NET INCOME PER COMMON UNIT

Basic net income per common unit is determined pursuant to the two-class method. Under this method, all earnings are allocated to our limited partners and participating securities based on their respective rights to receive distributions earned during the period. Participating securities include restricted units awarded under our long-term incentive plan and, prior to the Merger, included our general partner’s interest. We compute basic net income per common unit by dividing net income attributable to common units by the weighted-average number of common units outstanding during the period.

As discussed in Note 11, the Series D Preferred Units are convertible into common units at the option of the holder at any time on or after June 29, 2028, and, as such, we calculated the dilutive effect of the Series D Preferred Units using the if-converted method. For the three and six months ended June 30, 2018, the effect of the assumed conversion of the 15,760,441 Series D Preferred Units outstanding as of June 30, 2018 was antidilutive and, therefore, we did not include such conversion in the computation of diluted net income per common unit.

The following table details the calculation of net income per common unit:



	Three Months Ended June 30,						Six Months Ended June 30,
	2018			2017			2018		2017
	(Thousands of Dollars, Except Unit and Per Unit Data)
Net income	$	29,399		$	26,250		$	155,532	$	84,190
Less: Distributions to preferred limited partners	16,245			9,950			32,235		14,763
Less: Distributions to general partner (including incentive distribution rights)	—			13,214			1,141		28,469
Less: Distributions to common limited partners	64,205			101,869			120,121		203,782
Less: Distribution equivalent rights to restricted units	480			712			925		1,427
Distributions (in excess of) less than earnings	$	(51,531	)	$	(99,495	)	$	1,110	$	(164,251	)

Net income attributable to common units:
Distributions to common limited partners	$	64,205		$	101,869		$	120,121	$	203,782
Allocation of distributions (in excess of) less than earnings	(50,500		)	(97,505		)	1,079		(160,966		)
Total	$	13,705		$	4,364		$	121,200	$	42,816

Basic weighted-average common units outstanding	93,192,238			90,345,469			93,187,038		84,526,506

Basic net income per common unit	$	0.15		$	0.05		$	1.30	$	0.51