360 ) Loss from equity method investees — — — (34,471 ) — (34,471 ) Equity in earnings of consolidated subsidiaries (32,473 ) (16,438 ) — — 48,911 — Net (loss) income $ (50,555 ) $ (32,473 ) $ 12,026 $ (28,464 ) $ 48,911 $ (50,555 ) Six months ended June 30, 2017 SMLP Co-Issuers Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating adjustments Total (In thousands) Revenues: Gathering services and related fees $ — $ — $ 166,336 $ 36,478 $ — $ 202,814 Natural gas, NGLs and condensate sales — — 21,527 188 — 21,715 Other revenues — — 11,841 1,227 — 13,068 Total revenues — — 199,704 37,893 — 237,597 Costs and expenses: Cost of natural gas and NGLs — — 18,128 23 — 18,151 Operation and maintenance — — 41,768 5,940 — 47,708 General and administrative — — 22,762 4,319 — 27,081 Depreciation and amortization 308 — 49,221 7,728 — 57,257 Transaction costs 119 — — — — 119 Loss on asset sales, net — — — 68 2 — 70 Long-lived asset impairment — — 2 285 — 287 Total costs and expenses 427 — 131,949 18,297 — 150,673 Other income 135 — — — — 135 Interest expense — (34,269 ) — — — (34,269 ) Early extinguishment of debt — (22,020 ) — — — (22,020 ) Deferred Purchase Price Obligation (15,825 ) — — — — (15,825 ) (Loss) income before income taxes and loss from equity method investees (16,117 ) (56,289 ) 67,755 19,596 — 14,945 Income tax expense (241 ) — — — — (241 ) Loss from equity method investees — — — (4,041 ) — (4,041 ) Equity in earnings of consolidated subsidiaries 27,021 83,310 — — (110,331 ) — Net income $ 10,663 $ 27,021 $ 67,755 $ 15,555 $ (110,331 ) $ 10,663 Six months ended June 30, 2016 SMLP Co-Issuers Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating adjustments Total (In thousands) Revenues: Gathering services and related fees $ — $ — $ 127,445 $ 26,842 $ — $ 154,287 Natural gas, NGLs and condensate sales — — 16,169 — — 16,169 Other revenues — — 8,674 1,076 — 9,750 Total revenues — — 152,288 27,918 — 180,206 Costs and expenses: Cost of natural gas and NGLs — — 13,154 — — 13,154 Operation and maintenance — — 43,614 5,638 — 49,252 General and administrative — — 20,891 4,864 — 25,755 Depreciation and amortization 270 — 49,429 5,992 — 55,691 Transaction costs 1,296 — — — — 1,296 Loss on asset sales, net — — 11 — — 11 Long-lived asset impairment — — 41 528 — 569 Total costs and expenses 1,566 — 127,140 17,022 — 145,728 Other income 41 — — — — 41 Interest expense (1,441 ) (30,476 ) — — — (31,917 ) Deferred Purchase Price Obligation (24,928 ) — — — — (24,928 ) (Loss) income before income taxes and loss from equity method investees (27,894 ) (30,476 ) 25,148 10,896 — (22,326 ) Income tax expense (283 ) — — — — (283 ) Loss from equity method investees — — — (31,611 ) — (31,611 ) Equity in earnings of consolidated subsidiaries (26,043 ) 4,433 — — 21,610 — Net (loss) income $ (54,220 ) $ (26,043 ) $ 25,148 $ (20,715 ) $ 21,610 $ (54,220 ) Condensed Consolidating Statements of Cash Flows. Statements of cash flows for the six months ended June 30, 2017 and 2016 follow. Six months ended June 30, 2017 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 $ 424 $ (32,466 ) $ 114,872 $ 38,511 $ — $ 121,341 Cash flows from investing activities: Capital expenditures (6,412 ) — (21,474 ) (18,026 ) — (45,912 ) Contributions to equity method investees — — — (15,649 ) — (15,649 ) Other, net (521 ) — — — — (521 ) Advances to affiliates 5,536 23,020 (97,460 ) — 68,904 — Net cash used in investing activities (1,397 ) 23,020 (118,934 ) (33,675 ) 68,904 (62,082 ) Cash flows from financing activities: Distributions to unitholders (89,029 ) — — — — (89,029 ) Borrowings under Revolving Credit Facility — 112,500 — — — 112,500 Repayments under Revolving Credit Facility — (269,500 ) — — — (269,500 ) Debt issuance costs — (15,613 ) — — — (15,613 ) Payment of redemption and call premiums on senior notes — (17,913 ) — — — (17,913 ) Proceeds from ATM Program issuances, net of costs 17,259 — — — — 17,259 Contribution from General Partner 465 — — — — 465 Issuance of senior notes — 500,000 — — — 500,000 Tender and redemption of senior notes — (300,000 ) — — — (300,000 ) Other, net (2,632 ) — 336 28 — (2,268 ) Advances from affiliates 74,440 — — (5,536 ) (68,904 ) — Net cash provided by (used in) financing activities 503 9,474 336 (5,508 ) (68,904 ) (64,099 ) Net change in cash and cash equivalents (470 ) 28 (3,726 ) (672 ) — (4,840 ) Cash and cash equivalents, beginning of period 698 51 5,647 1,032 — 7,428 Cash and cash equivalents, end of period $ 228 $ 79 $ 1,921 $ 360 $ — $ 2,588 Six months ended June 30, 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 $ 750 $ (28,517 ) $ 119,435 $ 39,832 $ — $ 131,500 Cash flows from investing activities: Capital expenditures (512 ) — (30,745 ) (60,115 ) — (91,372 ) Contributions to equity method investees — — — (15,645 ) — (15,645 ) Acquisitions of gathering systems from affiliate (359,431 ) — — — — (359,431 ) Other, net (435 ) — — — — (435 ) Advances to affiliates (8,978 ) (357,486 ) (93,269 ) — 459,733 — Net cash used in investing activities (369,356 ) (357,486 ) (124,014 ) (75,760 ) 459,733 (466,883 ) Cash flows from financing activities: Distributions to unitholders (82,020 ) — — — — (82,020 ) Borrowings under Revolving Credit Facility 12,000 427,300 — — — 439,300 Repayments under Revolving Credit Facility — (50,300 ) — — — (50,300 ) Debt issuance costs — (2,766 ) — — — (2,766 ) Cash advance from Summit Investments 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 (912 ) — — (4 ) — (916 ) Advances from affiliates 450,755 — — 8,978 (459,733 ) — Net cash provided by financing activities 370,853 374,234 — 34,979 (459,733 ) 320,333 Net change in cash and cash equivalents 2,247 (11,769 ) (4,579 ) (949 ) — (15,050 ) Cash and cash equivalents, beginning of period 73 12,407 6,930 2,383 — 21,793 Cash and cash equivalents, end of period $ 2,320 $ 638 $ 2,351 $ 1,434 $ — $ 6,743 |