16. Supplemental Guarantor Financial Information

Exterran Holdings, Inc. (“Parent”) is the issuer of the 7.25% Notes. Exterran Energy Solutions, L.P., EES Leasing LLC, EXH GP LP LLC and EXH MLP LP LLC (each a 100% owned subsidiary; together, the “Guarantor Subsidiaries”), have agreed to fully and unconditionally guarantee Parent’s obligations relating to the 7.25% Notes. As a result of these guarantees, we are presenting the following condensed consolidating financial information pursuant to Rule 3-10 of Regulation S-X. These schedules are presented using the equity method of accounting for all periods presented. Under this method, investments in subsidiaries are recorded at cost and adjusted for our share in the subsidiaries’ cumulative results of operations, capital contributions and distributions and other changes in equity. Elimination entries relate primarily to the elimination of investments in subsidiaries and associated intercompany balances and transactions. The Other Subsidiaries column includes financial information for those subsidiaries that do not guarantee the 7.25% Notes.

Condensed Consolidating Balance Sheet

March 31, 2013

(In thousands)

	Parent		Guarantor Subsidiaries		Other Subsidiaries		Eliminations			Consolidation
ASSETS

Current assets	$	1,598	$	781,103	$	518,392	$	—		$	1,301,093
Current assets associated with discontinued operations	—		—		20,994		—			20,994
Total current assets	1,598		781,103		539,386		—			1,322,087
Property, plant and equipment, net	—		1,163,519		1,695,903		—			2,859,422
Investments in affiliates	1,722,665		1,529,139		—		(3,251,804		)	—
Intangible and other assets, net	30,976		33,175		136,363		(19,268		)	181,246
Intercompany receivables	715,860		83,499		551,744		(1,351,103		)	—
Long-term assets associated with discontinued operations	—		—		297		—			297
Total long-term assets	2,469,501		2,809,332		2,384,307		(4,622,175		)	3,040,965
Total assets	$	2,471,099	$	3,590,435	$	2,923,693	$	(4,622,175	)	$	4,363,052

LIABILITIES AND EQUITY

Current liabilities	$	13,121	$	497,311	$	262,209	$	—		$	772,641
Current liabilities associated with discontinued operations	—		—		9,782		—			9,782
Total current liabilities	13,121		497,311		271,991		—			782,423
Long-term debt	896,728		378		732,548		—			1,629,654
Intercompany payables	—		1,267,604		83,499		(1,351,103		)	—
Other long-term liabilities	—		102,477		136,878		(19,268		)	220,087
Long-term liabilities associated with discontinued operations	—		—		933		—			933
Total liabilities	909,849		1,867,770		1,225,849		(1,370,371		)	2,633,097
Total equity	1,561,250		1,722,665		1,697,844		(3,251,804		)	1,729,955
Total liabilities and equity	$	2,471,099	$	3,590,435	$	2,923,693	$	(4,622,175	)	$	4,363,052

Condensed Consolidating Balance Sheet

December 31, 2012

(In thousands)

	Parent		Guarantor Subsidiaries		Other Subsidiaries		Eliminations			Consolidation
ASSETS

Current assets	$	142	$	754,303	$	461,810	$	(33	)	$	1,216,222
Current assets associated with discontinued operations	—		—		21,746		—			21,746
Total current assets	142		754,303		483,556		(33		)	1,237,968
Property, plant and equipment, net	—		1,299,797		1,542,234		—			2,842,031
Investments in affiliates	1,631,185		1,145,551		—		(2,776,736		)	—
Intangible and other assets, net	33,234		37,748		123,681		(19,815		)	174,848
Intercompany receivables	704,319		83,362		419,108		(1,206,789		)	—
Total long-term assets	2,368,738		2,566,458		2,085,023		(4,003,340		)	3,016,879
Total assets	$	2,368,880	$	3,320,761	$	2,568,579	$	(4,003,373	)	$	4,254,847

LIABILITIES AND EQUITY

Current liabilities	$	5,844	$	462,668	$	294,529	$	(74	)	$	762,967
Current liabilities associated with discontinued operations	—		—		11,572		—			11,572
Total current liabilities	5,844		462,668		306,101		(74		)	774,539
Long-term debt	884,423		—		680,500		—			1,564,923
Intercompany payables	—		1,123,427		83,362		(1,206,789		)	—
Other long-term liabilities	—		103,481		128,375		(19,774		)	212,082
Long-term liabilities associated with discontinued operations	—		—		1,044		—			1,044
Total liabilities	890,267		1,689,576		1,199,382		(1,226,637		)	2,552,588
Total equity	1,478,613		1,631,185		1,369,197		(2,776,736		)	1,702,259
Total liabilities and equity	$	2,368,880	$	3,320,761	$	2,568,579	$	(4,003,373	)	$	4,254,847

