Steel Partners Holdings L.P. Annual Report 2018

← All annual reports

FY2018 Annual Report · Steel Partners Holdings L.P.

Loading PDF…

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

(Mark One)

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For The Fiscal Year Ended December 31, 2018

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934

Commission File Number: 001-35493
______________

STEEL PARTNERS HOLDINGS L.P.

(Exact name of registrant as specified in its charter)

Delaware
(State of incorporation)
590 Madison Avenue, 32nd Floor
New York, New York
(Address of principal executive offices)

13-3727655
(I.R.S. Employer Identification No.)

10022
(Zip code)

Registrant's telephone number, including area code: (212) 520-2300

Securities registered pursuant to Section 12(b) of the Act:

Title of each class
Common units, $0 par

Name of each exchange on
which registered
New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act:

Common Units, no par value

Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes

Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the

Act. Yes

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be
submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter
period that the registrant was required to submit such files). Yes

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter)
is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a
smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer,"
"smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer
Non-accelerated filer

Accelerated filer
Smaller reporting company
Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition
period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange
Act.

Indicate by check mark whether the registrant is a shell company (as defined by Rule 12b-2 of the Exchange Act). Yes

The aggregate market value of our common units held by non-affiliates of registrant as of June 30, 2018 totaled

approximately $207.1 million based on the then-closing unit price.

On February 27, 2019, there were 24,788,667 common units outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

The information required by Items 10, 11, 12, 13 and 14 of Part III will be incorporated by reference to certain portions

of a definitive proxy statement, which will be filed by the Registrant within 120 days after the close of its fiscal year.

96
96

STEEL PARTNERS HOLDINGS L.P.
TABLE OF CONTENTS

Business
Risk Factors

Item 1A.
Item 1B. Unresolved Staff Comments
Item 2.

Properties
Legal Proceedings

PART I

Item 1.

Item 3.

Item 4.

PART II

Item 5.

Item 6.

Item 7.

Item 8.

Item 9.

Mine Safety Disclosures

Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of
Equity Securities

Selected Financial Data
Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Financial Statements and Supplementary Data

Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
Controls and Procedures

Item 9A.
Item 9B. Other Information

PART III

Item 10.

Item 11.

Item 12.

Item 13.

Item 14.

PART IV

Directors, Executive Officers and Corporate Governance

Executive Compensation

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder
Matters

Certain Relationships and Related Transactions, and Director Independence

Principal Accounting Fees and Services

Item 15.

Exhibits, Financial Statement Schedules

Item 16.

Form 10-K Summary

SIGNATURES

As used in this Form 10-K, unless the context otherwise requires, the terms "we," "us," "our," "SPLP" and the "Company"

refer to Steel Partners Holdings L.P., a Delaware limited partnership.

PART I

FORWARD-LOOKING STATEMENTS

This report includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as
amended ("Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended ("Exchange Act"), including, in
particular, forward-looking statements under the headings "Item 7 - Management's Discussion and Analysis of Financial Condition
and Results of Operations" and "Item 8 - Financial Statements and Supplementary Data." These statements appear in a number of
places in this report and include statements regarding the Company's intent, belief or current expectations with respect to (i) its
financing plans, (ii) trends affecting its financial condition or results of operations, and (iii) the impact of competition. The words
"expect," "anticipate," "intend," "plan," "believe," "seek," "estimate" and similar expressions are intended to identify such forward-
looking statements; however, this report also contains other forward-looking statements in addition to historical information.

All monetary amounts used in this section are in thousands unless otherwise indicated.

Item 1. Business

The Company

SPLP is a diversified global holding company that owns and operates businesses and has significant interests in leading
companies in various industries, including diversified industrial products, energy, defense, supply chain management and logistics,
banking and youth sports. SPLP operates through the following segments: Diversified Industrial, Energy, Financial Services, and
Corporate and Other. Each of our companies has its own management team with significant experience in their industries. Our
subsidiary, Steel Services Ltd ("Steel Services"), through management services agreements, provides services to us and some of
our companies which include assignment of C-Level management personnel, legal, tax, accounting, treasury, consulting, auditing,
administrative, compliance, environmental health and safety, human resources, marketing, investor relations, operating group
management and other similar services. We work with our businesses to increase corporate value over the long term for all
stakeholders by implementing our unique strategy discussed in more detail below.

SPLP is managed by SP General Services LLC ("Manager"), pursuant to the terms of an amended and restated management
agreement ("Management Agreement") discussed in further detail in Note 20 – "Related Party Transactions" to the SPLP consolidated
financial statements found elsewhere in this Form 10-K. From its founding in 1990, the Manager and its affiliates have focused on
increasing value for investors in the entities it has managed. Our wholly-owned subsidiary, Steel Partners Holdings GP Inc. ("General
Partner"), is our general partner. The General Partner has a board of directors ("Board of Directors"). The Board of Directors is
currently comprised of eight members, six of whom are elected annually by our unitholders and two of whom are appointed by the
Manager. Warren G. Lichtenstein, the Executive Chairman of our Manager, serves as the Executive Chairman of the Board of
Directors.

Products and Product Mix

Diversified Industrial Segment

The Diversified Industrial segment is comprised of manufacturers of engineered niche industrial products, with leading
market positions in many of the markets they serve. The businesses in this segment distribute products to customers through their
sales personnel, outside sales representatives and distributors in North and South America, Europe, Australia, Asia and several other
international markets. Below is additional information related to the businesses within the Diversified Industrial segment.

Joining Materials - The Joining Materials business primarily fabricates precious metals and their alloys into brazing alloys.
Brazing alloys are used to join similar and dissimilar metals, as well as specialty metals and some ceramics, with strong, hermetic
joints. The Joining Materials business offers these metal joining products in a wide variety of alloys, including gold, silver, palladium,
copper, nickel, aluminum and tin. These brazing alloys are fabricated into a variety of engineered forms and are used in many
industries, including electrical, appliance, transportation, construction and general industrial, where dissimilar material and metal
joining applications are required. Operating income from precious metal products is principally derived from the "value-added" of
processing and fabricating and not from the direct purchase and resale of precious metals. The Joining Materials business enters
into commodity futures and forward contracts to mitigate the impact of price fluctuations on its precious and certain non-precious

metal inventories that are not subject to fixed price contracts. We believe that our Joining Materials business is the North American
market leader in many of the markets that it serves.

Tubing - The Tubing business manufactures a wide variety of stainless and low carbon steel tubing products. The Tubing
business manufactures some of the world's longest continuous seamless stainless steel tubing coils, up to 6,000 feet, serving primarily
the petrochemical and oil & gas infrastructure markets. In addition, it is a top supplier of precision, small diameter (less than 3 mm)
coil tubing to industry leading specifications serving the aerospace, defense and health care markets. The Tubing business is also
a leading manufacturer of mechanical and fluid-carrying welded low carbon tubing used for diverse industries, including the
automotive, heavy truck, heating, cooling and oil & gas markets. Products are delivered in continuous lengths from 2 inches to
30,000 feet in coil, cut or spool packaging styles.

Building Materials - The Building Materials business manufactures and supplies products primarily to the commercial
construction and building industries. It manufactures fasteners, adhesives and fastening systems for the U.S. commercial low-slope
roofing industry, which are sold to building and roofing material wholesalers, roofing contractors and private label roofing system
manufacturers, and a line of engineered specialty fasteners for the building products industry for fastening applications in the
remodeling and construction of homes, decking and landscaping. We believe that our primary business unit in the Building Materials
business is the market leader in fasteners and accessories for commercial low-slope roofing applications and that the majority of
the net sales for our Building Materials business are for the commercial construction repair and replacement market.

Performance Materials - The Performance Materials business manufactures woven substrates of fiberglass, quartz, carbon
and aramid materials for specialty applications in a wide expanse of markets requiring highly engineered components. Its products
are used in a wide range of advanced composite applications, such as civilian and military aerospace components, printed electronic
circuit boards, automotive and industrial components, and substrates for civilian and military armor applications.

Electrical Products - The Electrical Products business designs, manufactures and markets power electronics, motion
control, power protection, power quality electromagnetic equipment, and custom ball-screws, gears and gearboxes used in a variety
of medical, commercial and military aerospace, computer, datacom, industrial, specialty LED lighting, test & measurement, and
telecom applications. Its products are generally incorporated into larger systems to improve operating performance, safety, reliability
and efficiency.

Kasco Blades and Route Repair Services ("Kasco") - The Kasco business provides meat-room blade products, repair
services and resale products for the meat and deli departments of supermarkets, restaurants, meat and fish processing plants, and
for distributors of electrical saws and cutting equipment, principally in North America and Europe. The Kasco business also provides
cutting blades for bakeries, in addition to wood cutting blade products for the pallet manufacturing, pallet recycler and portable
saw mill industries in North America.

Packaging - The Packaging business manufactures and distributes foils, films and laminates used to enhance the visual
appeal of products and packaging. Packaging's laminates and foils businesses produce carton board laminates and foils for the
packaging of consumer goods, as well as the food and confectionery, tobacco, health and beauty, personal care, greeting cards,
books, magazines, footwear, sports goods, and office and promotional products industries. The Packaging business includes the
operations of Dunmore Corporation in the U.S. and Dunmore Europe GmbH in Germany (collectively, "Dunmore"), which were
acquired in February 2018. Dunmore manufactures and distributes coated, laminated and metallized films for engineered applications
in the imaging, aerospace, insulation and solar photo-voltaic markets and also provides products for custom and special applications.

Energy Segment

The Energy segment provides drilling and production services to the oil & gas industry and owns a youth sports business.
Its parent company also has equity method and other investments in a number of businesses. Below is additional information related
to the consolidated businesses within the Energy segment.

Steel Energy - The Energy business provides completion, re-completion and production services to exploration and
production companies in the oil & gas business. The services provided include well completion and recompletion, well maintenance
and workover, snubbing, flow testing, down hole pumping, plug and abandonment, well logging and perforating wireline services.

Steel Sports - Steel Sports is a social impact organization that strives to provide a first-class youth sports experience

emphasizing positive experiences and instilling the core values of discipline, teamwork, safety, respect and integrity.

Financial Services Segment

The Financial Services segment consists primarily of the operations of WebBank. WebBank is a Utah chartered industrial
bank subject to comprehensive regulation, examination and supervision by the Federal Deposit Insurance Corporation ("FDIC")
and the State of Utah Department of Financial Institutions ("UDFI"). WebBank is not considered a "bank" for Bank Holding
Company Act purposes and, as such, SPLP is not regulated as a bank holding company. WebBank's deposits are insured by the
FDIC. WebBank engages in a full range of banking activities, including originating loans, issuing credit cards and taking deposits
that are federally insured. WebBank originates and funds consumer and small business loans through lending programs with
unaffiliated companies that market and service the programs ("Marketing Partners"), where the Marketing Partners subsequently
purchase the loans (or interests in the loans) that are originated by WebBank. WebBank retains a portion of the loans it originates
for its Marketing Partners. WebBank also has private-label financing programs that are branded for a specific retailer, manufacturer,
dealer channel, proprietary network or bank card program. WebBank participates in syndicated commercial and industrial as well
as asset-based credit facilities and asset-based securitizations through relationships with other financial institutions.

Corporate and Other Segment

The Corporate and Other segment consists of several consolidated subsidiaries, including Steel Services, equity method
and other investments, and cash and cash equivalents. Its income or loss includes certain unallocated general corporate expenses.
Steel Services has management services agreements with our consolidated subsidiaries and other related companies. For additional
information on these service agreements see Note 20 - "Related Party Transactions" to the SPLP consolidated financial statements
found elsewhere in this Form 10-K.

Business Strategy

We continuously evaluate the retention and disposition of existing operations and investigate possible acquisitions of new
businesses, often focusing on businesses that are selling substantially below intrinsic value. We consider possible synergies and
economies of scale in operating and/or making determinations to acquire or dispose of companies. We seek additional means to
reduce costs and to encourage integration of operations and the building of business relationships among our companies, consistent
with our desire that our unitholders benefit from the diversified holding company structure.

We strive to enhance the business operations of our companies and increase corporate value for unitholders and stakeholders
through balance sheet improvements, strategic allocation of capital, and operational and growth initiatives. We use a set of tools
and processes called the Steel Business System to drive operational and commercial efficiencies across each of our businesses. The
Steel Business System utilizes a strategy deployment process to execute strategic initiatives for each of our businesses to improve
their performance, including objectives relating to manufacturing improvement, idea generation, product development, and global
sourcing of materials and services. Our operational initiatives include creating efficiencies through consolidated purchasing and
materials sourcing provided by the Steel Partners Purchasing Council, which arranges shared purchasing programs and is reducing
costs for, and providing other benefits to, a number of our companies. We are focused on reducing corporate overhead of our
companies by centralizing certain administrative and corporate services through Steel Services, which provides management,
consulting and advisory services.

Generally, we seek to actively acquire and maintain control over our companies through our ability to influence their
policies. Depending on the size of our ownership interests in any given company, this may be achieved by obtaining board
representation and overseeing and providing assistance to the existing management team. We generally view our companies as
long-term holdings, and we expect to realize value by operating them with a view towards fostering growth and maximizing their
value rather than through the sale of ownership interests. The securities of some of the companies in which we have interests are
traded on national securities exchanges, while others are privately held or not actively traded.

Customers

The businesses within the Diversified Industrial segment are diversified across industrial markets and customers. Its
businesses sell to customers in the construction, electrical, electronics, transportation, power control, utility, medical, oil & gas
exploration, aerospace and defense, consumer products, packaging and food industries. No customer accounted for more than 10%
of the Diversified Industrial segment's consolidated net sales in 2018 or 2017. The Diversified Industrial segment's 15 largest
customers accounted for approximately 28% of consolidated Diversified Industrial segment net sales in 2018.

The Energy segment primarily provides its services to customers' extraction and production operations in North Dakota
and Montana in the Bakken basin, Colorado and Wyoming in the Niobrara basin, Texas in the Permian basin and New Mexico in
the San Juan basin. It relies primarily on its local operations to sell and market its services. In 2018, the Energy segment had two
customers that made up 24% of its net revenue, and its top 15 customers made up 73% and 70% of its net revenue for the years
ended December 31, 2018 and 2017, respectively.

In the Financial Services segment, WebBank earns interest income primarily from interest and fees earned on loans and
investments, and it earns non-interest income primarily from origination fees earned on loans, fee income on contractual lending
arrangements, premiums on the sale of loans and loan servicing fees. For the years ended December 31, 2018 and 2017, the two
highest grossing contractual lending programs accounted for 29% and 40%, respectively, of WebBank's total revenue.

Raw Materials

The raw materials used by the businesses within the Diversified Industrial segment are as follows:

In addition to precious metals, the raw materials used in the Joining Materials, Tubing, Building Materials, Electrical
Products and Kasco businesses consist principally of stainless, silicon and carbon steel, aluminum, copper, tin, nickel alloys, a
variety of high-performance alloys, permanent magnets, electronic and electrical components, chemicals and various plastic
compositions. The raw materials used in the operations of the Performance Materials business consist principally of fiberglass,
quartz and aramid yarns. The raw materials used in the Packaging business consist principally of board, PET film, organic solvents,
aluminum, resins, pigments and adhesives. Raw materials are generally purchased at open market prices from domestic and foreign
suppliers. The Diversified Industrial segment businesses have not experienced any significant problem in obtaining the necessary
quantities of raw materials. Prices and availability, particularly of raw materials purchased from foreign suppliers, are affected by
world market conditions and government policies. The raw materials used by these businesses are generally readily available from
more than one source.

The businesses in our Diversified Industrial segment also require significant amounts of electricity, oil & natural gas to
operate their facilities, and they are subject to price changes in these commodities. A shortage of electricity, oil or natural gas, or a
government allocation of supplies resulting in a general reduction in supplies, could increase costs of production and could cause
some curtailment of production.

Capital Investments

SPLP believes that in order to be and remain competitive, its businesses must continuously strive to increase revenue,
improve productivity and product quality, and control and/or reduce manufacturing costs. Accordingly, SPLP expects to continue
to make capital investments that reduce overall manufacturing costs, improve the quality of products produced and services provided
and broaden the array of products offered to the industries it serves, as well as replace equipment as necessary to maintain compliance
with environmental, health and safety laws and regulations. SPLP's capital expenditures for 2018 and 2017 were $47,085 and
$54,737, respectively. SPLP anticipates funding its capital expenditures in 2019 from funds generated by operations and borrowed
funds.

Employment

As of December 31, 2018, the Company employed approximately 5,300 employees worldwide. Of these employees, 550
were covered by collective bargaining agreements, all in the Diversified Industrial segment. The Energy segment also hires additional
full-time and part-time employees during peak seasonal periods.

Competition

There are many companies, larger and smaller, domestic and foreign, which manufacture products or provide services of
the type offered by our businesses. Some of these competitors are larger and have financial resources greater than our subsidiaries.
Some of these competitors enjoy certain other competitive advantages, including greater name recognition, greater financial,
technical, marketing and other resources, a larger installed base of customers and well-established relationships with current and
potential customers.

Competition in the Diversified Industrial segment is based on quality, technology, performance, service, reputation, price,

and in some industries, new product introduction.

The Energy business operates in a highly competitive industry that is influenced by price, capacity, reputation and
experience. In times of high demand, capacity, reputation and experience are major competitive forces. In times of low demand,
service providers will compete on price to attract customers. In addition, they need to maintain a safe work environment and a well-
trained work force to remain competitive. Energy services are affected by seasonal factors, such as inclement weather, fewer daylight
hours and holidays during the winter months. Heavy snow, ice, wind or rain can make it difficult to operate and to move equipment
between work sites, which can reduce its ability to provide services and generate revenues. These seasonal factors affect competitors
5

as well. Because they have conducted business together over several years, the members of our local operations have established
strong working relationships with certain of their clients. These strong client relationships provide a better understanding of region-
specific issues and enable us to better address customer needs. The market for Steel Sports' baseball facility services and soccer
camps and leagues is very fragmented, and its competitors are primarily small local or regional operations.

WebBank competes with a broad range of banks, both larger and smaller, across its various lines of business.

Regulation

We are subject to many U.S. federal and state and foreign laws and regulations, including those related to environmental
protection, labor, employment, worker health and safety, import and export, customs and tariffs, cybersecurity, intellectual property,
privacy and protection of user data. WebBank is also subject to regulatory capital requirements administered by the FDIC and legal
requirements in connection with the consumer and business lending programs that it originates.

These laws and regulations are constantly evolving and may be interpreted, applied, created or amended in a manner that
could harm our business. We believe that we are in compliance in all material respects with all such laws and regulations and that
we have obtained all material licenses and permits that are required for the operation of our business. For more information regarding
regulatory risks, see the information in Part I, Item 1A, Risk Factors, of this Report.

Other Information

The amounts of revenue, earnings before taxes and identifiable assets attributable to the aforementioned business segments
and additional information regarding SPLP's investments are included in Note 21 - "Segment Information" and Note 10 -
"Investments" to the SPLP consolidated financial statements found elsewhere in this Form 10-K.

Our common units are quoted on the New York Stock Exchange under the symbol "SPLP." Our business address is 590
Madison Avenue, 32nd Floor, New York, New York 10022, and our telephone number is (212) 520-2300. Our website is
www.steelpartners.com. The information contained in, or that can be accessed through, the website is not part of this Form 10-K.
This Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and all amendments to those reports, are available
to you free of charge through our website as soon as reasonably practicable after those materials have been electronically filed with,
or furnished to, the U.S. Securities and Exchange Commission ("SEC").

Item 1A. Risk Factors

Our business is subject to a number of risks. You should carefully consider the following risk factors, together with all of
the other information included or incorporated by reference in this report, before you decide whether to purchase our common or
preferred units. These factors are not intended to represent a complete list of the general or specific risks that may affect us. It should
be recognized that other risks may be significant, presently or in the future, and the risks set forth below may affect us to a greater
extent than indicated. If any of the following risks occur, our business, financial condition and results of operations could be
materially adversely affected. In such case, the trading price of our common and preferred units could decline, and you may lose
all or part of your investment.

The ordering of the risk factors set forth below is not intended to reflect any Company indication of priority or likelihood.

Risks Related to Our Business

Certain of the Company's subsidiaries sponsor defined benefit pension plans, which could subject the Company to

substantial cash funding requirements in the future.

The Company's ongoing operating cash flow requirements include arranging for the funding of the minimum requirements
of its subsidiaries' defined benefit pension plans. The Company is jointly and severally liable with Handy & Harman Ltd. and JPS
Industries Holdings LLC for such subsidiaries' underfunded pension liabilities. The performance of the financial markets and interest
rates, as well as health care trends and associated mortality rates, impact our defined benefit pension plan expense and funding
obligations. Significant changes in these factors, including adverse changes in discount rates, investment losses on plan assets and
increases in participant life expectancy, may increase our funding obligations and adversely impact our financial condition. Required
future contributions are estimated based upon assumptions such as discount rates on future obligations, assumed rates of return on
plan assets and legislative changes. Actual future pension costs and required funding obligations will be affected by changes in the
factors and assumptions described in the previous sentence, as well as other changes such as any plan termination or other acceleration
events. See the "Liquidity and Capital Resources" section of this Form 10-K for additional information.

We could incur significant costs, including remediation costs, as a result of complying with environmental laws or

failing to comply with other extensive regulations, including banking regulations, that our businesses are subject to.

Our businesses are subject to extensive regulation by U.S. and non-U.S. governmental and self-regulatory entities at the
federal, state and local levels, including laws related to anti-corruption, environmental matters, privacy matters, banking, health
and safety, import laws and export control and economic sanctions, and the sale of products and services to government entities.
Some of these laws and regulations pertain to the handling, storage and transportation of raw materials, products and wastes, and
hazardous materials and wastes. Compliance with such requirements may make it necessary for us to retrofit existing facilities with
additional pollution-control equipment, undertake new measures in connection with the storage, transportation, treatment and
disposal of by-products and wastes or take other steps, which may be at a substantial cost to our subsidiaries. Although our subsidiaries
maintain insurance coverage for certain environmental matters, they could incur substantial costs, including cleanup costs, fines or
sanctions, and third-party claims for property damage or personal injury, as a result of violations of, or liabilities under, environmental
laws. Any material violations of these laws can lead to substantial liability, revocations of discharge permits, fines or penalties, and
any new laws, regulations and enforcement policies could become more stringent and significantly increase our compliance costs
or limit our future business opportunities, negatively impacting our financial condition, business and results of operations.

In addition, the consumer and business lending programs offered by WebBank are subject to extensive legal requirements
at the federal and state levels, described in more detail below. If WebBank or its programs do not comply with these laws, it may
be subject to claims for damages, fines, penalties or other relief, and may face regulatory examination and enforcement action, and
some violations could result in an underlying loan being found invalid or unenforceable, or subject to payment defenses.

Many of the customers in our Energy segment utilize hydraulic fracturing services, which is the process of creating or
expanding cracks, or fractures, in formations underground where water, sand and other additives are pumped under high pressure
into the formation. Although our Energy segment is not a provider of hydraulic fracturing services, many of its services complement
the hydraulic fracturing process. Fracturing regulations vary widely because they are regulated at the state level. States continue to
evaluate fracturing activities and their impact on the environment. Legislation for broader federal regulation of hydraulic fracturing
operations and the reporting and public disclosure of chemicals used in the fracturing process could be enacted. Additionally, the
United States Environmental Protection Agency has asserted federal regulatory authority over certain hydraulic fracturing activities
involving diesel fuel under the Safe Drinking Water Act. Our Energy segment's customers' operations could be adversely affected
if additional regulation or permitting requirements were to be required for hydraulic fracturing activities, which could have an
adverse effect on our results of operations.

These are not the only regulations that our businesses must comply with. Failure to comply with these or any other
regulations could result in civil and criminal, monetary and non-monetary penalties, damage to our reputation, disruptions to our
business, limitations on our ability to manufacture, import, export and sell products and services, disbarment from selling to certain
federal agencies, damage to our reputation and loss of customers and could cause us to incur significant legal and investigatory
fees. Compliance with these and other regulations may also require us to incur significant expenses. The products and operations
of our businesses are also often subject to the rules of industrial standards bodies such as the International Organization for
Standardization (ISO), and failure to comply with these rules could result in withdrawal of certifications needed to sell our products
and services and otherwise adversely impact our financial condition.

WebBank operates in a highly regulated environment, and its lending programs are subject to extensive federal and

state regulation. Ongoing legislative and regulatory actions may significantly affect our liquidity or financial condition.

The consumer and business lending programs offered by WebBank are subject to extensive legal requirements at the federal

and state levels. Among the laws that may be applicable to some or all of the programs offered by WebBank are:

•

the Federal Truth-in-Lending Act and Regulation Z promulgated thereunder, which require certain disclosures to borrowers
regarding the terms of their loans;
the Dodd-Frank Wall Street Reform and Consumer Protection Act ("Dodd-Frank Act"), the Federal Trade Commission Act and
state laws that prohibit unfair, deceptive, or abusive acts or practices;
the Federal Equal Credit Opportunity Act and Regulation B promulgated thereunder, which prohibit discrimination in the
extension of credit on the basis of age, race, color, sex, religion, marital status, national origin, receipt of public assistance or
the exercise of any right under the Consumer Credit Protection Act;
the Fair Credit Reporting Act, which governs the use of credit reports and the reporting of information to credit bureaus, and
imposes restrictions on the marketing of credit products through prescreened solicitations based on credit report information;

•

the Servicemembers Civil Relief Act and the Military Lending Act, which impose rate limitations and other requirements in
connection with the credit obligations of active duty military personnel and certain of their dependents;
federal and state laws relating to privacy and the safeguarding of personally identifiable consumer information and data breach
notification;
the Bank Secrecy Act, which relates to compliance with anti-money laundering, customer due diligence and record-keeping
policies and procedures; and
laws governing the permissibility of the interest rates and fees that are charged to borrowers.

The Dodd-Frank Act, which was signed into law in 2010, is intended primarily to overhaul the financial regulatory
framework and impacts all financial institutions, including WebBank. The Dodd-Frank Act, among other things, established the
Bureau of Consumer Financial Protection ("CFPB") and Financial Stability Oversight Council, consolidated certain federal bank
regulators and imposed increased corporate governance and executive compensation requirements. The Economic Growth,
Regulatory Relief, and Consumer Protection Act, which was signed into law in May 2018, amended the Dodd-Frank Act in some
respects, but many of the requirements of the Dodd-Frank Act remain in effect. The extent and complexity of this regulatory
framework and other regulations has increased WebBank's regulatory compliance burden and therefore has increased its regulatory
risk.

If WebBank or its programs do not comply with these laws, it may be subject to claims for damages, fines, penalties or
other relief, and may face regulatory scrutiny. In addition, some violations could result in an underlying loan being found invalid
or unenforceable, or subject to payment defenses. Any of these violations could result in the imposition of liability on WebBank,
although WebBank may have indemnification rights for certain claims. In addition, there could be limitations on WebBank's ongoing
or future business.

WebBank offers lending programs through relationships with Marketing Partners. WebBank and its Marketing Partners
are subject to supervision by the FDIC and the UDFI. The authority of the FDIC and the UDFI includes the ability to examine
WebBank, the Marketing Partners and the programs. The FDIC and UDFI also may bring enforcement actions against WebBank
and its Marketing Partners if they detect any violations of law. These enforcement actions could result in monetary liability on
WebBank, increased compliance obligations or limitations on its ongoing and future business.

Other regulators, including the CFPB and the Federal Trade Commission ("FTC"), may bring investigations and
enforcement actions against WebBank's Marketing Partners. In 2018, the FTC brought such an enforcement action against one of
WebBank's Marketing Partners, which remains ongoing. These actions against Marketing Partners may increase WebBank's own
regulators' scrutiny of WebBank's business and could result in an increased risk of investigations or claims being brought against
WebBank.

The U.S. Congress and state legislatures and federal and state regulatory authorities continually review banking laws,
regulations and policies for possible changes. We cannot predict whether additional legislation or regulations will be enacted and,
if enacted, the effect that it would have on our business, financial condition or results of operations.

Future cash flows from operations or through financings may not be sufficient to enable the Company to meet its
obligations, and this would likely have a material adverse effect on its businesses, financial condition and results of operations,
and credit market volatility may affect our ability to refinance our existing debt, borrow funds under our existing lines of credit
or incur additional debt.

There can be no assurances that the Company or its subsidiaries will continue to have access to their lines of credit if their
financial performance does not satisfy the financial covenants set forth in the applicable financing agreements. If the Company or
its subsidiaries do not meet certain of its financial covenants, and if they are unable to secure necessary waivers or other amendments
from the respective lenders on terms acceptable to management, their ability to access available lines of credit could be limited,
their debt obligations could be accelerated by the respective lenders and liquidity could be adversely affected.

If the Company's or its subsidiaries' cash needs are significantly greater than anticipated or they do not materially meet
their business plans, or there are unanticipated downturns in the markets for the Company's and its subsidiaries' products and services,
the Company or its subsidiaries may be required to seek additional or alternative financing sources. Future disruption and volatility
in credit market conditions could have a material adverse impact on the Company's ability or that of its subsidiaries to refinance
debt when it comes due on terms similar to our current credit facilities, or to draw upon existing lines of credit or incur additional
debt if needed. There can be no assurance therefore that such financing will be available or available on acceptable terms. The
inability to generate sufficient cash flows from operations or through financings could impair the Company's or its subsidiaries'
liquidity and would likely have a material adverse effect on their businesses, financial condition and results of operations.

Our business strategy includes acquisitions, and acquisitions entail numerous risks, including the risk of management

diversion and increased costs and expenses, all of which could negatively affect the Company's profitability.

Our business strategy includes, among other things, strategic acquisitions, as well as potential opportunistic acquisitions.
This element of our strategy entails several risks, including the diversion of management's attention from other business concerns
and the need to finance such acquisitions with additional equity and/or debt.

In addition, once completed, acquisitions entail further risks, including: unanticipated costs and liabilities of the acquired
businesses, including environmental liabilities, that could materially adversely affect our results of operations; difficulties in
assimilating acquired businesses, preventing the expected benefits from the transaction from being realized or achieved within the
anticipating time frame; negative effects on existing business relationships with suppliers and customers; and losing key employees
of the acquired businesses. If our acquisition strategy is not successful or if acquisitions are not well integrated into our existing
operations, the Company's profitability could be negatively affected.

We may sustain losses in our investment portfolio, which could have an adverse effect on our results of operations,

financial condition and liquidity.

A portion of our assets consists of equity securities which are adjusted to fair value each period, as well as other investments.
An adverse change in economic conditions or setbacks unique to such companies, their operations or business models may result
in a decline in the value of these investments. Such declines in value are principally recognized in net income or loss in accordance
with current accounting principles generally accepted in the United States of America ("U.S. GAAP"). Any adverse changes in the
financial markets and resulting declines in value of our investments may result in additional losses and could have an adverse effect
on our results of operations, financial condition and liquidity.

Rising interest rates may negatively impact our investments and have an adverse effect on our business, financial

condition, results of operations and cash flows.

In recent years, the Federal Reserve System ("Fed") has incrementally raised the target range for the federal funds rate,
with additional increases expected to come over the next year. As interest rates increase, generally, the cost of borrowing increases,
affecting our interest costs and ability to make new investments on favorable terms or at all. More generally, interest rate fluctuations
and changes in credit spreads on floating rate loans may have a negative impact on our investments and investment opportunities
and, accordingly, may have a material adverse effect on our rate of return on invested capital, our net investment income, our net
asset value and the market price of our securities. In addition, an increase in interest rates may make it difficult or impossible to
make payments on outstanding indebtedness. There can be no guaranty the Fed will raise rates at the gradual pace they originally
proposed, nor can there be any assurance that the Fed will make sound decisions as to when to raise rates. The increase in interest
rates could have a negative effect on our interest costs and investments, which could negatively impact our operating results, financial
condition and cash flows.

As more fully described in Part II, Item 7A, Quantitative and Qualitative Disclosures About Market Risk, of this Report,
WebBank derives a portion of its income from the excess of interest collected over interest paid. The rates of interest WebBank
earns on assets and pays on liabilities generally are established contractually for a period of time. Market interest rates change over
time. Accordingly, WebBank's results of operations, like those of most financial institutions, are impacted by changes in interest
rates and the interest rate sensitivity of its assets and liabilities. WebBank monitors and measures its exposure to changes in interest
rates in order to comply with applicable government regulations and to limit the risk that rising interest rates could have a negative
impact on its results of operations. There can be no assurance, however, that, in the event of adverse changes in interest rates,
WebBank's efforts to limit interest rate risk will be successful.

Our businesses rely, and may rely, on their intellectual property and licenses to use others' intellectual property, for
competitive advantage. If our businesses are unable to protect their intellectual property, are unable to obtain or retain licenses
to use others' intellectual property, or if they infringe upon or are alleged to have infringed upon others' intellectual property,
it could have a material adverse effect on their financial condition, business and results of operations.

The success of each of our businesses depends in part on the trademarks and patents that they own, or their licenses to use
others', brand names, proprietary technology and manufacturing techniques. In addition to trademark and patent protection, these
businesses rely on copyrights, trade secrets, confidentiality procedures and contractual provisions to protect their intellectual property
rights. The steps they have taken to protect their intellectual property rights may not prevent third parties from using their intellectual
property without their authorization or independently developing intellectual property that is similar. In addition, the laws of foreign

countries may not protect our businesses' intellectual property rights effectively. Stopping unauthorized use of proprietary
information and intellectual property, and defending claims of unauthorized use of others' proprietary information or intellectual
property, may be difficult, time-consuming and costly and could subject our businesses to significant liability for damages and
invalidate their property rights. Such unauthorized use could reduce or eliminate any competitive advantage our businesses have
developed, cause them to lose sales or otherwise harm their business.

We conduct business outside of the U.S., which may expose us to additional risks not typically associated with companies

that operate solely in the U.S.

We conduct business and have operations or own interests in securities of companies with operations outside the U.S.
These operations have additional risks, including risks relating to currency exchange, less developed or efficient financial markets
than in the U.S., absence of uniform accounting, auditing and financial reporting standards, differences in the legal and regulatory
environment, different publicly available information in respect of companies in non-U.S. markets, economic and political risks,
and possible imposition of non-U.S. taxes. There can be no assurance that adverse developments with respect to such risks will not
adversely affect our assets that are held in certain countries or the returns from these assets.

We also face several risks inherent in conducting business internationally, including compliance with international and
U.S. laws and regulations that apply to our international operations. These laws and regulations include data privacy requirements,
labor relations laws, tax laws, anti-competition regulations, import and trade restrictions, U.S. laws such as export control laws and
the Foreign Corrupt Practices Act, and similar laws in other countries which also prohibit corrupt payments to governmental officials
or certain payments or remunerations to customers. Given the high level of complexity of these laws, there is a risk that some
provisions may be inadvertently breached. Also, we may be held liable for actions taken by our local partners. Violations of these
laws and regulations could result in fines, criminal sanctions against us, our officers or our employees, and prohibitions on the
conduct of our business. Any such violations could include prohibitions on our ability to offer our products and services in one or
more countries.

Recent and potential changes in U.S. trade policies and retaliatory responses from other countries may significantly

increase the costs or limit supplies of materials and products used in our operations.

The federal government has recently imposed new or increased tariffs or duties on an array of imported materials and
goods that are used in connection with our operations. Foreign governments, including China and Canada, and trading blocs, such
as the European Union ("EU"), have responded by imposing or increasing tariffs, duties and/or trade restrictions on U.S. goods,
and are reportedly considering other measures. These trade conflicts and related escalating governmental actions that result in
additional tariffs, duties and/or trade restrictions could increase our operating costs, cause disruptions or shortages in our supply
chains and/or negatively impact the U.S., regional or local economies, and, individually or in the aggregate, materially and adversely
affect our business and our consolidated financial statements.

The exit of the United Kingdom from the European Union could have future adverse effects on our operations revenues

and costs, and therefore our profitability.

The referendum held in the United Kingdom on June 23, 2016 resulted in a determination that the United Kingdom should
exit the EU. In March 2017, the United Kingdom government initiated the exit process under Article 50 of the Treaty of the EU,
commencing a period of up to two years for the United Kingdom and the other EU member states to negotiate the terms of the
withdrawal. The uncertainty surrounding the timing, terms and consequences of the United Kingdom's exit could adversely impact
our operations in the United Kingdom. Some of our facilities are located in the United Kingdom, and these facilities, as well as
others in our network, source goods, manufacture goods and provide services from or intended for the United Kingdom. These
facilities operate within an existing framework of trade and human capital integration with the EU and, by extension, the other parts
of the world, with which the EU has trade and immigration agreements. Furthermore, some of our facilities located in other EU
member states ship materials to or otherwise engage in various business interactions with the United Kingdom, including our United
Kingdom facilities. Due to future changes in the United Kingdom resulting from an eventual exit, including potentially increased
trade barriers, increased tariff rates or custom duties, or in anticipation of such changes, our suppliers, customers, or employees
may change their interactions with us, including changes in imports to or exports from the United Kingdom, changes in the requested
utilization of our facilities, both within and without the United Kingdom, and changes in our relationships with our workforce in
the United Kingdom. To the extent that our facilities operate as part of a cross-border supply and distribution chain, their operations
may also be negatively affected by a decrease in the cross-border mobility of goods and services. We cannot anticipate the nature
of these changes, as they largely depend on factors outside our control, but the changes may result in adverse changes in our future
operations, revenues and costs, and therefore our future profitability.

