CONDENSED CONSOLIDATING GUARANTOR FINANCIAL STATEMENTS

Our senior unsecured notes are guaranteed by certain of our subsidiaries as follows: Rose Rock Finance Corporation, Rose Rock Midstream Operating, LLC, Rose Rock Midstream Energy GP, LLC, Rose Rock Midstream Crude, L.P., Rose Rock Midstream Field Services, LLC, 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., Mid-America Midstream Gas Services, L.L.C., SemCrude Pipeline, L.L.C., Wattenberg Holding, LLC and Glass Mountain Holding, LLC (collectively, the "Guarantors").

Each of the Guarantors is 100% owned by SemGroup Corporation (the "Parent"). Such guarantees of the Notes are full and unconditional and constitute the joint and several obligations of the Guarantors. 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.

Subsequent to the Merger as described in Note 10, SemGroup assumed the obligations of Rose Rock under Rose Rock's senior unsecured notes. Supplemental indentures were entered into with respect to the previously existing SemGroup senior unsecured notes and the senior unsecured notes assumed from Rose Rock to include the Guarantors as listed above to the extent the entity was not already a Guarantor. Prior period comparative information has been recast to reflect the addition of Rose Rock subsidiaries as Guarantors.

Unaudited condensed consolidating financial statements for the Parent, the Guarantors and non-guarantors as of March 31, 2017 and December 31, 2016, and for the three months ended March 31, 2017 and 2016, 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. These balances are eliminated through consolidating adjustments below.

Condensed Consolidating Guarantor Balance Sheets



	March 31, 2017
	Parent		Guarantors		Non-guarantors		Consolidating Adjustments			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	8,214	$	—	$	62,087	$	(4,445	)	$	65,856
Accounts receivable, net	48		415,704		61,294		—			477,046
Receivable from affiliates	28		12,148		750		—			12,926
Inventories	—		90,564		11,841		—			102,405
Other current assets	5,299		5,452		3,786		—			14,537
Total current assets	13,589		523,868		139,758		(4,445		)	672,770
Property, plant and equipment, net	7,012		951,187		876,201		—			1,834,400
Equity method investments	2,518,858		1,005,151		—		(3,091,620		)	432,389
Goodwill	—		26,628		8,016		—			34,644
Other intangible assets, net	14		147,086		1,250		—			148,350
Other noncurrent assets	49,810		1,882		2,481		—			54,173
Total assets	$	2,589,283	$	2,655,802	$	1,027,706	$	(3,096,065	)	$	3,176,726
LIABILITIES AND OWNERS’ EQUITY
Current liabilities:
Accounts payable	$	855	$	399,406	$	17,325	$	—		$	417,586
Payable to affiliates	—		17,086		—		—			17,086
Accrued liabilities	20,174		24,364		42,829		1			87,368
Other current liabilities	1,165		6,212		6,405		—			13,782
Total current liabilities	22,194		447,068		66,559		1			535,822
Long-term debt, net	1,140,619		6,210		16,500		(22,692		)	1,140,637
Deferred income taxes	9,752		—		50,169		—			59,921
Other noncurrent liabilities	2,373		—		23,628		—			26,001
Commitments and contingencies
Total owners’ equity	1,414,345		2,202,524		870,850		(3,073,374		)	1,414,345
Total liabilities and owners’ equity	$	2,589,283	$	2,655,802	$	1,027,706	$	(3,096,065	)	$	3,176,726



	December 31, 2016
	Parent		Guarantors		Non-guarantors		Consolidating Adjustments			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	19,002	$	—	$	59,796	$	(4,582	)	$	74,216
Accounts receivable, net	—		361,160		57,179		—			418,339
Receivable from affiliates	27		25,244		184		—			25,455
Inventories	—		89,638		9,596		—			99,234
Other current assets	8,986		5,760		3,887		(3		)	18,630
Total current assets	28,015		481,802		130,642		(4,585		)	635,874
Property, plant and equipment, net	5,621		970,079		786,372		—			1,762,072
Equity method investments	2,454,118		940,696		—		(2,960,525		)	434,289
Goodwill	—		26,628		7,602		—			34,230
Other intangible assets, net	15		149,669		1,294		—			150,978
Other noncurrent assets	54,155		2,080		1,294		—			57,529
Total assets	$	2,541,924	$	2,570,954	$	927,204	$	(2,965,110	)	$	3,074,972
LIABILITIES AND OWNERS’ EQUITY
Current liabilities:
Accounts payable	$	674	$	348,297	$	18,336	$	—		$	367,307
Payable to affiliates	—		26,508		—		—			26,508
Accrued liabilities	25,078		23,423		32,603		—			81,104
Other current liabilities	889		5,108		7,439		—			13,436
Total current liabilities	26,641		403,336		58,378		—			488,355
Long-term debt, net	1,050,893		6,142		16,500		(22,617		)	1,050,918
Deferred income taxes	16,119		—		48,382		—			64,501
Other noncurrent liabilities	2,306		—		22,927		—			25,233
Commitments and contingencies
Total owners’ equity	1,445,965		2,161,476		781,017		(2,942,493		)	1,445,965
Total liabilities and owners’ equity	$	2,541,924	$	2,570,954	$	927,204	$	(2,965,110	)	$	3,074,972

