(6)Partnership Equity and Distributions

Our Minimum Quarterly Distribution

Our partnership agreement provides for a minimum quarterly distribution of $0.17 per unit for each quarter, or $0.68 per unit on an annualized basis.

Our partnership agreement generally provides that we distribute cash each quarter during the subordination period in the following manner:

first, to the holders of common units, until each common unit has received the minimum quarterly distribution of $0.17 plus any arrearages from prior quarters;

second, to the holders of subordinated units, until each subordinated unit has received the minimum quarterly distribution of $0.17; and

third, to the holders of common units and subordinated units pro rata until each has received a distribution of $0.1955.

If cash distributions to our unitholders exceed $0.1955 per common unit and subordinated unit in any quarter, our unitholders and our general partner, as the holder of our incentive distribution rights (“IDRs”), will receive distributions according to the following percentage allocations:


	Marginal Percentage
	Interest in
	Distributions
			General Partner
Total Quarterly Distribution			(as holder of
Target Amount	Unitholders		IDRs)
above $0.1955 up to $0.2125	85	%	15	%
above $0.2125 up to $0.2550	75	%	25	%
above $0.2550	50	%	50	%

General Partner Interest

Our general partner does not own any limited partner or subordinated limited partner interests in us. However, our general partner owns the IDRs and may in the future own common units or other equity interests in us and will be entitled to receive cash distributions on such interests.

Subordinated Units

Antero owns all of our subordinated units. The principal difference between our common units and subordinated units is that, for any quarter during the subordination period, holders of the subordinated units are not entitled to receive any distribution from operating surplus until the common units have received the minimum quarterly distribution from operating surplus for such quarter plus any arrearages in the payment of the minimum quarterly distribution from prior quarters. Subordinated units will not accrue arrearages. When the subordination period ends, all of the subordinated units will convert into an equal number of common units. The subordination period will end on the first business day after we have earned and paid at least $0.68 (the minimum quarterly distribution on an annualized basis) on each outstanding common unit and subordinated unit for each of three consecutive, non-overlapping four-quarter periods ending on or after September 30, 2017 and there are no outstanding arrearages on our common units.

To the extent we do not pay the minimum quarterly distribution on our common units, our common unitholders will not be entitled to receive such arrearage payments in the future except during the subordination period. To the extent we have cash available for distribution from operating surplus in any future quarter during the subordination period in excess of the amount necessary to pay the minimum quarterly distribution to holders of our common units, we will use this excess cash to pay any distribution arrearages on common units related to prior quarters before any cash distribution is made to holders of subordinated units.

Cash Distributions

The board of directors of our general partner has declared a cash distribution of $0.265 per unit for the quarter ended September 30, 2016. The distribution will be payable on November 24, 2016 to unitholders of record as of November 10, 2016.

The following table details the distributions paid during or pertaining to the periods presented below (in thousands, except per unit data):


			Distributions
			Limited Partners
Quarter and Year	Record Date	Distribution Date	Common unitholders		Subordinated unitholders		General partner (IDRs)		Total		Distributions per limited partner unit
Q4 2014	February 13, 2015	February 27, 2015	$	7,161	$	7,161	$	-	$	14,322	$	0.0943
Q1 2015	May 13, 2015	May 27, 2015	$	13,669	$	13,669	$	-	$	27,338	$	0.1800
Q2 2015	August 13, 2015	August 27, 2015	$	14,429	$	14,429	$	-	$	28,858	$	0.1900
Q3 2015	November 11, 2015	November 30, 2015	$	20,470	$	15,568	$	295	$	36,333	$	0.2050
*	November 12, 2015	November 20, 2015	$	397	$	-	$	-	$	397	$	*
	Total 2015		$	56,126	$	50,827	$	295	$	107,248

Q4 2015	February 15, 2016	February 29, 2016	$	22,048	$	16,708	$	969	$	39,725	$	0.2200
Q1 2016	May 11, 2016	May 25, 2016	$	23,556	$	17,846	$	1,850	$	43,252	$	0.2350
Q2 2016	August 10, 2016	August 24, 2016	$	25,059	$	18,985	$	2,731	$	46,775	$	0.2500
	Total 2016		$	70,663	$	53,539	$	5,550	$	129,752

* Distribution equivalent rights on units that vested under the Midstream LTIP.