A significant disruption in, or breach in security of, our information technology systems could adversely affect our

business.

We rely on information technology systems, some of which are managed by third parties, to process, transmit and store
electronic information, and to manage or support a variety of critical business processes and activities. We also collect and store
sensitive data, including confidential business information and personal data. These systems may be susceptible to damage,
disruptions or shutdowns due to attacks by computer hackers, computer viruses, employee error or malfeasance, power outages,
hardware failures, telecommunication or utility failures, catastrophes or other unforeseen events. Upgrading our information
technology systems is costly and subject to delay, and there is no assurance new systems will provide the benefits expected. In
addition, security breaches of our systems could result in the misappropriation or unauthorized disclosure of confidential information
or personal data belonging to us or to our employees, partners, customers or suppliers. Any such events could disrupt our operations,
delay production and shipments, result in defective products or services, damage customer relationships and our reputation and
result in legal claims or proceedings, liability or penalties under privacy laws, each of which could adversely affect our business
and our financial condition. State and federal laws may also require us to provide notice to affected individuals if their personal
data is the subject of a breach in security, which would impose costs and could lead to additional liability and negative publicity.
We take cybersecurity seriously and devote significant resources and tools to protect our systems, products and data and to prevent
unwanted intrusions. However, these security efforts are costly to implement and may not be successful. There can be no assurance
that we will be able to prevent, detect and adequately address or mitigate such cyber-attacks or security breaches. Any such breach
could have a material adverse effect on our operations and our reputation and could cause irreparable damage to us or our systems,
regardless of whether we or our third-party providers are able to adequately recover critical systems following a systems failure.
In addition, regulatory or legislative action related to cybersecurity, privacy and data protection worldwide, such as the European
General Data Protection Regulation, which went into effect in May 2018, may increase the costs to develop, implement or secure
our products and services. We expect cybersecurity regulations to continue to evolve and be costly to implement.

Labor disputes may have an adverse effect on the Company's business.

Some of our subsidiaries are party to collective bargaining agreements with various labor unions in the United States and
internationally. We may be subject to, among other things, strikes, work stoppages or work slowdowns as a result of disputes under
these collective bargaining agreements and labor contracts or our potential inability to negotiate acceptable contracts with these
unions. If the unionized workers in the United States or internationally were to engage in a strike, work stoppage or other slowdown;
if other employees were to become unionized or if the terms and conditions in future labor agreements were renegotiated, we could
experience a significant disruption in our operations and incur higher ongoing labor costs.

WebBank's status as lender of the loans it offers, and the ability of assignees to collect interest, may be challenged, and

these challenges could negatively impact WebBank's ongoing and future business.

WebBank's business includes lending programs with Marketing Partners, where the Marketing Partners provide origination
servicing for the loans and subsequently purchase the loans (or interests in the loans) that are originated by WebBank. There have
been litigation and regulatory actions which have challenged lending arrangements where a bank has made a loan and then sold
and assigned it to an entity that is engaged in assisting with the origination and servicing of the loan. Some of these cases have
alleged that the marketing and servicing entity should be viewed as the "true creditor" of the loans originated through the lending
program, and the bank should be disregarded. If this type of challenge is successful, state law interest rate limitations and other
requirements that apply to non-bank lenders would then be applicable, instead of the federal interest rate laws that govern bank
lenders. Other cases have relied on the claim that even if a bank originated a loan based on the federal interest rate laws, an assignee
of a bank is not permitted to rely on the federal law and is instead subject to state law limitations. Certain of these challenges have
been brought or threatened in programs involving WebBank, including a pending lawsuit against one of WebBank's Marketing
Partners brought by the Administrator of the Uniform Consumer Credit Code in Colorado. WebBank has intervened in that litigation,
which remains pending. Such cases or regulatory actions, if successfully brought against WebBank or its Marketing Partners or
others could negatively impact WebBank's ongoing and future business. WebBank continues to structure its programs, and to exercise
control over these programs, to address these risks, although there can be no assurance that additional cases or regulatory actions
will not be brought in the future.

The Volcker Rule, which is part of the Dodd-Frank Act, restricts SPLP's flexibility to do business.

The Dodd-Frank Act added a new Section 13 to the Bank Holding Company Act, the so-called "Volcker Rule," which
generally restricts certain banking entities (including affiliates of depository institutions) from engaging in proprietary trading
activities and acquiring or retaining ownership interests in, or sponsoring, any private equity or hedge fund (collectively, "covered
funds"). Under the implementing regulations, WebBank and its affiliates are restricted from engaging in proprietary trading, or

investing in or sponsoring covered funds, unless their activities qualify for a specific exclusion or exemption under the rule. Because
SPLP controls WebBank, each of SPLP and all its subsidiaries, as well as its controlled entities, are banking entities under the
Volcker Rule and therefore subject to the same restrictions. In June 2018, and again in December 2018, the federal agencies
responsible for implementing the Volcker Rule proposed further revisions to the existing regulations implementing the Volcker
Rule. The substance and timing of any final rules that will be implemented based on these proposals is not yet known. Changes to
the regulations implementing the Volcker Rule could require changes to the business of WebBank, SPLP or any of their affiliates,
which may have the effect of restricting the business or increasing regulatory risk.

WebBank is subject to capital requirements, and SPLP could be called upon by the FDIC to infuse additional capital

into WebBank to the extent that WebBank fails to satisfy its capital requirements.

In July 2013, the Federal Reserve Board, the Office of the Comptroller of the Currency and the FDIC issued rules that
implemented the Basel III changes to the international regulatory capital framework and revised the U.S. risk-based and leverage
capital requirements for U.S. banking organizations in order to strengthen identified areas of weakness in capital rules and to address
relevant provisions of the Dodd-Frank Act.

Effective January 1, 2015 for WebBank, FDIC regulations implementing the Basel III Accord modified WebBank's
minimum capital requirements by defining what constitutes capital for regulatory capital purposes and adding a 4.5% Common
Equity Tier 1 ratio and increased the Tier 1 capital ratio requirement from 4% to 6%. FDIC regulations also require WebBank to
comply with a total capital ratio of 8% and a leverage ratio of 4%. Additionally, a Capital Conservation Buffer (composed solely
of common equity Tier 1 capital) equal to 2.5% above the new regulatory minimum capital requirements began to be phased in
starting January 1, 2016 and has been fully implemented as of January 1, 2019. The Capital Conservation Buffer is on top of the
minimum risk-weighted capital ratios and had the effect of increasing those ratios by 2.5% each. A failure of WebBank to maintain
the aggregate minimum capital required by the Capital Conservation Buffer will impair its ability to make certain distributions
(including dividends and stock repurchases) and discretionary bonus payments to executive officers. A failure of WebBank to
maintain capital as required by the FDIC's minimum capital requirements would subject WebBank to the FDIC's prompt corrective
action regime, which may further impair WebBank's ability to make payments or distributions and may require a capital restoration
plan or other corrective regulatory measures.

Federal banking agencies jointly issued a proposed rule on September 27, 2017 that would simplify the treatment of certain
assets and deductions for institutions such as WebBank that are not subject to the so-called "advanced approaches" capital rule. The
proposed rule would adjust the deduction thresholds for certain mortgage servicing assets, deferred tax assets, investments in the
capital of unconsolidated financial institutions and minority interests. While the banking agencies consider comments on the proposed
rule, the banking agencies adopted a rule on November 21, 2017, that provides interim relief to non-advanced approaches banking
organizations by extending the regulatory capital transition periods effective in 2017 for certain items, including regulatory capital
deductions, risk weights and certain minority interest limitations.

The Company currently cannot predict the specific impact and long-term effects that Basel III and its implementation in
the U.S. will have on WebBank and the banking industry more generally. Furthermore, the Dodd-Frank Act codified a longstanding
policy that all companies that directly or indirectly control an FDIC-insured bank are required to serve as a source of financial
strength for such institution. As a result, SPLP could be called upon by the FDIC to infuse additional capital into WebBank to the
extent that WebBank fails to satisfy its capital requirements, including at times that SPLP might not otherwise be inclined to provide
it and even if doing so may adversely affect SPLP's ability to meet its other obligations, which include limitations on capital
contributions to WebBank specified in the Company's senior secured revolving credit facility.

WebBank's lending programs depend on relationships with Marketing Partners.

WebBank offers its lending programs with Marketing Partners. If those Marketing Partners do not provide origination
services or other services to WebBank, or provide those services in a faulty manner, that may negatively impact WebBank's ongoing
and future business. In addition, if the Marketing Partners or other third parties do not purchase the loans (or interests in loans) that
are originated by WebBank, then WebBank may need to retain those loans (or interests in loans) and that may negatively impact
its ongoing and future business. Marketing Partners are also required to indemnify WebBank for certain liabilities that may arise
from the lending programs. If Marketing Partners are unable or unwilling to satisfy their indemnification obligations, then WebBank
would face increased risk from liability for claims made in private litigation or regulatory enforcement actions. Marketing Partners
may rely on outside sources of capital to meet their obligations. Market conditions and other factors may affect the availability of
capital for Marketing Partners. The availability of capital may also affect the volume of loans that can be originated through
WebBank's lending programs. In recent periods, the availability of capital has been more limited for several of WebBank's Marketing
Partners, resulting in a decrease in loan volume and a negative impact on WebBank's business.

Economic downturns could disrupt and materially harm our businesses.

Negative trends in the general economy, including rising interest rates and commodity prices, could cause a downturn in
the markets for our products and services. A significant portion of our revenues in the Diversified Industrial segment are received
from customers in transportation, oil & gas exploration, and construction-related industries, which have experienced significant
financial downturns in the past. These industries are cyclical and demand for their products tends to fluctuate due to changes in
national and global economic conditions, availability of credit and other factors. A worsening of customer demand in these industries
would adversely affect our revenues, profitability, operating results and cash flows. In our Energy segment, the level of oil & natural
gas exploration and production activity in the U.S. is affected by the price of oil. Reduced discovery rates of new oil & natural gas
reserves, or a decrease in the development rate of reserves in our market areas, weakness in oil & natural gas prices, or our customers'
perceptions that oil & natural gas prices will decrease in the future, could result in a reduction in the utilization of our equipment
and result in lower revenues or rates for the services of our Energy segment. Our customers' willingness to undertake these activities
depends largely upon prevailing industry conditions that are influenced by many factors over which we have no control. Our
Financial Services segment could be impacted by tightening of the credit markets and other general economic declines that could
result in a decrease in lending and demand for consumer loans. We may also experience a slowdown if some customers experience
difficulty in obtaining adequate financing due to tightness in the credit markets. Furthermore, the financial stability of our customers
or suppliers may be compromised, which could result in additional bad debts for us or non-performance by suppliers. Our assets
may also be impaired or subject to write-down or write-off as a result of these conditions. These adverse effects would likely be
exacerbated if global economic conditions worsen, resulting in wide-ranging, adverse and prolonged effects on general business
conditions, and materially and adversely affect our operations, financial results and liquidity.

Our subsidiaries do not have long-term contracts with all of their customers, and the loss of customers with which we

do not have long-term contracts could materially adversely affect our financial condition, business and results of operations.

Our businesses are based primarily upon individual orders, sales and service agreements with customers and not long-
term contracts. As such, these customers could cease buying products or using our services at any time and for any reason, and we
will have no recourse in the event a customer no longer wants to purchase products from us or use our services. If a significant
number of our customers elect not to purchase products or use our services, or we have to make price concessions in order to retain
certain customers, it could materially adversely affect our financial condition, business and results of operations.

Litigation or compliance failures could adversely affect our profitability.

The nature of our businesses and our investment strategies expose us to various litigation matters. We contest these matters
vigorously and make insurance claims where appropriate. However, litigation is inherently costly and unpredictable, making it
difficult to accurately estimate the outcome of any litigation. These lawsuits may include claims for compensatory damages, punitive
and consequential damages and/or injunctive relief. The defense of these lawsuits may divert our management's attention, we may
incur significant expenses in defending these lawsuits, and we may be required to pay damage awards or settlements or become
subject to equitable remedies that could adversely affect our operations and financial condition. Moreover, any insurance or
indemnification rights that we may have may be insufficient or unavailable to protect us against such losses. In addition, developments
in legal proceedings in any given period may require us to adjust the loss contingency estimates that we have recorded in our
consolidated financial statements, record estimates or reserves for liabilities or assets previously not susceptible of reasonable
estimates or pay cash settlements or judgments. Any of these developments could adversely affect our financial condition in any
particular period. Although we make accruals as we believe warranted, the amounts that we accrue could vary significantly from
any amounts we actually pay due to the inherent uncertainties in the estimation process. See the "Litigation Matters" included in
Note 19 - "Commitments and Contingencies" to Consolidated Financial Statements, included in Part II, Item 8, Financial Statements
and Supplementary Data, of this Report for additional information.

Our internal controls over financial reporting may not be effective, and our independent registered public accounting
firm may not be able to certify as to their effectiveness, which could have a significant and adverse effect on our business and
reputation.

We are subject to the requirements of Section 404 of the Sarbanes-Oxley Act of 2002 and the rules and regulations of the
SEC thereunder ("Section 404"). Section 404 requires us to report on the design and effectiveness of our internal controls over
financial reporting. Section 404 also requires an independent registered public accounting firm to test our internal controls over
financial reporting and report on the effectiveness of such controls. There can be no assurance that our independent registered public
accounting firm will issue an unqualified report attesting to our internal controls over financial reporting. As a result, there could

be a negative reaction in the financial markets due to a loss of confidence in the reliability of our consolidated financial statements
or our consolidated financial statements could change.

Any failure to maintain or implement new or improved controls, or any difficulties we encounter in their implementation,
could result in significant deficiencies or material weaknesses, and cause us to fail to meet our periodic reporting obligations, or
result in material misstatements in our consolidated financial statements. We may also be required to incur costs to improve our
internal control system and hire additional personnel. This could negatively impact our results of operations.

Risks Related to Our Structure

The unitholders have limited recourse to maintain actions against the General Partner, the Board of Directors, our

officers and the Manager.

The Limited Partnership Agreement of SPLP, or the "Partnership Agreement," contains broad indemnification and
exculpation provisions that limit the right of a unitholder to maintain an action against the General Partner, the Board of Directors,
our officers and the Manager, or to recover losses or costs incurred due to action or inaction by these parties which have a negative
effect on the Company.

Our Partnership Agreement contains certain provisions that may limit the voting rights of some unitholders.

Our Partnership Agreement contains specific provisions that are intended to comply with regulatory limitations on the
ownership of our securities as a result of our ownership of WebBank. Under the Partnership Agreement, a person or group that
acquires beneficial ownership of 10% or more of the common units without the prior approval of the Board of Directors may lose
voting rights with respect to all of its common units in excess of 9.9%.

We may have conflicts of interest with the minority shareholders of our businesses and decisions may need to be made
by disinterested directors, without the participation of directors or officers associated with the Manager and the Company. These
decisions may be different from the decisions we would make, and may or may not be in the best interests of our unitholders.

Because we own less than 100% of certain affiliates, and we may engage in transactions with these affiliates from time to
time, the boards of directors and officers of those businesses, including directors and officers associated with our Manager and the
Company, have fiduciary duties to their respective shareholders. As a result, they may make decisions that are in the best interests
of their shareholders generally but which are not necessarily in the best interest of our unitholders. In dealings with us, the directors
and officers of our businesses may have conflicts of interest and decisions may have to be made without their participation. Such
decisions may be different from the decisions we would make and may not be in the best interests of our common and preferred
unitholders, which may have an adverse effect on our business and results of operations.

There are certain interlocking relationships among us and certain affiliates of Warren G. Lichtenstein, our Executive

Chairman, which may present potential conflicts of interest.

Warren G. Lichtenstein, our Executive Chairman and a substantial unitholder, is the Chief Executive Officer of our Manager.
As of December 31, 2018, Mr. Lichtenstein directly owned approximately 4.1% of our outstanding common units. In addition,
affiliates of our Manager, including Mr. Lichtenstein, beneficially own approximately 55.5% of our outstanding common units,
although Mr. Lichtenstein disclaims beneficial ownership of any common units not directly held by him. We have entered into
transactions and/or agreements with these entities. There can be no assurance that such entities will not have interests in conflict
with our own.

Certain members of our management team may be involved in other business activities that may involve conflicts of

interest, possibly diverting their attention from the Company's operations.

Certain individual members of our management team, including Warren G. Lichtenstein, our Executive Chairman, and
Jack L. Howard, our President, may from time to time be involved in the management of other businesses, including those owned
or controlled by our Manager and its affiliates. Accordingly, these individuals may focus a portion of their time and attention on
managing these other businesses. Conflicts may arise in the future between our interests and the interests of the other entities and
business activities in which such individuals are involved.

Risks Related to Our Manager

We depend on Warren G. Lichtenstein, the Chairman and Chief Executive Officer of the Manager, and Jack L. Howard,
the President of the Manager, in running our businesses. The loss of their services could have a material adverse effect on our
business, results and financial condition.

Our success depends on the efforts, skills, reputation and business contacts of Warren G. Lichtenstein, the Chairman and
Chief Executive Officer of the Manager and Jack L. Howard, the President of the Manager. While the key members of the Manager
have worked for the Manager and its affiliates for many years, our Manager does not have any employment agreements with any
of the key members of its management team, and their continued service is not guaranteed. The loss of the services of Mr. Lichtenstein
or Mr. Howard could have a material adverse effect on our asset value, revenues, net income and cash flows and could harm our
ability to maintain or grow our existing operations or pursue additional opportunities in the future.

We cannot determine the amount of the Management Fee that will be paid or Class C partnership units that will be

issued over time with any certainty.

The Manager receives a fee ("Management Fee") at an annual rate of 1.5% of total partners' capital. Our total partners'
capital will be impacted by the performance of our businesses and other businesses we may acquire in the future, as well as the
issuance of additional common or preferred units. Changes in our total partners' capital and in the resulting Management Fee could
be significant, resulting in a material adverse effect on our results of operations. In addition, if our performance declines, assuming
our total partners' capital remains the same, the Management Fee will increase as a percentage of our income. In addition, SPH
SPV-I LLC, an affiliate of the Manager, holds partnership profits interests in the form of incentive units which entitle the holder
generally to share in 15% of the increase in the equity value of the Company, as calculated for the twenty trading days prior to each
year end. The incentive units' share of such appreciation is reflected by classifying a portion of the incentive units as Class C units
of the Company. Any issuance of such Class C units will result in dilution to existing limited partners' holdings in the Company.

Our Manager's liability is limited under the Management Agreement, and we have agreed to indemnify our Manager
against certain liabilities. Such indemnification may incentivize our Manager to take unnecessary risks with respect to actions
for which it will be indemnified.

Under the Management Agreement, our Manager, its members, officers, employees, affiliates, agents and legal
representatives are not liable for, and we have agreed to indemnify such persons from, any loss or expense, including without
limitations, any judgment, settlement, reasonable attorneys' fees and other costs and expenses incurred in connection with the defense
of any actual or threatened proceeding, other than losses resulting from willful misconduct or gross negligence in the performance
of such indemnified person's obligations and duties. Such indemnification may incentivize our Manager to take unnecessary risks
with respect to actions for which it will be indemnified.

Risks Related to our Common and Preferred Units

We may issue additional common or preferred units, or other series of units, in the future without the consent of
unitholders and at a discount to the market price of such units. In particular, sales of significant amounts of the common or
preferred units may cause the respective prices of the units to decline.

Under the terms of the Partnership Agreement, additional common or preferred units, or additional series of units, may be
issued without the consent of unitholders at a discount to the market price. In addition, other classes of securities may be issued
with rights that are senior to or which otherwise have preferential rights to the rights of the common and preferred units. Sales of
significant amounts of the common or preferred units in the public market or the perception that such sales of significant amounts
may occur could adversely affect their respective market prices. Moreover, the perceived risk of any potential dilution could cause
common or preferred unitholders to attempt to sell their units and investors to "short" the common or preferred units, a practice in
which an investor sells units that he or she does not own at prevailing market prices, hoping to purchase units later at a lower price
to cover the sale. Any event that would cause the number of common or preferred units being offered for sale to increase would
likely cause the respective units' market price to further decline. These sales might also make it more difficult for us to sell additional
common or preferred units in the future at a time and price that we deem appropriate.

Transfer restrictions contained in the Company's Partnership Agreement and other factors could hinder the development

of an active market for our common or preferred units.

There can be no assurance as to the volume of our common or preferred units or the degree of price volatility for our
common and preferred units traded on the New York Stock Exchange. There are transfer restrictions contained in the Company's
Partnership Agreement to help protect net operating tax loss carryforwards of certain of the Company's corporate subsidiaries and

other portfolio companies. The transfer restrictions will expire on February 7, 2020, and they could hinder development of an active
market for our common and preferred units.

Risks Related to Taxation

All statutory references in this section are to the Internal Revenue Code of 1986, as amended, or the "Code."

Our common unitholders may be subject to U.S. federal, state and other income tax on their share of our taxable income,

regardless of whether they receive any cash distributions from us.

The Company operates, for U.S. federal income tax purposes, as a partnership and not a publicly traded partnership taxable
as a corporation. Our common unitholders will be subject to U.S. federal, state, local and possibly, in some cases, foreign income
tax on their allocable share of our taxable income, whether or not they receive cash distributions from us. Any future determination
to declare dividends on the Company's common units will remain at the discretion of the Board of Directors and is separately
determined regardless of the allocation of taxable income. Accordingly, our common unitholders may be required to make tax
payments in connection with their ownership of common units that significantly exceed their cash distributions in any given year.

The Centralized Partnership Audit Regime may subject unitholders to IRS initiated tax adjustments for prior years on

their personal tax returns.

For tax years beginning on or after January 1, 2018, the Company is subject to partnership audit rules enacted as part of
the Bipartisan Budget Act of 2015 ("Centralized Partnership Audit Regime"). Under the Centralized Partnership Audit Regime, any
Internal Revenue Service ("IRS") audit of the Company would be conducted at the Company level, and if the IRS determines an
adjustment, the default rule is that the Company would pay an "imputed underpayment" including interest and penalties, if applicable.
The Company may instead elect to make a "push-out" election, in which case the partners for the year that is under audit would be
required to take into account the adjustments on their own personal income tax returns.

Newly enacted U.S. government tax reform could have a negative impact on the results of future operations.

On December 22, 2017, the U.S. Tax Cuts and Jobs Act ("Act") was enacted which contained substantial changes to the
Code, some of which could have an adverse effect on our business. Among other things, the Act (i) reduces the U.S. corporate
income tax rate from 35% to 21% beginning in 2018, (ii) generally will limit annual deductions for interest net expense to no more
than 30% of our "adjusted taxable income," plus 100% of our business interest income for the year, and (iii) will permit a taxpayer
to offset only 80% (rather than 100%) of its taxable income with any U.S. net operating losses ("NOLs") generated for taxable years
beginning after 2017. The U.S. Department of the Treasury has broad authority to issue regulations and interpretative guidance that
may significantly impact how we will apply the law and impact our results of operations in the period issued. While the U.S.
Department of the Treasury has issued some proposed regulations since the enactment of the Act, additional guidance is likely
forthcoming. The measurement period allowed by SEC Staff Accounting Bulletin No. 118 has closed during the fourth quarter of
2018 in which we recorded an income tax benefit of $1,896 related to the one-time mandatory repatriation tax. The prospects of
supplemental legislation or regulatory processes to address uncertainties that arise because of the Act, or evolving technical
interpretations of the tax law, may cause our consolidated financial statements to be impacted in the future. We will continue to
analyze the effects of the Act as subsequent guidance continues to emerge.

Our tax treatment is not assured. If we are taxed as a corporation, it could adversely impact our results of operations.

A partnership is not a taxable entity, and distributions by a partnership to a partner are generally not taxable to the partnership
or the partner unless the amount of cash distributed to such partner exceeds the partner's adjusted basis in its partnership interest.
Section 7704 provides that generally publicly traded partnerships are taxed as corporations. However, an exception, referred to as
the "Qualifying Income Exception," exists with respect to publicly traded partnerships of which 90 percent or more of the gross
income for every taxable year consists of "qualifying income" as defined in the Code. We expect that we will meet the Qualifying
Income Exception.

If the Qualifying Income Exception is not available to us, then we will be treated as a corporation instead of a partnership.
In that event, the deemed incorporation of SPLP should be tax-free. If we were taxed as a corporation, (i) our net income would be
taxed at corporate income tax rates, thereby substantially reducing our profitability, (ii) our common unitholders would not be
allowed to deduct their share of losses of SPLP and (iii) distributions to our common unitholders, other than liquidating distributions,
would constitute dividends to the extent of our current or accumulated earnings and profits, and would be taxable as such.

Our structure involves complex provisions of U.S. federal income tax law for which no clear precedent or authority

may be available.

The U.S. federal income tax treatment of our common unitholders depends in some instances on interpretations of complex
provisions of U.S. federal income tax law for which no clear precedent or authority may be available. Our Partnership Agreement
permits our General Partner to modify it from time to time, including the allocation of items of income, gain, loss and deduction
(including unrealized gain and unrealized loss to the extent allowable under U.S. federal income tax law), without the consent of
our unitholders, to address certain changes in U.S. federal income tax regulations, legislation or interpretation or to preserve the
uniformity of our common units. In some circumstances, such revisions could have a material adverse impact on some or all common
unitholders. In addition, we formed a subsidiary partnership, to which we contributed certain of our assets ("Subsidiary Partnership").
To preserve the uniformity of common units, we (but not the Subsidiary Partnership) made an election permitted under Section
754, and we will adopt the remedial allocation method under Section 704(c) with respect to items of income, gain, loss and deduction
attributable to assets contributed to us (which we will contribute to the Subsidiary Partnership), to account for any difference between
the tax basis and fair market value of such assets at the time of contribution, or attributable to the "book-up" or "book-down" of
our assets prior to their contribution to the Subsidiary Partnership, or while they were held by the Subsidiary Partnership, to account
for the difference between the tax basis and fair market value of such assets at the time of a mark-to-market event. We intend
generally to make allocations under Section 704(c) to our common unitholders in accordance with their respective percentage
interests. However, built-in gain or built-in loss in existence and allocable to the assets we contributed to the Subsidiary Partnership,
when recognized, will be allocated to our common unitholders as of the contribution date. We intend to prepare our tax returns on
the basis that buyers of common units from such unitholders will not inherit such unitholders' built-in gains or built-in losses as of
that date as a result of the election under Section 754. However, it is not clear whether this position will be upheld if challenged by
the IRS. While we believe it represents the right result, there is no law directly on point.

Tax-exempt entities face unique tax issues from owning common units that may result in adverse tax consequences to

them.

A holder of common units that is a tax-exempt organization may be subject to U.S. federal income taxation to the extent
that its allocable share of our income consists of unrelated business taxable income ("UBTI"). A tax-exempt partner of a partnership
may be treated as earning UBTI if the partnership regularly engages in a trade or business that is unrelated to the exempt function
of the tax-exempt partner, if the partnership derives income from debt-financed property (as we may borrow money) or if the tax-
exempt organization's partnership interest itself is debt-financed.

Our subsidiaries may not be able to fully utilize their tax benefits, which could result in increased cash payments for

taxes in future periods.

NOLs may be carried forward to offset federal and state taxable income in future years and reduce the amount of cash paid
for income taxes otherwise payable on such taxable income, subject to certain limits and adjustments. If fully utilized, our subsidiaries'
NOLs and other carryforwards could provide them with significant tax savings in future periods. Their ability to utilize these tax
benefits in future years will depend upon their ability to generate sufficient taxable income and to comply with the rules relating to
the preservation and use of NOLs, as well as potential future changes in tax laws. The potential benefit of the NOLs and other
carryforwards may be limited or permanently lost as a result of the following:

•

the inability to generate sufficient taxable income in future years to use such benefits before they expire as NOLs generated
for taxable years ending on or before December 31, 2017 have a limited carryforward period;
a change in control of our subsidiaries that would trigger limitations on the amount of taxable income in future years that may
be offset by NOLs and other carryforwards that existed prior to the change in control; and
examinations and audits by the IRS and other taxing authorities could reduce the amount of NOLs and other credit carryforwards
that are available for future years.

Certain of our subsidiaries maintain valuation allowances against their NOLs and other carryforwards due to uncertainty
regarding their ability to generate sufficient taxable income in future periods. Their inability to utilize the NOLs and other
carryforwards could result in increased cash payments for taxes in future periods.

Item 1B. Unresolved Staff Comments

None.

Item 2. Properties

Diversified Industrial Segment

As of December 31, 2018, the Diversified Industrial segment had 32 active operating plants in the United States, Canada,
China, United Kingdom, Germany, France and Mexico, with a total area of approximately 3,143,991 square feet, including
warehouse, office, sales, service and laboratory space. The Diversified Industrial segment also owns or leases sales, service, office
and warehouse facilities at 26 other locations in the United States, United Kingdom, Canada, Germany, France, Italy, Poland,
Netherlands, Singapore and China which have a total area of approximately 591,926 square feet, and owns or leases 4 non-operating
locations with a total area of approximately 680,743 square feet. Manufacturing facilities are located in: Camden, Delaware; Brewster,
New York; Bristol, Pennsylvania; Addison, Illinois; Evansville and Osgood, Indiana; Agawam and Billerica, Massachusetts;
Rockford and Montevideo, Minnesota; Arden and Statesville, North Carolina; Anderson, South Carolina; Kenosha and Cudahy,
Wisconsin; Warwick, Rhode Island; Lawrence, Kansas; Toronto, Canada; Matamoros, Mexicali and Tecate, Mexico; Welham Green,
Gwent, Poynton, and Livingston, United Kingdom; Freiburg, Germany; Riberac, France; and Xianghe and Suzhou, China. The
following plants are leased: both Tecate plants, Addison, Kenosha, Arden, Rockford, one of two Matamoros plants, Mexicali,
Freiburg, Xianghe and Suzhou plants. The other plants are owned. The Diversified Industrial segment considers its manufacturing
plants and service facilities to be well maintained and efficiently equipped, and therefore suitable for the work being done. The
productive capacity and extent of utilization of its facilities is dependent in some cases on general business conditions and in other
cases on the seasonality of the utilization of its products. Capacity can be expanded at some locations.

Energy Segment

As of December 31, 2018, the Energy business owns 3 buildings in Williston, North Dakota, including one that serves as
its headquarters and operations hub in the Bakken basin along with separate buildings with office and shop space, 3 buildings in
Farmington, New Mexico which serve as office and shop space, and a non-operating location in Arnegard, North Dakota. The
Energy business also owns office and shop space in Texas that serves as its operations hub in the Permian basin. The Energy business
leases shop space and office space in other locations under month-to-month arrangements on an as-needed basis, and owns and
leases housing for temporary living arrangements for certain of its employees.

Steel Sports has a lease for approximately 28 acres of land in Yaphank, New York for its baseball services operation. Steel
Sports also has a lease for office space in Cedar Knolls, New Jersey which serves as the headquarters for its youth soccer operation,
and also has leases in various states for small administrative offices to support the soccer operation.

Financial Services

As of December 31, 2018, WebBank leases 23,476 square feet of office space headquartered in Salt Lake City, Utah.
WebBank also leases office space in New Jersey. WebBank believes that these facilities are adequate for its current needs and that
suitable additional space will be available as required.

Corporate and Other

As of December 31, 2018, Steel Services leases 15,660 square feet of office space headquartered in New York, New York

and leases 3,082 square feet of office space in Hermosa Beach, California.

Item 3. Legal Proceedings

The information set forth under Note 19 - "Commitments and Contingencies" to Consolidated Financial Statements,
included in Part II, Item 8, Financial Statements and Supplementary Data, of this Report, is incorporated herein by reference. For
an additional discussion of certain risks associated with legal proceedings, see also Part I, Item 1A, Risk Factors, of this Report.

Item 4. Mine Safety Disclosures

Not applicable.

PART II

Item 5. Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

All monetary amounts in this section are in thousands, except for common unit and per common unit data.

Market Information

As of December 31, 2018, we had 25,294,003 common units issued and outstanding. Our common units, no par value, are

quoted on the New York Stock Exchange under the symbol "SPLP."

Holders

As of December 31, 2018, there were approximately 102 unitholders of record.

Issuer Purchases of Equity Securities

In December 2016, the Board of Directors approved the repurchase of up to an aggregate of 2,000,000 of the Company's
common units. In November 2018, the Board of Directors approved the repurchase of up to an additional 1,000,000 of the Company's
common units (collectively, with the December 2016 approval, "Repurchase Program"). The Repurchase Program supersedes and
cancels, to the extent any amounts remain available, all previously approved repurchase programs. Any purchases made under the
Repurchase Program will be made from time to time on the open market at prevailing market prices or in negotiated transactions
off the market, in compliance with applicable laws and regulations. In connection with the Repurchase Program, the Company may
enter into a stock purchase plan. The Repurchase Program has no termination date. During the fourth quarter ended December 31,
2018, the Company purchased 500,384 units, and there remains 1,416,159 units that may yet be purchased under the Repurchase
Program.

Item 6. Selected Financial Data

The following table contains our selected historical consolidated financial data, which should be read in conjunction with
our consolidated financial statements and the related notes thereto, and "Management's Discussion and Analysis of Financial
Condition and Results of Operations" contained in this Annual Report on Form 10-K. The selected financial data as of and for the
years ended December 31, 2018 and 2017 has been derived from our audited consolidated financial statements at those dates and
for those periods, contained elsewhere in this Annual Report on Form 10-K. The historical selected financial data as of and for the
years ended December 31, 2016, 2015 and 2014 has been derived from our audited consolidated financial statements adjusted for
discontinued operations at those dates and for those periods, as applicable, not contained in this Annual Report on Form 10-K.

CONSOLIDATED STATEMENT OF OPERATIONS DATA (a), (b)
(in thousands, except common unit and per common unit data)

Revenue

Net (loss) income from continuing operations

Income from discontinued operations

Net (loss) income

Net (income) loss attributable to noncontrolling interests in consolidated entities

Net (loss) income attributable to common unitholders
Net (loss) income per common unit - basic:

Net (loss) income from continuing operations

Net income from discontinued operations

Net (loss) income attributable to common unitholders

Year Ended December 31,

2018

2017

2016

$ 1,584,614

$ 1,372,027

$ 1,163,549

(31,490) $

6,012

2,571

—

(31,490)

(1,114)

—

6,012

(6,028)

(32,604) $

(16) $

(1.25) $

—

(1.25) $

— $

—

— $

—

2,571

4,059

6,630

0.25

—

0.25

2015

965,059

70,311

86,257

156,568

(19,833)

136,735

2.97

2.03

5.00

2014

847,263

(17,572)

10,304
(7,268)

(287)

(7,555)

(0.48)
0.21
(0.27)

Basic weighted-average common units outstanding

25,984,185

26,053,098

26,353,714

27,317,974

28,710,220

Net (loss) income per common unit - diluted:

Net (loss) income from continuing operations
Net income from discontinued operations

Net (loss) income attributable to common unitholders

(1.25) $
—

(1.25) $

— $
—

— $

0.25
—

0.25

2.96
2.02

4.98

(0.48)
0.21
(0.27)

Diluted weighted-average common units outstanding

25,984,185

26,053,098

26,486,209

27,442,308

28,710,220

(a) Statement of operations data includes the consolidation of the results of acquired entities, or their operating assets, from their respective
acquisition dates: primarily, JPS Industries, Inc. on July 2, 2015, CoSine Communications, Inc. and API Group plc ("API") on January 20,
2015 and April 17, 2015, respectively, SL Industries, Inc. on June 1, 2016, Electromagnetic Enterprise division of Hamilton Sundstrand

Corporation on September 30, 2016, Hazen Paper Company and Amsterdam Metallized Products B.V. on July 27, 2016 and December 1,
2016, respectively, Basin Well Logging Wireline Services, Inc. ("Basin") in May 2017, and Dunmore and PST Group, Inc. ("PST") on
February 16, 2018 and June 1, 2018, respectively.

(b) Effective January 1, 2018 upon adoption of Accounting Standards Update No. ("ASU") 2016-01, unrealized gains or losses on equity securities
are no longer recorded in Accumulated other comprehensive income (loss) on the consolidated balance sheet, but are instead recorded in
Realized and unrealized losses (gains) on securities, net in the consolidated statement of operations. Realized and unrealized losses (gains)
on securities, net totaled $62,586 for 2018, as compared to $(790) for 2017.

BALANCE SHEET DATA

(in thousands, except per common unit data)

Cash and cash equivalents

Marketable securities

Long-term investments

Total assets
Long-term debt (a)
SPLP Partners' capital

SPLP Partners' capital per common unit

Dividends declared per common unit

December 31,

2018

2017

2016

2015

2014

334,884

418,755

450,128

185,852

188,983

1,439

258,044

58,313

236,144

53,650

120,066

80,842

167,214

138,457

311,951

2,356,059

2,164,040

1,967,115

1,684,773

1,490,497

478,096

515,651

20.39

—

412,584

546,103

20.73

—

330,126

548,741

20.98

0.15

235,913

558,034

20.95

—

295,707

494,859

17.95

—

(a) Excludes the current portion of long-term debt, which totaled $799, $459, $62,928, $2,176 and $19,592 at December 31, 2018, 2017, 2016,

2015 and 2014, respectively.

