CONDENSED CONSOLIDATING GUARANTOR FINANCIAL STATEMENTS

We have outstanding $300 million of 7.50% senior unsecured notes due 2021 (the “SemGroup Notes”). The SemGroup Notes are guaranteed by certain of our subsidiaries as follows: SemGas, 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 and Mid-America Midstream Gas Services, L.L.C. (collectively, the "Guarantors").

The guarantees of the SemGroup 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 of 1933, as amended.

In February 2015, we contributed our interests in Wattenberg Holding, LLC and Glass Mountain Holding, LLC to Rose Rock (Note 4). As a result of this transaction, Wattenberg Holding, LLC and Glass Mountain Holding, LLC no longer guarantee our SemGroup Notes. In June 2015, SemCanada, L.P. and SemCanada II, L.P. were released as Guarantors and no longer guarantee our SemGroup Notes. Prior period comparative information has been recast to reflect Wattenberg Holding, LLC, Glass Mountain Holding, LLC, SemCanada, L.P. and SemCanada II, L.P. as non-guarantors.

Condensed consolidating financial statements for the Parent, the Guarantors and non-guarantors as of December 31, 2015 and 2014 and for the years ended December 31, 2015, 2014 and 2013 are presented on an equity method basis in the tables below (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, 2015
	Parent		Guarantors			Non-guarantors		Consolidating Adjustments			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	4,559	$	—		$	55,101	$	(1,564	)	$	58,096
Restricted cash	—		—			32		—			32
Accounts receivable	640		20,015			306,058		—			326,713
Receivable from affiliates	1,616		1,119			6,141		(2,962		)	5,914
Inventories	—		(48		)	70,287		—			70,239
Other current assets	8,477		359			10,551		—			19,387
Total current assets	15,292		21,445			448,170		(4,526		)	480,381
Property, plant and equipment	4,335		536,628			1,025,858		—			1,566,821
Equity method investments	1,546,853		426,801			438,291		(1,860,867		)	551,078
Goodwill	—		13,052			34,980		—			48,032
Other intangible assets	20		144,183			18,020		—			162,223
Other noncurrent assets, net	43,898		881			17,376		—			62,155
Total assets	$	1,610,398	$	1,142,990		$	1,982,695	$	(1,865,393	)	$	2,870,690
LIABILITIES AND OWNERS’ EQUITY
Current liabilities:
Accounts payable	$	734	$	11,221		$	261,711	$	—		$	273,666
Payable to affiliates	78		155			7,762		(2,962		)	5,033
Accrued liabilities	5,551		10,957			68,534		5			85,047
Deferred revenue	—		—			11,349		—			11,349
Other current liabilities	569		—			1,332		—			1,901
Current portion of long-term debt	—		—			31		—			31
Total current liabilities	6,932		22,333			350,719		(2,957		)	377,027
Long-term debt	330,000		7,340			761,097		(23,840		)	1,074,597
Deferred income taxes	155,411		—			45,542		—			200,953
Other noncurrent liabilities	2,528		—			19,229		—			21,757
Commitments and contingencies
Owners’ equity excluding noncontrolling interests in consolidated subsidiaries	1,115,527		1,113,317			725,279		(1,838,596		)	1,115,527
Noncontrolling interests in consolidated subsidiaries	—		—			80,829		—			80,829
Total owners’ equity	1,115,527		1,113,317			806,108		(1,838,596		)	1,196,356
Total liabilities and owners’ equity	$	1,610,398	$	1,142,990		$	1,982,695	$	(1,865,393	)	$	2,870,690