Condensed Consolidating Statement of Operations and Comprehensive Income (Loss)

Three Months Ended March 31, 2013

(In thousands)

	Parent			Guarantor Subsidiaries			Other Subsidiaries			Eliminations			Consolidation
Revenue	$	—		$	535,427		$	378,871		$	(102,921	)	$	811,377
Costs of sales (excluding depreciation and amortization expense)	—			429,448			259,570			(102,921		)	586,097
Selling, general and administrative	102			45,689			39,188			—			84,979
Depreciation and amortization	—			34,032			48,614			—			82,646
Long-lived asset impairment	—			1,895			1,668			—			3,563
Interest expense	20,023			485			7,366			—			27,874
Other (income) expense:
Intercompany charges, net	(9,085		)	8,147			938			—			—
Equity in income of affiliates	(57,703		)	(53,188		)	(4,665		)	110,891			(4,665		)
Other, net	9			(7,007		)	(2,811		)	—			(9,809		)
Income before income taxes	46,654			75,926			29,003			(110,891		)	40,692
Provision for (benefit from) income taxes	(3,551		)	18,223			479			—			15,151
Income from continuing operations	50,205			57,703			28,524			(110,891		)	25,541
Income from discontinued operations, net of tax	—			—			33,250			—			33,250
Net Income	50,205			57,703			61,774			(110,891		)	58,791
Less: Net income attributable to the noncontrolling interest	—			—			(8,586		)	—			(8,586		)
Net income attributable to Exterran stockholders	50,205			57,703			53,188			(110,891		)	50,205
Other comprehensive loss attributable to Exterran stockholders	(5,443		)	(5,335		)	(4,863		)	10,198			(5,443		)
Comprehensive income attributable to Exterran stockholders	$	44,762		$	52,368		$	48,325		$	(100,693	)	$	44,762

Condensed Consolidating Statement of Operations and Comprehensive Income (Loss)

Three Months Ended March 31, 2012

(In thousands)

	Parent			Guarantor Subsidiaries			Other Subsidiaries			Eliminations			Consolidation
Revenue	$	—		$	329,991		$	347,577		$	(62,327	)	$	615,241
Costs of sales (excluding depreciation and amortization expense)	—			257,120			230,665			(62,327		)	425,458
Selling, general and administrative	208			49,351			45,280			—			94,839
Depreciation and amortization	—			36,263			48,848			—			85,111
Long-lived asset impairment	—			2,916			1,206			—			4,122
Restructuring charges	—			2,202			845			—			3,047
Interest expense	28,683			3,053			6,255			—			37,991
Other (income) expense:
Intercompany charges, net	(17,275		)	14,802			2,473			—			—
Equity in income of affiliates	(13,302		)	(37,822		)	(37,339		)	51,124			(37,339		)
Other, net	10			(2,050		)	(4,054		)	—			(6,094		)
Income before income taxes	1,676			4,156			53,398			(51,124		)	8,106
Provision for (benefit from) income taxes	(3,819		)	(9,146		)	12,622			—			(343		)
Income from continuing operations	5,495			13,302			40,776			(51,124		)	8,449
Loss from discontinued operations, net of tax	—			—			(1,162		)	—			(1,162		)
Net income	5,495			13,302			39,614			(51,124		)	7,287
Less: Net income attributable to the noncontrolling interest	—			—			(1,792		)	—			(1,792		)
Net income attributable to Exterran stockholders	5,495			13,302			37,822			(51,124		)	5,495
Other comprehensive income attributable to Exterran stockholders	6,528			5,156			1,231			(6,387		)	6,528
Comprehensive income attributable to Exterran stockholders	$	12,023		$	18,458		$	39,053		$	(57,511	)	$	12,023

Condensed Consolidating Statement of Cash Flows

Three Months Ended March 31, 2013

(In thousands)