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of our financial condition and results of operations should be read in conjunction
with our consolidated financial statements and related notes thereto that are available elsewhere in this Annual Report on Form
10-K. The following is a discussion and analysis of SPLP's consolidated results of operations for the years ended December 31,
2018 and 2017. In addition to historical consolidated financial information, the following discussion contains forward-looking
statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward-
looking statements. Factors that could cause or contribute to these differences include those discussed below and elsewhere in this
Annual Report on Form 10-K, particularly in "Risk Factors" in Item 1A. All monetary amounts used in this discussion are in
thousands except common and preferred unit and per common and preferred unit amounts.

Business Segments

SPLP operates through the following segments: Diversified Industrial, Energy, Financial Services, and Corporate and
Other, which are managed separately and offer different products and services. For a more complete description of the Company's
segments, see Item 1 - "Business - Products and Product Mix" found elsewhere in this Form 10-K.

Recent Developments

Below is a summary of recent developments that have impacted the Company in 2018 and early 2019. For additional
discussion of these matters, please see the Company's Consolidated Financial Statements, included in Part II, Item 8, Financial
Statements and Supplementary Data, of this Report.

• On February 16, 2018, the Company completed the Dunmore acquisition for a purchase price of $69,604, which includes
assumed debt and is subject to an earn-out based on future earnings during the period from January 1, 2018 through December 31,
2019. Dunmore manufactures and distributes coated, laminated and metallized films for engineered applications in the imaging,
aerospace, insulation and solar photo-voltaic markets and also provides products for custom and special applications.

• During 2018, the Company entered into purchase agreements with minority stockholders of its subsidiary, WebFinancial Holding
Corporation ("WFHC"), pursuant to which the Company purchased shares of common and preferred stock of WFHC in exchange
for aggregate consideration totaling approximately $20,680, comprised of cash of $13,708, 185,407 SPLP common units and
186,271 SPLP preferred units. WFHC is the parent of WebBank, API and Dunmore. As a result of these transactions, the
Company now owns 100% of WFHC.

• On June 1, 2018, the Company completed the acquisition of PST for approximately $4,620. PST manufactures precision-
engineered threaded components and custom ball screw assemblies, providing linear motion and power transmission solutions
across a range of industries.

• On December 31, 2018, the Company increased its ownership in iGo, Inc. ("iGo") from 45.8% to 80.2% by contributing its

Kasco business to iGo in exchange for newly issued shares of iGo common stock.

• WebBank entered into a definitive agreement in December 2018 to purchase National Partners PFco, LLC, a national insurance

premium finance company. The transaction is expected to close in early 2019, subject to regulatory approval.

• The Company made investments totaling $76,261 in Babcock & Wilcox Enterprises, Inc. ("BW") shares during 2018, increasing

•

its ownership in BW to approximately 17.8%.
In both 2018 and early 2019, the Company entered into amendments to its senior secured revolving credit facility to increase
availability, allowing for continued growth through strategic acquisitions and other investments.

• Throughout 2018, the Company continued its focus to optimize infrastructure costs, consolidating operations in both its Electrical
Products and Packaging businesses. Continued focus on cost reduction and organic growth through new product development
will be critical given recent sales declines in the Packaging business discussed further below.

• We made investments in capital projects totaling $47,085, including expenditures associated with the aforementioned plant
consolidations, as well as upgrades in our information technology infrastructure as we continue to automate our operations.
In November 2018, the Board of Directors approved the repurchase of up to an additional 1,000,000 of the Company's common
units. During 2018, the Company purchased 1,274,161 common units for an aggregate price of approximately $21,202.

•

RESULTS OF OPERATIONS

Comparison of the Years Ended December 31, 2018 and 2017

Revenue

Cost of goods sold

Selling, general and administrative expenses

Asset impairment charges

Interest expense

Realized and unrealized losses (gains) on securities, net

All other expenses, net

Total costs and expenses
(Loss) income before income taxes and equity method investments

Income tax provision

Loss (income) of associated companies, net of taxes
Net (loss) income

Net income attributable to noncontrolling interests in consolidated entities

Net loss attributable to common unitholders

Revenue

Year Ended December 31,

2018

2017

1,584,614

1,372,027

1,109,978

352,794

8,108

39,234

62,586

21,336

958,490

337,719

2,028

22,804
(790)
11,353

1,594,036

1,331,604

(9,422)

12,559

9,509

(31,490)

(1,114)

(32,604) $

40,423

51,299
(16,888)
6,012
(6,028)
(16)

Revenue in 2018 increased $212,587, or 15.5%, as compared to 2017. Excluding growth from acquisitions of 5.2% and
the favorable impact from changes in foreign exchange rates of 0.5%, partially offset by the effect of a decrease in average silver
prices in the Diversified Industrial segment of 0.4%, revenue increased by 10.2%. The net revenue increase of 10.2% was due to
increases across all of our segments. The acquisition growth was primarily due to the acquisitions of Dunmore (February 2018)
and Basin (May 2017).

Cost of Goods Sold

Cost of goods sold in 2018 increased $151,488, or 15.8%, as compared to 2017 primarily due to increases in the Diversified
Industrial and Energy segments. The increase in the Diversified Industrial segment was primarily due to higher sales volume and
the Dunmore acquisition. The increase in the Energy segment was due to the overall revenue increase and the Basin acquisition.

Selling, General and Administrative Expenses

Selling, general and administrative expenses ("SG&A") in 2018 increased $15,075, or 4.5%, as compared to 2017, primarily
due to increases in the Diversified Industrial, Energy and Financial Services segments, partially offset by a decrease in the Corporate
and Other segment. Excluding the Dunmore acquisition impact, the increase in the Diversified Industrial segment was primarily
due to higher sales volume and costs incurred to consolidate certain operations, including footprint consolidation. The increase in
the Energy segment was primarily due to higher sales volume and the Basin acquisition. The increase in the Financial Services
segment was due to higher personnel expenses to support growth initiatives and increasing regulatory compliance. The decrease
in the Corporate and Other segment was primarily due to the non-cash incentive unit expense of approximately $9,021 recorded in

2017, partially offset by a legal settlement recorded and higher professional fees in 2018. There was no incentive unit expense
recorded in 2018.

Asset Impairment Charges

The asset impairment charges of $8,108 in 2018 were primarily associated with the loss of acquired customer relationships
in the Company's Packaging business in its Diversified Industrial segment. In 2017, the Company recorded a non-cash impairment
charge of $2,028 in its Energy segment related to an other-than-temporary impairment of a certain investment.

Interest Expense

Interest expense for the years ended December 31, 2018 and 2017 was $39,234 and $22,804, respectively. The higher
interest expense in 2018 was primarily due to higher borrowing levels due to the Company's recent acquisitions and interest on
SPLP's preferred units, which are classified as liabilities and issued primarily in 2017, as well as higher interest rates.

Realized and Unrealized Losses (Gains) on Securities, Net

Realized and unrealized losses (gains) on securities, net was a loss of $62,586 in 2018, as compared to a gain of $790 in
2017. The amounts are not comparable due to the required adoption of a new accounting standard, ASU 2016-01, on January 1,
2018 that requires equity investments, other than those accounted for under the traditional equity method of accounting, to be
measured at their fair value with changes in fair value recognized in the consolidated statements of operations. The 2018 loss was
principally driven by an unrealized loss on the Company's investment in BW shares. Prior to January 1, 2018, changes in fair value
were reported in Accumulated other comprehensive income or loss on the consolidated balance sheets.

All Other Expenses, Net

All other expenses, net was unfavorable by $9,983 in 2018, as compared to 2017, primarily due to higher finance interest
expense and higher provision for loan losses recorded in 2018 in the Financial Service segment, partially offset by higher income
from investments and derivatives recorded in 2018, as compared to 2017.

Income Taxes

As a limited partnership, we are generally not responsible for federal and state income taxes, and our profits and losses
are passed directly to our limited partners for inclusion in their respective income tax returns. The Company's tax provision represents
the income tax expense or benefit of its consolidated corporate subsidiaries. For the year ended December 31, 2018, a tax provision
of $12,559 was recorded, as compared to $51,299 in 2017. The Company recorded an income tax provision of approximately
$58,717 in 2017 resulting from the one-time mandatory repatriation tax and the revaluation of our U.S. deferred tax assets and
liabilities to reflect the 21% federal corporate tax rate enacted under the Act in December 2017. The Company recomputed its
repatriation tax in 2018 and recorded an income tax benefit of $1,896 to reflect its revised estimate. However, significant losses
incurred by a corporate subsidiary together with losses incurred by the limited partnership, a flow-through entity, for both of which
no tax benefits have been recorded, resulted in a negative effective tax rate of 133.3% based on the consolidated loss before income
taxes and equity method investments of $9,422 in 2018.

Loss (Income) of Associated Companies, Net of Taxes

The Company incurred a loss from associated companies, net of taxes of $9,509 in 2018, as compared to a gain of $16,888
in 2017. The year-over-year change is primarily due to unrealized mark-to-market adjustments for equity method investments that
are accounted for using the fair value option. For the details of each of these investments and the related mark-to-market adjustments
in both periods, see Note 10 - "Investments" to the SPLP consolidated financial statements found elsewhere in this Form 10-K.

Segment Analysis

Revenue:

Diversified industrial

Energy

Financial services

Total
Income (loss) before income taxes:

Diversified industrial

Energy

Financial services

Corporate and other

(Loss) income before income taxes

Income tax provision

Net (loss) income
Segment depreciation and amortization:

Diversified industrial

Energy

Financial services

Corporate and other

Total depreciation and amortization
(Loss) income of associated companies, net of taxes:

Energy

Corporate and other

Total

Diversified Industrial

Year Ended December 31,

2018

2017

1,286,665

1,156,187

175,950

121,999

1,584,614

42,661

(6,342)

54,544

(109,794)

(18,931)

12,559

(31,490) $

59,582

20,214

397

130

135,461

80,379

1,372,027

50,104
(21,514)
41,328
(12,607)
57,311

51,299

6,012

50,741

20,735

294

166

80,323

71,936

(1,685) $

(7,824)

(9,509) $

593

16,295

16,888

Net sales in 2018 increased by $130,478, or 11.3%, as compared to 2017. The change in net sales reflects $64,501 in
incremental sales associated with the Dunmore and PST (June 2018) acquisitions and the favorable impact from foreign exchange
rates of $6,264, partially offset by a decrease of $5,648 as a result of lower average silver prices. Excluding the acquisitions, foreign
exchange rate impact and change in silver prices, net sales increased by approximately $65,361 due to increased demand across all
of our businesses in the segment, except for the Packaging business in 2018, as compared to 2017. The incremental revenue from
2018 was primarily driven by higher demand for our private label roofing products from the commercial roofing sector, and electrical
products from the military and aerospace sectors, as well as the favorable impact from higher oil & gas prices.

Segment operating income in 2018 decreased by $7,443, or 14.9%, as compared to 2017, primarily due to the non-cash
asset impairment charge in the Packaging business and costs incurred to consolidate certain operations. Excluding the Dunmore
and PST acquisition impact, gross profit increased in the segment as a result of higher sales volume, and SG&A was higher, driven
by higher sales volume and costs incurred to consolidate certain operations in our Packaging and Electrical Products businesses.

Energy

In 2018, net revenue increased $40,489, or 29.9%, as compared to 2017. The increase in net revenue, which includes
incremental sales of approximately $6,447 from the Basin acquisition in May 2017, reflects an overall increase in the Company's
energy business as the demand for services continued to improve in line with the increase in the North American oil & gas drilling
rig count.

Segment operating loss in 2018 decreased $15,172, or 70.5%, as compared to 2017. The reduction in operating loss was
primarily due to higher gross profit, partially offset by higher SG&A due to the higher sales volume and a loss from associated
companies, which are principally valued using the fair value option. The increase in gross profit was primarily the result of the
increase in net revenue recorded in 2018, as compared to 2017.

Financial Services

Revenue in 2018 increased $41,620, or 51.8%, as compared to 2017. The increase was due to higher interest income driven

by larger outstanding loan receivable balances and increased volume in lending programs, as compared to 2017.

Segment operating income in 2018 increased $13,216, or 32.0%, as compared to 2017. The increase was due to the impact
of the higher revenue discussed above, partially offset by higher SG&A, driven by higher personnel expenses to support growth
initiatives and the continued expansion of WebBank's compliance and oversight group to meet increasing regulatory expectations.
In addition, the provision for loan losses increased $13,419 and finance interest expense increased $5,603 in 2018, as compared to
2017. The higher provision for loan losses was to support growth of consumer and small business loans held to maturity, and the
higher finance interest expense was due to a larger deposit balance to support loan growth and an increase in interest rates.

Net Interest Income, Margin and Interest Rate Spreads

Net interest income is the difference between interest earned on interest-earning assets and interest incurred on interest-
bearing liabilities. By its nature, net interest income is especially vulnerable to changes in the mix and amounts of interest-earning
assets and interest-bearing liabilities. In addition, changes in the interest rates and yields associated with these assets and liabilities
can significantly impact net interest income. The following table summarizes the average balances, the amount of interest earned
or incurred and the applicable yields for interest-earning assets and the costs of interest-bearing liabilities that generate net interest
income. For purposes of calculating the yields in these schedules, the average loan balances also include the principal amounts of
nonaccrual and restructured loans. However, interest received on nonaccrual loans is included in income only to the extent that cash
payments have been received and not applied to principal reductions. In addition, interest on restructured loans is generally accrued
at reduced rates.

Year Ended December 31,

Average

Outstanding

Balance

2018

Interest

Earned/

Paid

Yield/

Rate

Average

Outstanding

Balance

2017

Interest

Earned/

Paid

Yield/

Rate

Interest-earning assets:

Loans receivable

Held-to-maturity securities

Available-for-sale investments

Federal funds sold

Interest bearing deposits

Total interest-earning assets
Non interest-earning assets

Total assets

Interest-bearing liabilities:

Savings accounts

Time deposits

Total interest-bearing liabilities

Other non interest-bearing liabilities
Total liabilities

Shareholder's equity
Total liabilities and shareholder's equity

Net interest income

Spread on average interest-bearing funds

Net interest margin

Return on assets

Return on equity

Equity to assets

14.9% $

225,740 $

28,396

12.6%

59,234

1,323

4,026

64,696

1,062

9,226

10,288

396,538 $

40,286

2,624

3,047

234,198

676,693

17,965

694,658

99,809

460,201

560,010

12,737

572,747

121,911

694,658

614

2,231

31,273

406

4,279

4,685

3.3%

2.4%

1.6%

1.7%

9.6%

19,677

812

1,879

218,700

466,808

15,361

482,169

1.1% $

2.0%

1.8%

84,244

290,734

374,978

9,930

384,908

97,261

482,169

54,408

26,588

7.7%

8.0%

6.4%

36.5%

17.5%

3.1%

2.1%

0.8%

1.0%

6.7%

0.5%

1.5%

1.3%

5.4%

5.7%

28.3%

20.2%

WebBank has several lending arrangements with companies where it originates credit card and other loans for consumers

and small businesses. These loans are classified as held for sale and are typically sold after origination.

The following table presents the effects of changing rates and volumes on WebBank's net interest income for the periods
indicated. The rate column shows the effects attributable to changes in rate (changes in rate multiplied by prior volume). The volume
column shows the effects attributable to changes in volume (changes in volume multiplied by prior rate). The total column represents
the sum of the prior columns. For purposes of this table, changes attributable to both rate and volume, which cannot be segregated,
have been allocated proportionately, based on the changes due to rate and the changes due to volume.

Year Ended December 31,

2018 vs 2017

Increase/(Decrease)

2017 vs 2016

Increase/(Decrease)

Due to
Volume

Due to Rate

Total

Due to
Volume

Due to Rate

Total

24,713 $

6,125 $

30,838

1,591 $

(399) $

675

168

25,613

3,052

3,139

1,627

7,810

569

1,895

2,464

709

1,795

33,423

656

4,947

5,603

344

670

2,614

1,164

1,200

(53)

(1)

842

398

247

643

890

22,474 $

5,346 $

27,820

1,414 $

(492) $

1,192

291

1,512

3,012

283

1,807

2,090

922

Earning assets:

Loans receivable

Held-to-maturity securities

Available-for-sale investments

Federal funds sold

Interest bearing deposits
Total earning assets

Savings accounts

Time deposits
Total funds

Net variance

Balance Sheet Analysis

Loan Portfolio

As of December 31, 2018, net loans accounted for 58% of WebBank's total assets compared to 43% at the end of 2017.
The following table presents WebBank's loans outstanding by type of loan as of December 31, 2018 and the five most recent year-
ends.

2018

2017

2016

2015

2014

Amount

As of December 31,

Real estate loans:

Commercial - owner
occupied

Commercial - other
Total real estate loans

Commercial and industrial

Consumer loans

Loans held for sale
Total loans

Less:

252

380

632

146,758

188,391

188,143

523,924

0.1% $

0.1%

0.2%

28.0%

35.9%

100.0%

Deferred fees and discounts

—

Allowance for loan losses
Total loans receivable, net

(17,659)

$ 506,265

0.4% $

1,542

0.7% $

1,650

272

296

568

84,726

53,238

136,773

275,305

—

(5,237)

0.1% $

0.1%

0.2%

30.8%

19.3%

49.7%

604

266

870

50,564

22,805

80,692

0.2%

0.6%

32.6%

14.7%

52.1%

100.0%

154,931

100.0%

—

(1,483)

281

1,823

66,253

—

159,592

227,668

(15)

(630)

0.1%

0.8%

29.1%

—%

70.1%

264

1,914

75,706

—

40,886

1.4%

0.2%

1.6%

63.9%

—%

34.5%

100.0%

118,506

100.0%

(20)

(557)

$ 270,068

$ 153,448

$ 227,023

$ 117,929

The following table includes a maturity profile for the loans that were outstanding at December 31, 2018:

Due During Years Ending December 31,

2019

2020-2023

2024 and following

Total

Nonperforming Lending Related Assets

Total nonaccrual loans were $0 at December 31, 2018 and 2017.

Real Estate

Commercial
& Industrial

Consumer

Loans Held
for Sale

— $

81,507

89,899

188,143

632

—

41,309

23,942

98,492

—

632

146,758

188,391

188,143

Non-accruing loans:

Commercial real estate - owner occupied

— $

341

2018

2017

2016

2015

2014

As of December 31,

—

3,326

—

2,658

—

3,326

2,658

—

343

—

354

374

390

111

553

0.4%

—%

0.1%

0.2%

Commercial and industrial

Total
Accruing loans delinquent:

90 days or more

Total
Foreclosed assets:

Commercial real estate - owner occupied

Total
Total non-performing assets

Total as a percentage of total assets

Summary of Loan Loss Experience

The methodologies used to estimate the allowance for loan losses ("ALLL") depend upon the impairment status and
portfolio segment of the loan. Loan groupings are created for each loan class and are then graded against historical and industry
loss rates. After applying historic loss experience, as described above, we review the quantitatively derived level of ALLL for each
segment using qualitative criteria. We track various risk factors that influence our judgment regarding the level of the ALLL across
the portfolio segments. The following table summarizes activity in WebBank's allowance for loan and lease losses for the periods
indicated:

Balance at beginning of period

Charge offs:

Commercial and industrial

Other

Total charge offs
Recoveries:

Commercial real estate - owner occupied

Commercial real estate - other

Commercial and industrial

Other

Total recoveries

Net (charge offs) recoveries

Additions charged to operations
Balance at end of period

As of December 31,

2018

2017

2016

2015

2014

5,237

1,483

630

557

424

(2,772)

(4,549)

(7,321)

—

272

393

685

(933)

(1,214)

(2,147)

—

142

103

262

(6,636)

19,058

17,659

(1,885)

5,639

5,237

—

774

1,483

—

123

(50)

630

(3)

—

(3)

—

186

183

(50)

557

Ratio of net charge offs during the period to average loans
outstanding during the period

1.7%

0.8%

— %

(0.1)%

(0.2)%

The distribution of WebBank's allowance for losses on loans at the dates indicated is summarized as follows:

As of December 31,

2018

2017

2016

2015

2014

% of
Loans in
Each
Category
of Total
Loans

Amount

% of
Loans in
Each
Category
of Total
Loans

Amount

% of
Loans in
Each
Category
of Total
Loans

Amount

Commercial real estate - owner
occupied

Commercial real estate - other

Commercial and industrial

Other consumer loans

Loans held for sale
Total loans

6,165

11,468

—

—% $

0.1%

28.0%

36.0%

35.9%

2,800

2,424

—

0.1% $

0.1%

30.8%

19.3%

49.7%

880

574

—

0.4% $

0.2%

32.6%

14.7%

52.1%

$ 17,659

100.0% $

5,237

100.0% $

1,483

100.0% $

582

—

630

0.7% $

0.1%

29.1%

—

70.1%

100.0% $

481

—

557

1.4%

0.2%

63.9%

—%

34.5%

100.0%

Corporate and Other

Segment operating loss increased $97,187 in 2018, as compared to 2017, as a result of higher losses in 2018 driven by
unrealized losses on equity investments, which are recorded in earnings since the adoption of ASU 2016-01 on January 1, 2018, as
well as higher interest expense, primarily due to interest expense recorded on the SPLP preferred units issued in 2017, partially
offset by lower SG&A and higher other income. The lower SG&A was primarily due to non-cash incentive unit expense of
approximately $9,021 recorded in 2017, partially offset by a legal settlement recorded and higher professional fees in 2018. There
was no incentive unit expense recorded in 2018.

For additional information on the adoption of ASU 2016-01, see Note 2 - "Summary of Significant Accounting Policies"

and Note 10 - "Investments" to the SPLP consolidated financial statements found elsewhere in this Form 10-K.

DISCUSSION OF CONSOLIDATED CASH FLOWS

The following table provides a summary of the Company's consolidated cash flows for the years ended December 31,

2018 and 2017:

Net cash provided by (used in) operating activities

Net cash used in investing activities

Net cash provided by financing activities

Net change for the period

Cash Flows from Operating Activities

Year Ended December 31,

2018

2017

52,751

(366,429)

226,621

(87,057) $

(15,770)
(169,628)
155,889
(29,509)

Net cash provided by operating activities for the year ended December 31, 2018 was $52,751. Net loss of $31,490 was
impacted by certain non-cash items and a net unfavorable change of $88,843 relating to certain operating assets and liabilities. The
net change in operating assets and liabilities was primarily due to an increase of $51,370 in loans held for sale due to the timing of
loan originations, which can vary significantly from period-to-period since these loans are typically sold after origination, as well
as the level of activity at WebBank, an increase of $19,625 in trade and other receivables due to timing of receipts, an increase in
inventories of $7,415 to support sales growth in the Diversified Industrial segment, and an increase in prepaid expenses and other
assets of $7,851.

Net cash used in operating activities for the year ended December 31, 2017 was $15,770. Net income of $6,012 was
impacted by certain non-cash items and a net unfavorable change of $132,576 relating to certain operating assets and liabilities.
The net change in operating assets and liabilities was primarily due to an increase of $56,081 in loans held for sale due to the timing
of loan originations, which can vary significantly from period-to-period since these loans are typically sold after origination, as
well as the level of activity at WebBank, an increase of $22,842 in trade and other receivables due to timing of receipts, an increase
in inventories of $21,683 to support sales growth in the Diversified Industrial segment, a decrease in prepaid expenses and other
assets of $4,281, a decrease of $36,251 in accounts payable, accrued and other liabilities due primarily to higher pension contributions
and timing of payments.

Cash Flows from Investing Activities

Net cash used in investing activities for the year ended December 31, 2018 was $366,429. Significant items included
purchases of property, plant and equipment of $47,085, an increase in loan originations, net of collections of $203,885, primarily
due to larger outstanding loan balances, and net cash paid for acquisitions of $62,683, primarily for the Dunmore acquisition, as
well as net purchases of investments of $59,369, including the Company's investments in BW shares, partially offset by proceeds
from the sales of assets of $5,909. The Company's investments in BW shares totaled $76,261 in 2018.

Net cash used in investing activities for the year ended December 31, 2017 was $169,628. Significant items included
purchases of property, plant and equipment of $54,737, an increase in loan originations, net of collections, of $66,177, net payments
related to investment activities of $26,690, as well as the purchase of Steel Connect, Inc. ("STCN") convertible preferred stock for
$35,000, partially offset by proceeds from sale of assets of $14,991.

Cash Flows from Financing Activities

Net cash provided by financing activities for the year ended December 31, 2018 was $226,621, including net revolver
borrowings of $65,315 and a net increase in WebBank's deposits of $200,311. These increases were partially offset by cash used
to purchase the Company's common units of $21,202 and $18,068 used to purchase subsidiary shares from noncontrolling interests,
primarily the acquisition of WFHC shares.

Net cash provided by financing activities for the year ended December 31, 2017 was $155,889, including net revolver
borrowings of $67,864 and a net increase in WebBank's deposits of $145,395. These increases were partially offset by domestic
term loan repayments of $47,993, cash used to purchase the Company's common units of $5,188, as well as payment of financing-
related fees of $5,663.

LIQUIDITY AND CAPITAL RESOURCES

SPLP (excluding its operating subsidiaries, "Holding Company") is a diversified global holding company with assets that
principally consist of the stock of its direct subsidiaries, equity method and other investments, and cash and cash equivalents. The
Company works with its businesses to enhance the liquidity and operations of its businesses and increase long-term value for its
unitholders and stakeholders through balance sheet improvements, capital allocation policies, and operational and growth
initiatives, which are further described in Item 1 - "Business - Business Strategy."

On January 31, 2019, the Company entered into an amendment to its senior secured revolving credit facility ("Credit
Agreement") to increase the Company's borrowing capacity. The Credit Agreement covers substantially all of the Company's
subsidiaries, with the exception of WebBank. Availability under the Credit Agreement is based upon earnings and certain covenants,
including a maximum ratio limit on Total Leverage and a minimum ratio limit on Interest Coverage, as defined in the Credit
Agreement. The amendment increased the allowable leverage by 0.25 "turns" on a permanent basis through the maturity of the
Credit Agreement and converted $200,000 of the revolving credit commitments into a term loan with quarterly amortization
equating to 5.0% per annum, resulting in a $500,000 revolving credit facility going forward. The Credit Agreement is subject to
certain mandatory prepayment provisions and restrictive and financial covenants, primarily the leverage ratios described above.
The Company was in compliance with all financial covenants at December 31, 2018. There can be no assurances that the Company
will continue to have access to this line of credit if its financial performance does not satisfy the financial covenants set forth in
the Credit Agreement. If the Company does not meet its financial covenants, and if it is unable to secure necessary waivers or
other amendments from its lenders on terms acceptable to management, its ability to access available lines of credit could be
limited, its debt obligations could be accelerated and liquidity could be adversely affected. The Credit Agreement will expire, with
all amounts outstanding due and payable, on November 14, 2022.

The Holding Company and its operating businesses believe that they have access to adequate resources to meet their
needs for normal operating costs, capital expenditures, pension payments, debt obligations and working capital for their existing
business for at least the next twelve months. These resources include cash and cash equivalents, investments, cash provided by
operating activities and unused lines of credit. The Holding Company and its operating businesses' ability to satisfy their debt
service obligations, to fund planned capital expenditures and required pension payments, and to make acquisitions or repurchase
units under its common unit Repurchase Program will depend upon their future operating performance, which will be affected by
prevailing economic conditions in the markets in which they operate, as well as financial, business and other factors, some of
which are beyond their control. As indicated above, there can be no assurances that the Holding Company and its operating
businesses will continue to have access to their lines of credit if their financial performance does not satisfy the financial covenants
set forth in their respective financing agreements, which could also result in the acceleration of their debt obligations by their
respective lenders, adversely affecting liquidity.

Management is utilizing the following strategies to continue to enhance liquidity: (1) continuing to implement
improvements using the Steel Business System throughout all the Company's operations to increase sales and operating efficiencies,
(2) supporting profitable sales growth both internally and potentially through acquisitions and (3) evaluating from time to time
and as appropriate, strategic alternatives with respect to its businesses and/or assets. The Company continues to examine all of its
options and strategies, including acquisitions, divestitures and other corporate transactions, to increase cash flow and stakeholder
value.

As of December 31, 2018, the Company's working capital was $422,374, as compared to working capital of $513,689
as of December 31, 2017. As of December 31, 2018, the availability under the Credit Agreement was approximately $42,900.
During the years ended December 31, 2018 and 2017, capital expenditures were $47,085 and $54,737, respectively. The Company
currently expects full year capital expenditures in the range of $41,000 to $52,000 in 2019. The Company and its subsidiaries have
ongoing commitments as noted in the table below. These commitments include funding of the minimum requirements of its
subsidiaries' pension plans. Required future pension contributions are estimated based upon assumptions such as discount rates
28

on future obligations, assumed rates of return on plan assets and legislative changes. Actual future pension costs and required
funding obligations will be affected by changes in the factors and assumptions described in the previous sentence, as well as other
changes such as any plan termination or other acceleration events.

WebBank manages its liquidity to provide adequate funds to meet anticipated financial obligations, such as certificate of
deposit maturities and to fund customer credit needs. WebBank had $242,088 and $286,454 in cash at the Federal Reserve Bank
and in its Federal Funds account at its correspondent banks at December 31, 2018 and 2017, respectively. WebBank had $35,000
and $30,000 in lines of credit from its correspondent banks at December 31, 2018 and 2017, respectively. WebBank had $71,345
and $59,514 available from the Federal Reserve discount window at December 31, 2018 and 2017, respectively. WebBank had a
total of $348,433 and $375,968 in cash, lines of credit and access to the Federal Reserve Bank discount window at December 31,
2018 and 2017, respectively, which represents approximately 40.0% and 59.8%, respectively, of WebBank's total assets.

Contractual Commitments and Contingencies

Our consolidated contractual obligations as of December 31, 2018 are identified in the table below:

Debt obligations (a)
Estimated interest expense (a), (b)
Deposits (c)
Operating lease obligations

Capital lease obligations
Minimum pension contributions (d)
Preferred unit liability (e)
Total

Payments Due By Period

Less Than 1
Year

1 - 3 Years

3 - 5 Years

Thereafter

Total

3,893

4,529

473,567

— $

23,985
431,959

14,280

1,419

34,287

—

47,446
279,352

20,106

2,466

70,474

40,000

21,653
—

10,037

2,280

66,826

—

—
—

17,867

681

23,700

—

481,989

93,084
711,311

62,290

6,846

195,287

40,000

509,823

464,373

574,363

42,248

1,590,807

(a) Assumes repayment of the $472,495 balance outstanding on the Credit Agreement as of December 31, 2018 on its November 14, 2022
contractual maturity date. The outstanding balance on SPLP's Credit Agreement will fluctuate before maturity, and the repayment dates and
amounts may differ. The January 2019 amendment to the Company's Credit Agreement will add the following principal repayment
requirements, which are not reflected in the table above: $7,500 in 2019 and $10,000 in each of 2020, 2021 and 2022.

(b) Estimated interest expense does not include non-cash amortization of debt issuance costs, which is included in interest expense in the
Company's consolidated financial statements. The interest rates used to estimate future interest expense were based on interest rates at
December 31, 2018. As the majority of the Company's long-term debt bears interest at variable rates, any future interest rate fluctuations
will impact future cash payments.

(c) Excludes interest. The average interest rate on deposits at December 31, 2018 was 2.23% and interest rates ranged from 0.00% to 3.23%.
(d) Represents total expected required minimum pension plan contributions to the Company's significant pension plans for 2019, 2020, 2021,
2022, 2023 and for the five years thereafter. Actual future pension costs and required funding obligations will be affected by changes in the
factors and assumptions described elsewhere in this Annual Report on Form 10-K, as well as other changes such as any plan termination
or other acceleration events. The Company's other pension and post-retirement obligations are not significant individually or in the aggregate.
(e) Represents redemption of 1,600,000 6.0% Series A preferred units, no par value, on the third anniversary of the original issuance date of
the SPLP preferred units (February 7, 2020) at a redemption price equal to the liquidation preference value of $25 per unit, in cash. In
addition to the amount in the table above, the Partnership Agreement also specifies that if the SPLP preferred units are not redeemed earlier,
then on the ninth anniversary of the original issuance date (February 7, 2026), the remaining SPLP preferred units will be redeemed. The
redemption price will be $25 per unit in cash or in common units or a combination thereof, at the sole discretion of the Company's Board
of Directors. Upon redemption, the holders of the SPLP preferred units will also receive any accumulated and unpaid distributions as of
the redemption date. The SPLP preferred units entitle the holders to a cumulative quarterly cash or in-kind (or a combination thereof)
distribution, if and when declared at the discretion of the Company's Board of Directors.

Environmental Liabilities

Certain of the Company's facilities are subject to environmental remediation obligations. The Company has estimated its
liability to remediate these sites and has recorded $14,960 at December 31, 2018. For further discussion regarding these
commitments, among others, see Note 19 - "Commitments and Contingencies" to the Company's consolidated financial statements
found elsewhere in this Form 10-K.

Deposits

Deposits at WebBank at December 31, 2018 and 2017 were as follows:

Current

Long-term

Total

2018

2017

431,959

279,352

711,311

305,207

205,793

511,000

The increase in deposits at December 31, 2018, as compared to 2017, is due to WebBank's asset growth. The average

original maturity for time deposits at December 31, 2018 was 23 months, as compared to 27 months at December 31, 2017.

The following table details the maturity of time deposits as of December 31, 2018:

Certificate of deposits less than $100

Certificate of deposits of $100 or more

Total certificates of deposits

Off-Balance Sheet Risk

< 3 Months

3 to 6 Months

Maturity

6 to 12
Months

> 12 Months

Total

55,000

6,288

61,288

83,009

4,656

87,665

147,750

13,874

161,624

279,352

—

279,352

565,111

24,818

589,929

It is not the Company's usual business practice to enter into off-balance sheet arrangements such as guarantees on loans
and financial commitments, indemnification arrangements and retained interests in assets transferred to an unconsolidated entity
for securitization purposes. SPLP uses the same credit policy in making commitments and conditional obligations as it does for
on-balance sheet instruments.

WebBank is a party to financial instruments with off-balance sheet risk. In the normal course of business, these financial
instruments include commitments to extend credit in the form of loans as part of WebBank's lending arrangements with Marketing
Partners. Those instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount recognized
on the Company's consolidated balance sheets. The contractual amounts of those instruments reflect the extent of involvement
WebBank has in particular classes of financial instruments.

At December 31, 2018 and 2017, WebBank's undisbursed commitments under these instruments totaled $130,697 and
$148,529, respectively. Commitments to extend credit are agreements to lend to a borrower who meets the lending criteria
established by WebBank through one of WebBank's lending agreements with Marketing Partners, provided there is no violation
of any condition established in the contract with the counterparty to the lending arrangement. Commitments generally have fixed
expiration dates or other termination clauses and may require payment of a fee, and in some cases are subject to ongoing adjustment
by WebBank. Since certain of the commitments are expected to expire without the credit being extended, the total commitment
amounts do not necessarily represent future cash requirements. WebBank evaluates each prospective borrower's credit worthiness
on a case-by-case basis. The amount of collateral obtained, if deemed necessary by WebBank upon extension of credit, is based
on management's credit evaluation of the borrower and WebBank's Marketing Partner.

WebBank's exposure to credit loss in the event of nonperformance by the other party to the financial instrument for
commitments to extend credit is represented by the contractual amount of those instruments. WebBank uses the same credit policy
in making commitments and conditional obligations as it does for on-balance sheet instruments.

Critical Accounting Policies

The Company's discussion and analysis of financial condition and results of operations is based upon its consolidated
financial statements, which have been prepared in conformity with U.S. GAAP. Preparation of these consolidated financial
statements requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues,
expenses and related disclosure of contingent assets and liabilities. Estimates are based on historical experience, expected future
cash flows and various other assumptions that are believed to be reasonable under the circumstances, the results of which form
the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources.
Actual results may differ from these estimates.

Note 2 - "Summary of Significant Accounting Policies" to the Company's consolidated financial statements, included
elsewhere in this Annual Report on Form 10-K, includes a summary of the significant accounting policies and methods used in
the preparation of the consolidated financial statements. The following is a discussion of the critical accounting policies and
methods used by the Company.

Goodwill and Other Intangible Assets, Net

Goodwill, which is not amortized, represents the difference between the purchase price and the fair value of identifiable
net assets acquired in a business combination. We review goodwill for impairment annually in the fourth quarter, and test for
impairment during the year if an event occurs or circumstances change that would indicate the carrying amount may be impaired.
Examples of such events would include pertinent macroeconomic conditions, industry and market considerations, overall financial
performance and other factors. An entity can choose between using the Step 0 approach or the Step 1 approach.