	December 31, 2014
	Parent		Guarantors		Non-guarantors		Consolidating Adjustments			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	9,254	$	—	$	35,445	$	(4,101	)	$	40,598
Restricted cash	3,856		—		3,124		—			6,980
Accounts receivable	9,669		32,056		309,609		—			351,334
Receivable from affiliates	2,512		6,624		15,659		(7,976		)	16,819
Inventories	—		248		43,284		—			43,532
Other current assets	10,498		575		8,944		—			20,017
Total current assets	35,789		39,503		416,065		(12,077		)	479,280
Property, plant and equipment	4,112		452,352		800,361		—			1,256,825
Equity method investments	1,551,825		348,115		415,673		(1,737,693		)	577,920
Goodwill	—		13,052		45,274		—			58,326
Other intangible assets	26		152,383		20,656		—			173,065
Other noncurrent assets, net	24,555		958		18,873		—			44,386
Total assets	$	1,616,307	$	1,006,363	$	1,716,902	$	(1,749,770	)	$	2,589,802
LIABILITIES AND OWNERS’ EQUITY
Current liabilities:
Accounts payable	$	649	$	22,097	$	234,431	$	—		$	257,177
Payable to affiliates	21		7		21,406		(7,974		)	13,460
Accrued liabilities	11,993		17,575		63,126		—			92,694
Payables to pre-petition creditors	3,129		—		—		—			3,129
Deferred revenue	—		—		23,688		—			23,688
Other current liabilities	224		707		543		—			1,474
Current portion of long-term debt	—		—		40		—			40
Total current liabilities	16,016		40,386		343,234		(7,974		)	391,662
Long-term debt	335,000		—		490,946		(58,854		)	767,092
Deferred income taxes	112,897		—		49,059		—			161,956
Other noncurrent liabilities	2,886		—		46,769		—			49,655
Commitments and contingencies
Owners’ equity excluding noncontrolling interests in consolidated subsidiaries	1,149,508		965,977		716,965		(1,682,942		)	1,149,508
Noncontrolling interests in consolidated subsidiaries	—		—		69,929		—			69,929
Total owners’ equity	1,149,508		965,977		786,894		(1,682,942		)	1,219,437
Total liabilities and owners’ equity	$	1,616,307	$	1,006,363	$	1,716,902	$	(1,749,770	)	$	2,589,802

Condensed Consolidating Guarantor Statements of Operations



	Year Ended December 31, 2015
	Parent			Guarantors			Non-guarantors			Consolidating Adjustments			Consolidated
Revenues:
Product	$	—		$	190,900		$	948,576		$	(20,590	)	$	1,118,886
Service	—			58,690			200,852			—			259,542
Other	—			—			76,666			—			76,666
Total revenues	—			249,590			1,226,094			(20,590		)	1,455,094
Expenses:
Costs of products sold, exclusive of depreciation and amortization shown below	—			142,576			857,563			(20,590		)	979,549
Operating	—			34,407			190,036			—			224,443
General and administrative	29,914			9,935			57,517			—			97,366
Depreciation and amortization	1,522			31,395			67,965			—			100,882
Loss on disposal or impairment, net	—			142			11,330			—			11,472
Total expenses	31,436			218,455			1,184,411			(20,590		)	1,413,712
Earnings from equity method investments	65,513			47,352			76,355			(107,834		)	81,386
Gain on issuance of common units by equity method investee	6,385			—			—			—			6,385
Operating income	40,462			78,487			118,038			(107,834		)	129,153
Other expenses (income):
Interest expense	2,230			26,476			42,926			(1,957		)	69,675
Foreign currency transaction gain	(5		)	—			(1,062		)	—			(1,067		)
Other income, net	(16,565		)	—			(1,193		)	1,957			(15,801		)
Total other expenses (income), net	(14,340		)	26,476			40,671			—			52,807
Income from continuing operations before income taxes	54,802			52,011			77,367			(107,834		)	76,346
Income tax expense	24,482			—			9,048			—			33,530
Income from continuing operations	30,320			52,011			68,319			(107,834		)	42,816
Loss from discontinued operations, net of income taxes	—			(3		)	(1		)	—			(4		)
Net income	30,320			52,008			68,318			(107,834		)	42,812
Less: net income attributable to noncontrolling interests	—			—			12,492			—			12,492
Net income attributable to SemGroup	$	30,320		$	52,008		$	55,826		$	(107,834	)	$	30,320
Net income	$	30,320		$	52,008		$	68,318		$	(107,834	)	$	42,812
Other comprehensive income (loss), net of income taxes	17,420			430			(49,271		)	—			(31,421		)
Comprehensive income	47,740			52,438			19,047			(107,834		)	11,391
Less: comprehensive income attributable to noncontrolling interests	—			—			12,492			—			12,492
Comprehensive income (loss) attributable to SemGroup	$	47,740		$	52,438		$	6,555		$	(107,834	)	$	(1,101	)



