On June 14, 2013, we completed an offering of $300 million of 7.50% senior unsecured notes due 2021 (the “Notes”) to certain initial purchasers for resale to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”), and to non-U.S. persons outside the United States pursuant to Regulation S of the Securities Act. The Notes are guaranteed by certain of our subsidiaries as follows: SemGas, L.P., SemCanada, L.P., SemCanada II, L.P., SemMaterials, L.P., SemGroup Europe Holding, L.L.C., SemOperating G.P., L.L.C., SemMexico, L.L.C., SemDevelopment, L.L.C., Rose Rock Midstream Holdings, LLC, Wattenberg Holding, LLC, Glass Mountain Holding, LLC and Mid-America Midstream Gas Services, L.L.C. (collectively, the "Guarantors").

In accordance with a Registration Rights Agreement, in December 2013 the Company filed a registration statement with the SEC, which was declared effective on January 2, 2014, so that holders of the Notes could exchange the Notes and related guarantees for registered notes (the "Exchange Notes") and guarantees that have substantially identical terms as the Notes and related guarantees. An exchange offer was commenced on January 3, 2014 and expired on February 4, 2014. All of the Notes were exchanged. The guarantees of the Exchange Notes are full and unconditional and constitute the joint and several obligations of the Guarantors.

Each of the Guarantors is 100% owned by SemGroup Corporation (the "Parent"). There are no significant restrictions upon the ability of the Parent or any of the Guarantors to obtain funds from its respective subsidiaries by dividend or loan. None of the assets of the Guarantors represent restricted net assets pursuant to Rule 4-08(e)(3) of Regulation S-X under the Securities Act.

Condensed consolidating financial statements for the Parent, the Guarantors and non-guarantors as of December 31, 2013 and 2012 and for the years ended December 31, 2013, 2012 and 2011 is as follows (in thousands).

Intercompany receivable and payable balances, including notes receivable and payable, are capital transactions primarily to facilitate the capital needs of our subsidiaries. As such, subsidiary intercompany balances have been reported as a reduction to equity on the condensed consolidating Guarantor balance sheets. The Parent's net intercompany balance, including note receivable, and investments in subsidiaries have been reported in equity method investments on the condensed consolidating Guarantor balance sheets. Intercompany transactions, such as daily cash management activities, have been reported as financing activities within the condensed consolidating Guarantor statements of cash flows. Quarterly cash distributions from Rose Rock representing a return on capital have been included in the Parent's cash flows from operations. Dispositions of the Parent's investments in subsidiaries have been treated as investing activities in the cash flow statement, consistent with the presentation of investments in subsidiaries as equity method investments. These balances are eliminated through consolidating adjustments below.

Condensed Consolidating Guarantor Balance Sheets



	December 31, 2013
	Parent		Guarantors		Non-guarantors		Consolidating Adjustments			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	2,545	$	—	$	78,364	$	(1,558	)	$	79,351
Restricted cash	3,851		—		1,268		—			5,119
Accounts receivable	649		14,642		308,674		—			323,965
Receivable from affiliates	1,519		14,063		56,040		(4,349		)	67,273
Inventories	—		1,046		43,249		—			44,295
Other current assets	8,712		193		5,106		—			14,011
Total current assets	17,276		29,944		492,701		(5,907		)	534,014
Property, plant and equipment	4,114		366,067		735,547		—			1,105,728
Equity method investments	1,511,922		461,056		159,321		(1,567,175		)	565,124
Goodwill	—		23,839		38,182		—			62,021
Other intangible assets	31		163,144		11,663		—			174,838
Other noncurrent assets, net	15,263		1,302		12,324		—			28,889
Total assets	$	1,548,606	$	1,045,352	$	1,449,738	$	(1,573,082	)	$	2,470,614
LIABILITIES AND OWNERS’ EQUITY
Current liabilities:
Accounts payable	$	1,172	$	24,234	$	229,061	$	—		$	254,467
Payable to affiliates	17		115		67,062		(4,915		)	62,279
Accrued liabilities	10,072		17,341		56,011		5			83,429
Payables to pre-petition creditors	3,124		—		53		—			3,177
Deferred revenue	—		—		25,538		—			25,538
Other current liabilities	61,875		715		7,697		—			70,287
Current portion of long-term debt	—		—		37		—			37
Total current liabilities	76,260		42,405		385,459		(4,910		)	499,214
Long-term debt	370,000		—		245,088		—			615,088
Deferred income taxes	48,436		—		52,509		—			100,945
Other noncurrent liabilities	8		—		41,496		—			41,504
Commitments and contingencies
Owners’ equity excluding noncontrolling interests in consolidated subsidiaries	1,053,902		1,002,947		565,225		(1,568,172		)	1,053,902
Noncontrolling interests in consolidated subsidiaries	—		—		159,961		—			159,961
Total owners’ equity	1,053,902		1,002,947		725,186		(1,568,172		)	1,213,863
Total liabilities and owners’ equity	$	1,548,606	$	1,045,352	$	1,449,738	$	(1,573,082	)	$	2,470,614