For the Step 0 approach, an entity may assess qualitative factors to determine whether it is more likely than not that the
fair value of a reporting unit is less than its carrying amount. An entity has an unconditional option to bypass the Step 0 assessment
for any reporting unit in any period and proceed directly to performing the first step of the goodwill impairment test. An entity
may resume performing the Step 0 assessment in any subsequent period.

For the Step 1 approach, which is a quantitative approach, the Company will calculate the fair value of a reporting unit
and compare it to its carrying amount. There are several methods that may be used to estimate a reporting unit's fair value, including
the income approach, the market approach and/or the cost approach. If the fair value of a reporting unit exceeds its carrying amount,
there is no indication of impairment and further testing is not required. If the carrying amount of a reporting unit exceeds its fair
value, then a second step of testing is required. The second step of the goodwill impairment test compares the implied fair value
of the reporting unit's goodwill with the carrying amount of that goodwill.

For 2018, the Company utilized the Step 0 approach for all of its reporting units, except for the Packaging business within
its Diversified Industrial segment. Based on its qualitative assessment, the Company does not believe that it is more likely than
not that the fair value of any of its reporting units tested under this approach is less than its carrying value. The Company performed
a quantitative assessment of goodwill associated with its Packaging business due to a decline in market conditions and lower
demand for certain of the Packaging business' product lines. The assessment was based on a combination of income and market
approaches to estimate the fair value of the reporting unit, which indicated that the fair value of this reporting unit exceeded its
carrying value by approximately 21.9%. The carrying value and goodwill associated with the Packaging business were
approximately $160,951 and $40,827, respectively, at December 31, 2018. Significant assumptions used in the discounted cash
flow analysis included expected future earnings and cash flows, which are based on management's current expectations, as well
as the related risk-adjusted discount rate used to estimate fair value. At December 31, 2018, the goodwill related to the Packaging
business, and associated intangible assets, are at risk of future impairment if the fair value of this reporting unit, and its associated
assets, decrease in value due to further declines in market conditions or customer demand.

For 2017, the Company utilized the Step 0 approach for all of its reporting units to assess goodwill, and there were no

goodwill impairment charges recorded as a result of the assessment.

For definite-lived intangible assets, the Company evaluates the carrying value of such assets when circumstances indicate
the carrying amount may not be recoverable. Conditions that could have an adverse impact on the cash flows and fair value of the
long-lived assets are deteriorating business climate, condition of the asset or plans to dispose of the asset before the end of its
useful life. If the assets' carrying values exceed the sum of the undiscounted cash flows, an impairment charge is recognized in
the amount by which the carrying values exceeds their fair values. The Company performs such assessments at the lowest level
for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities, which is generally at the
plant level, operating company level or the reporting unit level, depending on the level of interdependencies in the Company's
operations. During 2018, the Company recorded non-cash impairment charges totaling approximately $7,600, calculated using
the income approach, primarily associated with the loss of acquired customer relationships in the Company's Packaging business.

Intangible assets with indefinite lives, which are only within the Diversified Industrial segment, are tested for impairment
at least annually, or when events or changes in circumstances indicate that it is more likely than not that the asset is impaired.
Companies can use the same two testing approaches for indefinite-lived intangibles as for goodwill. For 2018 and 2017, the
Company utilized the Step 0 approach to assess its intangible assets with indefinite lives as of December 31, and the results
indicated no impairment in either of these years.

Pension and Other Post-Retirement Benefit Costs

Some of the Company's subsidiaries maintain qualified and non-qualified pension and other post-retirement benefit plans.
The Company recorded pension expense of $3,184 for the year ended December 31, 2018 related to its significant pension plans,
and, at December 31, 2018, the Company had recorded pension liabilities totaling $205,770. Pension benefits are generally based
on years of service and the amount of compensation earned during the participants' employment. However, the qualified pension
benefits have been frozen for all participants.

The pension and other post-retirement benefit costs are developed from actuarial valuations. Inherent in these valuations
are key assumptions, including discount and mortality rates and expected long-term rates of return on plan assets. Material changes
in pension and other post-retirement benefit costs may occur in the future due to changes in these assumptions, changes in the
number of plan participants, changes in the level of benefits provided, changes to the level of contributions to these plans and
other factors.

Actuarial assumptions for its pension and other post-retirement benefit plans are determined each year to calculate liability
information as of December 31, and pension and other post-retirement benefit expense or income for the following year. The
discount rate assumption is derived from the rate of return on high-quality bonds.

The various pension plan assets are diversified as to type of assets, investment strategies employed and number of
investment managers used. Investments may include equities, fixed income, cash equivalents, convertible securities and private
investment funds. Derivatives may be used as part of the investment strategy. The transfer of assets may be directed between
investment managers in order to rebalance the portfolio in accordance with asset allocation guidelines established by the Company.
The private investment funds, or the investment funds they are invested in, own marketable and non-marketable securities and
other investment instruments. Such investments are valued by the private investment funds, underlying investment managers or
the underlying investment funds at fair value, as described in their respective financial statements and offering memorandums.
These values are utilized in quantifying the value of the assets of its pension plans, which are then used in the determination of
the unfunded pension liabilities on the Company's consolidated balance sheets. Because of the inherent uncertainty of valuation
of some of the pension plans' investments in private investment funds and the nature of some of the underlying investments held
by the investment funds, the recorded value may differ from the value that would have been used had a ready market existed for
some of these investments for which market quotations are not readily available. Management uses judgment to make assumptions
on which its employee benefit liabilities and expenses are based. The effect of a 1% change in discount rate or expected return on
asset assumptions for the pension plans sponsored by the Company's subsidiaries would not be material to the Company.

Loan Impairment and Allowance for Loan Losses

A loan is considered impaired when, based on current information and events, it is probable that WebBank will be unable
to collect all amounts due according to the contractual terms of the loan agreement, including scheduled interest payments. When
a loan has been identified as being impaired, the amount of impairment is measured based on the present value of expected future
cash flows discounted at the loan's effective interest rate or, when appropriate, the loan's observable fair value or the fair value of
the collateral (less any selling costs) if the loan is collateral-dependent. If the measurement of the impaired loan is less than the
recorded investment in the loan (including accrued interest, net of deferred loan fees or costs and unamortized premium or discount),
an impairment is recognized by creating or adjusting an existing allocation of the ALLL, or by charging down the loan to its value
determined in accordance with U.S. GAAP.

The ALLL is established as losses are estimated to have occurred through a provision for loan losses charged to earnings.
Loan losses are charged against the allowance when the uncollectability of a loan or receivable balance is confirmed. Subsequent
recoveries, if any, are credited to the allowance. The ALLL is evaluated on a regular basis and is based upon a periodic review of
the collectability of the amounts due in light of historical experience, the nature and volume of the loan portfolio, adverse situations
that may affect the borrower's ability to repay, estimated value of any underlying collateral and prevailing economic conditions.
This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information
becomes available. The allowance consists of specific and general components. The specific component relates to loans that are
classified as doubtful, substandard or loss. For such loans that are classified as impaired, an allowance is established when the
discounted cash flows (or collateral value or observable market price) of the impaired loan is lower than the carrying value of that
loan. The general component covers non-classified loans and is based on historical loss experience and is adjusted for qualitative
factors to cover uncertainties that could affect the estimate of probable losses. The ALLL is increased by charges to income and
decreased by charge-offs (net of recoveries). The periodic evaluation of the adequacy of the allowance is based on WebBank's
past loss experience, known and inherent risks in the portfolio, adverse situations that may affect the debtor's ability to repay, the
estimated value of any underlying collateral and current economic conditions. Since our loss rates are applied to large pools of
loans, even minor changes in the level of estimated losses can significantly affect management's determination of the appropriate
ALLL because those changes must be applied across a large portfolio.

Income Taxes

As a limited partnership, we are generally not responsible for federal and state income taxes, and our profits and losses
are passed directly to our limited partners for inclusion in their respective income tax returns. Our subsidiaries that are corporate
subsidiaries are subject to federal and state income taxes. The table in Note 16 - "Income Taxes" to the SPLP consolidated financial
32

statements, found elsewhere in this Form 10-K, reconciles a hypothetical calculation of federal income taxes based on the federal
statutory rate applied to the income or loss before income taxes and equity method investments. The tax effect of income passed
through to common unitholders is subtracted from the hypothetical calculation.

Our subsidiaries that are subject to income taxes use the liability method of accounting for such taxes. Under the liability
method, deferred tax assets and deferred tax liabilities are recognized for the future tax consequences attributable to differences
between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and operating
loss and tax credit carryforwards. Deferred tax assets and deferred tax liabilities are measured using enacted tax rates expected to
apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on
deferred tax assets and deferred tax liabilities of a change in tax rates is recognized in income in the period that includes the
enactment date. Our subsidiaries evaluate the recoverability of deferred tax assets and establish a valuation allowance when it is
more likely than not that some portion of the deferred tax assets will not be realized.

When tax returns are filed, it is highly certain that most positions taken would be sustained upon examination by the
taxing authorities, while others are subject to uncertainty about the merits of the position taken or the amount of the position that
would be ultimately sustained. The benefit of a tax position is recognized in the consolidated financial statements in the period
during which, based on all available evidence, management believes it is more likely than not that the position will be sustained
upon examination, including the resolution of appeals or litigation processes, if any. Tax positions taken are not offset or aggregated
with other positions. Tax positions that meet the more-likely-than-not recognition threshold are measured as the largest amount
of tax benefit that is more than 50% likely of being realized upon settlement with the applicable taxing authority. The portion of
the benefits associated with tax positions taken that exceeds the amount measured as described above is provided for and reflected
as a liability for unrecognized tax benefits on the consolidated balance sheets, along with any associated interest and penalties that
would be payable to the taxing authorities upon examination.

Environmental Remediation

The facilities and operations of the Company's subsidiaries are subject to extensive environmental laws and regulations
imposed by federal, state, foreign and local authorities relating to the protection of the environment. Accruals for losses associated
with environmental remediation obligations are recorded when such losses are probable and reasonably estimable, which is a
critical accounting estimate. Accruals for estimated losses from environmental remediation obligations generally are recognized
no later than completion of the remedial feasibility study. Such accruals are adjusted as further information develops or
circumstances change. Costs of future expenditures for environmental remediation obligations are not discounted to their present
value. Recoveries of environmental remediation costs from other parties are recorded as assets when their receipt is deemed
probable. Reserves may not be adequate to cover the ultimate costs of remediation, including discovery of additional contaminants
or the imposition of additional cleanup obligations, which could result in significant additional costs, unfavorably impacting the
Company's financial position and results of operations.

New or Recently Adopted Accounting Pronouncements

For a discussion of the Company's new or recently adopted accounting pronouncements, see Note 2 - "Summary of

Significant Accounting Policies" to the SPLP consolidated financial statements found elsewhere in this Form 10-K.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

In this "Quantitative and Qualitative Disclosure About Market Risk" section, all dollar amounts are in thousands.

Market risk is the risk of loss arising from adverse changes in market rates and prices, such as interest rates, foreign currency
exchange rates and commodity prices. Our significant market risks are primarily associated with interest rates, equity prices and,
to a lesser extent, derivatives. The following sections address the significant market risks associated with our business activities.

SPLP's quantitative and qualitative disclosures about market risk include forward-looking statements with respect to
management's opinion about the risk associated with the Company's financial instruments. These statements are based on certain
assumptions with respect to market prices, interest rates and other industry-specific risk factors. To the extent these assumptions
prove to be inaccurate, future outcomes may differ materially from those discussed herein.

Risks Relating to Investments

The Company's investments are primarily classified as Marketable securities or Long-term investments and are primarily

recorded on the Company's consolidated balance sheets at fair value. These investments are subject to equity price risk.

At December 31, 2018, Marketable securities aggregated approximately $1,439, which includes mutual funds and corporate
equities that are reported at fair value. In addition, financial instrument obligations aggregated $12,434 at December 31, 2018. A
change in the equity price of these securities could impact our results in future periods.

Included in the Company's Long-term investments of $258,044 at December 31, 2018 are equity securities and associated
company investments, which are both subject to equity price risk. The Company's significant associated company investments as
of December 31, 2018 include its investments in STCN and Aviat Networks, Inc. The Company's investments in associated companies
are accounted for under the equity method of accounting, primarily using the fair value option. A change in the equity price of our
investments in these securities could impact our results in future periods.

See Note 10 - "Investments" to the SPLP consolidated financial statements found elsewhere in this Form 10-K for more

information about the Company's marketable securities and associated company investments.

Risks Relating to Interest Rates

The fair value of cash and cash equivalents, trade and other receivables, accounts payable and short-term borrowings
approximate their carrying values and are relatively insensitive to changes in interest rates due to the short-term maturities of these
instruments or the variable nature of the associated interest rates.

Credit Facilities and Pension Obligations

At December 31, 2018, the Company's long-term debt obligations were comprised primarily of variable rate instruments.
Accordingly, the fair value of such instruments may be relatively sensitive to effects of interest rate fluctuations. An increase or
decrease in interest expense from a 1% change in interest rates would be approximately $4,800 on an annual basis based on total
variable-interest debt outstanding as of December 31, 2018. In addition, the fair value of such instruments is also affected by
investors' assessments of the risks associated with industries in which the Company operates, as well as its overall creditworthiness
and ability to satisfy such obligations upon their maturity.

A reduction in long-term interest rates could materially increase the Company's cash funding obligations to its pension

and other post-retirement benefit plans.

WebBank

WebBank derives a portion of its income from the excess of interest collected over interest paid. The rates of interest
WebBank earns on assets and pays on liabilities generally are established contractually for a period of time. Market interest rates
change over time. Accordingly, WebBank's results of operations, like those of most financial institutions, are impacted by changes
in interest rates and the interest rate sensitivity of its assets and liabilities.

WebBank monitors and measures its exposure to changes in interest rates in order to comply with applicable government
regulations and risk policies established by WebBank's board of directors and in order to preserve shareholder value. In monitoring
interest rate risk, WebBank analyzes assets and liabilities based on characteristics including size, coupon rate, repricing frequency,
maturity date and likelihood of prepayment.

WebBank currently focuses held-to-maturity lending efforts toward originating competitively priced adjustable-rate or
fixed-rate loan products with short to intermediate terms to maturity, generally 7 years or less. This theoretically allows WebBank
to maintain a portfolio of loans that will have relatively little sensitivity to changes in the level of interest rates, while providing a
reasonable spread over the cost of liabilities used to fund the loans.

The principal objective of WebBank's asset/liability management is to manage the sensitivity of Market Value of Equity
("MVE") to changing interest rates. Asset/liability management is governed by policies reviewed and approved annually by
WebBank's board of directors. WebBank's board of directors has delegated the responsibility to oversee the administration of these
policies to WebBank's asset/liability committee, or "ALCO." The interest rate risk strategy currently deployed by ALCO is to
primarily use "natural" balance sheet hedging (as opposed to derivative hedging). ALCO fine tunes the overall MVE sensitivity by
recommending lending and deposit strategies. WebBank then executes the recommended strategy by increasing or decreasing the
duration of the loan and deposit products, resulting in the appropriate level of market risk that WebBank's board of directors wants
to maintain.

WebBank measures interest rate sensitivity as the difference between amounts of interest earning assets and interest bearing
liabilities that mature or reprice within a given period of time. The difference provides an indication of the extent to which an
institution's interest rate spread will be affected by changes in interest rates. If the amount of interest rate sensitive assets exceeds
the amount of interest rate sensitive liabilities, then the bank is considered to be asset sensitive. If the amount of interest rate sensitive
liabilities exceeds the amount of interest rate sensitive assets, then the bank is considered to be liability sensitive. In a rising interest
rate environment, an institution that is asset sensitive would be in a better position than an institution that is liability sensitive because
the yield on its assets would increase at a faster pace than the cost of its interest bearing liabilities. During a period of falling interest
rates, however, an institution that is asset sensitive would tend to have its assets reprice at a faster rate than its liabilities, which
would tend to reduce the growth in its net interest income. The opposite is true if the institution is liability sensitive.

WebBank's board of directors and relevant government regulations establish limits on the level of acceptable interest rate
risk at WebBank to which management adheres. There can be no assurance, however, that, in the event of an adverse change in
interest rates, WebBank's efforts to limit interest rate risk will be successful.

Risks Relating to Commodity Prices

In the normal course of business, our operations are exposed to market risk or price fluctuations related to the purchase of
electricity, natural gas, fuel and petroleum-based commodities, including adhesives, and other products, such as yarns, precious
metals, electronic and electrical components, steel products and certain non-ferrous metals used as raw materials. The Company is
also exposed to the effects of price fluctuations on the value of its commodity inventories, in particular, its precious metal inventory.
The raw materials and energy which we use are largely commodities, subject to price volatility caused by changes in global supply
and demand and governmental controls.

The Company's market risk strategy has generally been to obtain competitive prices for its products and services, sourced
from more than one vendor, and allow operating results to reflect market price movements dictated by supply and demand. The
Company enters into commodity futures and forward contracts to mitigate the impact of price fluctuations on its precious and certain
non-precious metal inventories that are not subject to fixed price contracts. The Company's hedging strategy is designed to protect
it against normal volatility; therefore, abnormal price changes in these commodities or markets could negatively impact the
Company's earnings. Certain of these derivatives are not designated as accounting hedges under Accounting Standards Codification
Subtopic 815-10, Derivatives and Hedging. As of December 31, 2018, the Company had entered into forward contracts, with
settlement dates through January 2019, for silver with a total value of $3,993, for gold with a total value of $3,467, for palladium
with a value of $951, for copper with a total value of $388 and for tin with a total value of $392. There were no futures contracts
outstanding at December 31, 2018.

To the extent that we have not mitigated our exposure to rising raw material and energy prices, we may not be able to
increase our prices to our customers to offset such potential raw material or energy price increases, which could have a material
adverse effect on our results of operations and operating cash flows.

Risks Relating to Foreign Currency Exchange

The Company, primarily through its Diversified Industrial segment subsidiaries, manufactures and sells its products in a
number of countries throughout the world and, as a result, is exposed to movements in foreign currency exchange rates. The
Company's major foreign currency exposures involve the markets in Asia, Europe, Canada and Mexico. The Company is subject
to the risk of price fluctuations related to anticipated revenues and operating costs, firm commitments for capital expenditures and
existing assets or liabilities denominated in currencies other than the U.S. dollar. The Company has not generally used derivative
instruments to manage these specific risks; however, the Company enters into foreign currency forward contracts to hedge certain
of its receivables and payables denominated in other currencies, primarily those associated with its Packaging operations located
in the United Kingdom. In addition, the Company enters into foreign currency forward contracts to hedge the value of certain of
its future sales denominated in Euros and the value of certain of its future purchases denominated in U.S. dollars, also associated
with its Packaging operations located in the United Kingdom.

Item 8. Financial Statements and Supplementary Data

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

Reports of Independent Registered Public Accounting Firms
Consolidated Financial Statements:

Consolidated Balance Sheets as of December 31, 2018 and 2017

Consolidated Statements of Operations for the years ended December 31, 2018 and 2017

Consolidated Statements of Comprehensive (Loss) Income for the years ended December 31, 2018 and 2017

Consolidated Statements of Changes in Capital for the years ended December 31, 2018 and 2017

Consolidated Statements of Cash Flows for the years ended December 31, 2018 and 2017

Notes to Consolidated Financial Statements

Page

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the unitholders and the Board of Directors of Steel Partners Holdings L.P.

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheet of Steel Partners Holdings L.P. and subsidiaries (the "Company")
as of December 31, 2018, the related consolidated statements of operations, comprehensive (loss) income, changes in capital, and
cash flows, for the year ended December 31, 2018, and the related notes (collectively referred to as the "consolidated financial
statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of
the Company as of December 31, 2018, and the results of its operations and its cash flows for the year ended December 31, 2018,
in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States)
(PCAOB), the Company's internal control over financial reporting as of December 31, 2018, based on criteria established in Internal
Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and
our report dated February 28, 2019, expressed an unqualified opinion on the Company's internal control over financial reporting.

Change in Accounting Principle

As discussed in Note 2 to the consolidated financial statements, the Company has changed its method of accounting for available-
for-sale equity securities, which are now reported at fair value, with unrealized gains and losses recognized in Realized and unrealized
losses (gains) on securities, net in the consolidated statement of operations, with an opening balance cumulative effective
reclassification adjustment from Accumulated other comprehensive loss to Partners' capital, in 2018, due to the adoption of
Accounting Standards Update 2016-01-Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of
Financial Assets and Financial Liabilities.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an
opinion on the Company's consolidated financial statements based on our audit. We are a public accounting firm registered with
the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws
and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether
due to error or fraud. Our audit included performing procedures to assess the risks of material misstatement of the consolidated
financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included
examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audit also
included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall
presentation of the consolidated financial statements. We believe that our audit provides a reasonable basis for our opinion.

/s/ Deloitte & Touche LLP
New York, New York
February 28, 2019

We have served as the Company's auditor since 2018.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the unitholders and the Board of Directors of Steel Partners Holdings L.P.

Opinion on Internal Control over Financial Reporting

We have audited the internal control over financial reporting of Steel Partners Holdings L.P. and subsidiaries (the "Company") as
of December 31, 2018, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee
of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Company maintained, in all material
respects, effective internal control over financial reporting as of December 31, 2018, based on criteria established in Internal Control
- Integrated Framework (2013) issued by COSO.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States)
(PCAOB), the consolidated balance sheet of the Company as of December 31, 2018, the related consolidated statements of operations,
comprehensive (loss) income, changes in capital, and cash flows, for the year ended December 31, 2018, and the related notes and
our report dated February 28, 2019, expressed an unqualified opinion thereon.

As described in Management's Report on Internal Control Over Financial Reporting within Item 9A of this Form 10-K, management
excluded from its assessment the internal control over financial reporting at Dunmore Corporation and Dunmore Europe GmbH
(collectively, "Dunmore"), which were acquired on February 16, 2018 and whose financial statements constitute approximately
3.2% of the Company's total consolidated assets as of December 31, 2018 and approximately 3.8% of the Company's total
consolidated revenue for the year then ended. Accordingly, our audit did not include the internal control over financial reporting at
Dunmore.

Basis for Opinion

The Company's management is responsible for maintaining effective internal control over financial reporting and for its assessment
of the effectiveness of internal control over financial reporting, included in the accompanying "Item 9A, Management's Report on
Internal Control over Financial Reporting." Our responsibility is to express an opinion on the Company's internal control over
financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent
with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the
Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material
respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material
weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and
performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable
basis for our opinion.

Definition and Limitations of Internal Control over Financial Reporting

A company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted
accounting principles. A company's internal control over financial reporting includes those policies and procedures that (1) pertain
to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets
of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial
statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are
being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable
assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that
could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections
of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes
in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ Deloitte & Touche LLP
New York, New York
February 28, 2019

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Board of Directors and Unitholders
Steel Partners Holdings L.P.
New York, New York

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheet of Steel Partners Holdings L.P. (the "Company") and subsidiaries
as of December 31, 2017, the related consolidated statements of operations, comprehensive (loss) income, changes in capital, and
cash flows for the year ended December 31, 2017, and the related notes (collectively referred to as the "consolidated financial
statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of
the Company and subsidiaries at December 31, 2017, and the results of their operations and their cash flows for the year ended
December 31, 2017, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an
opinion on the Company's consolidated financial statements based on our audit. We are a public accounting firm registered with
the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to
the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and
Exchange Commission and the PCAOB.

Our audit included performing procedures to assess the risks of material misstatement of the consolidated financial statements,
whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a
test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audit also included evaluating
the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the
consolidated financial statements. We believe that our audit provides a reasonable basis for our opinion.

/s/ BDO USA, LLP

We served as the Company's auditor from 2013 to 2018.

New York, New York
March 8, 2018

STEEL PARTNERS HOLDINGS L.P.
Consolidated Balance Sheets
(in thousands, except common units)

ASSETS

Current assets:

Cash and cash equivalents

Restricted cash

Marketable securities

Trade and other receivables - net of allowance for doubtful accounts of $2,885 and $3,633, respectively

Receivables from related parties

Loans receivable, including loans held for sale of $188,143 and $136,773, respectively, net

Inventories, net

Prepaid expenses and other current assets

Assets held for sale

Total current assets

Long-term loans receivable, net

Goodwill

Other intangible assets, net

Deferred tax assets

Other non-current assets

Property, plant and equipment, net

Long-term investments

Total Assets
LIABILITIES AND CAPITAL

Current liabilities:

Accounts payable

Accrued liabilities

Financial instruments

Deposits

Payables to related parties

Short-term debt

Current portion of long-term debt

Other current liabilities

Liabilities of discontinued operations

Total current liabilities

Long-term deposits

Long-term debt

Preferred unit liability

Accrued pension liabilities

Deferred tax liabilities

Other non-current liabilities

Total Liabilities

Commitments and Contingencies

Capital:

Partners' capital common units: 25,294,003 and 26,348,420 issued and outstanding (after deducting

12,142,528 and 10,868,367 units held in treasury, at cost of $192,060 and $170,858), respectively

Accumulated other comprehensive loss

Total Partners' Capital

Noncontrolling interests in consolidated entities

Total Capital
Total Liabilities and Capital

December 31, 2018

December 31, 2017

334,884

12,434

1,439

209,543

425

341,890

158,850

32,826

—

418,755

15,629

58,313

188,487

355

182,242

142,635

19,597

2,549

1,092,291

1,028,562

164,375

183,945

183,541

96,040

80,356

297,467

258,044

87,826

170,115

199,317

109,011

61,074

271,991

236,144

2,356,059

2,164,040

106,261

93,179

12,434

431,959

248

3,094

799

21,943

—

669,917

279,352

478,096

180,340

205,770

2,225

20,987

105,221

74,118

15,629

305,207

1,563

1,624

459

10,602

450

514,873

205,793

412,584

176,512

268,233

3,007

16,002

1,836,687

1,597,004

692,895

(177,244)

515,651

3,721

519,372
2,356,059

650,488

(104,385)
546,103

20,933

567,036
2,164,040

See accompanying Notes to Consolidated Financial Statements

STEEL PARTNERS HOLDINGS L.P.
Consolidated Statements of Operations
(in thousands, except common units and per common unit data)

Year Ended December 31,

2018

2017

1,286,665

Revenue:

Diversified industrial net sales

Energy net revenue

Financial services revenue

Total revenue

Costs and expenses:

Cost of goods sold

Selling, general and administrative expenses

Asset impairment charges

Finance interest expense

Provision for loan losses

Interest expense

Realized and unrealized losses (gains) on securities, net

Other (income) expense, net
Total costs and expenses

(Loss) income before income taxes and equity method investments

Income tax provision

Loss (income) of associated companies, net of taxes

Net (loss) income

Net income attributable to noncontrolling interests in consolidated entities

Net loss attributable to common unitholders

Net loss per common unit - basic and diluted

Net loss attributable to common unitholders

Weighted-average number of common units outstanding - basic and diluted

175,950

121,999

1,584,614

1,109,978

352,794

8,108

10,288

19,058

39,234

62,586

(8,010)

1,594,036

(9,422)

12,559

9,509

(31,490)

(1,114)

(32,604) $

1,156,187

135,461

80,379

1,372,027

958,490

337,719

2,028

4,685

5,639

22,804
(790)
1,029

1,331,604

40,423

51,299
(16,888)
6,012
(6,028)
(16)

(1.25) $

—

25,984,185

26,053,098

See accompanying Notes to Consolidated Financial Statements

STEEL PARTNERS HOLDINGS L.P.
Consolidated Statements of Comprehensive (Loss) Income
(in thousands)

Net (loss) income

Other comprehensive (loss) income, net of tax:

Gross unrealized (losses) gains on available-for-sale securities (a)
Reclassification of unrealized losses on available-for-sale securities (a), (b)
Gross unrealized (losses) gains on derivative financial instruments

Currency translation adjustments

Changes in pension liabilities and other post-retirement benefit obligations

Other comprehensive income

Comprehensive (loss) income

Comprehensive income attributable to noncontrolling interests
Comprehensive (loss) income attributable to common unitholders

Tax (benefit) provision on gross unrealized (losses) gains on securities and derivative financial instruments

Tax provision on reclassification of unrealized losses on available-for-sale securities

Tax provision (benefit) on currency translation adjustments

Tax provision (benefit) on changes in pension liabilities and other post-retirement benefit obligations

Year Ended December 31,

2018

2017

(31,490) $

6,012

(274)

—

(2)

(4,733)

24,247

19,238

(12,252)

(1,100)

(13,352) $

(109) $

— $

184

8,274

27,689

908

624

5,444
(6,452)
28,213

34,225
(8,300)
25,925

33,624

329
(249)
(2,346)

(a) Effective January 1, 2018 upon adoption of Accounting Standards Update No. 2016-01, unrealized gains or losses on equity securities are no longer recorded
in Other comprehensive (loss) income, but are instead recorded in Realized and unrealized losses (gains) on securities, net in the consolidated statement of
operations.

(b) For the year ended December 31, 2017, pre-tax net unrealized holding gains of $790 and losses of $2,028 were reclassified to Realized and unrealized losses

(gains) on securities, net and Asset impairment charges, respectively.

See accompanying Notes to Consolidated Financial Statements

STEEL PARTNERS HOLDINGS L.P.
Consolidated Statements of Changes in Capital
(in thousands, except common units and treasury units)

Steel Partners Holdings L.P. Common Unitholders

Common

Treasury Units

Partners'

Units

Dollars

Capital

Accumulated
Other
Comprehensive
(Loss) Income

Total
Partners'

Capital

Noncontrolling
Interests in
Consolidated
Entities

Total

Capital

Balance at December 31, 2016

36,711,663

(10,558,687)

$ (164,900)

615,720

(66,979)

548,741

155,517

704,258

Net (loss) income

Unrealized gains on available-for-

sale securities

Unrealized gains on derivative

financial instruments

Currency translation adjustments

Changes in pension liabilities and

post-retirement benefit
obligations

Equity compensation - incentive
units and vesting of restricted
units

Equity compensation - subsidiaries

Purchases of SPLP common units

Purchases of subsidiary shares from

noncontrolling interests

Other, net

—

505,124

—

(309,680)

(5,958)

—

(16)

—

9,635

580

(5,958)

30,736

(209)

—

(16)

6,028

6,012

27,786

569

4,512

569

4,512

811

932

28,597

624

5,444

(6,926)

474

(6,452)

—

9,635

580

(5,958)

—

317

—

9,635

897

(5,958)

(63,347)

(32,611)

(144,476)

(177,087)

—

(209)

Balance at December 31, 2017

37,216,787

(10,868,367)

(170,858)

650,488

(104,385)

546,103

Net (loss) income

Unrealized losses on available-for-

sale debt securities

Cumulative effect of adopting ASU

2016-01 relating to net
unrealized gains and losses on
equity securities (a)

Cumulative effect of adopting ASC

606 relating to revenue
recognition (b)

Unrealized (losses) gains on

derivative financial instruments

Currency translation adjustments

Changes in pension liabilities and

post-retirement benefit
obligations

—

Equity compensation - vesting of

restricted units

34,337

—

(32,604)

—

(32,604)

(274)

91,078

(91,078)

—

1,034

—

1,034

—

529

(28)

(4,693)

(28)

(4,693)

24,247

—

529

(21,202)

1,275

20,933

1,114

—

1,066

567,036

(31,490)

(274)

—

1,034

(2)

(40)

(4,733)

—

24,247

529

(21,202)

Purchases of SPLP common units

— (1,274,161)

(21,202)

Purchases of subsidiary shares from

noncontrolling interests

185,407

Exchange of subsidiary shares to
obtain a controlling interest in
former equity-method investee

Other, net

—

3,788

(1,033)

2,755

(20,646)

(17,891)

—

(216)

—

(216)

2,334

—

2,334

(216)

Balance at December 31, 2018

37,436,531

(12,142,528)

$ (192,060)

692,895

(177,244)

515,651

3,721

519,372

(a) Effective January 1, 2018 upon adoption of Accounting Standards Update No. 2016-01, a cumulative effect reclassification adjustment was made to remove

the net unrealized gains and losses on equity securities from Accumulated other comprehensive loss and reclassify them to Partners' capital.

(b) Effective January 1, 2018, the Company adopted Accounting Standards Codification 606 for all contracts with customers using the modified retrospective
transition method. The Company recognized a net increase of $1,034 to Partners' capital due to the cumulative impact of adopting Accounting Standards
Codification 606.

See accompanying Notes to Consolidated Financial Statements

STEEL PARTNERS HOLDINGS L.P.
Consolidated Statements of Cash Flows
(in thousands)

Cash flows from operating activities:
Net (loss) income
Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities:

Provision for loan losses
Loss (income) of associated companies, net of taxes
Realized and unrealized losses (gains) on securities, net
Derivative gains on economic interests in loans
Deferred income taxes
Income tax provision (benefit) from changes in deferred tax valuation allowance
Depreciation and amortization
Equity-based compensation
Loss on extinguishment of debt
Asset impairment charges
Other

Net change in operating assets and liabilities:

Trade and other receivables
Inventories
Prepaid expenses and other assets
Accounts payable, accrued and other liabilities
Net increase in loans held for sale
Net cash provided by (used in) operating activities

Cash flows from investing activities:
Purchases of investments
Proceeds from sales of investments
Proceeds from maturities of marketable securities
Loan originations, net of collections
Purchases of property, plant and equipment
Proceeds from sales of assets
Acquisitions, net of cash acquired
Investments in associated companies
Other

Net cash used in investing activities
Cash flows from financing activities:
Net revolver borrowings
Net repayments of term loans - domestic
Net repayments of term loans - foreign
Proceeds from equipment lease financing
Purchases of the Company's common units
Purchase of subsidiary shares from noncontrolling interests
Deferred finance charges
Common unit dividend payment
Net increase in deposits
Other

Net cash provided by financing activities

Net change for the period

Effect of exchange rate changes on cash and cash equivalents
Cash, cash equivalents and restricted cash at beginning of period

Cash, cash equivalents and restricted cash at end of period

See accompanying Notes to Consolidated Financial Statements

Year Ended December 31,
2017
2018

(31,490) $

6,012

19,058
9,509
62,586
(14,757)
(1,900)
6,317
80,323
644
—
8,108
3,196

(19,625)
(7,415)
(7,851)
(2,582)
(51,370)
52,751

(149,505)
47,200
42,936
(203,885)
(47,085)
5,909
(62,683)
—
684
(366,429)

65,315
(459)
(145)
1,707
(21,202)
(18,068)
(1,280)
—
200,311
442
226,621
(87,057)
(9)
434,384
347,318

5,639
(16,888)
(790)
(8,902)
86,928
(48,598)
71,936
11,477
673
2,028
7,291

(22,842)
(21,683)
4,281
(36,251)
(56,081)
(15,770)

(56,160)
10,978
18,492
(66,177)
(54,737)
14,991
(2,008)
(35,000)
(7)
(169,628)

67,864
(47,993)
(979)
6,688
(5,188)
(2,086)
(5,663)
(3,923)
145,395
1,774
155,889
(29,509)
1,125
462,768
434,384

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

All amounts used in the Notes to Consolidated Financial Statements are in thousands, except common and preferred

units, per common and preferred unit, share and per share data.

1. NATURE OF THE BUSINESS AND BASIS OF PRESENTATION

Nature of the Business

Steel Partners Holdings L.P. ("SPLP" or "Company") is a diversified global holding company that engages in multiple
businesses through consolidated subsidiaries and other interests. It owns and operates businesses and has significant interests in
companies in various industries, including diversified industrial products, energy, defense, supply chain management and logistics,
banking and youth sports. SPLP operates through the following segments: Diversified Industrial, Energy, Financial Services, and
Corporate and Other, which are managed separately and offer different products and services. For additional details related to the
Company's reportable segments see Note 21 - "Segment Information." Steel Partners Holdings GP Inc. ("SPH GP"), a Delaware
corporation, is the general partner of SPLP and is wholly-owned by SPLP. The Company is managed by SP General Services LLC
("Manager"), pursuant to the terms of an amended and restated management agreement ("Management Agreement") discussed in
further detail in Note 20 - "Related Party Transactions."

Basis of Presentation

The consolidated financial statements include the accounts of the Company and its majority or wholly-owned subsidiaries.
All material inter-company accounts and transactions have been eliminated in consolidation. Certain amounts in the Company's
2017 consolidated statements of operations and cash flows have been reclassified to conform to the comparable 2018 presentation.