	Year Ended December 31, 2014
	Parent			Guarantors		Non-guarantors			Consolidating Adjustments			Consolidated
Revenues:
Product	$	—		$	338,621	$	1,479,543		$	(37,850	)	$	1,780,314
Service	—			37,139		196,100			—			233,239
Other	—			—		109,026			—			109,026
Total revenues	—			375,760		1,784,669			(37,850		)	2,122,579
Expenses:
Costs of products sold, exclusive of depreciation and amortization shown below	—			273,309		1,387,899			(37,850		)	1,623,358
Operating	—			32,132		214,481			—			246,613
General and administrative	22,394			9,328		56,123			—			87,845
Depreciation and amortization	1,678			25,714		71,005			—			98,397
Loss (gain) on disposal or impairment, net	5,945			54,698		(28,051		)	—			32,592
Total expenses	30,017			395,181		1,701,457			(37,850		)	2,088,805
Earnings from equity method investments	48,760			71,786		54,098			(110,445		)	64,199
Gain on issuance of common units by equity method investee	29,020			—		—			—			29,020
Operating income	47,763			52,365		137,310			(110,445		)	126,993
Other expenses (income):
Interest expense	8,423			9,265		34,661			(3,305		)	49,044
Foreign currency transaction gain	—			—		(86		)	—			(86		)
Other expenses (income), net	(24,092		)	500		(249		)	3,305			(20,536		)
Total other expenses (income), net	(15,669		)	9,765		34,326			—			28,422
Income from continuing operations before income taxes	63,432			42,600		102,984			(110,445		)	98,571
Income tax expense	34,192			—		12,321			—			46,513
Income from continuing operations	29,240			42,600		90,663			(110,445		)	52,058
Loss from discontinued operations, net of income taxes	—			—		(1		)	—			(1		)
Net income	29,240			42,600		90,662			(110,445		)	52,057
Less: net income attributable to noncontrolling interests	—			—		22,817			—			22,817
Net income attributable to SemGroup	$	29,240		$	42,600	$	67,845		$	(110,445	)	$	29,240
Net income	$	29,240		$	42,600	$	90,662		$	(110,445	)	$	52,057
Other comprehensive income (loss), net of income taxes	5,159			—		(29,446		)	—			(24,287		)
Comprehensive income	34,399			42,600		61,216			(110,445		)	27,770
Less: comprehensive income attributable to noncontrolling interests	—			—		22,817			—			22,817
Comprehensive income attributable to SemGroup	$	34,399		$	42,600	$	38,399		$	(110,445	)	$	4,953