Condensed Consolidating Guarantor Statements of Operations



	Three Months Ended March 31, 2017
	Parent			Guarantors			Non-guarantors			Consolidating Adjustments			Consolidated
Revenues:
Product	$	—		$	340,788		$	32,573		$	—		$	373,361
Service	—			38,050			30,143			—			68,193
Other	—			—			14,546			—			14,546
Total revenues	—			378,838			77,262			—			456,100
Expenses:
Costs of products sold, exclusive of depreciation and amortization shown below	—			321,657			27,341			—			348,998
Operating	—			28,120			23,963			—			52,083
General and administrative	5,930			6,930			8,784			—			21,644
Depreciation and amortization	473			16,830			7,296			—			24,599
Loss on disposal or impairment of long-lived assets, net	—			1,982			428			—			2,410
Total expenses	6,403			375,519			67,812			—			449,734
Earnings from equity method investments	19,187			18,566			—			(20,662		)	17,091
Operating income	12,784			21,885			9,450			(20,662		)	23,457
Other expenses (income), net:
Interest expense (income)	5,866			8,820			(626		)	(193		)	13,867
Loss on early extinguishment of debt	19,922			—			—			—			19,922
Other income, net	(197		)	(2		)	(144		)	193			(150		)
Total other expense (income), net	25,591			8,818			(770		)	—			33,639
Income (loss) from continuing operations before income taxes	(12,807		)	13,067			10,220			(20,662		)	(10,182		)
Income tax expense (benefit)	(2,530		)	—			2,625			—			95
Net income (loss)	$	(10,277	)	$	13,067		$	7,595		$	(20,662	)	$	(10,277	)
Net income (loss)	$	(10,277	)	$	13,067		$	7,595		$	(20,662	)	$	(10,277	)
Other comprehensive income (loss), net of income taxes	(3,581		)	(74		)	9,688			—			6,033
Comprehensive income (loss)	$	(13,858	)	$	12,993		$	17,283		$	(20,662	)	$	(4,244	)



	Three Months Ended March 31, 2016
	Parent			Guarantors			Non-guarantors			Consolidating Adjustments			Consolidated
Revenues:
Product	$	—		$	207,274		$	29,622		$	—		$	236,896
Service	—			50,156			13,917			—			64,073
Other	—			—			13,882			—			13,882
Total revenues	—			257,430			57,421			—			314,851
Expenses:
Costs of products sold, exclusive of depreciation and amortization shown below	—			183,213			13,734			—			196,947
Operating	—			29,100			21,092			—			50,192
General and administrative	5,872			7,148			8,040			—			21,060
Depreciation and amortization	380			16,771			6,900			—			24,051
Loss (gain) on disposal or impairment of long-lived assets, net	—			13,346			(39		)	—			13,307
Total expenses	6,252			249,578			49,727			—			305,557
Earnings from equity method investments	7,106			21,028			—			(5,063		)	23,071
Gain on issuance of common units by equity method investee	(41		)	—			—			—			(41		)
Operating income	813			28,880			7,694			(5,063		)	32,324
Other expenses (income), net:
Interest expense (income)	(1,416		)	20,440			(1,210		)	(237		)	17,577
Foreign currency transaction loss	—			—			1,469			—			1,469
Loss on sale of equity method investment	39,764			—			—			—			39,764
Other income, net	(237		)	—			(188		)	237			(188		)
Total other expenses, net	38,111			20,440			71			—			58,622
Income (loss) from continuing operations before income taxes	(37,298		)	8,440			7,623			(5,063		)	(26,298		)
Income tax expense (benefit)	(23,385		)	—			1,978			—			(21,407		)
Income (loss) from continuing operations	(13,913		)	8,440			5,645			(5,063		)	(4,891		)
Loss from discontinued operations, net of income taxes	—			(2		)	—			—			(2		)
Net income (loss)	(13,913		)	8,438			5,645			(5,063		)	(4,893		)
Less: net income attributable to noncontrolling interests	—			9,020			—			—			9,020
Net income (loss) attributable to SemGroup	$	(13,913	)	$	(582	)	$	5,645		$	(5,063	)	$	(13,913	)
Net income (loss)	$	(13,913	)	$	8,438		$	5,645		$	(5,063	)	$	(4,893	)
Other comprehensive income (loss), net of income taxes	(20,466		)	216			16,141			—			(4,109		)
Comprehensive income (loss)	(34,379		)	8,654			21,786			(5,063		)	(9,002		)
Less: comprehensive income attributable to noncontrolling interests	—			9,020			—			—			9,020
Comprehensive income (loss) attributable to SemGroup	$	(34,379	)	$	(366	)	$	21,786		$	(5,063	)	$	(18,022	)