During the first quarter of 2018, the Company corrected an out-of-period misstatement related to the increase in the fair
value of the Company's investment in Steel Connect, Inc. ("STCN") preferred stock for the period from December 15, 2017 to
December 31, 2017. Had this correction been recorded at December 31, 2017, the Company's investment in STCN preferred stock
would have increased to $46,208 at December 31, 2017, with a corresponding $11,208 increase in Income of associated companies,
net of tax and Net income to $28,096 and $17,220, respectively. For the year ended December 31, 2018, the Company's Loss of
associated companies, net of taxes and Net loss would have increased to losses of $20,717 and $42,698, respectively. In addition,
the Company made a correction as of December 31, 2016, decreasing Accumulated other comprehensive loss by $1,782 and
decreasing Partners' capital by the same amount, to properly reflect certain hedging activities associated with a 2015 business
combination.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Use of Estimates in Preparation of Consolidated Financial Statements

The Company's consolidated financial statements are prepared in accordance with accounting principles generally
accepted in the United States of America ("U.S. GAAP"). The preparation of the consolidated financial statements in conformity
with U.S. GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities
at the date of the financial statements and the reported amount of revenues and expenses, and related disclosure of contingent
assets and liabilities during the reporting period. The more significant estimates include: (1) the valuation allowances for trade
and other receivables, loans receivable and inventories; (2) the valuation of goodwill, indefinite-lived intangible assets, long-lived
assets and associated companies; (3) deferred tax assets; (4) environmental liabilities; (5) fair value of derivatives; (6) post-
employment benefit liabilities; (7) estimates and assumptions used in the determination of fair value of certain securities; and (8)
estimates of loan losses. Actual results may differ from the estimates used in preparing the consolidated financial statements; and,
due to substantial holdings in and/or restrictions on certain investments, the value that may be realized could differ from the
estimated fair value.

Cash and Cash Equivalents

Cash and cash equivalents include cash and deposits in depository institutions, financial institutions and banks. Cash at
December 31, 2018 and 2017 also includes $242,088 and $286,454, respectively, of WebBank cash at the Federal Reserve Bank
and in its Federal Funds account at its correspondent banks. The Company considers all highly liquid debt instruments with
maturities of three months or less when purchased to be cash equivalents. Cash and cash equivalents include qualifying money
market funds and exclude amounts where availability is restricted by loan agreements or other contractual provisions. Cash

equivalents are stated at cost, which approximates market value. There is a significant concentration of cash that, during the periods
presented, exceeded the federal deposit insurance limits and exposed the Company to credit risk. SPLP does not anticipate any
losses due to this concentration of cash at December 31, 2018.

Restricted Cash

Restricted cash at December 31, 2018 and 2017 primarily represents cash collateral for certain short sales of corporate

securities (see Note 13 - "Financial Instruments" for additional information).

Marketable Securities and Long-Term Investments

Marketable securities consist of short-term deposits, corporate debt and equity instruments, and mutual funds. The
Company classifies its marketable securities as current assets based on the nature of the securities and their availability for use in
current operations. Long-term investments consist of equity securities and certain associated company investments. Held-to-
maturity securities are classified in Other non-current assets. SPLP determines the appropriate classifications of its investments
at the acquisition date and re-evaluates the classifications at each balance sheet date.

•

Since the Company adopted Accounting Standards Update No. ("ASU") 2016-01 effective January 1, 2018, available-for-
sale equity securities are now reported at fair value, with unrealized gains and losses recognized in Realized and unrealized
losses (gains) on securities, net in the consolidated statement of operations. In 2017, prior to the adoption of ASU 2016-01,
such unrealized gains and losses were recognized in Accumulated other comprehensive income (loss) ("AOCI") as a separate
component of SPLP's Partners' capital.

• Available-for-sale debt securities are reported at fair value, with unrealized gains and losses recognized in AOCI as a separate

component of SPLP's Partners' capital in both 2018 and 2017.

• Associated companies represent equity method investments in companies where our ownership is between 20% and 50% of
the outstanding equity and the Company has the ability to exercise influence, but not control, over the investee. For equity
method investments where the fair value option has been elected, unrealized gains and losses are reported in the Company's
consolidated statements of operations as part of Loss (income) of associated companies, net of tax. For the equity method
investments where the fair value option has not been elected, SPLP records the investment at cost and subsequently increases
or decreases the investment by its proportionate share of the net income or loss and other comprehensive income or loss of
the investee.

• Held-to-maturity securities are recorded at amortized cost, adjusted for the amortization or accretion of premiums or discounts.

Dividend and interest income is recognized when earned. Realized gains and losses on marketable securities and long-
term investments are included in earnings and are derived using the specific-identification method. Commission expense is recorded
as a reduction of sales proceeds on investment sales. Commission expense on purchases is included in the cost of investments on
the Company's consolidated balance sheets.

Other Than Temporary Impairment

If the Company believes a decline in the market value of any available-for-sale debt security, equity method or held-to-
maturity security below cost is other than temporary, a loss is charged to earnings, which establishes a new cost basis for the
security. Impairment losses are included in Asset impairment charges in the Company's consolidated statements of operations.
SPLP's determination of whether a security is other than temporarily impaired incorporates both quantitative and qualitative
information. The Company considers a number of factors including, but not limited to, the length of time and the extent to which
the fair value has been less than cost, the length of time expected for recovery, the financial condition of the issuer, the reason for
the decline in fair value, changes in fair value subsequent to the balance sheet date, the ability and intent to hold investments to
maturity, and other factors specific to the individual investment.

Specifically, for held-to-maturity securities, the Company considers whether it plans to sell the security or it is more-
likely-than-not that it will be required to sell the security before recovery of its amortized cost. The credit component of an other-
than-temporary impairment loss is recognized in earnings and the non-credit component is recognized in AOCI in situations where
the Company does not intend to sell the security and it is more likely-than-not that the Company will not be required to sell the
security prior to recovery. If there is an other-than-temporary impairment in the fair value of any individual security classified as
held-to-maturity, the Company writes down the security to fair value with a corresponding credit loss portion charged to earnings,
and the non-credit portion being charged to AOCI. SPLP's assessment involves a high degree of judgment and accordingly, actual
results may differ materially from those estimates and judgments.

Trade Receivables and Allowance for Doubtful Accounts

The Company recognizes bad debt expense through an allowance account using estimates based primarily on
management's evaluation of the financial condition of the customer, historical experience, credit quality, whether any amounts are
currently past due, the length of time accounts may be past due, previous loss history and management's determination of a
customer's current ability to pay its obligations. Trade receivable balances are charged off against the allowance when it is determined
that the receivables will not be recovered, and payments subsequently received on such receivables are credited to recovery of
accounts written off. The Company believes that the credit risk with respect to trade receivables is limited due to this credit
evaluation process. As of December 31, 2018, the top 10 of the Company's largest customer balances accounted for 20% of the
Company's trade receivables.

Loans Receivable, Including Loans Held for Sale

WebBank's loan activities include several lending arrangements with companies where it originates credit card and other
loans for consumers and small businesses. These loans are classified as Loans receivable and are typically sold after origination.
As part of these arrangements, WebBank earns fees that are recorded in non-interest income. Fees earned from these lending
arrangements are recorded as fee income. WebBank also purchases participations in commercial and industrial loans through loan
syndications. Loans that management has the intent and ability to hold for the foreseeable future or until maturity or pay-off
generally are reported at their outstanding unpaid principal balances adjusted for charge-offs, the allowance for loan losses
("ALLL"), and any deferred fees or costs on originated loans. Interest income is accrued on the unpaid principal balance. Loan
origination fees, net of certain direct origination costs, are deferred and recognized as an adjustment of the related loan yield over
the estimated life of the loan.

Through a loan program, merchants can borrow a certain percentage of their annual payment volume and are charged a
fixed fee for the loan, which targets an annual percentage rate based on the overall credit assessment of the merchant. Loans are
repaid through a fixed percentage of the merchant's future payment volume. The fee is fixed at the time the loan is extended. The
fixed fee is amortized to interest income based on the amount repaid over the repayment period. We estimate the repayment period
based on the merchant's payment processing history. There is no stated interest rate. There is a general requirement that at least
10% of the original amount of the loan plus the fixed fee must be repaid every 90 days. We calculate the repayment rate of the
merchant's future payment volume so that repayment of the loan or advance and fixed fee is expected to generally occur within 9
to 12 months from the date of the loan or advance.

Loans held for sale are carried at the lower of cost or estimated market value in the aggregate. A valuation allowance is
recorded when cost exceeds fair value based on our determination at the time of reclassification and periodically thereafter. Gains
and losses are recorded in noninterest income based on the difference between sales proceeds and carrying value and impairments
from reductions in carrying value.

Loans are reported as past due when either principal or interest is due and unpaid for a period of 30 days or more. The
accrual of interest on loans is generally discontinued at the time the loan is 90 to 180 days delinquent, depending on the type of
loan, unless the loan is well-secured and in process of collection. In all cases, loans are placed on nonaccrual or charged-off at an
earlier date if collection of principal or interest is considered doubtful.

All interest accrued but not collected for loans that are placed on nonaccrual or charged off is reversed against interest
income. The interest on these loans is accounted for on the cash-basis or cost-recovery method, until qualifying for return to accrual.
Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future
payments are reasonably assured.

Loan Impairment and Allowance for Loan Losses

The ALLL is established as losses are estimated to have occurred through a provision for loan losses charged to earnings.
Loan losses are charged against the allowance when the uncollectability of a loan or receivable balance is confirmed. Subsequent
recoveries, if any, are credited to the allowance. The ALLL is evaluated on a regular basis and is based upon a periodic review of
the collectability of the amounts due in light of historical experience, the nature and volume of the loan portfolio, adverse situations
that may affect the borrower's ability to repay, estimated value of any underlying collateral and prevailing economic conditions.
This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information
becomes available. The allowance consists of specific and general components. The specific component relates to loans that are
classified as doubtful, substandard or loss. For such loans that are classified as impaired, an allowance is established when the
discounted cash flows (or collateral value or observable market price) of the impaired loan is lower than the carrying value of that
loan. The general component covers non-classified loans and is based on historical loss experience and is adjusted for qualitative
factors to cover uncertainties that could affect the estimate of probable losses. The ALLL is increased by charges to income and
decreased by charge-offs (net of recoveries). The periodic evaluation of the adequacy of the allowance is based on WebBank's past
loss experience, known and inherent risks in the portfolio, adverse situations that may affect the debtor's ability to repay, the
estimated value of any underlying collateral and current economic conditions.

Inventories

Inventories are generally stated at the lower of cost (determined by the first-in, first-out method or average cost method)
or market. Cost is determined by the last-in, first-out ("LIFO") method for certain precious metal inventory held in the U.S., and
remaining precious metal inventory is primarily carried at fair value. For precious metal inventory, no segregation among raw
materials, work in process and finished products is practicable. For other inventory, the cost of work in process and finished
products comprises the cost of raw materials, direct labor and overhead costs attributable to the production of inventory.

Non-precious metal inventories are evaluated for estimated excess and obsolescence based upon assumptions about future
demand and market conditions, and are adjusted accordingly. If actual market conditions are less favorable than those projected,
future write-downs may be required.

Goodwill and Other Intangible Assets, Net

Goodwill, which is not amortized, represents the difference between the purchase price and the fair value of identifiable
net assets acquired in a business combination. Goodwill is reviewed for impairment indicators throughout the year and tested for
impairment annually in the fourth quarter. An entity can choose between two testing approaches:

a. Step 0 or Qualitative approach - An entity may assess qualitative factors to determine whether it is more likely than
not (that is, a likelihood of more than 50 percent) that the fair value of a reporting unit is less than its carrying amount, including
goodwill. In evaluating whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount, an
entity should assess relevant events and circumstances. Examples of such events and circumstances would include pertinent
macroeconomic conditions, industry and market considerations, overall financial performance and other factors.

An entity has an unconditional option to bypass this qualitative assessment for any reporting unit in any period and proceed
directly to performing the first step of the goodwill impairment test. An entity may resume performing the qualitative assessment
in any subsequent period.

b. Step 1 or Quantitative approach - The fair value of a reporting unit is calculated and compared with its carrying amount.
There are several methods that may be used to estimate a reporting unit's fair value, including the income approach, market approach
and/or cost approach. If the fair value of a reporting unit exceeds its carrying amount, there is no indication of impairment and
further testing is not required. If the carrying amount of a reporting unit exceeds its fair value, then a second step of testing is
required ("Step 2"). The second step of the goodwill impairment test compares the implied fair value of the reporting unit's goodwill
with the carrying amount of that goodwill.

For 2018, the Company utilized a qualitative approach for all of its reporting units, except for the Packaging business
within its Diversified Industrial segment. Based on its qualitative assessment, the Company does not believe that it is more likely
than not that the fair value of any of its reporting units tested under this approach is less than its carrying value. The Company
performed a quantitative assessment of goodwill associated with its Packaging business due to a decline in market conditions and
lower demand for certain of the Packaging business' product lines. The assessment was based on a combination of income and
market approaches to estimate the fair value of the reporting unit, which indicated that the fair value of this reporting unit exceeded
its carrying value. Significant assumptions used in the discounted cash flow analysis included expected future earnings and cash
flows, which are based on management's current expectations, as well as the related risk-adjusted discount rate used to estimate

fair value. There were no goodwill impairment charges recorded as a result of these assessments. For 2017, the Company utilized
a qualitative approach for all of its reporting units to assess goodwill, and there were no goodwill impairment charges recorded as
a result of the assessment.

Other intangible assets with indefinite lives are not amortized, while other intangible assets with finite lives are amortized
over their estimated useful lives. Intangible assets with finite lives are reviewed for impairment when events or changes in
circumstances indicate that the carrying amount may not be recoverable (see "Long-Lived Asset Testing" below).

Intangible assets with indefinite lives, which are only within the Diversified Industrial segment, are tested for impairment
at least annually, or when events or changes in circumstances indicate that it is more likely than not that the asset is impaired.
Companies can use the same two testing approaches for indefinite-lived intangibles as for goodwill. For 2018 and 2017, the
Company utilized a qualitative approach to assess its intangible assets with indefinite lives, and the results indicated no impairment
in either of these years.

Derivatives

The Company uses various hedging instruments to reduce the impact of changes in precious metal prices and the effect
of foreign currency fluctuations. In accordance with Accounting Standards Codification ("ASC") 815, Derivatives and Hedging,
these instruments are recorded as either fair value hedges, economic hedges, cash flow hedges or derivatives with no hedging
designation.

Precious Metals

The Company's precious metal and commodity inventories are subject to market price fluctuations. The Company enters
into commodity futures and forward contracts to mitigate the impact of price fluctuations on its precious and certain non-precious
metal inventories that are not subject to fixed price contracts. The Company's hedging strategy is designed to protect it against
normal volatility; therefore, abnormal price changes in these commodities or markets could negatively impact the Company's
earnings.

Fair Value Hedges. The fair values of these derivatives are recognized as derivative assets and liabilities on the Company's
consolidated balance sheets. The net change in fair value of the derivative assets and liabilities, and the change in the fair value
of the underlying hedged inventory, are recognized in the Company's consolidated statements of operations, and such amounts
principally offset each other due to the effectiveness of the hedges. The fair value hedges are associated primarily with the Company's
precious metal inventory carried at fair value.

Economic Hedges. As these derivatives are not designated as accounting hedges under ASC 815, they are accounted for
as derivatives with no hedge designation. The derivatives are marked to market, and both realized and unrealized gains and losses
are recorded in current period earnings in the Company's consolidated statements of operations. The economic hedges are associated
primarily with the Company's precious metal inventory valued using the LIFO method.

Foreign Currency Forward Contracts

The Company enters into foreign currency forward contracts to hedge certain of its receivables and payables denominated
in other currencies. In addition, the Company enters into foreign currency forward contracts to hedge the value of certain of its
future sales and the value of its future purchases denominated in other currencies. The forward contracts that are used to hedge
the risk of foreign exchange movement on its receivables and payables are accounted for as fair value hedges under ASC 815. The
fair values of these derivatives are recognized as derivative assets and liabilities on the Company's consolidated balance sheets.
The net change in fair value of the derivative assets and liabilities are recognized in the Company's consolidated statements of
operations. The forward contracts that are used to hedge the value of the Company's future sales and purchases are accounted for
as cash flow hedges in accordance with ASC 815. These hedges are fully effective and accordingly, the changes in fair value are
recorded in AOCI and, at maturity, any gain or loss on the forward contract is reclassified from AOCI into the Company's
consolidated statements of operations.

WebBank - Derivative Financial Instruments

statements of operations in Financial services revenue. Fair value represents the estimated amounts that WebBank would receive
at the reporting date based on a discounted cash flow model for the same or similar instruments. WebBank does not enter into
derivative contracts for speculative or trading purposes.

Property, Plant and Equipment, Net

Property, plant and equipment is recorded at cost. Depreciation of property, plant and equipment is recorded principally
on the straight line method over the estimated useful lives of the assets, which range as follows: machinery & equipment 3 to 15
years and buildings & improvements 10 to 30 years. Leasehold improvements are amortized over the shorter of the terms of the
related leases or the estimated useful lives of the improvements. Interest cost is capitalized for qualifying assets during the assets'
acquisition period. Maintenance and repairs are charged to expense, and renewals and betterments are capitalized. Gain or loss on
dispositions is recorded in Other (income) expense, net.

Long-Lived Asset Testing

The Company estimates the depreciable lives of property, plant and equipment, and reviews long-lived assets for
impairment whenever events, or changes in circumstances, indicate the carrying amount of such assets may not be recoverable.
If the carrying values of the long-lived assets exceed the sum of the undiscounted cash flows, an impairment charge is recognized
in the amount by which the carrying values exceeds their fair values. The Company performs such assessments at the lowest level
for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities, which is generally at the
plant level, operating company level or the reporting unit level, dependent on the level of interdependencies in the Company's
operations.

The Company considers various factors in determining whether an impairment test is necessary, including among other
things: a significant or prolonged deterioration in operating results and projected cash flows; significant changes in the extent or
manner in which assets are used; technological advances with respect to assets which would potentially render them obsolete; the
Company's strategy and capital planning; and the economic climate in the markets it serves. When estimating future cash flows
and if necessary, fair value, the Company makes judgments as to the expected utilization of assets and estimated future cash flows
related to those assets. The Company considers historical and anticipated future results, general economic and market conditions,
the impact of planned business and operational strategies and other information available at the time the estimates are made. The
Company believes these estimates are reasonable; however, changes in circumstances or conditions could have a significant impact
on its estimates, which might result in material impairment charges in the future.

Business Combinations

When the Company acquires a business, it allocates the purchase price to the assets acquired, liabilities assumed and any
noncontrolling interests based on their fair values at the acquisition date. Significant judgment may be used to determine these
fair values including the use of appraisals, discounted cash flow models, market value for similar purchases or other methods
applicable to the circumstances. The assumptions and judgments made by the Company when recording business combinations
will have an impact on reported results of operations in the future.

Revenue Recognition

Diversified Industrial and Energy Segments

In May 2014, the Financial Accounting Standards Board ("FASB") issued ASU 2014-09, Revenue from Contracts with
Customers (Topic 606) and has since issued amendments thereto (collectively referred to herein as "ASC 606"). In January 1,
2018, we adopted ASC 606 using the modified retrospective method applied to those contracts which were not completed as of
the adoption date. Results for reporting periods beginning after December 31, 2017 are presented under ASC 606, while prior
period amounts are not adjusted and continue to be reported under the accounting standards in effect for those periods. Our revenue
recognition accounting policies applied prior to adoption of ASC 606 are outlined in the consolidated financial statements in our
Annual Report on Form 10-K for the year ended December 31, 2017. The disclosures included herein reflect our accounting
policies under ASC 606.

manufactured goods are recognized over time as the customer order is fulfilled (for example, contracts for sale of custom
manufactured goods that do not have an alternative use and for which the Company has an enforceable right to payment). Certain
customers may receive sales incentives, such as right of return, rebates, volume discounts and early payment discounts, which are
accounted for as variable consideration. The Company estimates these amounts based on the expected incentive amount to be
provided to customers and reduces revenues. Revenue is reported net of any sales or usage-based tax collected. Cash received
from customers prior to shipment of goods, or otherwise not yet earned, is recorded as deferred revenue. Service revenues are
generated primarily by the Energy segment's energy and sports businesses and by the repair and maintenance work performed on
equipment used at mass merchants, supermarkets and restaurants in the Diversified Industrial segment. Service revenues are
primarily recognized in the amount to which the entity has a right to invoice. The Company records all shipping and handling fees
billed to customers as revenue. If revenue is recognized for the related good before the shipping and handling activities occur, the
related costs of those shipping and handling activities are accrued.

The Company has also entered into rebate agreements with certain customers. These programs are typically structured
to incentivize the customers to increase their annual purchases from the Company. The rebates are usually calculated as a percentage
of the purchase amount, and such percentages may increase as the customer's level of purchases rise. Rebates are recorded as a
reduction of net sales in the Company's consolidated statements of operations. As of December 31, 2018 and 2017, accrued rebates
payable totaled $12,345 and $8,300, respectively, and are included in Accrued liabilities on the Company's consolidated balance
sheets.

Financial Services Segment

WebBank generates revenue through a combination of interest income and non-interest income. Interest income is derived
from interest and fees earned on loans and investments. Interest income is accrued on the unpaid principal balance, including
amortization of premiums and accretion of discounts. Loan origination fees, net of certain direct origination costs, are deferred
and recognized as an adjustment of the related loan yield over the estimated life of the loan. Non-interest income is primarily
derived from premiums on the sale of loans, loan servicing fees, origination fees earned on loans and fee income on contractual
lending arrangements.

Concentration of Revenue

No single customer accounted for 5% or more of the Company's consolidated revenues in 2018 or 2017. In 2018 and
2017, the 10 largest customers accounted for approximately 19% and 18%, respectively, of the Company's consolidated revenues.

Fair Value Measurements

The Company measures certain assets and liabilities at fair value (see Note 18 - "Fair Value Measurements"). Fair value
is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants
at the measurement date. Fair values of assets and liabilities are determined based on a three-level measurement input hierarchy.
Level 1 inputs are quoted prices in active markets for identical assets or liabilities as of the measurement date. Level 2 inputs are
other than quoted market prices that are observable, either directly or indirectly, for an asset or liability. Level 2 inputs can include
quoted prices in active markets for similar assets or liabilities, quoted prices in a market that is not active for identical assets or
liabilities, or other inputs that can be corroborated by observable market data. Level 3 inputs are unobservable for the asset or
liability when there is little, if any, market activity for the asset or liability. Level 3 inputs are based on the best information available,
and may include data developed by the Company.

Equity-Based Compensation

The Company accounts for restricted stock units granted to employees and non-employee directors as compensation
expense, which is recognized in exchange for the services received. The compensation expense is based on the fair value of the
equity instruments on the grant-date and is recognized as an expense over the service period of the recipients.

Income Taxes

SPLP and certain of its subsidiaries, as limited partnerships, are generally not responsible for federal and state income
taxes, and their profits and losses are passed directly to their partners for inclusion in their respective income tax returns. SPLP's
subsidiaries that are corporate entities are subject to federal and state income taxes and file corporate income tax returns.

SPLP's subsidiaries that are subject to income taxes use the liability method of accounting for such taxes. Under the
liability method, deferred tax assets and deferred tax liabilities are recognized for the future tax consequences attributable to
differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and
operating loss and tax credit carryforwards. Deferred tax assets and deferred tax liabilities are measured using enacted tax rates
expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The
effect on deferred tax assets and deferred tax liabilities of a change in tax rates is recognized in income in the period that includes
the enactment date. Such subsidiaries evaluate the recoverability of deferred tax assets and establish a valuation allowance when
it is more likely than not that some portion of the deferred tax assets will not be realized.

When tax returns are filed, it is highly certain that most positions taken would be sustained upon examination by the
taxing authorities, while others are subject to uncertainty about the merits of the position taken or the amount of the position that
would be ultimately sustained. The benefit of a tax position is recognized in the Company's consolidated financial statements in
the period during which, based on all available evidence, management believes it is more likely than not that the position will be
sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions taken are not offset
or aggregated with other positions. Tax positions that meet the more-likely-than-not recognition threshold are measured as the
largest amount of tax benefit that is more than 50% likely of being realized upon settlement with the applicable taxing authority.
The portion of the benefits associated with tax positions taken that exceeds the amount measured as described above is provided
for and reflected as a liability for unrecognized tax benefits on the Company's consolidated balance sheets, along with any associated
interest and penalties that would be payable to the taxing authorities upon examination.

SPLP's policy is to record estimated interest and penalties related to the underpayment of income taxes as income tax

expense in its consolidated statements of operations.

The Company does not release income tax effects from AOCI until the underlying asset or liability to which the income

tax relates has been derecognized from the balance sheet or otherwise terminated.

Foreign Currency Translation

Assets and liabilities of SPLP's foreign subsidiaries are translated at current exchange rates and related revenues and
expenses are translated at average rates of exchange in effect during the year. Resulting cumulative translation adjustments are
recorded as a separate component of other comprehensive income or loss. Gains and losses arising from transactions denominated
in a currency other than the functional currency of the reporting entity are included in earnings.

Legal Contingencies

The Company provides for legal contingencies when the liability is probable and the amount of the associated loss is
reasonably estimable. The Company regularly monitors the progress of legal contingencies and revises the amounts recorded in
the period in which a change in estimate occurs.

Environmental Liabilities

The Company accrues for losses associated with environmental remediation obligations when such losses are probable
and reasonably estimable. Accruals for estimated losses from environmental remediation obligations generally are recognized no
later than completion of the remedial feasibility study.

Such accruals are adjusted as further information develops or circumstances change. Costs of future expenditures for
environmental remediation obligations are not discounted to their present value. Recoveries of environmental remediation costs
from other parties are recorded as assets when their receipt is deemed probable.

New or Recently Adopted Accounting Pronouncements

In May 2014, the FASB issued ASC 606 relating to revenue recognition. The core principle of the guidance is that an
entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the
consideration to which the entity expects to be entitled in exchange for those goods or services, and the guidance defines a five-
step process to achieve this core principle. ASC 606 also requires additional disclosure about the nature, amount, timing and
uncertainty of revenues and cash flows arising from customer contracts, including significant judgments and changes in judgments
and assets recognized from costs incurred to obtain or fulfill a contract. The Company adopted ASC 606 as of January 1, 2018
using the modified retrospective transition method. For additional information, see Note 3 - "Revenues."

In January 2016, the FASB issued ASU 2016-01, Financial Instruments—Overall (Subtopic 825-10), which eliminates
the requirement to classify equity securities with readily determinable market values as either available-for-sale or trading securities,
and requires that equity investments, other than those accounted for under the traditional equity method of accounting, be measured
at their fair value with changes in fair value recognized in net income or loss. In the past, changes in fair value were reported in
the Company's consolidated statement of comprehensive (loss) income and in AOCI. Equity investments that do not have readily
determinable market values may be measured at cost under ASU 2016-01, subject to an assessment for impairment. We adopted
ASU 2016-01 effective January 1, 2018. Upon adoption, we recorded a cumulative effect reclassification adjustment from AOCI
to Partners' capital of $91,078, which represented the accumulated net unrealized gain on equity securities that was held in AOCI
as of December 31, 2017. See also Note 15 - "Capital and Accumulated Other Comprehensive Loss." Furthermore, to have a
comparable presentation in our prior-period financial statements after adoption of ASU 2016-01 in 2018, we reclassified realized
gains of $790 for the year ended December 31, 2017 from Other (income) expense, net to Realized and unrealized losses (gains)
on securities, net in both the consolidated statement of operations and consolidated statement of cash flows for 2017.

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which is effective for public companies for annual
reporting periods beginning after December 15, 2018, including interim periods within those fiscal years. The new standard
establishes a right-of-use ("ROU") model that requires a lessee to record a ROU asset and a lease liability, measured on a discounted
basis, on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating,
with classification affecting the pattern of expense recognition in the statement of operations. In July 2018, the FASB issued ASU
2018-10, Codification Improvements to Topic 842, Leases, which clarified various aspects of the guidance under ASU 2016-02.
Originally, entities were required to adopt ASU 2016-02 using a modified retrospective approach, which required prior periods to
be presented under this new standard with certain practical expedients available. However, in July 2018, the FASB issued ASU
2018-11, Leases (Topic 842): Targeted Improvements, which now allows entities the option of recognizing the cumulative effect
of applying the new standard as an adjustment to the opening balance of retained earnings in the year of adoption (January 1, 2019)
while continuing to present all prior periods under previous lease accounting guidance. ASU 2016-02 and its various amendments
and clarifications are collectively referred to herein as "ASC 842."

The Company will adopt ASC 842 in the first quarter of 2019 using the alternative modified transition method. Under
this method, the cumulative-effect adjustment to the opening balance of retained earnings is recognized on the date of adoption
with prior periods not restated. The Company will also elect to use the package of practical expedients permitted under the transition
guidance, such as, carryforward of our historical lease classification, no reassessment on whether an expired or existing contract
contains an embedded lease, no reassessment of initial direct costs for any leases that exist prior to adoption of the new standard
and to consolidate lease and non-lease components. We are also electing to keep leases with an initial term of 12 months or less
off the balance sheet and recognize the associated lease payments in the consolidated statements of operations on a straight-line
basis over the lease term.

The Company has completed its implementation plan for the new lease standard, which includes an information system,
and business process and control changes, to accumulate the appropriate data in order to calculate and record the recognition of
ROU assets, lease liabilities and the related expense recognition. We estimate that based on our portfolio of leases as of December
31, 2018, approximately $51,000 of ROU lease assets and $53,000 of lease liabilities will be recognized on our consolidated
balance sheet upon adoption, primarily relating to building rentals.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit
Losses on Financial Instruments. The new standard changes the impairment model for most financial assets that are measured at
amortized cost and certain other instruments, including trade receivables, from an incurred loss model to an expected loss model
and adds certain new required disclosures. Under the expected loss model, entities will recognize estimated credit losses to be
incurred over the entire contractual term of the instrument rather than delaying recognition of credit losses until it is probable the
loss has been incurred. The new standard is effective for the Company's 2020 fiscal year with early adoption permitted for all
entities in fiscal years beginning after December 15, 2018. The Company is currently evaluating the potential impact of this new
guidance; however, it expects that it could have a significant impact on the Company's ALLL.

In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash
Receipts and Cash Payments. This new standard provides guidance to help decrease diversity in practice in how certain cash
receipts and cash payments are classified in the statement of cash flows. The amendments in ASU 2016-15 provide guidance on
eight specific cash flow issues. We adopted ASU 2016-15 effective January 1, 2018. The adoption of this standard did not have a
material impact on the Company's consolidated financial statements.

In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash. This new
standard provides guidance on the classification of restricted cash in the statement of cash flows. We adopted ASU 2016-18 effective
January 1, 2018. As a result of the adoption of ASU 2016-18, in the consolidated statement of cash flows for the year ended
December 31, 2017, we reclassified $15,629 of restricted cash.

In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a
Business. This new standard provides guidance to help determine more clearly what is a business acquisition, as opposed to an
asset acquisition. The amendments provide a screen to help determine when a set of components is a business by reducing the
number of transactions in an acquisition that need to be evaluated. The new standard states that to classify the acquisition of assets
as a business, there must be an input and a substantive process that jointly contribute to the ability to create outputs, with outputs
being defined as the key elements of the business. If all of the fair value of the assets acquired are concentrated in a single asset
group, this would not qualify as a business. The Company adopted ASU 2017-01 effective January 1, 2018. The adoption of this
standard did not have a material impact on the Company's consolidated financial statements.

In January 2017, the FASB issued ASU 2017-04, Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for
Goodwill Impairment. This new standard simplifies subsequent measurements of goodwill by eliminating Step 2 from the goodwill
impairment test. Instead, entities will perform their interim or annual goodwill impairment testing by comparing the fair value of
a reporting unit with its carrying amount and recognizing an impairment charge based on the amount that the carrying amount
exceeds the reporting unit's fair value. The loss recognized should not exceed the total goodwill allocated to the reporting unit.
The amendments in ASU 2017-04 are effective for the Company's 2020 fiscal year. The Company is currently evaluating the
potential impact of this new guidance.

In March 2017, the FASB issued ASU 2017-07, Compensation-Retirement Benefits (Topic 715): Improving the Presentation
of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. This new standard requires the components of net
benefit cost to be disaggregated within the statement of operations, with service cost being included in the same line item as other
compensation costs, and any other components being presented outside of operating income. The Company adopted ASU 2017-07
effective January 1, 2018. Since the Company's significant pension plans have been frozen, there is no substantial service cost
associated with such plans and therefore, the adoption of ASU 2017-07 did not have a material impact on the Company's consolidated
financial statements.

In May 2017, the FASB issued ASU 2017-09, Compensation-Stock Compensation (Topic 718): Scope of Modification
Accounting. This new standard provides guidance about which changes to the terms or conditions of a share-based payment award
require an entity to apply modification accounting. The standard states that entities should account for the effects of a modification
unless the fair value of the modified award is the same as the fair value of the original award, the vesting conditions do not change,
and the classification as an equity instrument or a liability instrument is the same. We adopted ASU 2017-09 effective January 1,
2018. The adoption of this standard did not have a material impact on the Company's consolidated financial statements.

In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to
Accounting for Hedging Activities. This new standard was created to refine and expand hedge accounting for both financial and
commodity risk in order to simplify the current application of hedge accounting guidance in current U.S. GAAP. This new standard
creates more transparency around how hedging results are presented, both in the notes and on the face of the financial statements.
The amendments in ASU 2017-12 are effective for the Company's 2019 fiscal year. The Company is currently evaluating the
potential impact of this new guidance.

In February 2018, the FASB issued ASU 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220):
Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. The new standard provides financial
statement preparers with an option to reclassify stranded tax effects within AOCI to retained earnings in each period in which the
effect of the change in the U.S. federal corporate income tax rate in the federal Tax Cuts and Jobs Act ("Act") is recorded. The
amendments in ASU 2018-02 are effective for the Company's 2019 fiscal year. The Company is currently evaluating the potential
impact of this new guidance.

In March 2018, the FASB issued ASU 2018-05, Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin
No. 118. ASU 2018-05 applies to income tax effects from the enactment of the Act in December 2017. ASU 2018-05 allows a
Company to report as provisional those amounts where the Company does not have the necessary information available, prepared
or analyzed in reasonable detail to complete the accounting under Accounting Standards Codification Topic 740. ASU 2018-05
further allows a measurement period, not to exceed one year from the enactment date of Act, during which an entity may need to
reflect adjustments to its provisional amounts. ASU 2018-05 requires that any adjustments to provisional amounts during the

measurement period be included in income from continuing operations as an adjustment to tax expense or benefit, and also requires
certain disclosures. The provisions of ASU 2018-05 were effective as of the enactment date of the Act, December 22, 2017.

In June 2018, the FASB issued ASU 2018-07, Compensation-Stock Compensation (Topic 718): Improvements to
Nonemployee Share-Based Payment Accounting. This new standard was created to simplify the accounting for share-based
payments to nonemployees. This standard provides guidance on how to account for share-based payment transactions with
nonemployees in which a grantor acquires goods or services to be used or consumed in the grantor's own operations by issuing
share-based payment awards. The amendments in ASU 2018-07 are effective for the Company's 2019 fiscal year. The Company
is currently evaluating the potential impact of this new guidance.

In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework-Changes
to the Disclosure Requirements for Fair Value Measurement. ASU 2018-13 modifies the disclosure requirements on fair value
measurements. The amendments in ASU 2018-13 are effective for the Company's 2020 fiscal year, except that the standard permits
an entity to early adopt any removed or modified disclosures upon issuance of ASU No. 2018-13 and delay adoption of the additional
disclosures until the effective date. Because ASU 2018-13 affects disclosure only, management does not expect that the full adoption
of this standard will have a material impact on the Company's consolidated financial statements.

In August 2018, the FASB issued ASU 2018-14, Compensation-Retirement Benefits-Defined Benefit Plans-General
(Subtopic 715-20): Disclosure Framework-Changes to the Disclosure Requirements for Defined Benefit Plans. ASU 2018-14
modifies the disclosure requirements for employers that sponsor defined benefit pension and other post-retirement plans. The
amendments in ASU 2018-14 are effective for the Company's 2021 fiscal year. Because ASU 2018-14 affects disclosure only,
management does not expect that the adoption of this standard will have a material impact on the Company's consolidated financial
statements.

In August 2018, the FASB issued ASU 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40):
Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract (a
consensus of the FASB Emerging Issues Task Force) to align the requirements for capitalizing implementation costs incurred in a
hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or
obtain internal-use software (and hosting arrangements that include an internal use software license). The amendments in ASU
2018-15 are effective for the Company's 2020 fiscal year. The Company is currently evaluating the potential impact of this new
guidance.

3. REVENUES

Adoption of ASC 606, "Revenue from Contracts with Customers"

On January 1, 2018, the Company adopted ASC 606 for all contracts with customers using the modified retrospective
transition method. The Company recognized a net increase of $1,034 to Partners' capital due to the cumulative impact of adopting
ASC 606. The impact to Partners' capital was primarily related to the timing of when revenue is recognized. While revenue from
most contracts will continue to be recognized at a point-in-time, revenue from other contracts (for example, contracts for sale of
custom manufactured goods that do not have an alternative use and for which the Company has an enforceable right to payment)
will be recognized over time. The comparative information has not been restated and continues to be reported under the accounting
standards in effect for those periods. For the year ended December 31, 2018, ASC 606 did not have a material impact on the
Company's consolidated financial statements, including total revenue.

Revenue Recognition Accounting Policies

Revenues are recognized when control of the promised goods or services are transferred to the customer, in an amount

that reflects the consideration the Company expects to be entitled to in exchange for those goods or services.

The Company records all shipping and handling fees billed to customers as revenue. The Company has elected to account
for shipping and handling activities that are performed after the customer obtains control of a good as activities to fulfill the promise
to transfer the good. If revenue is recognized for the related good before the shipping and handling activities occur, the related
costs of those shipping and handling activities are accrued.