	Year Ended December 31, 2013
	Parent			Guarantors		Non-guarantors			Consolidating Adjustments			Consolidated
Revenues:
Product	$	—		$	224,072	$	944,984		$	(23,952	)	$	1,145,104
Service	—			3,192		137,006			—			140,198
Other	—			—		141,714			—			141,714
Total revenues	—			227,264		1,223,704			(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	—			19,792		203,793			—			223,585
General and administrative	21,560			9,167		47,870			—			78,597
Depreciation and amortization	2,001			13,909		50,499			—			66,409
Loss (gain) on disposal or impairment, net	—			668		(907		)	—			(239		)
Total expenses	23,561			210,271		1,178,572			(23,952		)	1,388,452
Earnings from equity method investments	67,965			49,825		44,099			(109,412		)	52,477
Gain on issuance of common units by equity method investee	26,873			—		—			—			26,873
Operating income	71,277			66,818		89,231			(109,412		)	117,914
Other expenses (income):
Interest expense	4,826			9,700		16,028			(5,412		)	25,142
Foreign currency transaction gain	—			—		(1,633		)	—			(1,633		)
Other expense (income), net	40,928			—		(434		)	5,412			45,906
Total other expenses, net	45,754			9,700		13,961			—			69,415
Income from continuing operations before income taxes	25,523			57,118		75,270			(109,412		)	48,499
Income tax expense (benefit)	(22,579		)	—		5,325			—			(17,254		)
Income from continuing operations	48,102			57,118		69,945			(109,412		)	65,753
Income (loss) from discontinued operations, net of income taxes	—			65		(6		)	—			59
Net income	48,102			57,183		69,939			(109,412		)	65,812
Less: net income attributable to noncontrolling interests	—			—		17,710			—			17,710
Net income attributable to SemGroup	$	48,102		$	57,183	$	52,229		$	(109,412	)	$	48,102
Net income	$	48,102		$	57,183	$	69,939		$	(109,412	)	$	65,812
Other comprehensive loss, net of income taxes	(1,517		)	—		(38		)	—			(1,555		)
Comprehensive income	46,585			57,183		69,901			(109,412		)	64,257
Less: comprehensive income attributable to noncontrolling interests	—			—		17,710			—			17,710
Comprehensive income attributable to SemGroup	$	46,585		$	57,183	$	52,191		$	(109,412	)	$	46,547

Condensed Consolidating Guarantor Statements of Cash Flows



	Year Ended December 31, 2015
	Parent			Guarantors			Non-guarantors			Consolidating Adjustments			Consolidated
Net cash provided by operating activities	$	37,259		$	39,786		$	141,899		$	(37,182	)	$	181,762
Cash flows from investing activities:
Capital expenditures	(1,740		)	(110,729		)	(367,061		)	—			(479,530		)
Proceeds from sale of long-lived assets	—			35			3,653			—			3,688
Contributions to equity method investments	—			—			(46,730		)	—			(46,730		)
Proceeds from sale of common units of equity method investee	56,318			—			—			—			56,318
Proceeds from the sale of Wattenberg Holding, LLC and Glass mountain Holding, LLC to Rose Rock Midstream L.P.	251,181			—			—			(251,181		)	—
Distributions in excess of equity in earnings of affiliates	35,340			—			24,113			(35,340		)	24,113
Net cash provided by (used in) investing activities	341,099			(110,694		)	(386,025		)	(286,521		)	(442,141		)
Cash flows from financing activities:
Debt issuance costs	(601		)	—			(5,688		)	—			(6,289		)
Borrowings on credit facilities and issuance of senior unsecured notes	181,000			—			686,208			—			867,208
Principal payments on credit facilities and other obligations	(186,000		)	—			(374,049		)	—			(560,049		)
Proceeds from issuance of Rose Rock Midstream, L.P. common units, net of offering costs	—			—			89,119			—			89,119
Distributions to noncontrolling interests	—			—			(40,410		)	—			(40,410		)
Repurchase of common stock for payment of statutory taxes due on equity-based compensation	(4,261		)	—			—			—			(4,261		)
Dividends paid	(69,514		)	—			—			—			(69,514		)
Proceeds from issuance of common stock under employee stock purchase plan	1,223			—			—			—			1,223
Intercompany borrowings (advances), net	(304,900		)	70,908			(92,248		)	326,240			—
Net cash provided by (used in) financing activities	(383,053		)	70,908			262,932			326,240			277,027
Effect of exchange rate changes on cash and cash equivalents	—			—			850			—			850
Change in cash and cash equivalents	(4,695		)	—			19,656			2,537			17,498
Cash and cash equivalents at beginning of period	9,254			—			35,445			(4,101		)	40,598
Cash and cash equivalents at end of period	$	4,559		$	—		$	55,101		$	(1,564	)	$	58,096



