Partners’ Capital

Preferred Units

Subject to certain conditions, the holders of the Preferred Units have the right to convert their Preferred Units into (i) common units on a 1-for-10 basis or (ii) a number of common units determined pursuant to a conversion ratio set forth in Crestwood Equity's partnership agreement upon the occurrence of certain events, such as a change in control. The Preferred Units have voting rights that are identical to the voting rights of the common units and will vote with the common units as a single class, with each Preferred Unit entitled to one vote for each common unit into which such Preferred Unit is convertible, except that the Preferred Units are entitled to vote as a separate class on any matter on which all unitholders are entitled to vote that adversely affects the rights, powers, privileges or preferences of the Preferred Units in relation to Crestwood Equity's other securities outstanding.

Common Units

On August 4, 2017, we entered into an equity distribution agreement with certain financial institutions (each, a Manager), under which we may offer and sell from time to time through one or more of the Managers, common units having an aggregate offering price of up to $250 million. Common units sold pursuant to this at-the-market (ATM) equity distribution program are issued under a registration statement that became effective on April 12, 2017. We will pay the Managers an aggregate fee of up to 2.0% (which totaled $0.2 million during the three and nine months ended September 30, 2017) of the gross sales price per common unit sold under our ATM equity distribution program. The table below shows the units issued and the net proceeds from the issuances:



Issuance Dates	Common Units	Net Proceeds⁽¹⁾ (in millions)
Third Quarter 2017	437,518	$	10.6


(1)	The net proceeds from sales under the ATM program are used for general partnership purposes, which may include debt repayment and capital expenditures.

Distributions

Crestwood Equity

Limited Partners. A summary of CEQP's limited partner quarterly cash distributions for the nine months ended September 30, 2017 and 2016 is presented below:



Record Date	Payment Date	Per Unit Rate		Cash Distributions (in millions)
2017
February 7, 2017	February 14, 2017	$	0.60	$	41.8
May 8, 2017	May 15, 2017	0.60		41.8
August 7, 2017	August 14, 2017	0.60		41.8
				$	125.4
2016
February 5, 2016	February 12, 2016	$	1.375	$	95.6
May 6, 2016	May 13, 2016	0.60		41.4
August 5, 2016	August 12, 2016	0.60		41.4
				$	178.4

On October 19, 2017, we declared a distribution of $0.60 per limited partner unit to be paid on November 14, 2017, to unitholders of record on November 7, 2017 with respect to the third quarter of 2017.

Preferred Unit Holders. We are required to make quarterly distributions to our preferred unitholders. During the nine months ended September 30, 2017 and 2016, we issued 4,724,030 and 4,311,143 Preferred Units to our preferred unitholders in lieu of paying cash distributions of $43.1 million and $39.3 million, respectively. On October 19, 2017, the board of directors of our general partner authorized a cash distribution to our preferred unitholders of approximately $15.0 million for the quarter ended September 30, 2017 in lieu of issuing additional preferred units, and beginning with the quarter ending December 31, 2017, we will be required to make all future quarterly distributions to our preferred unitholders in cash.

Crestwood Midstream

During the nine months ended September 30, 2017 and 2016, Crestwood Midstream paid cash distributions of $119.5 million and $185.0 million to Crestwood Equity.

Non-Controlling Partners

Crestwood Niobrara issued a preferred interest to a subsidiary of General Electric Capital Corporation and GE Structured Finance, Inc. (collectively, GE) in conjunction with the acquisition of its investment in Jackalope, which is reflected as non-controlling interest in our consolidated financial statements. During the three and nine months ended September 30, 2017, net income attributable to non-controlling partners was approximately $6.4 million and $18.8 million. During the three and nine months ended September 30, 2016, net income attributable to non-controlling partners was approximately $6.1 million and $18.0 million. During both the nine months ended September 30, 2017 and 2016, Crestwood Niobrara paid cash distributions of $11.4 million to GE. In October 2017, Crestwood Niobrara paid a cash distribution of $3.8 million to GE for the quarter ended September 30, 2017.