	December 31, 2012
	Parent		Guarantors		Non-guarantors		Consolidating Adjustments			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	19,123	$	—	$	63,844	$	(2,938	)	$	80,029
Restricted cash	33,324		—		1,354		—			34,678
Accounts receivable	1,155		7,927		337,087		—			346,169
Receivable from affiliates	827		7,222		109		(1,980		)	6,178
Inventories	—		181		34,252		—			34,433
Other current assets	2,528		312		15,676		—			18,516
Total current assets	56,957		15,642		452,322		(4,918		)	520,003
Property, plant and equipment	5,399		122,899		686,426		—			814,724
Equity method investments	1,104,832		468,033		138,970		(1,324,033		)	387,802
Goodwill	—		—		9,884		—			9,884
Other intangible assets	36		—		7,549		—			7,585
Other noncurrent assets, net	3,606		1,317		3,258		—			8,181
Total assets	$	1,170,830	$	607,891	$	1,298,409	$	(1,328,951	)	$	1,748,179
LIABILITIES AND OWNERS’ EQUITY
Current liabilities:
Accounts payable	$	70	$	12,304	$	241,249	$	—		$	253,623
Accrued liabilities	8,972		4,546		50,313		—			63,831
Payables to pre-petition creditors	32,876		—		57		—			32,933
Deferred revenue	—		—		18,973		—			18,973
Other current liabilities	134		580		4,263		(17		)	4,960
Current portion of long-term debt	—		—		24		—			24
Total current liabilities	42,052		17,430		314,879		(17		)	374,344
Long-term debt	201,500		—		4,562		—			206,062
Deferred income taxes	2,018		—		63,602		—			65,620
Other noncurrent liabilities	32,866		—		47,759		—			80,625
Commitments and contingencies
Owners’ equity excluding noncontrolling interests in consolidated subsidiaries	892,394		590,461		738,473		(1,328,934		)	892,394
Noncontrolling interests in consolidated subsidiaries	—		—		129,134		—			129,134
Total owners’ equity	892,394		590,461		867,607		(1,328,934		)	1,021,528
Total liabilities and owners’ equity	$	1,170,830	$	607,891	$	1,298,409	$	(1,328,951	)	$	1,748,179

Condensed Consolidating Guarantor Statements of Operations



	Year Ended December 31, 2013
	Parent			Guarantors		Non-guarantors			Consolidating Adjustments			Consolidated
Revenues:
Product	$	—		$	224,072	$	944,984		$	(23,952	)	$	1,145,104
Service	—			3,868		136,330			—			140,198
Other	—			—		141,714			—			141,714
Total revenues	—			227,940		1,223,028			(23,952		)	1,427,016
Expenses:												—
Costs of products sold, exclusive of depreciation and amortization shown below	—			166,735		877,317			(23,952		)	1,020,100
Operating	—			19,541		204,044			—			223,585
General and administrative	21,560			9,437		47,600			—			78,597
Depreciation and amortization	2,001			14,452		49,956			—			66,409
Loss (gain) loss on disposal of long-lived assets, net	—			668		(907		)	—			(239		)
Total expenses	23,561			210,833		1,178,010			(23,952		)	1,388,452
Earnings from equity method investments	67,965			54,995		44,203			(114,686		)	52,477
Gain on issuance of common units by equity method investee	26,873			—		—			—			26,873
Operating income	71,277			72,102		89,221			(114,686		)	117,914
Other expenses (income):												—
Interest expense	4,826			9,781		15,947			(5,412		)	25,142
Foreign currency transaction loss (gain)	—			—		(1,633		)	—			(1,633		)
Other expense (income), net	40,928			—		(434		)	5,412			45,906
Total other expenses, net	45,754			9,781		13,880			—			69,415
Income from continuing operations before income taxes	25,523			62,321		75,341			(114,686		)	48,499
Income tax expense (benefit)	(22,579		)	—		5,325			—			(17,254		)
Income from continuing operations	48,102			62,321		70,016			(114,686		)	65,753
Income (loss) from discontinued operations, net of income taxes	—			65		(6		)	—			59
Net income	48,102			62,386		70,010			(114,686		)	65,812
Less: net income attributable to noncontrolling interests	—			—		17,710			—			17,710
Net income attributable to SemGroup	$	48,102		$	62,386	$	52,300		$	(114,686	)	$	48,102
Net income	$	48,102		$	62,386	$	70,010		$	(114,686	)	$	65,812
Other comprehensive loss, net of income taxes	(1,517		)	—		(38		)	—			(1,555		)
Comprehensive income	46,585			62,386		69,972			(114,686		)	64,257
Less: comprehensive income attributable to noncontrolling interests	—			—		17,710			—			17,710
Comprehensive income attributable to SemGroup	$	46,585		$	62,386	$	52,262		$	(114,686	)	$	46,547



