Partners' Capital, Mezzanine Capital and Distributions

3 Months Ended

Mar. 31, 2026

Partners' Capital, Mezzanine Capital and Distributions

Partners’ Capital (Deficit), Mezzanine Capital and Distributions

At March 31, 2026, our outstanding common units consisted of 122,424,321 Class A Common Units and 39,997 Class B Common Units. The Class A Common Units are traditional common units in us. The Class B Common Units are identical to the Class A Common Units and, accordingly, have voting and distribution rights equivalent to those of the Class A Common Units, and, in addition, the Class B Common Units have the right to elect all of our board of directors and are convertible into Class A Common Units under certain circumstances, subject to certain exceptions. At March 31, 2026, we had 11,690,975 Class A Convertible Preferred Units outstanding, which are discussed below in further detail.

In an effort to return capital to our investors, we announced a common equity repurchase program (the “Repurchase Program”) on August 8, 2023. The Repurchase Program authorizes the repurchase from time to time of up to 10% of our then outstanding Class A Common Units, or 12,253,922 units, via open market purchases or negotiated transactions conducted in accordance with applicable regulatory requirements. These repurchases may be made pursuant to a repurchase plan or plans that comply with Rule 10b5-1 under the Securities Exchange Act of 1934. The Repurchase Program does not create an obligation for us to acquire a particular number of Class A Common Units and any Class A Common Units repurchased will be canceled. The Repurchase Program will be reviewed no later than December 31, 2026 and may be suspended or discontinued at any time prior thereto. We did not repurchase any Class A Common Units for the three months ending March 31, 2026 or during 2025.

Distributions

We paid, or will pay, the following cash distributions to our common unitholders in 2025 and 2026:


Distribution For	Date Paid	Per Unit Amount		Total Amount
2025
1st Quarter	May 15, 2025	$	0.1650	$	20,207
2nd Quarter	August 14, 2025	$	0.1650	$	20,207
3rd Quarter	November 14, 2025	$	0.1650	$	20,207
4th Quarter	February 13, 2026	$	0.1800	$	22,044
2026
1st Quarter(1)	May 15, 2026	$	0.1800	$	22,044

(1)This distribution was declared in April 2026 and will be paid to unitholders of record as of April 30, 2026.

Class A Convertible Preferred Units

Our Class A Convertible Preferred Units rank senior to all of our currently outstanding classes or series of limited partner interests with respect to distribution and/or liquidation rights. Holders of our Class A Convertible Preferred Units vote on an as-converted basis with holders of our common units and have certain class voting rights, including with respect to any amendment to the partnership agreement that would adversely affect the rights, preferences or privileges, or otherwise modify the terms, of those Class A Convertible Preferred Units.

Accounting for the Class A Convertible Preferred Units

Our Class A Convertible Preferred Units are considered redeemable securities under GAAP due to the existence of redemption provisions upon a deemed liquidation event that is outside of our control. Therefore, we present them as temporary equity in the mezzanine section of the Unaudited Condensed Consolidated Balance Sheets. We initially recognized our Class A Convertible Preferred Units at their issuance date fair value, net of issuance costs, as they were not then redeemable and we did not have plans or expect any events that constitute a change of control in our partnership agreement.

As of March 31, 2026, we will not be required to further adjust the carrying amount of our Class A Convertible Preferred Units until it becomes probable that they would be redeemed. Once redemption becomes probable, we would adjust the carrying amount of our Class A Convertible Preferred Units to the redemption value over a period of time comprising the date redemption first becomes probable and the date the units could first be redeemed.

Class A Convertible Preferred Units Transactions and Distributions

On March 6, 2025, we entered into purchase agreements with certain Class A Convertible Preferred unitholders whereby we purchased a total of 7,416,196 Class A Convertible Preferred Units at a purchase price of $35.40 per unit. In addition, we paid a distribution of $5.1 million (or $0.6841 per unit), which represented distributions that accrued on these purchased units from January 1, 2025 through March 6, 2025.

On February 3, 2026, we entered into a purchase agreement with one of our Class A Convertible Preferred unitholders whereby we purchased 741,620 Class A Convertible Preferred Units at a purchase price of $33.71 per unit. In addition, we paid a distribution of $0.3 million (or $0.3473 per unit), which represented the distributions that accrued on these purchased units from January 1, 2026 through February 3, 2026.

On March 6, 2026, we entered into a purchase agreement with one of our Class A Convertible Preferred unitholders whereby we purchased 3,263,127 Class A Convertible Preferred Units at a purchase price of $34.38 per unit. In addition, we paid a distribution of $2.2 million (or $0.6841 per unit), which represented distributions that accrued on these purchased units from January 1, 2026 through March 6, 2026.

There were 11,690,975 and 15,695,722 Class A Convertible Preferred Units outstanding as of March 31, 2026 and December 31, 2025, respectively.

Net Income (Loss) Attributable to Common Unitholders is adjusted for distributions paid and returns attributable to the Class A Convertible Preferred Units in the period. Net Income (Loss) Attributable to Common Unitholders was reduced by $17.4 million and $27.0 million for the three months ending March 31, 2026 and 2025, respectively, due to Class A Convertible Preferred Unit distributions paid in the period (Class A Convertible Preferred Unit distributions are summarized in the table below). For the three months ended March 31, 2026, Net Income Attributable to Common Unitholders was increased by $3.8 million due to returns attributable to the Class A Convertible Preferred Units that accumulated in the period. For the three months ended March 31, 2025, Net Loss Attributable to Common Unitholders was further reduced by $1.4 million due to returns attributable to the Class A Convertible Preferred Units that accumulated in the period.

We paid, or will pay, by the dates noted below, the following cash distributions to our Class A Convertible Preferred unitholders in 2025 and 2026:


Distribution For	Date Paid	Per Unit Amount		Total Amount
2025
1st Quarter(1)	May 15, 2025	$	0.9473	$	19,942
2nd Quarter	August 14, 2025	$	0.9473	$	14,868
3rd Quarter	November 14, 2025	$	0.9473	$	14,868
4th Quarter	February 13, 2026	$	0.9473	$	14,868
2026
1st Quarter(2)(3)(4)	May 15, 2026	$	0.9473	$	13,565

(1)Approximately $5.1 million of this distribution was associated with certain Class A Convertible Preferred Units purchased in this period and paid on March 6, 2025.

(2)Approximately $0.3 million of this distribution was associated with certain Class A Convertible Preferred Units purchased in this period and paid on February 3, 2026.

(3)Approximately $2.2 million of this distribution was associated with certain Class A Convertible Preferred Units purchased in this period and paid on March 6, 2026.

(4)Approximately $11.1 million of this distribution was declared in April 2026 and will be paid to unitholders of record as of April 30, 2026.

Noncontrolling Interests

We own a 64% membership interest in Cameron Highway Oil Pipeline Company, LLC (“CHOPS”) and are the operator of its pipeline and associated assets (the “CHOPS Pipeline”). We also own an 80% membership interest in Independence Hub, LLC. For financial reporting purposes, the assets and liabilities of these entities are consolidated with those of our own, with any third party or affiliate interest in our Unaudited Condensed Consolidated Balance Sheets amounts shown as noncontrolling interests in Partners’ Capital (Deficit).