Sales and usage-based taxes are excluded from revenues. The Company does not have any material service-type warranty
arrangements. The expected costs associated with the Company's assurance warranties continue to be recognized as expense when

the products are sold. The Company does not have any material significant financing arrangements as payment is received shortly
after the goods are sold or services are performed.

Standalone Selling Price

Generally, the Company's sales contracts with customers contain only one performance obligation. In certain
circumstances, contracts with customers may include multiple performance obligations. For such arrangements, the Company
allocates revenue to each performance obligation based on its relative standalone selling price. The Company generally determines
the standalone selling price based on the prices charged to similar customers or by using the expected cost plus margin approach.
The Company's performance obligations are generally part of contracts with customers that have a duration of less than one year,
and therefore, the Company has not provided disclosures with respect to remaining performance obligations.

Practical Expedients and Exemptions

Given the typical duration of the Company's contracts with customers, as noted directly above, is less than one year, in
accordance with the standard, the Company generally expenses sales commissions when incurred because the amortization period
would have been one year or less. These costs are recorded within Selling, general and administrative expenses.

For certain of the services that the Company's Diversified Industrial and Energy segments provide, the Company has
determined that it has a right to consideration from a customer in an amount that corresponds directly with the value to the customer
of the Company's performance completed to date, and therefore, the Company recognizes revenue in the amount to which the
entity has a right to invoice.

Disaggregation of Revenues

Revenues are disaggregated at the Company's segment level since the segment categories depict how the nature, amount,
timing and uncertainty of revenues and cash flows are affected by economic factors. For additional details related to the Company's
reportable segments see Note 21 - "Segment Information."

The following table presents the Company's revenues disaggregated by geography for the year ended December 31, 2018.
The Company's revenues are primarily derived domestically. Foreign revenues are based on the country in which the legal subsidiary
generating the revenue is domiciled. Revenue from any single foreign country was not material to the Company's consolidated
financial statements.

United States
Foreign (a)
Total revenue

Year Ended
December 31, 2018

1,368,778

215,836

1,584,614

(a) Foreign revenues are primarily related to the Company's API Group plc ("API") business, which is domiciled in the United Kingdom.

Diversified Industrial Revenues

The Diversified Industrial segment is comprised of manufacturers of engineered niche industrial products. The majority
of revenues recognized are for the sale of manufactured goods in the United States. Other revenue recognized is for repair and
maintenance services. Customer contracts are generally short-term in nature and are based on individual customer purchase orders.
The terms and conditions of the customer purchase orders are dictated by either the Company's standard terms and conditions or
by a master service agreement.

Diversified Industrial revenues related to product sales are recognized when control of the promised goods is transferred
to the customer, in an amount that reflects the consideration the Company expects to be entitled to receive in exchange for those
goods. This condition is usually met at a point-in-time when the product has been shipped to the customer, or in certain circumstances
when the product has been delivered to the customer, depending on the terms of the contract. However, revenues for certain custom
manufactured goods are recognized over time as the customer order is fulfilled (for example, contracts for sale of custom
manufactured goods that do not have an alternative use and for which the Company has an enforceable right to payment). Generally,
a cost incurred input method is used to determine the timing of revenue recognition for over time arrangements. Service revenues
are primarily recognized in the amount to which the entity has a right to invoice.

Certain customers may receive sales incentives, such as right of return, rebates, volume discounts and early payment
discounts, which are accounted for as variable consideration. The Company estimates these amounts based on the expected incentive
amount to be provided to customers and reduces revenues, and these estimates are typically constrained. The Company adjusts its
estimate of revenue at the earlier of when the expected value or most likely amount of consideration we expect to receive changes
or when the consideration becomes fixed.

Energy Revenues

The Energy segment provides drilling and production services to the oil & gas industry in the United States. The services
provided include well completion and recompletion, well maintenance and workover, snubbing, flow testing, down hole pumping,
plug and abatement, well logging and perforating wireline services. Service revenues are recognized in the amount to which the
entity has a right to invoice. Consideration for Energy contracts is generally fixed.

A portion of Energy revenues are service revenues related to Energy's youth sports business. These service revenues are
recognized when services are provided to the customer, in an amount that reflects the consideration the Company expects to be
entitled to receive in exchange for those services. Consideration for the Energy's sports business contracts is generally fixed.

Financial Services Revenues

WebBank generates revenues through a combination of interest income and non-interest income. Interest income is derived
from interest and fees earned on loans and investments. Interest income is accrued on the unpaid principal balance, including
amortization of premiums and accretion of discounts. Loan origination fees, net of certain direct origination costs, are deferred
and recognized as an adjustment of the related loan yield over the estimated life of the loan. Non-interest income is primarily
derived from premiums on the sale of loans, loan servicing fees, origination fees earned on loans and fee income on contractual
lending arrangements. WebBank's revenue streams are primarily accounted for outside of the scope of ASC 606.

Contract Balances

The timing of revenue recognition, billings and cash collections results in billed trade receivables, unbilled receivables

(contract assets), return assets and deferred revenue (contract liabilities) on the consolidated balance sheet.

Contract Assets

Unbilled receivables arise when the timing of billings to customers differs from the timing of revenue recognition, such
as when the Company recognizes revenue over time before a customer can be billed. Contract assets are classified as Prepaid
expenses and other current assets on the consolidated balance sheet. The balances of contract assets as of December 31, 2018 and
January 1, 2018 were $8,969 and $3,480, respectively. As of December 31, 2018, and January 1, 2018, the Company's return assets
account was not material.

Contract Liabilities

The Company records deferred revenues when cash payments are received or due in advance of the Company's
performance, including amounts which are refundable, which are recorded as contract liabilities. Contract liabilities are classified
as Other current liabilities on the consolidated balance sheet based on the timing of when the Company expects to recognize
revenue. The balances of contract liabilities as of December 31, 2018 and January 1, 2018 were $5,900 and $3,920, respectively.
For the year ended December 31, 2018, the Company recognized revenue of $3,865 that was included in the contract liability
balance at the date of adoption.

4. ACQUISITIONS

2018 Acquisitions

On June 1, 2018, the Company completed the acquisition of PST Group, Inc. ("PST") located in Muskego, Wisconsin
for approximately $4,620. PST manufactures precision-engineered threaded components and custom ball screw assemblies,
providing linear motion and power transmission solutions across a range of industries. PST is included in the Company's Diversified
Industrial segment.

On February 16, 2018, the Company completed the acquisition of certain assets and liabilities of Dunmore Corporation
in the U.S. and the share purchase of Dunmore Europe GmbH in Germany (collectively, "Dunmore") for a purchase price of
$69,604, which includes assumed debt and is subject to an earn-out based on future earnings during the period from January 1,
2018 through December 31, 2019, as provided in the purchase agreement. In no case will the purchase price, including the potential
earn-out, exceed $80,000. Dunmore manufactures and distributes coated, laminated and metallized films for engineered applications
in the imaging, aerospace, insulation and solar photo-voltaic markets and also provides products for custom and special applications.
Dunmore reports into the Company's Packaging business in its Diversified Industrial segment. In connection with the Dunmore
acquisition, the Company recorded inventories, property, plant and equipment, other intangible assets and goodwill on a preliminary
basis, totaling approximately $7,700, $30,600, $19,900 and $13,006, respectively, as well as other assets and liabilities. Other
intangible assets consist of customer relationships of $12,600, trade names of $3,300, developed technology of $3,300 and customer
order backlog of $700. The expected useful lives are 15 years for customer relationships, indefinite for trade names and 10 years
for developed technology. The customer order backlog was amortized based on the expected period over which the orders were
fulfilled of four months. The goodwill from the Dunmore acquisition consists largely of the synergies expected from combining
the operations of Dunmore and the Company's existing Packaging business. The goodwill assigned to Dunmore Corporation of
$5,176 is expected to be deductible for income tax purposes, while the goodwill assigned to Dunmore Europe GmbH of $7,830
is not tax deductible. The preliminary purchase price allocation is subject to finalization of valuations of certain acquired assets
and liabilities.

On December 31, 2018, the Company increased its ownership in a former equity investee, iGo, Inc. ("iGo") from 45.8%

to 80.2%. For further discussion, see Note 15 - "Capital and Accumulated Other Comprehensive Loss."

2017 Acquisition

On May 19, 2017, the Company acquired an 80% interest in Basin Well Logging Wireline Services, Inc. ("Basin") located
in Farmington, New Mexico for approximately $5,100. Basin provides wireline services to major oil & gas exploration and
production companies in the U.S. and specializes in cased-hole wireline logging and perforating services for exploration and
production companies with wells in New Mexico, Texas, Utah, Arizona and Colorado. In connection with the Basin acquisition,
which was not material to SPLP's operations, goodwill totaling approximately $2,353 was recorded.

5. DIVESTITURES AND ASSET IMPAIRMENT CHARGES

Divestitures

During 2017, API sold two facilities for approximately $12,500 and recorded gains on sale totaling approximately $650,
which are recorded in Other (income) expense, net in the Company's consolidated statements of operations. During 2017, the
Company also sold its Micro-Tube Fabricators, Inc. business, which produced precision fabricated tubular components primarily
for the medical industry and was included in the Company's Diversified Industrial segment, for approximately $2,500 and recorded
a loss on sale of $400, which is also included in Other (income) expense, net. The sales price was paid $2,000 in cash at closing
and a $500 subordinated promissory note, which has been fully collected. In addition, the Company was eligible to receive up to
$1,000 of additional contingent consideration if certain sales volume milestones were met between the sale date and December
31, 2019. In 2017, the Company earned $755 of additional contingent consideration. The remaining $245 of contingent consideration
was earned in 2018.

Asset Impairment Charges

During 2018, the Company recorded non-cash impairment charges totaling approximately $7,600, calculated using the
income approach, primarily associated with the loss of acquired customer relationships in the Company's Packaging business in
its Diversified Industrial segment.

During 2017, the Company recorded a non-cash impairment charge of $2,028 in its Energy segment related to an other-

than-temporary impairment of a certain investment.

6. LOANS RECEIVABLE, INCLUDING LOANS HELD FOR SALE

Major classification of WebBank's loans receivable, including loans held for sale, at December 31, 2018 and 2017 are as

follows:

December 31,
2018

188,143

Total

Current

Non-current

December 31,
2017

136,773

December 31,
2018

December 31,
2017

December 31,
2018

December 31,
2017

188,143

136,773

— $

—

Loans held for sale

Commercial real estate loans

Commercial and industrial

Consumer loans

Total loans

Less:

632 —% $

146,758

188,391

44%

56%

568

84,726

53,238

61%

38%

335,781

100%

138,532

100%

Allowance for loan losses

(17,659)

(5,237)

Total loans receivable, net

318,122

133,295

Loans receivable, including loans

held for sale (a)

—

81,507

89,899

171,406

(17,659)

153,747

28,315

22,371

50,706

(5,237)

45,469

632

65,251

98,492

164,375

—

164,375

548

56,411

30,867

87,826

—

87,826

341,890

182,242

164,375

87,826

(a) The carrying value is considered to be representative of fair value because the rates of interest are not significantly different from market
interest rates for instruments with similar maturities. The fair value of loans receivable, including loans held for sale, was $510,543 and
$270,068 at December 31, 2018 and 2017, respectively.

Loans with a carrying value of approximately $56,851 and $57,436 were pledged as collateral for potential borrowings
at December 31, 2018 and 2017, respectively. WebBank serviced $3,044 and $3,125 in loans for others at December 31, 2018 and
2017, respectively.

WebBank sold loans totaling $21,116,184 in 2018 and $16,471,432 in 2017 that were classified as loans held for sale.
The sold loans were derecognized from the consolidated balance sheets. Loans classified as loans held for sale primarily consist
of credit cards and other consumer and small business loans. The loans are mainly sold to WebBank's partners. Amounts added to
loans held for sale during these same periods were $21,167,553 and $16,528,082, respectively.

Allowance for Loan Losses

The ALLL represents an estimate of probable and estimable losses inherent in the loan portfolio as of the balance sheet
date. Losses are charged to the ALLL when incurred. Generally, commercial loans are charged off or charged down at the point
at which they are determined to be uncollectible in whole or in part. Consumer term loans are charged off at 120 days past due
and open-end consumer and small and medium business loans are charged off at 180 days past due unless the loan is well secured
and in the process of collection. The amount of the ALLL is established by analyzing the portfolio at least quarterly and a provision
for or reduction of loan losses is recorded so that the ALLL is at an appropriate level at the balance sheet date. The methodologies
used to estimate the ALLL depend upon the impairment status and portfolio segment of the loan. Loan groupings are created for
each loan class and are then graded against historical and industry loss rates.

After applying historic loss experience, the quantitatively derived level of ALLL is reviewed for each segment using
qualitative criteria. Various risk factors are tracked that influence our judgment regarding the level of the ALLL across the portfolio
segments. Primary qualitative factors that may be reflected in the quantitative models include:

Portfolio management and controls

• Asset quality trends
• Risk management and loan administration practices
•
• Effect of changes in the nature and volume of the portfolio
• Changes in lending policies and underwriting policies
• Existence and effect of any portfolio concentrations
• National economic business conditions and other macroeconomic adjustments
• Regional and local economic and business conditions
• Data availability and applicability
•
• Value of underlying collateral

Industry monitoring

Changes in these factors are reviewed to ensure that changes in the level of the ALLL are consistent with changes in these
factors. The magnitude of the impact of each of these factors on the qualitative assessment of the ALLL changes from quarter to
quarter according to the extent these factors are already reflected in historic loss rates and according to the extent these factors

diverge from one another. Also considered is the uncertainty inherent in the estimation process when evaluating the ALLL. Changes
in the ALLL are summarized as follows:

December 31, 2016

Charge-offs

Recoveries

Provision

December 31, 2017

Charge-offs

Recoveries

Provision

December 31, 2018

Commercial
Real Estate
Loans

Commercial
& Industrial

Consumer
Loans

Total

—

(33)

—

(7)

880

574

(933)

142

2,711

2,800

(2,772)

272

5,865

6,165

(1,214)

103

2,961

2,424

(4,549)

393

13,200

11,468

1,483

(2,147)

262

5,639

5,237

(7,321)

685

19,058

17,659

The ALLL and outstanding loan balances according to the Company's impairment method are summarized as follows:

December 31, 2018

Allowance for loan losses:

Individually evaluated for impairment

Collectively evaluated for impairment

Total

Outstanding loan balances:

Individually evaluated for impairment

Collectively evaluated for impairment

Total

December 31, 2017

Allowance for loan losses:

Individually evaluated for impairment

Collectively evaluated for impairment

Total

Outstanding loan balances:

Individually evaluated for impairment

Collectively evaluated for impairment

Total

Nonaccrual and Past Due Loans

Commercial
Real Estate
Loans

Commercial
& Industrial

Consumer
Loans

Total

617

632

109

6,056

6,165

3,851

142,907

146,758

— $

11,468

124

17,535

17,659

— $

188,391

3,866

331,915

335,781

Commercial
Real Estate
Loans

Commercial
& Industrial

Consumer
Loans

Total

552

568

2,762

2,800

84,685

84,726

— $

2,424

5,198

5,237

— $

53,238

138,475

138,532

Commercial and industrial loans past due 90 days or more and still accruing interest were $2,387 and $2,551 at
December 31, 2018 and 2017, respectively. Consumer loans past due 90 days or more and still accruing interest were $939 and
$107 at December 31, 2018 and 2017, respectively. The Company did not have any nonaccrual loans at December 31, 2018 or
2017.

Past due loans (accruing and nonaccruing) are summarized as follows:

December 31, 2018

Current

30-89 Days
Past Due

90+ Days
Past Due

Total
Past Due

Total Loans

Recorded
Investment
In Accruing
Loans 90+
Days Past
Due

Nonaccrual
Loans
That Are
Current (a)

Commercial real estate loans

632

— $

632

— $

Commercial and industrial

Consumer loans

Total loans

140,616

184,502

325,750

3,755

2,950

6,705

2,387

939

6,142

3,889

146,758

188,391

2,387

939

3,326

10,031

335,781

3,326

—

December 31, 2017

Current

30-89 Days
Past Due

90+ Days
Past Due

Total
Past Due

Total Loans

Recorded
Investment
In Accruing
Loans 90+
Days Past
Due

Nonaccrual
Loans
That Are
Current (a)

Commercial real estate loans

568

— $

568

— $

Commercial and industrial

Consumer loans

Total loans

81,101

52,521

1,074

610

2,551

107

3,625

717

84,726

53,238

2,551

107

134,190

1,684

2,658

4,342

138,532

2,658

—

(a) Represents nonaccrual loans that are not past due more than 30 days; however, full payment of principal and interest is still not expected.

Credit Quality Indicators

In addition to the past due and nonaccrual criteria, loans are analyzed using a loan grading system. Generally, internal
grades are assigned to loans based on the performance of the loans, financial/statistical models and loan officer judgment. For
consumer loans and some commercial and industrial loans, the primary credit quality indicator is payment status. Reviews and
grading of loans with unpaid principal balances of $100 or more is performed once per year. Grades follow definitions of Pass,
Special Mention, Substandard and Doubtful, which are consistent with published definitions of regulatory risk classifications. The
definitions of Pass, Special Mention, Substandard and Doubtful are summarized as follows:

• Pass: An asset in this category is a higher quality asset and does not fit any of the other categories described below. The

•

likelihood of loss is considered remote.
Special Mention: An asset in this category has a specific weakness or problem but does not currently present a significant risk
of loss or default as to any material term of the loan or financing agreement.
Substandard: An asset in this category has a developing or currently minor weakness or weaknesses that could result in loss
or default if deficiencies are not corrected or adverse conditions arise.

• Doubtful: An asset in this category has an existing weakness or weaknesses that have developed into a serious risk of significant

loss or default with regard to a material term of the financing agreement.

Outstanding loan balances (accruing and nonaccruing) categorized by these credit quality indicators are summarized as

follows:

December 31, 2018

Commercial real estate loans

Commercial and industrial

Consumer loans

Total loans

December 31, 2017

Commercial real estate loans
Commercial and industrial
Consumer loans

Total loans

Impaired Loans

Non -
Graded

Pass

Special
Mention

Sub-
standard

Doubtful

Total
Loans

— $

617

— $

632

79,851

188,391

62,317

—

$ 268,242

$ 62,934

739

—

739

3,851

—

146,758

188,391

3,866

— $ 335,781

Non -
Graded

— $

25,082
53,238

Pass

552
56,286
—

$ 78,320

$ 56,838

Special
Mention

Sub-
standard

Doubtful

Total
Loans

— $

3,317
—

3,317

16
41
—

— $
—
—

568
84,726
53,238

— $ 138,532

Loans are considered impaired when, based on current information and events, it is probable that WebBank will be unable
to collect all amounts due according to the contractual terms of the loan agreement, including scheduled interest payments. When
loans are impaired, an estimate of the amount of the balance that is impaired is made and a specific reserve is assigned to the loan
based on the estimated present value of the loan's future cash flows discounted at the loan's effective interest rate, the observable
market price of the loan or the fair value of the loan's underlying collateral less the cost to sell. When the impairment is based on
the fair value of the loan's underlying collateral, the portion of the balance that is impaired is charged off, such that these loans do
not have a specific reserve in the ALLL. Payments received on impaired loans that are accruing are recognized in interest income,
according to the contractual loan agreement. WebBank recognized $122 and $4 on impaired loans for the years ended December 31,
2018 and 2017, respectively. Payments received on impaired loans that are on nonaccrual are not recognized in interest income,
but are applied as a reduction to the principal outstanding. Payments are recognized when cash is received. Information on impaired
loans is summarized as follows:

December 31, 2018

Commercial real estate loans

Commercial and industrial

Total loans

December 31, 2017

Commercial real estate loans

Commercial and industrial

Total loans

7. INVENTORIES, NET

Recorded Investment

Unpaid
Principal
Balance

With No
Allowance

With
Allowance

Total
Recorded
Investment

Related
Allowance

Average
Recorded
Investment

3,851

3,866

— $

—

— $

3,851

3,866

3,851

3,866

109

124

3,878

3,894

Recorded Investment

Unpaid
Principal
Balance

With No
Allowance

With
Allowance

Total
Recorded
Investment

Related
Allowance

Average
Recorded
Investment

— $

A summary of Inventories, net is as follows:

Finished products
In-process

Raw materials
Fine and fabricated precious metal in various stages of completion

LIFO reserve
Total

Fine and Fabricated Precious Metal Inventory

December 31, 2018

December 31, 2017

55,723

25,392

58,569

20,790

160,474

(1,624)

158,850

49,053

25,037

53,015

16,757

143,862
(1,227)
142,635

In order to produce certain of its products, the Company purchases, maintains and utilizes precious metal inventory. The
Company records certain precious metal inventory at the lower of LIFO cost or market, with any adjustments recorded through
Cost of goods sold. Remaining precious metal inventory is accounted for primarily at fair value.

During the third quarter of 2017, the Company began obtaining certain precious metals under a $29,500 fee consignment
agreement with the Bank of Nova Scotia ("ScotiaBank"). As of December 31, 2018 and 2017, the Company had approximately
$6,700 and $8,100 of silver under consignment with ScotiaBank, respectively, which are recorded at fair value in Inventories, net
with a corresponding liability for the same amount included in Accounts payable on the Company's consolidated balance sheets.
Fees charged under the consignment agreement are recorded in Interest expense in the Company's consolidated statements of
operations.

Supplemental inventory information:

Precious metals stated at LIFO cost

Precious metals stated under non-LIFO cost methods, primarily at fair value

Market value per ounce:

Silver

Gold

Palladium

December 31, 2018

December 31, 2017

9,538

9,628

15.51

1,281.65

1,263.00

4,897

10,633

17.01

1,296.50

1,056.00

8. GOODWILL AND OTHER INTANGIBLE ASSETS, NET

A reconciliation of the change in the carrying value of goodwill by reportable segment is as follows:

Balance at December 31, 2017:

Gross goodwill

Accumulated impairments

Net goodwill
Acquisitions (a)
Currency translation adjustments
Balance at December 31, 2018:

Gross goodwill

Accumulated impairments

Net goodwill

Balance at December 31, 2016:

Gross goodwill

Accumulated impairments

Net goodwill
Acquisitions (b)
Currency translation adjustments

Other adjustments
Balance at December 31, 2017:

Gross goodwill

Accumulated impairments

Net goodwill

Diversified
Industrial

Energy

Corporate and
Other

Total

193,530

(24,254)

169,276

13,006

(771)

205,765

(24,254)

65,548

(64,790)

758

1,595

—

67,143

(64,790)

181,511

2,353

Diversified
Industrial

Energy

Corporate and
Other

191,596

(24,254)

167,342

—

1,504

430

193,530

(24,254)

64,790

(64,790)

—

758

—

65,548

(64,790)

169,276

758

—

259,159

(89,044)

170,115

14,601

(771)

272,989

(89,044)

183,945

Total

256,467

(89,044)

167,423

758

1,504

430

259,159

(89,044)

170,115

(a) Goodwill related to the 2018 Dunmore acquisition and purchase price adjustments related to the 2017 Basin acquisition. See Note 4 -

"Acquisitions" for additional information on the Company's 2018 and 2017 acquisitions.

(b) Goodwill related to the Basin acquisition.

A summary of Other intangible assets, net is as follows:

Customer relationships

220,709

95,796

124,913

222,277

80,952

December 31, 2018

December 31, 2017

Gross
Carrying
Amount

Accumulated
Amortization

Net

Gross
Carrying
Amount

Accumulated
Amortization

Trademarks, trade names and brand names

Developed technology, patents and patent

applications

Other

Total

54,950

31,743

17,884

17,923

14,435

13,591

37,027

17,308

4,293

52,356

28,239

16,131

14,996

11,756

11,982

325,286

141,745

183,541

319,003

119,686

199,317

Net

141,325

37,360

16,483

4,149

Other intangible assets, net as of December 31, 2018 includes approximately $19,900 in intangible assets, primarily
customer relationships, associated with the Dunmore acquisition. These balances, and the related goodwill balance noted above,
are subject to adjustment during the finalization of the purchase price allocation for the Dunmore acquisition.

Trademarks with indefinite lives as of December 31, 2018 and 2017 were $11,320 and $8,020, respectively. Amortization
expense related to intangible assets was $29,858 and $29,743 for the years ended December 31, 2018 and 2017, respectively. The
estimated amortization expense for each of the five succeeding years and thereafter is as follows:

2019

2020

2021

2022

2023

Thereafter

Total

Trademarks,
Trade Names
and Brand
Names

Developed
Technology,
Patents and
Patent
Applications

Customer
Relationships

16,786

15,472

13,699

11,304

10,108

57,544

2,337

2,331

2,301

14,064

2,692

2,469

2,184

2,131

5,701

124,913

25,707

17,308

Other

Total

992

926

868

302

1,108

4,293

22,807

21,204

19,088

16,068

14,637

78,417

172,221

9. PROPERTY, PLANT AND EQUIPMENT, NET

A summary of property, plant and equipment, net is as follows:

Land

Buildings and improvements

Machinery, equipment and other

Construction in progress

Accumulated depreciation

Property, plant and equipment, net

December 31, 2018

December 31, 2017

18,547

84,639

416,130

16,105

535,421

(237,954)

297,467

18,674

74,662

352,276

17,178

462,790
(190,799)
271,991

Depreciation expense was $50,465 and $42,193 for the years ended December 31, 2018 and 2017, respectively.

10. INVESTMENTS

Short-Term Investments

Marketable Securities

The Company's short-term investments primarily consist of its marketable securities portfolio. The classification of
marketable securities as a current asset is based on the intended holding period and realizability of the investments. The Company's
portfolio of marketable securities at December 31, 2018 and 2017 was as follows:

December 31, 2018

Gross
Unrealized
Gains

Gross
Unrealized
Losses

Cost

Fair value

Cost

December 31, 2017

Gross
Unrealized
Gains

Gross
Unrealized
Losses

Fair value

Short-term deposits

Mutual funds

Corporate securities

Total marketable securities

21,064

— $

21,064

35,834

— $

—

4,533

25,597

—

(3,094)

—

1,439

22,503

12,077

32,311

80,222

—

(21,064)

(35,834)

4,675

11,893

16,568

—

— $

—

(2,643)

35,834

16,752

41,561

94,147

—

(35,834)

Amounts classified as cash equivalents

(21,064)

Amounts classified as marketable

securities

4,533

— $

(3,094) $

1,439

44,388

16,568

(2,643) $

58,313

Proceeds from sales of marketable securities were approximately $47,200 and $16,596 in 2018 and 2017, respectively.
The Company determines gains and losses from sales of marketable securities based on specific identification of the securities
sold. Gross realized gains and losses from sales of marketable securities, which are reported as a component of Realized and
unrealized losses (gains) on securities, net in the Company's consolidated statements of operations, were as follows:

Gross realized gains

Gross realized losses
Realized gains, net

Year Ended December 31,

2018

2017

16,499

(5,129)
11,370

637
(545)
92

Effective January 1, 2018 upon adoption of ASU 2016-01, unrealized gains or losses due to changes in fair value of
securities are being accounted for as a component of Realized and unrealized losses (gains) on securities, net in the Company's
consolidated statement of operations. Prior to January 1, 2018, changes in fair value were recognized in Partners' capital as other
comprehensive income or loss, except for other-than-temporary impairments, which were reflected as a reduction of cost and
charged to the consolidated statements of operations.

The fair value of marketable securities with unrealized losses at December 31, 2018 and 2017, and the duration of time

that such losses had been unrealized, were as follows:

December 31, 2018:

Corporate securities

Total

December 31, 2017:

Corporate securities

Total

Less than 12 Months

12 Months or Greater

Total

Fair Value

Gross
Unrealized
Losses

Fair Value

Gross
Unrealized
Losses

Fair Value

Gross
Unrealized
Losses

396

5,801

(322) $

(2,558) $

1,043

398

(2,772) $

(85) $

1,439

6,199

(3,094)

(2,643)

The corporate securities with gross unrealized losses primarily consist of investments in equity securities of publicly
traded entities. In 2017, the Company evaluated such securities to determine if certain unrealized losses represented other-than-
temporary impairments. This determination was based on several factors, including adverse changes in the market conditions and
economic environments in which the entities operate, as well as the length of time and extent to which fair value had been less
than the cost basis, the financial condition and near-term prospects of the entities, and the intent and ability to hold the corporate
securities for a period of time sufficient to allow for any anticipated recovery in market value. The Company recognized asset
impairment charges of $2,028 for the year ended December 31, 2017.

Long-Term Investments

The following table summarizes the Company's long-term investments as of December 31, 2018 and 2017:

Ownership %

Long-Term Investments
Balance

December 31,

Loss (Income) Recorded
in Statements of
Operations

Year Ended December
31,

2018

2017

2018

2017

2018

2017

Corporate securities (a), (e)
STCN convertible notes (b), (f)
STCN preferred stock (c), (f)
STCN warrants (f)
Equity method investments: (f)

Carried at fair value:

STCN common stock

Aviat Networks, Inc. ("Aviat")

Other

Long-term investments carried at fair value
Other equity method investments (d)

Total

161,799

131,307

59,658

14,943

39,420

—

31,457

8,881

1,223

10,387

35,000

—

45,275

10,168

1,223

29.6%

12.4%

43.8%

30.4%

12.7%

43.8%

(197)

(4,420)

—

(614)

—

12,320

1,287

—

(15,700)

(899)

—

257,723

233,360

321

2,784

519

306

258,044

236,144

(a) Cost basis totaled $100,269 and $12,250 at December 31, 2018 and 2017, respectively, and gross unrealized gains totaled $61,530 and

$119,057 at December 31, 2018 and 2017, respectively.

(b) Represents investment in STCN convertible notes. Cost basis totaled $13,262 and $8,903 at December 31, 2018 and 2017, respectively,
and gross unrealized gains totaled $1,681 and $1,484 at December 31, 2018 and 2017, respectively. Changes in fair value are recorded in
the Company's consolidated statements of operations as the Company elected the fair value option to account for this investment.

(c) Represents investment in STCN preferred stock. On December 15, 2017, the Company entered into an agreement pursuant to which STCN
issued Series C convertible voting preferred stock for an aggregate purchase consideration of $35,000. Each share of preferred stock can
be converted into shares of STCN's common stock at an initial conversion price equal to $1.96 per share, subject to appropriate adjustments

for any stock dividend, stock split, stock combination, reclassification or similar transaction, among other things. Changes in fair value are
recorded in the Company's consolidated statements of operations as the Company elected the fair value option to account for this investment.
The convertible preferred shares, if converted as of December 31, 2018, when combined with the common shares owned by the Company,
would result in the Company having a direct interest of approximately 45.6% of STCN's outstanding shares.

(d) Balance included the Company's investment in iGo as of December 31, 2017. The Company's ownership of iGo increased to 80.2% on
December 31, 2018, as discussed in Note 15 - "Capital and Accumulated Other Comprehensive Loss," and iGo is now a consolidated
subsidiary.

(e) Loss (income) from these investments is included in Realized and unrealized losses (gains) on securities, net in the consolidated statements

of operations.

(f) Loss (income) from these investments is included in Loss (income) of associated companies, net of taxes in the consolidated statements of

operations.

The Company's long-term investments (corporate securities) include common shares of Babcock & Wilcox Enterprises,
Inc. ("BW"). The Company made investments totaling $76,261 in BW shares during 2018, increasing its ownership in BW to
approximately 17.8%.

The Company had no proceeds from sales of securities classified in long-term investments for the years ended

December 31, 2018 and 2017.

Equity Method Investments

The Company's investments in associated companies are accounted for under the equity method of accounting, primarily
using the fair value option. Associated companies are included in the Diversified Industrial, Energy, and Corporate and Other
segments. Certain associated companies have a fiscal year end that differs from December 31. Additional information for SPLP's
significant investments in associated companies is as follows:

•

STCN (formerly ModusLink Global Solutions, Inc.) provides supply chain and logistics services to companies in the consumer
electronics, communications, computing, medical devices, software and retail industries. STCN also owns IWCO Direct
Holdings, Inc. ("IWCO"), a provider of data-driven marketing solutions that offers a full range of services including strategy,
creative and execution for omnichannel marketing campaigns, along with postal logistics programs for direct mail.

• Aviat designs, manufactures and sells a range of wireless networking solutions and services to mobile and fixed telephone
service providers, private network operators, government agencies, transportation and utility companies, public safety agencies
and broadcast system operators across the globe.

The following summary balance sheet and statement of operations amounts are for STCN as of July 31, 2018 and 2017,
and for the years then ended, which are STCN's nearest corresponding full fiscal years to the Company's fiscal years ended
December 31, 2018 and 2017, respectively:

Summary of balance sheet amounts: (a)
Current assets

Non-current assets

Total assets

Current liabilities

Non-current liabilities

Total liabilities

Contingently redeemable preferred stock

Equity

Total liabilities and equity

Summary operating results: (a)
Revenue

Gross profit
Net income (loss) (b)

2018

2017

264,281

562,769

827,050

290,612

393,618

684,230

35,192

107,628

827,050

257,846

23,452

281,298

149,155

69,172

218,327

—

62,971

281,298

2018

2017

645,258

101,259

36,715

436,620

36,365

(25,827)

(a) The increases in the 2018 amounts, as compared to the 2017 amounts, in the table above are principally due to STCN's acquisition of IWCO.
(b) Net income in the 2018 period was favorably impacted by an income tax benefit related to STCN's acquisition of IWCO.

Other Investments

WebBank had $48,005 and $32,816 of held-to-maturity securities at December 31, 2018 and 2017, respectively. WebBank
records these securities at amortized cost, and they are included in Other non-current assets on the Company's consolidated balance
sheets. The dollar value of these securities with expected maturities between one and five years is $22,866, five years through ten
years is $23,189 and after ten years is $1,950. Actual maturities may differ from expected or contractual maturities because
borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. The securities are
collateralized by unsecured consumer loans. These securities had an estimated fair value of $47,886 and $32,842 at December 31,
2018 and 2017, respectively.

11. DEPOSITS

A summary of WebBank deposits is as follows:

Time deposits year of maturity:

2018

2019

2020

2021

Total time deposits

Savings deposits
Total deposits (a)

Current

Long-term

Total deposits

December 31, 2018

December 31, 2017

— $

310,577

249,352

30,000

589,929

121,382

711,311

431,959

279,352

711,311

191,528

115,819

89,974

—

397,321

113,679

511,000

305,207

205,793

511,000

(a) All time deposits accounts are under $250. The carrying value is considered to be representative of fair value because the rates of interest
are not significantly different from market interest rates for instruments with similar maturities. The fair value of deposits was $710,323
and $511,473 at December 31, 2018 and 2017, respectively.

12. LONG-TERM DEBT

Debt consists of the following:

Short term debt:

Foreign

Short-term debt
Long-term debt:

SPLP revolving facility

Other debt - foreign

Other debt - domestic

Subtotal

Less portion due within one year

Long-term debt
Total debt

December 31, 2018

December 31, 2017

3,094

472,495

796

5,604

478,895

799

478,096

481,989

1,624

406,981

—

6,062

413,043

459

412,584

414,667

Long-term debt as of December 31, 2018 matures in each of the next five years as follows:

Long-term debt

478,895

799

4,214

315

473,567

— $

—

Total

2019

2020

2021

2022

2023

Thereafter

On November 14, 2017, the Company entered into a credit agreement ("Credit Agreement") that consolidated a number
of its existing credit facilities into one combined, revolving credit facility covering substantially all of the Company's subsidiaries,
with the exception of WebBank. The Credit Agreement provided for a revolving credit facility in an aggregate principal amount
not to exceed $600,000, including a $55,000 subfacility for swing line loans and a $50,000 subfacility for standby letters of credit.
Borrowings under the Credit Agreement bear interest, at the borrower's option, at annual rates of either the Base Rate or the Euro-
Rate, as defined, plus an applicable margin as set forth in the Credit Agreement (1.50% and 2.50%, respectively, for Base Rate
and Euro-Rate borrowings at December 31, 2018), and the Credit Agreement provides for a commitment fee to be paid on unused
borrowings. The weighted average interest rate on the Credit Agreement was 4.93% at December 31, 2018. At December 31, 2018,
letters of credit totaling $11,153 had been issued under the Credit Agreement, including $3,709 of the letters of credit guaranteeing

various insurance activities, and $7,444 for environmental and other matters. The Credit Agreement permits SPLP, the parent, to
fund the dividends on its preferred units and its routine corporate expenses. The Company's total availability under the Credit
Agreement, which is based upon earnings and certain covenants as described in the Credit Agreement, was approximately $42,900
as of December 31, 2018.

On April 27, 2018, the Company entered into a first amendment to the Credit Agreement to allow the Company to (i)
exercise certain subscription rights in BW common shares, (ii) increase the maximum aggregate principal amount to $700,000,
(iii) increase the defined leverage ratios under the Credit Agreement by 0.25 "turns" for the fiscal quarters ending June 30, 2018,
September 30, 2018 and December 31, 2018 and (v) make certain administrative changes.