	Year Ended December 31, 2012
	Parent		Guarantors			Non-guarantors			Consolidating Adjustments			Consolidated
Revenues:
Product	$	—	$	123,424		$	840,892		$	(10,578	)	$	953,738
Service	—		1,198			116,523			—			117,721
Other	—		387			165,651			—			166,038
Total revenues	—		125,009			1,123,066			(10,578		)	1,237,497
Expenses:
Costs of products sold, exclusive of depreciation and amortization shown below	—		98,224			787,239			(10,578		)	874,885
Operating	—		12,719			211,981			—			224,700
General and administrative	22,105		8,360			41,453			—			71,918
Depreciation and amortization	2,496		6,448			39,266			—			48,210
(Gain) loss on disposal of long-lived assets, net	—		276			(3,807		)	—			(3,531		)
Total expenses	24,601		126,027			1,076,132			(10,578		)	1,216,182
Earnings from equity method investments	66,671		85,330			36,439			(152,404		)	36,036
Operating income	42,070		84,312			83,373			(152,404		)	57,351
Other expenses (income):
Interest expense	3,942		(240		)	11,056			(5,856		)	8,902
Foreign currency transaction loss	—		—			298			—			298
Other expense (income), net	15,698		(21		)	(262		)	5,856			21,271
Total other expenses (income), net	19,640		(261		)	11,092			—			30,471
Income from continuing operations before income taxes	22,430		84,573			72,281			(152,404		)	26,880
Income tax expense (benefit)	334		—			(2,412		)	—			(2,078		)
Income from continuing operations	22,096		84,573			74,693			(152,404		)	28,958
Income (loss) from discontinued operations, net of income taxes	4		(17		)	2,952			—			2,939
Net income	22,100		84,556			77,645			(152,404		)	31,897
Less: net income attributable to noncontrolling interests	—		—			9,797			—			9,797
Net income attributable to SemGroup	$	22,100	$	84,556		$	67,848		$	(152,404	)	$	22,100
Net income	$	22,100	$	84,556		$	77,645		$	(152,404	)	$	31,897
Other comprehensive income, net of income taxes	917		—			11,659			—			12,576
Comprehensive income	23,017		84,556			89,304			(152,404		)	44,473
Less: comprehensive income attributable to noncontrolling interests	—		—			9,797			—			9,797
Comprehensive income attributable to SemGroup	$	23,017	$	84,556		$	79,507		$	(152,404	)	$	34,676