	Year Ended December 31, 2014
	Parent			Guarantors			Non-guarantors			Consolidating Adjustments			Consolidated
Net cash provided by operating activities	$	27,393		$	57,976		$	186,578		$	(90,289	)	$	181,658
Cash flows from investing activities:
Capital expenditures	(1,672		)	(155,392		)	(113,442		)	—			(270,506		)
Proceeds from sale of long-lived assets	—			2,368			2,077			—			4,445
Contributions to equity method investments	—			—			(71,131		)	—			(71,131		)
Payments to acquire businesses	—			(514		)	(43,994		)	—			(44,508		)
Proceeds from sale of common units of equity method investee	79,741			—			—			—			79,741
Proceeds from the sale of interest in SemCrude Pipeline, L.L.C. to Rose Rock Midstream, L.P.	114,412			—			—			(114,412		)	—
Distributions in excess of equity in earnings of affiliates	1,843			—			11,734			(1,843		)	11,734
Net cash provided by (used in) investing activities	194,324			(153,538		)	(214,756		)	(116,255		)	(290,225		)
Cash flows from financing activities:
Debt issuance costs	(93		)	—			(8,593		)	—			(8,686		)
Borrowings on debt	405,500			—			848,744			—			1,254,244
Principal payments on debt and other obligations	(440,500		)	—			(661,772		)	—			(1,102,272		)
Distributions to noncontrolling interests	—			—			(28,494		)	—			(28,494		)
Proceeds from warrant exercises	1,451			—			—			—			1,451
Repurchase of common stock	(719		)	—			—			—			(719		)
Dividends paid	(44,206		)	—			—			—			(44,206		)
Proceeds from issuance of common stock under employee stock purchase plan	340			—			—			—			340
Excess tax benefit from equity-based awards	1,650			—			—			—			1,650
Intercompany borrowings (advances), net	(138,431		)	95,562			(161,110		)	203,979			—
Net cash provided by (used in) financing activities	(215,008		)	95,562			(11,225		)	203,979			73,308
Effect of exchange rate changes on cash and cash equivalents	—			—			(3,494		)	—			(3,494		)
Change in cash and cash equivalents	6,709			—			(42,897		)	(2,565		)	(38,753		)
Cash and cash equivalents at beginning of period	2,545			—			78,342			(1,536		)	79,351
Cash and cash equivalents at end of period	$	9,254		$	—		$	35,445		$	(4,101	)	$	40,598



	Year Ended December 31, 2013
	Parent			Guarantors			Non-guarantors			Consolidating Adjustments			Consolidated
Net cash provided by operating activities	$	20,130		$	23,230		$	150,284		$	(20,235	)	$	173,409
Cash flows from investing activities:
Capital expenditures	(734		)	(96,909		)	(117,966		)	—			(215,609		)
Proceeds from sale of long-lived assets	23			19			1,237			—			1,279
Contributions to equity method investments	(18,775		)	—			(155,093		)	—			(173,868		)
Payments to acquire businesses	—			(313,487		)	(48,969		)	—			(362,456		)
Proceeds from the sale of SemStream assets	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			(410,377		)	(308,545		)	(362,600		)	(738,408		)
Cash flows from financing activities:
Debt issuance costs	(10,866		)	—			(4,070		)	—			(14,936		)
Borrowings on credit facilities	706,000			—			562,474			—			1,268,474
Principal payments on credit facilities 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		)	387,147			(259,503		)	384,237			—
Net cash provided by (used in) financing activities	(379,822		)	387,147			169,568			384,237			561,130
Effect of exchange rate changes on cash and cash equivalents	—			—			3,191			—			3,191
Change in cash and cash equivalents	(16,578		)	—			14,498			1,402			(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		$	—		$	78,342		$	(1,536	)	$	79,351