On December 31, 2018, the Company entered into a second amendment to the Credit Agreement to allow the Company
to (i) enter into the iGo transaction discussed in Note 15 - "Capital and Accumulated Other Comprehensive Loss," (ii) join iGo to
the Credit Agreement and grant the lenders a security interest in its assets, (iii) provide an $18,500 sublimit for iGo's and its
subsidiaries' borrowings and (iv) make certain administrative changes.

On January 31, 2019, the Company entered into a third amendment to the Credit Agreement to allow the Company to (i)
convert $200,000 of the revolving credit commitments into a term loan with quarterly amortization equating to 5.0% per annum,
(ii) amend certain defined leverage ratios under the Credit Agreement, increasing allowable leverage by 0.25 "turns" on a permanent
basis through the maturity of the Credit Agreement, (iii) eliminate certain previously allowed investments, which would have
reduced collateral available to the Company's lenders and (iv) make certain administrative changes. Accordingly, this third
amendment to the Credit Agreement will add the following required principal repayments to the above long-term debt maturity
table: $7,500 in 2019 and $10,000 in each of 2020, 2021 and 2022.

The Credit Agreement will expire, with all amounts outstanding due and payable, on November 14, 2022. The Credit
Agreement is guaranteed by substantially all existing and thereafter acquired assets of the borrowers and the guarantors, as defined
in the agreement, and a pledge of all of the issued and outstanding shares of capital stock of each of the borrowers' and guarantors'
subsidiaries, and is fully guaranteed by the guarantors. The Credit Agreement is subject to certain mandatory prepayment provisions
and restrictive and financial covenants, which include a maximum ratio limit on Total Leverage and a minimum ratio limit on
Interest Coverage, as defined. The Company was in compliance with all financial covenants at December 31, 2018.

13. FINANCIAL INSTRUMENTS

At December 31, 2018 and 2017, financial instrument liabilities and related restricted cash consisted of $12,434 and
$15,629, respectively, related to short sales of corporate securities. Full year activity is summarized below for financial instrument
liabilities and related restricted cash:

Balance, beginning of period

Settlement of short sales of corporate securities

Short sales of corporate securities

Net investment (gains) losses
Balance, end of period

Short Sales of Corporate Securities

Year Ended December 31,

2018

2017

15,629

(3,100)

(121)

12,434

12,640

(94)

165

2,918

15,629

From time to time, the Company enters into short sale transactions on certain corporate securities in which it receives
proceeds from the sale of such securities and incurs obligations to deliver such securities at a later date. Upon initially entering
into such short sale transactions, the Company recognizes a liability equal to the fair value of the obligation, with a comparable
amount of cash and cash equivalents reclassified as restricted cash. Subsequent changes in the fair value of such obligations,
determined based on the closing market price of the securities, are recognized currently as gains or losses in the consolidated
statements of operations, with a comparable adjustment made between unrestricted and restricted cash.

Foreign Currency Forward Contracts

with certain of the Company's operations located in the United Kingdom and have settlement dates ranging through December
2019. The forward contracts that are used to hedge the risk of foreign exchange movement on its receivables and payables are
accounted for as fair value hedges. At December 31, 2018, there were contracts in place to buy Sterling and sell Euros in the
amount of €9,800. The fair values of these derivatives are recognized as derivative assets and liabilities on the Company's
consolidated balance sheets. The net change in fair value of the derivative assets and liabilities are recognized in the Company's
consolidated statements of operations. The forward contracts that are used to hedge the value of the Company's future sales and
purchases are accounted for as cash flow hedges. At December 31, 2018, there were contracts in place to hedge the value of future
sales denominated in Euros in the amount of €10,300 and the value of future purchases denominated in USD in the amount of
$450. These hedges are fully effective, and, accordingly, the changes in fair value are recorded in AOCI and, at maturity, any gain
or loss on the forward contract is reclassified from AOCI into the Company's consolidated statements of operations.

WebBank - Economic Interests in Loans

WebBank's derivative financial instruments represent on-going economic interests in loans made after they are sold. These
derivatives are carried at fair value on a gross basis in Other non-current assets on the Company's consolidated balance sheets and
are classified within Level 3 in the fair value hierarchy (see Note 18 - "Fair Value Measurements"). At December 31, 2018,
outstanding derivatives mature within 5 years. Gains and losses resulting from changes in the fair value of derivative instruments
are accounted for in the Company's consolidated statements of operations in Financial services revenue. Fair value represents the
estimated amounts that WebBank would receive or pay to terminate the contracts at the reporting date based on a discounted cash
flow model for the same or similar instruments. WebBank does not enter into derivative contracts for speculative or trading purposes.

Precious Metal and Commodity Inventories

As of December 31, 2018, the Company had the following outstanding forward contracts with settlement dates through

January 2019. There were no futures contracts outstanding at December 31, 2018.

Commodity

Amount

Notional Value

Silver

Gold

Palladium

Copper

Tin

264,822 ounces

2,733 ounces

775 ounces

150,000 pounds

20 metric tons

3,993

3,467

951

388

392

Of the total forward contracts outstanding, 18,895 ounces of silver and substantially all the copper contracts are designated
and accounted for as fair value hedges and are associated primarily with the Company's precious metal inventory carried at fair
value. The remaining outstanding forward contracts for silver, and all the contracts for gold, palladium and tin, are accounted for
as economic hedges.

The forward contracts were made with a counterparty rated Aa2 by Moody's. Accordingly, the Company has determined
that there is minimal credit risk of default. The Company estimates the fair value of its derivative contracts through the use of
market quotes or with the assistance of brokers when market information is not available. The Company maintains collateral on
account with the third-party broker, which varies in amount depending on the value of open contracts.

The fair value and carrying amount of derivative instruments on the Company's consolidated balance sheets and the effect

of derivative instruments in the Company's consolidated statements of operations are shown in the following tables:

Derivative

Balance Sheet Location

2018

2017

December 31,

Commodity contracts (a), (b)
Commodity contracts (c)

Accrued liabilities

Foreign exchange forward contracts (a), (d)
Foreign exchange forward contracts (a), (b)
Economic interests in loans (c)
Call options

Put options

Total derivatives

(Accrued liabilities)/Prepaid expenses and other
current assets
Accrued liabilities

Other non-current assets

Other current liabilities

Prepaid expenses and other current assets

(14) $

(145)

(95)

(81)

17,156

—

16,821

(49)

(78)

166

(188)

13,126

(258)

12,722

Derivative

Statements of Operations Location

Commodity contracts (a), (b)
Commodity contracts (c)
Commodity contracts (c)
Foreign exchange forward contracts (a), (d)
Foreign exchange forward contracts (a), (b)
Economic interests in loans (c)
Call options

Put options

Total derivatives

(a) Designated as hedging instruments.
(b) Fair value hedge.
(c) Economic hedge.
(d) Cash flow hedge.

Cost of goods sold

Other income (expense), net

Revenue/Cost of goods sold

Other income (expense), net

Revenue

Other income (expense), net

Financial Instruments with Off-Balance Sheet Risk

Year Ended December 31,

2018

Gain (Loss)

2017

Gain (Loss)

223

(461)

840

241

(55)

14,559

—

15,347

(435)

(61)

(145)

(1,357)

(339)

8,902

(28)

(780)

5,757

WebBank is a party to financial instruments with off-balance sheet risk. In the normal course of business, these financial
instruments include commitments to extend credit in the form of loans as part of WebBank's lending arrangements. Those
instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount recognized on the
consolidated balance sheets. The contractual amounts of those instruments reflect the extent of involvement WebBank has in
particular classes of financial instruments.

At December 31, 2018 and 2017, WebBank's undisbursed loan commitments totaled $130,697 and $148,529, respectively.
Commitments to extend credit are agreements to lend to a borrower who meets the lending criteria through one of WebBank's
lending agreements, provided there is no violation of any condition established in the contract with the counterparty to the lending
arrangement.

Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since
certain of the commitments are expected to expire without the credit being extended, the total commitment amounts do not
necessarily represent future cash requirements. WebBank evaluates each prospective borrower's credit worthiness on a case-by-
case basis. The amount of collateral obtained, if deemed necessary by WebBank upon extension of credit, is based on management's
credit evaluation of the borrower and WebBank's counterparty.

14. PENSION AND OTHER POST-RETIREMENT BENEFITS

The Company maintains several qualified and non-qualified pension plans and other post-retirement benefit plans. The
Company's significant pension plans are discussed below. The Company's other pension and post-retirement benefit plans are not
significant individually or in the aggregate.

Qualified Pension Plans - HNH

The Company's subsidiary, Handy & Harman Ltd. ("HNH") and its subsidiary, Handy & Harman ("H&H"), sponsor a
defined benefit pension plan, the WHX Pension Plan, covering many of H&H's employees and certain employees of H&H's former
subsidiary, Wheeling-Pittsburgh Corporation ("WPC"). The WHX Pension Plan was established in May 1998 as a result of the
merger of the former H&H plans, which covered substantially all H&H employees, and the WPC plan. The WPC plan, covering
most United Steel Workers of America-represented employees of WPC, was created pursuant to a collective bargaining agreement
ratified on August 12, 1997. Prior to that date, benefits were provided through a defined contribution plan, the Wheeling-Pittsburgh
Steel Corporation Retirement Security Plan ("RSP Plan"). The assets of the RSP Plan were merged into the WPC plan as of
December 1, 1997. Under the terms of the WHX Pension Plan, the benefit formula and provisions for the WPC and H&H participants
continued as they were designed under each of the respective plans prior to the merger.

The qualified pension benefits under the WHX Pension Plan were frozen as of December 31, 2005 and April 30, 2006
for hourly and salaried non-bargaining participants, respectively, with the exception of a single operating unit. In 2011, the benefits
were frozen for the remainder of the participants. WPC employees ceased to be active participants in the WHX Pension Plan
effective July 31, 2003, and as a result, such employees no longer accrue benefits under the WHX Pension Plan.

HNH's subsidiary, JPS Industries Holdings LLC ("JPS"), sponsors a defined benefit pension plan ("JPS Pension Plan").
Under the JPS Pension Plan, substantially all JPS employees who were employed prior to April 1, 2005 have benefits. The JPS
Pension Plan was frozen effective December 31, 2005. Employees no longer earned additional benefits after that date. Benefits
earned prior to December 31, 2005 will be paid out to eligible participants following retirement. The JPS Pension Plan was
"unfrozen" for employees who were active employees on or after June 1, 2012. This new benefit, calculated based on years of
service and a capped average salary, will be added to the amount of any pre-2005 benefit. The JPS Pension Plan was again frozen
for all future accruals effective December 31, 2015, although unvested participants may still vest in accrued but unvested benefits.

Pension benefits under the WHX Pension Plan are based on years of service and the amount of compensation earned
during the participants' employment. However, as noted above, the qualified pension benefits have been frozen for all participants.

Pension benefits for the WPC bargained participants include both defined benefit and defined contribution features, since
the plan includes the account balances from the RSP Plan. The gross benefit, before offsets, is calculated based on years of service
and the benefit multiplier under the plan. The net defined benefit pension plan benefit is the gross amount offset for the benefits
payable from the RSP Plan and benefits payable by the Pension Benefit Guaranty Corporation from previously terminated plans.
Individual employee accounts established under the RSP Plan are maintained until retirement. Upon retirement, participants who
are eligible for the WHX Pension Plan and maintain RSP Plan account balances will normally receive benefits from the WHX
Pension Plan. When these participants become eligible for benefits under the WHX Pension Plan, their vested balances in the RSP
Plan become assets of the WHX Pension Plan. Although these RSP Plan assets cannot be used to fund any of the net benefit that
is the basis for determining the defined benefit plan's net benefit obligation at the end of the year, the Company has included the
amount of the RSP Plan accounts of $13,261 and $14,800 on a gross-basis as both assets and liabilities of the plan as of December 31,
2018 and 2017, respectively.

On December 30, 2016, the WHX Pension Plan was split into two plans by spinning off certain plan participants with
smaller benefit obligations (which in the aggregate were equal to approximately 3.0% of the assets of the WHX Pension Plan),
and assets equal thereto, to a new separate plan, the WHX Pension Plan II. The benefits of participants under the WHX Pension
Plan II are equal to their accrued benefits under the benefit formula that was applicable to each participant under the WHX Pension
Plan at the time of the plan spin-off. The total benefit liabilities of the two plans after the spin-off were equal to the benefit liabilities
of the WHX Pension Plan immediately before the spin-off, and under the applicable spin-off rules, the WHX Pension Plan II was
considered fully funded as of the date of the spin-off.

Net actuarial losses for the WHX Pension Plan are being amortized over the average future lifetime of the participants,
which is expected to be approximately 17 years, and for the JPS Plan, 15 years. The Company believes that use of the future
lifetime of the participants is appropriate because the plans are inactive.

API Plan

The Company's subsidiary, API, maintains a pension plan in the United Kingdom ("API Plan"). The API Plan is a defined
benefit pension plan providing benefits based on final pensionable earnings, as defined in the API Plan, funded by the payment
of contributions to a separately administered trust fund. Benefits under the API Plan were frozen, and the plan was closed to new
participants in December 2008.

Certain employees of API's former Rahway, New Jersey plant participated in a multiemployer pension plan. For the year
ended December 31, 2017, API recorded a one-time charge of $4,300 related to pension obligations associated with the closure
of the Rahway, New Jersey plant, which charge is not included in the table below.

The following table presents the components of pension expense for the HNH and API pension plans:

Interest cost

Expected return on plan assets

Amortization of actuarial loss

Total

Year Ended December 31,

2018

2017

20,999

(27,703)

9,888

3,184

21,910

(25,969)

9,228

5,169

Actuarial assumptions used to develop the components of pension expense were as follows:

Discount rates:

WHX Pension Plan

WHX Pension Plan II

JPS Pension Plan

API Pension Plan

HNH expected return on assets

API expected return on assets

2018

2017

3.45%

3.33%

3.40%

2.50%

6.50%

3.80%

3.84%

3.64%

3.81%

2.65%

6.50%

3.87%

The measurement date for plan obligations is December 31. The discount rate is the rate at which the plans' obligations

could be effectively settled and is based on high quality bond yields as of the measurement date.

Summarized below is a reconciliation of the funded status for HNH's and API's qualified defined benefit pension plans:

Change in benefit obligation:

Benefit obligation at January 1

Prior service cost

Interest cost

Actuarial (gain) loss

Benefits paid

Impact of foreign exchange rate

Benefit obligation at December 31

Change in plan assets:

Fair value of plan assets at January 1

Actual returns on plan assets

Benefits paid

Company contributions

Impact of foreign exchange rate

Fair value of plan assets at December 31

Funded status

Accumulated benefit obligation ("ABO") for qualified defined
benefit pension plans:

ABO at January 1

ABO at December 31

Amounts recognized on the consolidated balance sheets:

Current liability

Non-current liability

Total

HNH Plans

API Plan

2018

2017

2018

2017

601,194

597,405

152,006

136,564

—

17,276

(75,503)

(44,155)

—

498,812

349,819

(29,091)

(44,155)

31,916

—

308,489

—

18,183

27,324

(41,718)

—

601,194

331,872

24,239

(41,718)

35,426

—

349,819

2,634

3,723

(9,527)

(5,528)

(7,696)

135,612

140,634

(2,984)

(5,528)

936

(7,225)

125,833

(190,323) $

(251,375) $

(9,779) $

—

3,730

4,204

(5,338)

12,846

152,006

118,327

15,261

(5,338)

901

11,483

140,634

(11,372)

601,194

498,812

597,405

601,194

152,006

135,612

136,564

152,006

— $

(190,323)

(190,323) $

— $

(251,375)

(251,375) $

— $

(9,779)

(9,779) $

—

(11,372)

The weighted average assumptions used in the valuations at December 31 were as follows:

Discount rates:

WHX Pension Plan

WHX Pension Plan II

JPS Pension Plan
API Pension Plan

2018

2017

4.10%

4.00%

4.09%
2.90%

3.45%

3.33%

3.40%
2.50%

Pretax amounts included in Accumulated other comprehensive loss at December 31, 2018 and 2017 were as follows:

Prior service cost

Net actuarial loss

Accumulated other comprehensive loss

HNH Plans

API Plan

2018

2017

2018

2017

— $

220,778

— $

254,599

2,475

5,551

8,026

—

7,083

The pretax amount of actuarial losses included in Accumulated other comprehensive loss at December 31, 2018 that is

expected to be recognized in net periodic benefit cost in 2019 is $10,075.

Other pretax changes in plan assets and benefit obligations recognized in comprehensive income (loss) are as follows:

Current year actuarial gain (loss)

Amortization of actuarial loss

Current year prior service cost

Amortization of prior service credit

Impact of foreign exchange rate

Total recognized in comprehensive income (loss)

HNH Plans

Pension Benefits

API Plan

Pension Benefits

2018

2017

2018

2017

23,933

9,888

(24,333) $

9,228

—

1,300

6,339

—

(2,634)

367

—

33,821

(15,105) $

(943) $

6,339

The actuarial gain in 2018 occurred principally because the discount rates used to measure benefit obligations for the
HNH plans at the end of the fiscal year increased from the prior fiscal year end. In addition, the mortality assumptions were updated
to reflect the results of a mortality study conducted in 2018, which also created an actuarial gain. Conversely, the actuarial loss in
2017 occurred principally because the discount rates used to measure benefit obligation for the HNH plans decreased in that year.

Benefit obligations were in excess of plan assets for each of the pension plans at both December 31, 2018 and 2017.

Additional information for the plans with accumulated benefit obligations in excess of plan assets follows:

Projected benefit obligation

Accumulated benefit obligation

Fair value of plan assets

HNH Plans

API Plan

2018

2017

2018

2017

498,812

308,489

601,194

349,819

135,612

125,833

152,006

140,634

In determining the expected long-term rate of return on plan assets, the Company evaluated input from various investment
professionals. In addition, the Company considered its historical compound returns, as well as the Company's forward-looking
expectations. The Company determines its actuarial assumptions for its pension plans each year to calculate liability information
as of December 31, and pension expense or income for the following year. The discount rate assumption is derived from the rate
of return on high-quality bonds as of December 31 of each year.

The Company's investment policy is to maximize the total rate of return with a view to long-term funding objectives of
the pension plans to ensure that funds are available to meet benefit obligations when due. Pension plan assets are diversified to
the extent necessary to minimize risk and to achieve an optimal balance between risk and return. There are no target allocations.
The HNH plans' assets are diversified as to type of assets, investment strategies employed and number of investment managers
used. Investments may include equities, fixed income, cash equivalents, convertible securities and private investment funds.
Derivatives may be used as part of the investment strategy. The Company may direct the transfer of assets between investment
managers in order to rebalance the portfolio in accordance with asset allocation guidelines established by the Company.

The fair value of pension investments is defined by reference to one of three categories (Level 1, Level 2 or Level 3)
based on the reliability of inputs, as such terms are defined in Note 2 - "Summary of Significant Accounting Policies." HNH's
plans' assets at December 31, 2018 and 2017, by asset category, are as follows:

Fair Value Measurements as of December 31, 2018:

Asset Class

Assets at Fair Value as of December 31, 2018

Level 1

Level 2

Level 3

Total

Equity securities:

U.S. mid-cap

U.S. large-cap

U.S. small-cap

International large-cap

Fixed income securities

Mortgage backed securities

U.S. Government debt securities

Corporate bonds and loans

Convertible promissory notes

Stock warrants

Private company common stock

Subtotal

Pension assets measured at net asset value (1)
Hedge funds: (2)

Equity long/short

Event driven

Value driven

Private equity - asset based lending - maritime (3)
Private equity - value oriented partnership investment fund (4)
Funds of funds - long-term capital growth (5)
Offshore feeder fund - Pan-Asia equity long/short (6)
Insurance separate account (7)
Total pension assets measured at net asset value

Cash and cash equivalents

Net payables
Total pension assets

Fair Value Measurements as of December 31, 2017:

Asset Class

Equity securities:

U.S. mid-cap

U.S. large-cap

U.S. small-cap

International large-cap

Fixed income securities

Mortgage backed securities

U.S. Government debt securities

Corporate bonds and loans

Convertible promissory notes

Stock warrants

Private company common stock

Subtotal

Pension assets measured at net asset value (1)
Hedge funds: (2)

Equity long/short

Event driven

Value driven

Private equity - asset based lending - maritime (3)
Funds of funds - long-term capital growth (5)
Common trust funds: (2)

Other

Insurance separate account (7)
Total pension assets measured at net asset value

Cash and cash equivalents

Net receivables
Total pension assets

24,736

— $

75,859

1,099

918

2,111

—

15,934

10,161

34,117

—

104,723

60,212

—

4,202

193

1,050

5,445

24,736

75,859

1,099

918

2,111

15,934

10,161

34,117

4,202

193

1,050

170,380

50,777

27,028

18,995

9,498

4,102

14,945

4,243

12,328

141,916

4,738

(8,545)

308,489

Assets at Fair Value as of December 31, 2017

Level 1

Level 2

Level 3

Total

28,715

— $

66,076

3,214

1,188

2,217

—

10,682

14,001

35,033

—

101,410

59,716

—

4,202

193

1,050

5,445

28,715

66,076

3,214

1,188

2,217

10,682

14,001

35,033

4,202

193

1,050

166,571

45,147

49,757

19,960

8,466

12,517

15,009

150,859

28,397

3,992
349,819

(1) Certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been

classified in the fair value hierarchy.

(2) Hedge funds and common trust funds are comprised of shares or units in commingled funds that may not be publicly traded. The underlying

assets in these funds are primarily publicly traded equity securities and fixed income securities.

(3) The limited partnership is a direct lending private debt fund, which serves as an alternative source of liquidity for the shipping industry.
(4) The limited partnership's strategy is to build a concentrated portfolio of 8-10 companies with $100 to $1,000 of equity allocated per
investment. Investments will be control positions of minority stakes with significant protections and influence. The strategy will focus on
the North American and Asian financial, industrial, energy, consumer and business service sectors.

(5) The limited partnership operates as a fund of funds. The underlying assets in this fund are generally expected to be illiquid. The limited
partnership's investment strategy is to seek above-average rates of return and long-term capital growth by investing in a broad range of
investments, including, but not limited to, global distressed corporate securities, activist equities, value equities, post-reorganizational
equities, municipal bonds, high yield bonds, leveraged loans, unsecured debt, collateralized debt obligations, mortgage-backed securities,
commercial mortgage-backed securities, direct lending and sovereign debt.

(6) The offshore feeder fund's Pan-Asia strategy employs a value-oriented and concentrated approach with a long-term horizon and seeks to

build a portfolio of independent long and short positions with access to small/mid-cap opportunities.

(7) The JPS Pension Plan holds a deposit administration group annuity contract with an immediate participation guarantee from Transamerica
Life Insurance Company ("TFLIC"). The TFLIC contract unconditionally guarantees benefits to certain salaried JPS Pension Plan participants
earned through June 30, 1984 in the pension plan of a predecessor employer. The assets deposited under the contract are held in a separate
custodial account ("TFLIC Assets"). If the TFLIC Assets decrease to the level of the trigger point (as defined in the contract), which represents
the guaranteed benefit obligation representing the accumulated plan benefits as of June 30, 1984, TFLIC has the right to cause annuities to
be purchased for the individuals covered by these contract agreements. No annuities have been purchased for the individuals covered by
these contract arrangements.

API's pension plan's assets at December 31, 2018 and 2017 by asset category, are as follows:

Fair Value Measurements as of December 31, 2018:

Asset Class

Equities

Bonds

Property
Liability-driven instrument (1)
Private markets

Cash and cash equivalents
Total pension assets

Fair Value Measurements as of December 31, 2017:

Asset Class

Equities

Bonds

Property
Liability-driven instrument (1)
Private markets

Cash and cash equivalents
Total pension assets

Assets at Fair Value as of December 31, 2018

Level 1

Level 2

Level 3

Total

38,814

— $

—

7,494

13,605

13,457

38,639

—

13,824

—

38,814

13,605

13,457

38,639

13,824

7,494

46,308

65,701

13,824

125,833

Assets at Fair Value as of December 31, 2017

Level 1

Level 2

Level 3

Total

67,634

— $

—

448

14,568

13,159

30,980

—

13,845

—

67,634

14,568

13,159

30,980

13,845

448

68,082

58,707

13,845

140,634

(1) Represents investments in pooled funds. This is a method of investing whereby a portfolio of assets is built with the objective of moving
in-line with liabilities. The assets are typically derivative instruments based on government bonds or instruments called swaps which are
exposed to the same liability sensitivities (interest rates and inflation) as the pension liabilities.

During 2018, there were no changes to the HNH plans' Level 3 assets, and during 2017, the changes were as follows:

Year Ended December 31, 2017

Beginning balance as of January 1, 2017

Transfers into Level 3

Transfers out of Level 3

Gains or losses included in changes in net assets

Purchases, issuances, sales and settlements

Purchases

Issuances

Sales

Settlements

Convertible
Promissory
Notes

Stock
Warrants

Private
Company
Common
Stock

Total

3,500

875

— $

4,375

—

702

—

193

—

(875)

—

175

875

—

877

875

193

—

(875)

5,445

Ending balance as of December 31, 2017

4,202

193

1,050

The Company's policy is to recognize transfers in and transfers out of Level 3 as of the date of the event or change in

circumstances that caused the transfer.

In 2018, changes in the API Plan's Level 3 net assets consisted of transfers out of $281, a gain of $1,057 and foreign
currency translation losses of $797. In 2017, changes in the API Plan's Level 3 net assets consisted of transfers in of $13,395 and
a gain of $450.

The following tables present the category, fair value, unfunded commitments, redemption frequency and redemption
notice period of those assets for which fair value was estimated using the net asset value per share (or its equivalents), as well as
plan assets which have redemption notice periods, as of December 31, 2018 and 2017:

Class Name

Hedge funds

Fund of funds

Hedge funds

Description

Global long short feeder fund

US long small cap value hedge fund

International equity long/short hedge fund

Multi-strategy hedge fund

Value driven hedge fund

Long-term capital growth

Equity long/short hedge funds

Event driven hedge funds

Insurance separate account

Private equity

Asset-based lending-maritime

Value oriented partnership investment fund

Offshore feeder fund

Pan-Asia equity long/short

Hedge funds

Private equity

Equity long/short hedge funds

Revenue-based lending

Fair Value
December 31,
2018

Unfunded
Commitments

Redemption
Frequency

Redemption
Notice Period

9,499

9,775

11,680

3,630

18,995

14,945

10,507

27,028

12,328

9,498

4,102

4,243

3,689

1,997

—

Monthly (1)

— Quarterly (2)

90 days

— Quarterly (3)

90 days (3)

1,750

—

22,222

—

8,500

—

(4)

(5)

(6)

(7)

Monthly

(8)

(9)

(10)

(11)

— Quarterly (12)

— Quarterly (13)

(4)

6 months

95 days

60 days

90 days

(8)

(9)

(10)

60 days

90 days

60 days

(14)

— $

7,750

(14)

(1) 3 year lock up and 5% redemption fee if under 3 years. Notice for redemption is 90 days prior to expiry of lock up period. Annual limited

redemption of 20% per shareholder in any twelve month period, subject to 30 days' notice.

(2) Maximum withdrawal is 25%. Can withdraw 100% over 4 consecutive calendar quarters in 25% increments.
(3) Redemptions are subject to (i) a rolling thirty-six month holding period and (ii) a one-quarter investor level gate. There is a holdback of

10% upon complete distribution until completion of the audit of the fund for that year, without interest.

(4) Limited partnership formed in 2017. Commitment of $5,000, no right to withdraw. The fund has a four years duration with the option for

two additional 1 year extensions.

(5) 5 year staggered lockup period. One-third of the investment on each of December 31, 2020, 2021 and 2022.
(6) Each capital commitment is subject to a commitment period of 3 years during which capital may be drawn-down, subject to two 1-year
extensions. During the commitment period, no withdrawals are permitted. Once permitted, withdrawals of available liquidity in underlying
investment vehicles are permitted quarterly. The fund-of-funds will not invest in any fund or investment vehicle that has an initial lock-up
period of more than 5 years. Upon complete redemption, a holdback of up to 10% is withheld and paid after the fund's financial statement
audit.

(7) Redeemable annually subject to 3 years rolling, staggered lock up period. Upon complete redemption, a holdback of up to 10% is withheld

and paid after the fund's financial statement audit.

(8) Except for benefit payments to participants and beneficiaries and related expenses, withdrawals are restricted for substantially all of the
assets in the account, as defined in the contract. However, a suspension or transfer can be requested with 30 days' notice. When funds are
exhausted either by benefit payments, purchase of annuity contracts or transfer, the related contract terminates.

(9) Entered into an agreement effective December 15, 2016 with a commitment of $10,000. The agreement contains a commitment period of
3 years, subject to an extension of up to one additional year. Voluntary withdrawals are not permitted. Complete distributions will be made
after 8 years, subject to an extension of an additional 2 years.

(10) Entered into an agreement effective September 8, 2016 for a commitment of $12,500 to a limited partnership private equity fund. $4,000
of capital has been called as of December 31, 2018. Voluntary withdrawals will not be permitted. Complete distributions will be made after
10 years, subject to an extension of an additional 1 year. The agreement provided for loans to the fund, and as of December 31, 2018, a
$3,505 loan receivable was outstanding from the fund. Per the loan agreement, a loan exists until the partnership issues a drawdown notice.
Upon issuance of a drawdown notice, a capital contribution to the partnership will be deemed to be made and deemed to have repaid the
loan to the extent of the capital contribution.

(11) 3 year lock up. Optional annual limited redemption of 10% per shareholder, subject to 60 days' notice. 25% Master Fund level gate. Upon

complete redemption, a holdback of up to 10% is withheld and paid after the fund's financial statement audit.

(12) Maximum withdraw is 25% of the net asset value of the relevant class per quarter.
(13) Entered into an agreement effective May 21, 2018 for a commitment of $2,000. 1 year lockup period for each capital contribution. Upon

complete redemption, a holdback of 10% is withheld and paid after the fund's financial statement audit.

(14) Entered into agreements effective October 31, 2018 which contain a $8,000 commitment with a commitment period between 3 and 4 years.
Voluntary withdrawals are not permitted. Complete distributions will be made after 8 to 9 years, subject to two extensions in 1 year increments.
On December 18, 2018, capital was called in the amount of $250 and is recorded as cash as of December 31, 2018.

In addition to those on the table above, there is an additional unfunded commitment at December 31, 2018 of $1,500 for

a convertible promissory note, of which $750 was funded in January 2019.

Class Name

Hedge funds

Fund of funds

Hedge funds

Description

Global long short feeder fund

US long small cap value hedge fund

International equity long/short hedge fund

Multi-strategy hedge fund

Value driven hedge fund

Long-term capital growth

Equity long/short hedge funds

Event driven hedge funds

Common trust funds

Collective equity investment funds

Insurance separate account

Private equity

Asset-based lending-maritime

Value oriented partnership investment fund

Opportunistic long/short private investment
fund

Offshore feeder fund

Pan-Asia equity long/short

Fair Value
December 31,
2017

Unfunded
Commitments

Redemption
Frequency

Redemption
Notice Period

11,416

10,003

11,504

1,756

19,960

12,517

10,468

49,757

15,009

8,466

— $

—

Monthly (1)

— Quarterly (2)

90 days

— Quarterly (3)

90 days (3)

3,250

—

23,958

—

1,444

12,500

3,000

(4)

(5)

(6)

(7)

Monthly

Daily

(8)

(9)

(10)

(11)

(12)

(4)

6 months

95 days

60 days

90 days

0-2 days

(8)

(9)

(10)

(11)

(12)

(1) 3 year lock up and 5% redemption fee if under 3 years. Notice for redemption is 90 days prior to expiry of lock up period. Annual limited

redemption of 10% per shareholder in any twelve month period, subject to 30 days' notice.

10% upon complete distribution until completion of the audit of the fund for that year, without interest.

(4) Limited partnership formed in 2017. Commitment of $5,000, no right to withdraw. The fund has a four years duration with the option for

two additional 1 year extensions.

(7) Redeemable annually subject to 3 years rolling, staggered lock up period. Upon complete redemption, a holdback of up to 10% is withheld

and paid after the fund's financial statement audit.

(10) Entered into an agreement effective September 8, 2016 for a commitment of $12,500 to a limited partnership private equity fund. Capital
had not been called as of December 31, 2017. Voluntary withdrawals will not be permitted. Complete distributions will be made after 10
years, subject to an extension of an additional one year. The agreement provided for loans to the fund, and as of December 31, 2017, a
$3,000 loan receivable was outstanding from the fund. Per the loan agreement, a loan exists until the partnership issues a drawdown notice.
Upon issuance of a drawdown notice, a capital contribution to the partnership will be deemed to be made and deemed to have repaid the
loan to the extent of the capital contribution.

(11) During 2017, the WHX and JPS plans committed $5,000 to a fund which had a capital call for $2,000 due January 1, 2018, funded on
December 29, 2017 and recorded as cash as of December 31, 2017. This fund's objective is generating returns on its long and short positions
in companies undergoing change.

(12) During 2017, the WHX and JPS plans committed $5,000 to a fund which had a capital call for $2,000 due January 1, 2018, funded on
December 29, 2017 and recorded as cash as of December 31, 2017. The fund's investment focus is on companies with substantial exposure
in the Asian-Pacific region.

In addition to those on the table above, HNH had an additional unfunded commitment at December 31, 2017 totaling

$10,000 for a separately managed investment account which had an all-cap value strategy.

Contributions

Employer contributions consist of funds paid from employer assets into a qualified pension trust account. HNH's funding
policy is to contribute annually an amount that satisfies the minimum funding standards of the Employee Retirement Income
Security Act. API's funding policy is to contribute monthly an amount that satisfies the API Plan's provisions to meet the level of
assets needed to pay benefits in accordance with the statutory funding objectives required in the United Kingdom.

HNH expects to have required minimum annual contributions for 2019, 2020, 2021, 2022, 2023 and for the five years
thereafter of $33,400, $34,700, $34,000, $36,700, $28,500 and $23,700, respectively. API expects to have required minimum
annual contributions of $887 for 2019, 2020, 2021 and 2022, and $739 in 2023. Required future pension contributions are estimated
based upon assumptions such as discount rates on future obligations, assumed rates of return on plan assets and legislative changes.
Actual future pension costs and required funding obligations will be affected by changes in the factors and assumptions described
in the previous sentence, as well as other changes such as any plan termination or other acceleration events.

Benefit Payments

Estimated future benefit payments for the pension plans over the next ten years are as follows:

Years

2019

2020

2021

2022

2023

2024-2028

HNH Plans

API Plan

42,260

41,305

40,264

39,215

38,151

171,699

5,362

5,591

5,844

6,110

6,402

36,117

15. CAPITAL AND ACCUMULATED OTHER COMPREHENSIVE LOSS

As of December 31, 2018, the Company had 25,294,003 Class A units (regular common units) outstanding.

Common Unit Repurchase Program

In December 2016, the Board of Directors of SPH GP approved the repurchase of up to an aggregate of 2,000,000 of the
Company's common units. In November 2018, the Board of Directors approved the repurchase of up to an additional 1,000,000
of the Company's common units (collectively, with the December 2016 approval, "Repurchase Program"). The Repurchase Program
supersedes and cancels, to the extent any amounts remain available, all previously approved repurchase programs. Any purchases
made under the Repurchase Program will be made from time to time on the open market at prevailing market prices or in negotiated
transactions off the market, in compliance with applicable laws and regulations. In connection with the Repurchase Program, the
Company may enter into a stock purchase plan. The Repurchase Program has no termination date. The Company has purchased
1,583,841 common units for an aggregate price of approximately $27,160 under the Repurchase Program.

Incentive Award Plan

On May 24, 2018, the Company's unitholders approved the adoption of the Company's 2018 Incentive Award Plan ("2018
Plan"). The 2018 Plan provides equity-based compensation through the grant of options to purchase the Company's limited
partnership units, unit appreciation rights, restricted units, phantom units, substitute awards, performance awards, other unit-based
awards, and includes, as appropriate, any tandem distribution equivalent rights granted with respect to an award (collectively, "LP
Units"). The 2018 Plan allows for issuance of up to 500,000 LP Units. As of December 31, 2018, no awards had been granted
under the 2018 Plan.

Common Unit Dividend

On January 13, 2017, the Company paid dividends of approximately $3,923 to common unitholders of record as of January
3, 2017, excluding a consolidated affiliate. This special one-time cash dividend of $0.15 per common unit was declared on December
22, 2016. Any future determination to declare dividends on its common units will remain at the discretion of the Company's Board
of Directors and will be dependent upon a number of factors, including the Company's results of operations, cash flows, financial
position and capital requirements, among others.