	Year Ended December 31, 2011
	Parent			Guarantors			Non-guarantors			Consolidating Adjustments			Consolidated
Revenues:
Product	$	—		$	712,724		$	609,870		$	(85,281	)	$	1,237,313
Service	—			2,778			120,567			—			123,345
Other	—			311			104,277			—			104,588
Total revenues	—			715,813			834,714			(85,281		)	1,465,246
Expenses:
Costs of products sold, exclusive of depreciation and amortization shown below	—			673,927			555,793			(85,281		)	1,144,439
Operating	—			14,594			140,447			—			155,041
General and administrative	15,564			13,854			46,029			—			75,447
Depreciation and amortization	2,930			8,892			38,001			—			49,823
(Gain) loss on disposal of long-lived assets, net	1,605			(46,139		)	44,835			—			301
Total expenses	20,099			665,128			825,105			(85,281		)	1,425,051
Earnings (losses) from equity method investments	32,096			(20,736		)	15,004			(11,360		)	15,004
Operating income	11,997			29,949			24,613			(11,360		)	55,199
Other expenses (income):
Interest expense	24,352			19,498			21,157			(4,869		)	60,138
Foreign currency transaction loss (gain)	—			39			(3,489		)	—			(3,450		)
Other (income) expense, net	(12,141		)	(2,150		)	(2,117		)	4,869			(11,539		)
Total other expenses, net	12,211			17,387			15,551			—			45,149
Income (loss) from continuing operations before income taxes	(214		)	12,562			9,062			(11,360		)	10,050
Income tax (benefit) expense	(2,485		)	—			175			—			(2,310		)
Income from continuing operations	2,271			12,562			8,887			(11,360		)	12,360
Income (loss) from discontinued operations, net of income taxes	106			28			(9,682		)	—			(9,548		)
Net income (loss)	2,377			12,590			(795		)	(11,360		)	2,812
Less: net income attributable to noncontrolling interests	—			—			435			—			435
Net income (loss) attributable to SemGroup	$	2,377		$	12,590		$	(1,230	)	$	(11,360	)	$	2,377
Net income (loss)	$	2,377		$	12,590		$	(795	)	$	(11,360	)	$	2,812
Other comprehensive loss, net of income taxes	(1,853		)	—			(13,137		)	—			(14,990		)
Comprehensive income (loss)	524			12,590			(13,932		)	(11,360		)	(12,178		)
Less: comprehensive income attributable to noncontrolling interests	—			—			435			—			435
Comprehensive income (loss) attributable to SemGroup	$	524		$	12,590		$	(14,367	)	$	(11,360	)	$	(12,613	)

Condensed Consolidating Guarantor Statements of Cash Flows



	Year Ended December 31, 2013
	Parent			Guarantors			Non-guarantors			Consolidating Adjustments			Consolidated
Net cash provided by (used in) operating activities	$	20,130		$	24,642		$	148,872		$	(20,235	)	$	173,409
Cash flows from investing activities:
Capital expenditures	(734		)	(123,246		)	(91,629		)	—			(215,609		)
Proceeds from sale of long-lived assets	23			19			1,237			—			1,279
Investments in non-consolidated subsidiaries	(18,775		)	(57,850		)	(97,243		)	—			(173,868		)
Payments to acquire businesses	—			(313,487		)	(48,969		)	—			(362,456		)
Proceeds from the sale of interest in SemCrude Pipeline, L.L.C. to Rose Rock Midstream, L.P.	362,600			—			—			(362,600		)	—
Distributions in excess of equity in earnings of affiliates	—			—			12,246			—			12,246
Net cash provided by (used in) investing activities	343,114			(494,564		)	(224,358		)	(362,600		)	(738,408		)
Cash flows from financing activities:
Debt issuance costs	(10,866		)	—			(4,070		)	—			(14,936		)
Borrowings on debt	706,000			—			562,474			—			1,268,474
Principal payments on debt and other obligations	(537,500		)	—			(321,912		)	—			(859,412		)
Proceeds from issuance of Rose Rock Midstream, L.P. common units, net of offering costs	—			—			210,226			—			210,226
Distributions to noncontrolling interests	—			—			(17,647		)	—			(17,647		)
Proceeds from warrant exercises	225			—			—			—			225
Repurchase of common stock	(371		)	—			—			—			(371		)
Dividends paid	(25,429		)	—			—			—			(25,429		)
Intercompany borrowings (advances), net	(511,881		)	469,922			(342,256		)	384,215			—
Net cash provided by (used in) financing activities	(379,822		)	469,922			86,815			384,215			561,130
Effect of exchange rate changes on cash and cash equivalents	—			—			3,191			—			3,191
Change in cash and cash equivalents	(16,578		)	—			14,520			1,380			(678		)
Cash and cash equivalents at beginning of period	19,123			—			63,844			(2,938		)	80,029
Cash and cash equivalents at end of period	$	2,545		$	—		$	78,364		$	(1,558	)	$	79,351