	Parent			Guarantor Subsidiaries			Other Subsidiaries			Eliminations			Consolidation
Cash flows from operating activities:
Net cash provided by (used in) continuing operations	$	6,851		$	19,866		$	(7,289	)	$	—		$	19,428
Net cash provided by discontinued operations	—			—			3,314			—			3,314
Net cash provided by (used in) operating activities	6,851			19,866			(3,975		)	—			22,742
Cash flows from investing activities:
Capital expenditures	—			(68,670		)	(41,698		)	3,378			(106,990		)
Proceeds from sale of property, plant and equipment	—			13,522			4,801			(3,378		)	14,945
Capital distributions received from consolidated subsidiaries	—			8,069			—			(8,069		)	—
Return of investments in non-consolidated affiliates	—			—			4,665			—			4,665
Investment in consolidated subsidiaries	—			(5,357		)	—			5,357			—
Net cash used in continuing operations	—			(52,436		)	(32,232		)	(2,712		)	(87,380		)
Net cash provided by discontinued operations	—			—			30,674			—			30,674
Net cash used in investing activities	—			(52,436		)	(1,558		)	(2,712		)	(56,706		)
Cash flows from financing activities:
Proceeds from borrowings of long-term debt	405,001			—			799,036			—			1,204,037
Repayments of long-term debt	(398,251		)	—			(747,000		)	—			(1,145,251		)
Payments for debt issuance costs	—			—			(11,373		)	—			(11,373		)
Proceeds from stock options exercised	2,576			—			—			—			2,576
Proceeds from stock issued pursuant to our employee stock purchase plan	345			—			—			—			345
Purchases of treasury stock	(3,368		)	—			—			—			(3,368		)
Stock-based compensation excess tax benefit	1,311			—			—			—			1,311
Distributions to noncontrolling partners in the Partnership	—			—			(23,331		)	8,069			(15,262		)
Capital contributions received from parent	—			—			5,357			(5,357		)	—
Borrowings (repayments) between consolidated subsidiaries, net	(14,391		)	22,693			(8,302		)	—			—
Net cash provided by (used in) financing activities	(6,777		)	22,693			14,387			2,712			33,015
Effect of exchange rate changes on cash and cash equivalents	—			—			(454		)	—			(454		)
Net increase (decrease) in cash and cash equivalents	74			(9,877		)	8,400			—			(1,403		)
Cash and cash equivalents at beginning of period	24			10,461			24,116			—			34,601
Cash and cash equivalents at end of period	$	98		$	584		$	32,516		$	—		$	33,198

Condensed Consolidating Statement of Cash Flows

Three Months Ended March 31, 2012

(In thousands)

	Parent			Guarantor Subsidiaries			Other Subsidiaries			Eliminations			Consolidation
Cash flows from operating activities:
Net cash provided by (used in) continuing operations	$	1,894		$	(13,878	)	$	49,633		$	—		$	37,649
Net cash provided by discontinued operations	—			—			1,011			—			1,011
Net cash provided by (used in) operating activities	1,894			(13,878		)	50,644			—			38,660
Cash flows from investing activities:
Capital expenditures	—			(68,175		)	(47,297		)	—			(115,472		)
Contract operations acquisition	—			77,415			(77,415		)	—			—
Proceeds from sale of property, plant and equipment	—			4,094			5,691			—			9,785
Capital distributions received from consolidated subsidiaries	—			7,373			—			(7,373		)	—
Increase in restricted cash	—			—			(15		)	—			(15		)
Return of investment in non-consolidated subsidiaries	—			—			37,563			—			37,563
Cash invested in non-consolidated affiliates	—			—			(224		)	—			(224		)
Investment in consolidated subsidiaries	—			(10,231		)	—			10,231			—
Net cash provided by (used in) continuing operations	—			10,476			(81,697		)	2,858			(68,363		)
Net cash used in discontinued operations	—			—			(1,081		)	—			(1,081		)
Net cash provided by (used in) investing activities	—			10,476			(82,778		)	2,858			(69,444		)
Cash flows from financing activities:
Proceeds from borrowings of long-term debt	279,500			—			565,000			—			844,500
Repayments of long-term debt	(438,000		)	—			(475,048		)	—			(913,048		)
Payments for debt issuance costs	—			—			(525		)	—			(525		)
Net proceeds from the sale of Partnership units	—			—			114,568			—			114,568
Proceeds from stock issued pursuant to our employee stock purchase plan	405			—			—			—			405
Purchases of treasury stock	(1,757		)	—			—			—			(1,757		)
Stock-based compensation excess tax benefit	194			—			—			—			194
Distributions to noncontrolling partners in the Partnership	—			—			(19,580		)	7,373			(12,207		)
Net proceeds from sale of general partner units	—			—			2,426			(2,426		)	—
Capital contributions received from parent	—			—			7,805			(7,805		)	—
Borrowings (repayments) between consolidated subsidiaries, net	157,942			1,691			(159,633		)	—			—
Net cash provided by (used in) financing activities	(1,716		)	1,691			35,013			(2,858		)	32,130
Effect of exchange rate changes on cash and cash equivalents	—			—			243			—			243
Net increase (decrease) in cash and cash equivalents	178			(1,711		)	3,122			—			1,589
Cash and cash equivalents at beginning of period	93			2,810			19,000			—			21,903
Cash and cash equivalents at end of period	$	271		$	1,099		$	22,122		$	—		$	23,492