	Three Months Ended March 31, 2017
	Parent			Guarantors			Non-guarantors			Consolidating Adjustments			Consolidated
Net cash provided by operating activities	$	(11,492	)	$	34,314		$	5,187		$	—		$	28,009
Cash flows from investing activities:
Capital expenditures	(1,863		)	(13,384		)	(77,001		)	—			(92,248		)
Proceeds from sale of long-lived assets	—			15,191			309			—			15,500
Contributions to equity method investments	—			(2,490		)	—			—			(2,490		)
Distributions in excess of equity in earnings of affiliates	—			4,392			—			—			4,392
Net cash provided by (used in) investing activities	(1,863		)	3,709			(76,692		)	—			(74,846		)
Cash flows from financing activities:
Debt issuance costs	(4,632		)	—			—			—			(4,632		)
Borrowings on credit facilities and issuance of senior notes, net of discount	437,018			—			—			—			437,018
Principal payments on credit facilities and other obligations	(348,272		)	(6		)	—			—			(348,278		)
Debt extinguishment costs	(16,293		)	—			—			—			(16,293		)
Repurchase of common stock for payment of statutory taxes due on equity-based compensation	(1,047		)	—			—			—			(1,047		)
Dividends paid	(29,770		)	—			—			—			(29,770		)
Proceeds from issuance of common stock under employee stock purchase plan	231			—			—			—			231
Intercompany borrowings (advances), net	(34,668		)	(38,017		)	72,548			137			—
Net cash provided by (used in) financing activities	2,567			(38,023		)	72,548			137			37,229
Effect of exchange rate changes on cash and cash equivalents	—			—			1,248			—			1,248
Change in cash and cash equivalents	(10,788		)	—			2,291			137			(8,360		)
Cash and cash equivalents at beginning of period	19,002			—			59,796			(4,582		)	74,216
Cash and cash equivalents at end of period	$	8,214		$	—		$	62,087		$	(4,445	)	$	65,856



	Three Months Ended March 31, 2016
	Parent			Guarantors			Non-guarantors			Consolidating Adjustments			Consolidated
Net cash provided by operating activities	$	26,421		$	25,221		$	14,705		$	(17,448	)	$	48,899
Cash flows from investing activities:
Capital expenditures	(1,357		)	(20,966		)	(52,556		)	—			(74,879		)
Proceeds from sale of long-lived assets	—			—			40			—			40
Contributions to equity method investments	—			(1,356		)	—			—			(1,356		)
Distributions in excess of equity in earnings of affiliates	2,158			6,074			—			(2,158		)	6,074
Net cash provided by (used in) investing activities	801			(16,248		)	(52,516		)	(2,158		)	(70,121		)
Cash flows from financing activities:
Borrowings on credit facilities	90,500			83,500			—			—			174,000
Principal payments on credit facilities and other obligations	(50,500		)	(59,511		)	—			—			(110,011		)
Distributions to noncontrolling interests	—			(10,833		)	—			—			(10,833		)
Repurchase of common stock for payment of statutory taxes due on equity-based compensation	(807		)	—			—			—			(807		)
Dividends paid	(19,887		)	—			—			—			(19,887		)
Proceeds from issuance of common stock under employee stock purchase plan	269			—			—			—			269
Intercompany borrowing (advances), net	(48,748		)	(20,516		)	50,182			19,082			—
Net cash provided by (used in) financing activities	(29,173		)	(7,360		)	50,182			19,082			32,731
Effect of exchange rate changes on cash and cash equivalents	—			—			2,884			—			2,884
Change in cash and cash equivalents	(1,951		)	1,613			15,255			(524		)	14,393
Cash and cash equivalents at beginning of period	4,559			9,058			46,043			(1,564		)	58,096
Cash and cash equivalents at end of period	$	2,608		$	10,671		$	61,298		$	(2,088	)	$	72,489