	Year Ended December 31, 2012
	Parent			Guarantors			Non-guarantors			Consolidating Adjustments			Consolidated
Net cash provided by (used in) operating activities	$	(4,535	)	$	6,236		$	93,534		$	(15,593	)	$	79,642
Cash flows from investing activities:
Capital expenditures	(1,977		)	(59,317		)	(58,025		)	—			(119,319		)
Proceeds from sale of long-lived assets	19			(202		)	2,824			—			2,641
Investments in non-consolidated subsidiaries	(1,740		)	(74,434		)	(2,079		)	—			(78,253		)
Proceeds from the sale of non-consolidated affiliate	—			—			3,500			—			3,500
Proceeds from the sale of SemStream assets	12,250			—			—			—			12,250
Distributions in excess of equity in earnings of affiliates	9,218			—			8,072			—			17,290
Net cash provided by (used in) investing activities	17,770			(133,953		)	(45,708		)	—			(161,891		)
Cash flows from financing activities:
Debt issuance costs	(455		)	—			(252		)	—			(707		)
Borrowings on credit facilities	318,000			—			—			—			318,000
Principal payments on credit facilities and other obligations	(194,000		)	—			(28,066		)	—			(222,066		)
Distributions to noncontrolling interests	—			—			(8,502		)	—			(8,502		)
Repurchase of common stock	(242		)	—			—			—			(242		)
Intercompany borrowings (advances), net	(117,526		)	127,717			(25,608		)	15,417			—
Net cash provided by (used in) financing activities	5,777			127,717			(62,428		)	15,417			86,483
Effect of exchange rate changes on cash and cash equivalents	—			—			(610		)	—			(610		)
Change in cash and cash equivalents	19,012			—			(15,212		)	(176		)	3,624
Change in cash and cash equivalents included in discontinued operations	—			—			2,792			—			2,792
Change in cash and cash equivalents from continuing operations	19,012			—			(12,420		)	(176		)	6,416
Cash and cash equivalents at beginning of period	111			—			76,264			(2,762		)	73,613
Cash and cash equivalents at end of period	$	19,123		$	—		$	63,844		$	(2,938	)	$	80,029



	Year Ended December 31, 2011
	Parent			Guarantors			Non-guarantors			Consolidating Adjustments			Consolidated
Net cash provided by operating activities	$	6,817		$	44,957		$	17,004		$	5,263		$	74,041
Cash flows from investing activities:
Capital expenditures	(2,080		)	(16,865		)	(47,050		)	—			(65,995		)
Proceeds from sale of long-lived assets	—			82			1,043			—			1,125
Investments in non-consolidated subsidiaries	(3,218		)	(23		)	(476		)	—			(3,717		)
Proceeds from the sale of SemStream assets	93,054			—			—			—			93,054
Proceeds from sale of limited partner interest in subsidiary, net of offering costs	127,134			—			—			(127,134		)	—
Distributions in excess of equity in earnings of affiliates	—			—			12,455			—			12,455
Net cash provided by (used in) investing activities	214,890			(16,806		)	(34,028		)	(127,134		)	36,922
Cash flows from financing activities:
Debt issuance costs	(10,867		)	—			(1,666		)	—			(12,533		)
Borrowings on credit facilities	255,471			—			8,434			—			263,905
Principal payments on credit facilities and other obligations	(498,515		)	(21		)	(4,653		)	—			(503,189		)
Proceeds from issuance of Rose Rock Midstream, L.P. common units, net of offering costs	—			—			127,134			—			127,134
Intercompany borrowings (advances), net	25,099			(28,130		)	(116,789		)	119,820			—
Net cash provided by (used in) financing activities	(228,812		)	(28,151		)	12,460			119,820			(124,683		)
Effect of exchange rate changes on cash and cash equivalents	—			—			(34		)	—			(34		)
Change in cash and cash equivalents	(7,105		)	—			(4,598		)	(2,051		)	(13,754		)
Change in cash and cash equivalents included in discontinued operations	—			—			(454		)	—			(454		)
Change in cash and cash equivalents from continuing operations	(7,105		)	—			(5,052		)	(2,051		)	(14,208		)
Cash and cash equivalents at beginning of period	7,216			—			81,316			(711		)	87,821
Cash and cash equivalents at end of period	$	111		$	—		$	76,264		$	(2,762	)	$	73,613