Preferred Units

The 6.0% Series A preferred units, no par value ("SPLP Preferred Units"), which were issued in connection with the Steel
Excel Inc. ("Steel Excel"), HNH and WebFinancial Holding Corporation ("WFHC") transactions discussed below, entitle the
holders to a cumulative quarterly cash or in-kind (or a combination thereof) distribution. The Company declared cash distributions
of approximately $11,750 and $4,700 to preferred unitholders for the years ended December 31, 2018 and 2017, respectively. The
SPLP Preferred Units have a term of nine years and are redeemable at any time at the Company's option at a $25 liquidation value
per unit, plus any accrued and unpaid distributions (payable in cash or SPLP common units, or a combination of both, at the
Company's discretion). If redeemed in common units, the number of common units to be issued will be equal to the liquidation
value per unit divided by the volume weighted-average price of the common units for 60 days prior to the redemption. In addition,
the holders can require the Company to repurchase up to 1,600,000 of the SPLP Preferred Units, in cash on a pro rata basis, on
the third anniversary of the original issuance date of February 7, 2017, reduced by any preferred units called for redemption by
the Company, in cash on a pro rata basis, prior to that time.

The SPLP Preferred Units have no voting rights, except that holders of the preferred units have certain voting rights in
limited circumstances relating to the election of directors following the failure to pay six quarterly distributions. The SPLP Preferred
Units are recorded as a non-current liability, including accrued interest expense, on the Company's consolidated balance sheets as
of December 31, 2018 and 2017 because they have an unconditional obligation to be redeemed for cash or by issuing a variable
number of SPLP common units for a monetary value that is fixed and known at inception. Because the SPLP Preferred Units are
classified as a liability, distributions thereon are recorded as a component of Interest expense in the Company's consolidated
statements of operations. As of December 31, 2018 and 2017, there were 7,927,288 and 7,952,660 SPLP Preferred Units outstanding,
respectively.

Steel Excel Transaction

On December 23, 2016, the Company entered into an Amended Agreement and Plan of Merger with a subsidiary of the
Company and Steel Excel to make a tender offer to purchase any and all of the outstanding shares of common stock of Steel Excel
not already owned by the Company or any of its affiliates. In exchange for each share of Steel Excel common stock, the Company
offered 0.712 SPLP Preferred Units. The offer commenced on January 9, 2017 and expired on February 6, 2017. As a result of the
completion of the offer, the Company issued approximately 2,500,000 SPLP Preferred Units with a fair value and liquidation value
of $25.00 per SPLP Preferred Unit, or approximately $63,500, to Steel Excel shareholders and paid approximately $2,100 in cash
for any remaining unvested restricted shares of Steel Excel. As a result of this transaction, the Company owns 100% of Steel Excel.

HNH Transaction

On June 26, 2017, the Company entered into an Agreement and Plan of Merger with a subsidiary of the Company and
HNH to make a tender offer to purchase any and all of the outstanding shares of common stock of HNH not already owned by the
Company or any of its affiliates. In exchange for each share of HNH common stock, the Company offered 1.484 SPLP Preferred
Units. The offer expired on October 12, 2017, and as a result of the completion of the offer, the Company issued approximately
5,400,000 SPLP Preferred Units with a fair value of approximately $112,000 and liquidation value of approximately $135,000 to
HNH shareholders. As a result of this transaction, the Company owns 100% of HNH.

WFHC Transactions

During 2018, the Company entered into purchase agreements with minority stockholders of its subsidiary, WFHC, pursuant
to which the Company purchased shares of common and preferred stock of WFHC in exchange for aggregate consideration totaling
approximately $20,680, comprised of cash of $13,708, 185,407 SPLP common units and 186,271 SPLP Preferred Units. As a
result of these transactions, the Company now owns 100% of WFHC, as compared to 91.2% at December 31, 2017.

For each of the Steel Excel, HNH and WFHC transactions described above, in accordance with the accounting standard
on consolidation, changes in a parent's ownership interest where the parent retains a controlling financial interest in its subsidiary
were accounted for as equity transactions. The carrying amount of the acquired noncontrolling interests were eliminated to reflect
the change in SPLP's ownership interest in each subsidiary, and the difference between the fair value of the consideration paid and
the amount by which the noncontrolling interest was adjusted was recognized in Partners' capital.

iGo Transaction

On December 31, 2018, the Company entered into a contribution agreement with iGo, an equity method investee of the
Company, in which the Company contributed its interest in its subsidiary, Kasco LLC ("Kasco"), in exchange for consideration
consisting of 5,000,000 newly issued common shares of iGo and the assumption by iGo/Kasco of $15,000 of debt outstanding
under the Credit Agreement (see Note 12 - "Long-Term Debt"). As a result of this transaction, the Company now owns 80.2% of
iGo's common stock, and iGo became a consolidated subsidiary. As of December 31, 2018, iGo's assets and liabilities have been
included in the Company's consolidated balance sheet, with a related noncontrolling interest of 19.8% of iGo's common stock.

Accumulated Other Comprehensive Loss

Changes, net of tax, in Accumulated other comprehensive loss are as follows:

Balance at December 31, 2016
Other comprehensive income (loss), net of tax - before reclassifications (a)
Reclassification adjustments, net of tax (b)
Net other comprehensive income (loss) attributable to common

unitholders (c)

Acquisition of AOCI from noncontrolling interests
Balance at December 31, 2017

Net other comprehensive (loss) income attributable to common

unitholders (a), (c)

Cumulative effect of adopting ASU 2016-01 relating to net unrealized
gains and losses on equity securities (d)
Acquisition of AOCI from noncontrolling interests
Balance at December 31, 2018

Unrealized
gain (loss)
on available-
for-sale
securities

Unrealized
loss on
derivative
financial
instruments

Cumulative
translation
adjustments

Change in
net pension
and other
benefit
obligations

Total

62,527

(688)

(19,548) $

(109,270) $

(66,979)

26,878

908

27,786

765

91,078

(274)

(91,078)

—

569

—

569

—

(119)

(28)

—

(130)

4,512

—

4,512

(3,223)

(18,259)

(6,926)

—

(6,926)

(60,889)

(177,085)

25,033

908

25,941

(63,347)

(104,385)

(4,693)

24,247

19,252

—

(524)

—

(379)

(91,078)

(1,033)

(274) $

(277)

(23,476) $

(153,217) $

(177,244)

(a) Net of a tax provision of approximately $8,349 and $31,029 and for the years ended December 31, 2018 and 2017, respectively.
(b) Net of a tax provision of approximately $329.
(c) For 2017, does not include the net unrealized gain on available-for sale securities of $811, the gain on derivative financial instruments of
$55, cumulative translation adjustment gains of $932 and gains from the change in net pension and other post-retirement benefit obligations
of $474, which are attributable to noncontrolling interests. For 2018, does not include the net unrealized gain on derivative financial
instruments of $26 and cumulative translation adjustment of $(40), which are attributable to noncontrolling interests.

(d) Effective January 1, 2018 upon adoption of ASU 2016-01, a cumulative effect reclassification adjustment was made to remove the net
unrealized gains and losses on equity securities from Accumulated other comprehensive loss and reclassify them to Partners' capital.

Incentive Unit Expense

Effective January 1, 2012, SPLP issued to the Manager partnership profits interests in the form of incentive units, a portion
of which will be classified as Class C common units of SPLP upon the attainment of certain specified performance goals by SPLP,
which are determined as of the last day of each fiscal year. If the performance goals are not met for a fiscal year, no portion of the
incentive units will be classified as Class C common units for that year. The number of outstanding incentive units is equal to
100% of the common units outstanding, including common units held by non-wholly-owned subsidiaries. The performance goals
and expense related to the classification of a portion of the incentive units as Class C units is measured on an annual basis, but is
accrued on a quarterly basis. Accordingly, the expense accrued is adjusted to reflect the fair value of the Class C common units

on each interim calculation date. In the event the cumulative incentive unit expense calculated quarterly or for the full year is an
amount less than the total previously accrued, the Company records a negative incentive unit expense in the quarter when such
over accrual is determined. The expense is recorded in Selling, general and administrative expenses in the Company's consolidated
statements of operations. The Company recorded $0 and $9,021 of incentive unit expense for the years ended December 31, 2018
and 2017, respectively.

16. INCOME TAXES

Details of the Company's tax provision (benefit) are as follows:

Income (loss) before income taxes and equity method investments

Domestic

Foreign

Total

Income taxes:

Current:

Federal

State

Foreign

Total income taxes, current
Deferred:

Federal

State

Foreign

Total income taxes, deferred
Income tax provision

Year Ended December 31,

2018

2017

169

(9,591)

(9,422) $

(1,160) $

7,518

3,054

9,412

8,723

(3,521)

(2,055)

3,147

12,559

34,971

5,452

40,423

4,263

4,872

2,953

12,088

44,592

(4,093)

(1,288)

39,211

51,299

The following is a reconciliation of the income tax provision computed at the federal statutory rate to the provision for

income taxes:

(Loss) income before income taxes and equity method investments

Federal income tax (benefit) provision at statutory rate
Loss passed through to common unitholders (a)

State income taxes, net of federal effect

Change in valuation allowance

Foreign tax rate differences

Uncertain tax positions

Deferred tax rate change due to newly-enacted U.S. tax law

Permanent differences and other
Income tax provision

Year Ended December 31,

2018

2017

(9,422) $

(1,978) $

5,794

3,816

1,705

6,317

(59)

150

—

630

12,559

40,423

14,147

10,385

24,532

5,344

(48,598)

(1,202)

124

69,992

1,107

51,299

(a) Represents taxes at statutory rate on losses for which no tax benefit is recognizable by SPLP and certain of its subsidiaries which are taxed

as pass-through entities. Such losses are allocable directly to SPLP's unitholders and taxed when realized.

The Act was enacted on December 22, 2017. The income tax effects of changes in tax laws are recognized in the period
when enacted. The Act provides for numerous significant tax law changes and modifications with varying effective dates, which
include reducing the U.S. federal corporate income tax rate from 35% to 21%, creating a territorial tax system (with a one-time
mandatory repatriation tax on previously deferred foreign earnings) and allowing for immediate capital expensing of certain
qualified property acquired and placed in service after September 27, 2017 and before January 1, 2023.

In response to the enactment of the Act in late 2017, the U.S. Securities and Exchange Commission issued Staff Accounting
Bulletin No. 118 ("SAB 118") to address situations where the accounting is incomplete for certain income tax effects of the Act
upon issuance of an entity's financial statements for the reporting period in which the Act was enacted. The measurement period

allowed by SAB 118, in which the Company recorded an income tax benefit of $1,896 related to the one-time mandatory repatriation
tax, closed during the fourth quarter of 2018. The prospects of supplemental legislation or regulatory processes to address
uncertainties that arise because of the Act, or evolving technical interpretations of the tax law, may cause the Company's consolidated
financial statements to be impacted in the future. The Company will continue to analyze the effects of the Act as subsequent
guidance continues to emerge.

The Act also includes a provision to tax global intangible low-taxed income ("GILTI") of foreign subsidiaries. The FASB
Staff Q&A Topic No. 5, Accounting for Global Intangible Low-Taxed Income, states that an entity can make an accounting policy
election either to recognize deferred taxes for temporary differences that are expected to reverse as GILTI in future years or provide
for the tax expense related to GILTI resulting from those items in the year the tax is incurred. We have elected to recognize the
resulting tax on GILTI as a period expense in the period the tax is incurred.

Deferred income taxes result from temporary differences in the financial basis and tax basis of assets and liabilities. The
amounts shown on the following table represent the tax effect of temporary differences between the consolidated tax return basis
of assets and liabilities and the corresponding basis for financial reporting, as well as tax credit and operating loss carryforwards.

Deferred Tax Assets:
Operating loss carryforwards (a)
Postretirement and postemployment employee benefits

Tax credit carryforwards

Accrued costs

Investment impairments and unrealized losses

Inventories

Environmental costs

Capital loss

Allowance for doubtful accounts and loan losses

Other
Gross deferred tax assets

Deferred Tax Liabilities:

Intangible assets

Fixed assets

Unrealized gain on investment

Other
Gross deferred tax liabilities
Valuation allowance (b)
Net deferred tax assets

Classified on the Company's consolidated balance sheets as follows:

Deferred tax assets

Deferred tax liabilities

December 31,

2018

2017

136,940

50,306

12,837

4,970

6,282

3,536

3,299

8,459

4,460

1,427

118,594

70,151

13,412

4,151

7,325

2,468

2,297

7,968

1,361

3,748

232,516

231,475

(27,758)

(24,542)

(4,388)

(2,715)

(59,403)

(79,298)

93,815

96,040

2,225

93,815

(33,376)

(26,346)

(22,403)

(2,208)

(84,333)

(41,138)

106,004

109,011

3,007

106,004

(a) The ability for certain subsidiaries to utilize net operating losses and other credit carryforwards may be subject to limitation upon changes

in control.

(b) Certain subsidiaries of the Company establish valuation allowances when they determine, based on their assessment, that it is more likely
than not that certain deferred tax assets will not be fully realized. This assessment is based on, but not limited to, historical operating results,
uncertainty in projections of taxable income and other uncertainties that may be specific to a particular business.

At December 31, 2018, the Company's corporate subsidiaries had carryforwards of U.S. federal net operating losses
("NOLs") of approximately $397,046 that expire in 2020 through 2037. In addition, there are federal NOLs that can only be utilized
by the corporate subsidiaries that generated the prior year losses, commonly called SRLY NOLs, totaling $199,240, which will
expire in 2020 through 2037. The Company has a valuation allowance to reserve its deferred tax asset associated with the SRLY
NOLs, and the addition of SRLY NOLs during 2018 from the consolidation of iGo is the principal reason for the increase in the
valuation allowance during 2018. There is a capital loss carryforward in the amount of $34,815 that expires in 2021-2022. The
deferred tax asset associated with this item has been fully reserved.

The Company's corporate subsidiaries have NOLs in foreign jurisdictions totaling $18,054 for which a valuation allowance
to reserve the associated deferred tax asset has been established. There are NOLs in various states in which the subsidiaries operate.
The amount totaled $21,213 and expires in 2019 through 2037. A valuation allowance has been established against a significant
portion of the deferred tax asset associated with the state NOLs.

The Company's corporate subsidiaries have federal research and development credit carryforwards of $28,213 that expire
in 2019 through 2029, and state research and development credit carryforwards of $20,683 for which a significant amount do not
expire. The Company has a valuation allowance to reserve a significant portion of its deferred tax assets associated with the credit
carryforwards.

At December 31, 2017, a valuation allowance was released against substantially all of one of the Company's corporate
subsidiary's federal deferred tax assets (except for certain federal NOLs of a subsidiary company subject to limitations and the
realized capital losses) as the Company concluded such assets were fully realizable. This assessment was primarily based on the
restructuring of several business units that enabled operational efficiencies resulting in a more likely than not assertion to realize
the majority of the federal deferred tax assets. The Company will continue to monitor the likelihood that it will be able to recover
the deferred tax assets in the future. This determination includes objectively verifiable positive evidence that outweighs potential
negative evidence.

Unrecognized Tax Benefits

U.S. GAAP provides that the tax effects from an uncertain tax position can be recognized in the consolidated financial
statements only if the position is more likely than not of being sustained on audit, based on the technical merits of the position.
The change in the amount of unrecognized tax benefits for 2018 and 2017 was as follows:

Balance at December 31, 2016

Additions for tax positions related to current year

Reductions due to lapsed statutes of limitations
Balance at December 31, 2017

Additions for tax positions related to current year

Additions for tax positions related to prior years

Payments

Reductions due to lapsed statutes of limitations and expiration of credits
Balance at December 31, 2018

29,394

32,684

(1,350)

60,728

977

1,413

(543)

(10,850)

51,725

The Company's total gross unrecognized tax benefits were $51,725 and $60,728 at December 31, 2018 and 2017,
respectively, of which $33,812, if recognized, would affect the provision for income taxes. In 2018, the Company settled certain
state tax examinations resulting in a payment against the reserve of $543. In addition, the Company reversed $10,850 of reserves
upon the expiration of the statutes of limitations with applicable taxing authorities and the expiration of time for utilizing certain
credits for which a full reserve is maintained. The increase in unrecognized tax benefits in 2017 was primarily related to certain
tax credits from prior years that may not be sustained on a more-likely-than-not basis. As of December 31, 2018, it is reasonably
possible that unrecognized tax benefits may decrease by $1,103 in the next 12 months due to the expiration of statutes of limitations.
The Company recognizes interest and penalties (if applicable) related to uncertain tax positions in its income tax provision in the
consolidated statement of operations. For 2018 and 2017, the amount of such interest and penalties recognized was not significant.

The Company is subject to U.S. federal income tax, as well as income taxes in various domestic states and foreign
jurisdictions in which the Company operated or formerly operated in. The Company is generally no longer subject to federal, state
or local income tax examinations by tax authorities for any year prior to 2015, except as noted below. However, NOLs generated
in prior years are subject to examination and potential adjustment by the taxing authorities upon their utilization in subsequent
years' tax returns.

A corporate subsidiary of the Company is currently under examination by the Internal Revenue Service ("IRS") for the
year 2015, which remains on-going. To date, the IRS has not notified the Company of any material adjustments resulting from the
examination. With respect to the same corporate subsidiary, the IRS completed the examination for the year 2014, resulting in no
adjustments to the original filing. The Company also settled an IRS examination of a corporate subsidiary's final pre-acquisition
period filing, resulting in a small refund.

During 2018, the Company settled various state and local examinations for the years 2012, 2013 and 2015 at a total cost
of $543, for which the Company was fully reserved. In addition, certain corporate subsidiaries are either currently under examination
or have been notified of pending examinations for the years 2014 through 2016 by the State of New York.

The Company is not currently under tax examination in any foreign jurisdictions.

17. NET (LOSS) INCOME PER COMMON UNIT

The following data was used in computing net (loss) income per common unit shown in the Company's consolidated

statements of operations:

Net (loss) income

Net loss attributable to noncontrolling interests in consolidated entities
Net loss attributable to common unitholders

Net loss per common unit - basic and diluted

Net loss attributable to common unitholders

Denominator for net loss per common unit - basic and diluted

Year Ended December 31,

2018

2017

(31,490) $

(1,114)

(32,604) $

6,012

(6,028)

(16)

(1.25) $

—

25,984,185

26,053,098

For the year ended December 31, 2018, the diluted net loss per unit calculation was based on the basic weighted-average
units only since the impact of 12,240,672 of SPLP Preferred Units and 24,100 of unvested restricted stock units, would have been
anti-dilutive. For the year ended December 31, 2017, the diluted net loss per unit calculation was based on the basic weighted-
average units only since the impact of 307,448 incentive units, 4,738,844 of SPLP Preferred Units and 39,634 of unvested restricted
stock units, would have been anti-dilutive.

18. FAIR VALUE MEASUREMENTS

Financial assets and liabilities measured at fair value on a recurring basis in the Company's consolidated financial
statements as of December 31, 2018 and 2017 are summarized by type of inputs applicable to the fair value measurements as
follows:

December 31, 2018

Assets:
Marketable securities (a)
Long-term investments (a)
Investments in certain funds

Precious metal and commodity inventories recorded at fair value

Economic interests in loans

Foreign currency forward exchange contracts

Warrants

Total

Liabilities:

Financial instrument obligations

Commodity contracts on precious metal and commodity inventories

Other precious metal liabilities

Foreign currency forward exchange contracts

Total

Level 1

Level 2

Level 3

Total

836

603

— $

200,179

—

9,884

—

14,943

—

275

—

42,601

422

—

17,156

—

1,738

1,439

257,723

422

9,884

17,156

275

1,738

210,899

15,821

61,917

288,637

12,434

— $

12,434

—

8,589

—

21,023

159

—

450

609

—

159

8,589

450

— $

21,632

December 31, 2017

Assets:
Marketable securities (a)
Long-term investments (a)
Investments in certain funds

Precious metal and commodity inventories recorded at fair value

Economic interests in loans

Foreign currency forward exchange contracts

Warrants

Long put options

Total

Liabilities:

Financial instrument obligations

Commodity contracts on precious metal and commodity inventories

Other precious metal liabilities

Foreign currency forward exchange contracts

Short call options

Total

Level 1

Level 2

Level 3

Total

44,371

1,988

11,954

186,750

—

10,993

—

10,387

—

166

—

36,223

407

—

13,126

—

206

—

58,313

233,360

407

10,993

13,126

166

206

242,117

12,541

61,916

316,574

15,629

— $

—

8,115

—

258

127

—

188

—

15,629

127

8,115

188

258

24,002

315

— $

24,317

(a) For additional detail of the marketable securities and long-term investments see Note 10 - "Investments."

There were no transfers of securities among the various measurement input levels during the years ended December 31,

2018 or 2017.

The fair value of the Company's financial instruments, such as cash and cash equivalents, trade and other receivables and
accounts payable, approximates carrying value due to the short-term maturities of these assets and liabilities. Carrying cost
approximates fair value for long-term debt, which has variable interest rates.

The precious metal and commodity inventories associated with the Company's fair value hedges (see Note 13 - "Financial
Instruments") are reported at fair value. Fair values of these inventories are based on quoted market prices on commodity exchanges
and are considered Level 1 measurements. The derivative instruments that the Company purchases in connection with its precious
metal and commodity inventories, specifically commodity futures and forward contracts, are also valued at fair value. The futures
contracts are Level 1 measurements since they are traded on a commodity exchange. The forward contracts are entered into with
a counterparty and are considered Level 2 measurements.

Following is a summary of changes in financial assets measured using Level 3 inputs:

Long-Term Investments

Investments in
Associated
Companies (a)

STCN Warrants
(a)

Marketable
Securities and
Other (b)

Total

Assets
Balance at December 31, 2016

Purchases

Sales and cash collections

Realized gains on sale

Unrealized gains

Unrealized losses
Balance at December 31, 2017

Purchases

Sales and cash collections

Realized gains on sale
Unrealized gains

Unrealized losses
Balance at December 31, 2018

1,223

35,000

—

36,223

—

—
4,420

—

(19)

— $

—

—
—

—

30,789

—

(19,404)

309

13,999

—

25,693

2,482

(23,154)

18,704
145

(2,346)

40,643

— $

21,524

32,031

35,000

(19,404)

—

13,999

(19)

61,916

2,482

(23,154)

18,704
4,565

(2,346)

62,167

(a) Unrealized gains and losses are recorded in Loss (income) of associated companies, net of taxes in the Company's consolidated statements

of operations.

(b) Realized gains and losses on sale are recorded in Realized and unrealized losses (gains) on securities, net or Revenue in the Company's
consolidated statements of operations, as are unrealized gains and losses incurred in 2018. In 2017, prior to the adoption of ASU 2016-01,
unrealized gains and losses were recorded in AOCI.

Long-Term Investments - Valuation Techniques

The Company estimates the value of its investment in STCN preferred stock using a Monte Carlo simulation. Key inputs
in this valuation include the trading price and volatility of STCN's common stock, the risk-free rate of return, as well as the dividend
rate, conversion price and redemption date of the preferred stock. The Company estimates the value of another of its investments
in an associated company primarily using a discounted cash flow method adjusted for additional information related to debt
covenants, solvency issues and other related matters.

Marketable Securities and Other - Valuation Techniques

The Company uses the net asset value included in quarterly statements it receives in arrears from a venture capital fund
to determine the fair value of such fund and determines the fair value of certain corporate securities and corporate obligations by
incorporating and reviewing prices provided by third-party pricing services based on the specific features of the underlying
securities. The fair value of the derivatives held by WebBank (see Note 13 - "Financial Instruments") represent the estimated
amounts that WebBank would receive or pay to terminate the contracts at the reporting date and is based on discounted cash flows
analyses that consider credit, performance and prepayment. Unobservable inputs used in the discounted cash flow analyses are: a
constant prepayment rate of 7.01% to 35.85%, a constant default rate of 1.01% to 27.56% and a discount rate of 1.34% to 27.71%.

Assets Measured at Fair Value on a Nonrecurring Basis

The Company's non-financial assets and liabilities measured at fair value on a non-recurring basis include goodwill and
other intangible assets, any assets and liabilities acquired in a business combination, or its long-lived assets written down to fair
value. To measure fair value for such assets and liabilities, the Company uses techniques including an income approach, a market
approach and/or appraisals (Level 3 inputs). The income approach is based on a discounted cash flow analysis and calculates the
fair value by estimating the after-tax cash flows attributable to an asset or liability and then discounting the after-tax cash flows
to a present value using a risk-adjusted discount rate. Assumptions used in the discounted cash flow analysis ("DCF") require the
exercise of significant judgment, including judgment about appropriate discount rates and terminal values, growth rates and the
amount and timing of expected future cash flows. The discount rates, which are intended to reflect the risks inherent in future cash
flow projections, used in the DCF are based on estimates of the weighted-average cost of capital of a market participant. Such
estimates are derived from analysis of peer companies and consider the industry weighted-average return on debt and equity from
a market participant perspective. A market approach values a business by considering the prices at which shares of capital stock,
or related underlying assets, of reasonably comparable companies are trading in the public market or the transaction price at which
similar companies have been acquired. If comparable companies are not available, the market approach is not used.

19. COMMITMENTS AND CONTINGENCIES

Operating Lease Commitments

The Company has certain facilities under non-cancelable operating lease arrangements. Rent and related expenses
recognized in the Company's consolidated statements of operations for the years ended December 31, 2018 and 2017 was $18,945
and $17,895, respectively. Future minimum operating lease and rental commitments under non-cancelable operating leases for
SPLP consolidated operations are as follows:

Payments due by period

2019

2020

2021

2022

2023

Thereafter

Total

Environmental and Litigation Matters

Amount

14,280

11,131

8,975

6,174

3,863

17,867

62,290

As discussed in more detail below, certain of the Company's subsidiaries have been designated as potentially responsible
parties ("PRPs") by federal and state agencies with respect to certain sites with which they may have had direct or indirect
involvement and as defendants in certain litigation matters. Most such legal proceedings and environmental investigations involve
unspecified amounts of potential damage claims or awards, are in an initial procedural phase, involve significant uncertainty as
to the outcome or involve significant factual issues that need to be resolved, such that it is not possible for the Company to estimate
a range of possible loss. For matters that have progressed sufficiently through the investigative process such that the Company is
able to reasonably estimate a range of possible loss, an estimated range of possible loss is provided, in excess of the accrued liability
(if any) for such matters. Any estimated range is or will be based on currently available information and involves elements of
judgment and significant uncertainties. Any estimated range of possible loss may not represent the Company's maximum possible
loss exposure. The circumstances of such legal proceedings and environmental investigations will change from time to time, and
actual results may vary significantly from the current estimate. For current proceedings not specifically reported below, management
does not anticipate that the liabilities, if any, arising from such proceedings would have a material effect on the financial position,
liquidity or results of operations of the Company.

The environmental claims are in various stages of administrative or judicial proceedings and include demands for recovery
of past governmental costs, and for future investigations and remedial actions. In many cases, the dollar amounts of the claims
have not been specified and, with respect to a number of the PRP claims, have been asserted against a number of other entities for
the same cost recovery or other relief as was asserted against certain of the Company's subsidiaries. The Company accrues costs
associated with environmental and litigation matters on an undiscounted basis, when they become probable and reasonably
estimable. As of December 31, 2018, on a consolidated basis, the Company has recorded liabilities of $14,960 in Accrued liabilities
on the consolidated balance sheet, which represent the current estimate of environmental remediation liabilities as well as reserves
related to the litigation matters discussed below. Expenses relating to these costs, and any recoveries, are included in Selling,
general and administrative expenses in the Company's consolidated statements of operations. In addition, the Company has
insurance coverage available for several of these matters and believes that excess insurance coverage may be available as well.
Estimates of the Company's liability for remediation of a particular site and the method and ultimate cost of remediation require
a number of assumptions that are inherently difficult to make, and the ultimate outcome may be materially different from current
estimates.

Environmental Matters

Certain HNH subsidiaries have existing and contingent liabilities relating to environmental matters, including costs of
remediation, capital expenditures, and potential fines and penalties relating to possible violations of national and state environmental
laws. Those subsidiaries have remediation expenses on an ongoing basis, although such costs are continually being readjusted
based upon the emergence of new techniques and alternative methods. HNH recorded liabilities of approximately $13,211 related
to estimated environmental remediation costs as of December 31, 2018. HNH may have insurance coverage available for certain
of these matters.

Included among these liabilities, certain HNH subsidiaries have been identified as PRPs under the Comprehensive
Environmental Response, Compensation, and Liability Act ("CERCLA") or similar state statutes at sites and are parties to
administrative consent orders in connection with certain properties. Those subsidiaries may be subject to joint and several liabilities
imposed by CERCLA on PRPs. Due to the technical and regulatory complexity of remedial activities and the difficulties attendant
in identifying PRPs and allocating or determining liability among them, the subsidiaries are unable to reasonably estimate the
ultimate cost of compliance with such laws.

Based upon information currently available, the HNH subsidiaries do not expect that their respective environmental costs,
including the incurrence of additional fines and penalties, if any, will have a material adverse effect on them or that the resolution
of these environmental matters will have a material adverse effect on the financial position, results of operations or cash flows of
such subsidiaries or the Company, but there can be no such assurances. The Company anticipates that the subsidiaries will pay
any such amounts out of their respective working capital, although there is no assurance that they will have sufficient funds to pay
them. In the event that a HNH subsidiary is unable to fund its liabilities, claims could be made against its respective parent companies
for payment of such liabilities.

The sites where certain HNH subsidiaries have environmental liabilities include the following:

HNH has been working with the Connecticut Department of Energy and Environmental Protection ("CTDEEP") with
respect to its obligations under a 1989 consent order that applies to a property in Connecticut that HNH sold in 2003 ("Sold Parcel")
and an adjacent parcel ("Adjacent Parcel") that together comprise the site of a former HNH manufacturing facility. The remaining
remediation, monitoring and regulatory administrative costs for the Sold Parcel are expected to approximate $100. With respect

to the Adjacent Parcel, an ecological risk assessment has been completed and the results, along with proposed cleanup goals, were
submitted in the second quarter of 2016 to the CTDEEP for their review and approval. An upland work plan to investigate the
upland portion of the parcel was submitted in the third quarter of 2017 to the CTDEEP and was approved in March 2018. That
investigation work started in the second quarter of 2018 and was completed in the fourth quarter of 2018. Additional investigatory
work could be required dependent upon CTDEEP requirements. Investigation of the wetlands portion is also expected to start in
the first half of 2019, pending regulatory approvals and setting goals for the entire parcel. The total remediation costs for the
Adjacent Parcel cannot be reasonably estimated at this time. Based on the current stage of the investigation at this time, the Company
estimates that it is reasonably possible that it may incur aggregate losses over a period of several years, above its accrued liability,
in a range of $2,000 to $6,000. Due to the uncertainties, there can be no assurance that the resolution of this matter will not be
material to the financial position, results of operations or cash flows of the Company.

In 1986, Handy & Harman Electronic Materials Corporation ("HHEM"), a subsidiary of HNH, entered into an
administrative consent order ("ACO") with the New Jersey Department of Environmental Protection ("NJDEP") with regard to
certain property that it purchased in 1984 in New Jersey. The ACO involves investigation and remediation activities to be performed
with regard to soil and groundwater contamination. HHEM is actively remediating the property and is continuing to investigate
effective methods for achieving compliance with the ACO. HHEM anticipates entering into discussions with the NJDEP to address
that agency's potential natural resource damage claims, the timing and ultimate scope and cost of which cannot be estimated at
this time. Pursuant to a settlement agreement with the former owner/operator of the site, the responsibility for site investigation
and remediation costs, as well as any other costs, as defined in the settlement agreement, related to or arising from environmental
contamination on the property (collectively, "Costs") are contractually allocated 75% to the former owner/operator and 25% jointly
to HHEM and HNH, all after having the first $1,000 paid by the former owner/operator. As of December 31, 2018, total investigation
and remediation costs of approximately $7,500 and $2,400 have been expended by the former owner/operator and HHEM,
respectively, in accordance with the settlement agreement. Additionally, HHEM had been reimbursed indirectly through insurance
coverage for a portion of the Costs for which HHEM is responsible. While the primary insurance reimbursement ceased, HHEM
believes that there is additional excess insurance coverage, which it is currently pursuing. There is no assurance that the former
owner/operator or guarantors will continue to timely reimburse HHEM for expenditures and/or will be financially capable of
fulfilling their obligations under the settlement agreement and the guaranties. There is no assurance that there will be any additional
insurance reimbursement. A reserve of approximately $1,800 has been established for HHEM's expected 25% share of anticipated
costs at this site, which is based upon the recent selection of a final remedy, on-going operations and maintenance, additional
investigations and monitored natural attenuation testing over the next 30 years. There can be no assurance that the resolution of
this matter will not be material to the financial position, results of operations or cash flows of HHEM, HNH or the Company.

HNH's subsidiary, SL Industries, Inc. ("SLI"), may incur environmental costs in the future as a result of the past activities
of its former subsidiary, SL Surface Technologies, Inc. ("SurfTech"), in Pennsauken, New Jersey ("Pennsauken Site"), in Camden,
New Jersey and at its former subsidiary, SGL Printed Circuits in Wayne, New Jersey. At the Pennsauken Site, in 2013, SLI reached
an agreement with both the U.S. Department of Justice and the U.S. Environmental Protection Agency ("EPA") related to its
liability and entered into a Consent Decree which governs the agreement. SLI has completed the remediation as required by the
Consent Decree and has paid EPA a fixed sum for its past oversight costs. Separate from the Consent Decree, in December 2012,
the NJDEP made a settlement demand of $1,800 for past and future cleanup and removal costs and natural resource damages
("NRD"). To avoid the time and expense of litigating the matter, SLI offered to pay approximately $300 to fully resolve the claim
presented by the State of New Jersey ("State"). SLI's settlement offer was rejected. On December 6, 2018, the State filed a complaint
against SLI related to its operations at the Pennsauken Site. The State is seeking treble damages and attorneys' fees, NRD for loss
of use of groundwater, as well as a request for relief that SLI pay all cleanup and removal costs that the State has incurred and will
incur at the Pennsauken Site. While the State did not specifically identify its alleged damages in the complaint, the State has
identified $3,661 in past costs through December 11, 2018. SLI intends to assert all legal and procedural defenses available to it.
Although the final scope and cost of this claim cannot be verified at this time, we estimate that it is reasonably possible that we
may incur an aggregate loss in a range of $300 to $3,661. Given the State's other generally-alleged damages, however, there can
be no assurance that there will not be potential additional costs associated with the Pennsauken Site, which cannot be reasonably
estimated at this time. Accordingly, there can be no assurance that the resolution of this matter will not be material to the financial
position, results of operations or cash flows of SLI, HNH or the Company.

SLI reported soil contamination and a groundwater contamination in 2003 from the SurfTech site located in Camden,
New Jersey. Substantial investigation and remediation work has been completed under the direction of the Licensed Site
Remediation Professional ("LSRP") for the site. Additional remediation initiated during the fourth quarter of 2018 is expected to
continue into the first quarter of 2019 and post-remediation groundwater monitoring conducted thereafter. A full-scale groundwater
bioremediation is expected to be implemented during the first quarter of 2019 following the remediation mentioned above. A
reserve of $2,500 has been established for anticipated costs at this site, but there can be no assurance that there will not be potential
additional costs associated with the site which cannot be reasonably estimated at this time. Accordingly, there can be no assurance

that the resolution of this matter will not be material to the financial position, results of operations or cash flows of SLI, HNH or
the Company.

SLI is currently participating in environmental assessment and cleanup at a commercial facility located in Wayne, New
Jersey. Contaminated soil and groundwater has undergone remediation with the NJDEP and LSRP oversight, but contaminants of
concern in groundwater and surface water, which extend off-site, remain above applicable NJDEP remediation standards. A reserve
of approximately $1,100 has been established for anticipated costs, but there can be no assurance that there will not be potential
additional costs associated with the site, which cannot be reasonably estimated at this time. Accordingly, there can be no assurance
that the resolution of this matter will not be material to the financial position, results of operations or cash flows of SLI, HNH or
the Company.

BNS LLC, a wholly-owned subsidiary of the BNS Holdings Liquidating Trust, has been named as a PRP at one previously
disclosed site. Based upon information currently available, BNS Holdings Liquidating Trust does not expect that its environmental
costs or that the resolution of this environmental matter will have a material adverse effect on the financial position, results of
operations or cash flows of the Company, and although there can be no such assurances to this effect, the Company will provide
further updates as to this site only if that assessment changes.

Litigation Matters

On December 8, 2017, a putative stockholder class action, captioned Sciabacucchi v. DeMarco, et al., was filed in the
Court of Chancery of the State of Delaware by a purported former stockholder of HNH challenging the Company's acquisition,
through a subsidiary, of all of the outstanding shares of common stock of HNH not already owned by the Company or any of its
affiliates. On June 15, 2018, this action was consolidated with a second putative stockholder class action filed April 30, 2018, and
captioned John Levin v. DeMarco, et al. The consolidated action names as defendants the former members of the HNH board of
directors, the Company and SPH GP, and alleges, among other things, that the defendants breached their fiduciary duties to the
former public stockholders of HNH in connection with the aforementioned acquisition. The complaint seeks, among other relief,
unspecified monetary damages, attorneys' fees and costs. On July 5, 2018, the Court granted plaintiff's motion for class certification.
The Company is vigorously defending itself against these claims; however, the outcome of this matter is uncertain.

A subsidiary of BNS Holdings Liquidating Trust ("BNS Sub") has been named as a defendant in multiple alleged asbestos-
related toxic-tort claims filed over a period beginning in 1994 through December 31, 2018. In many cases these claims involved
more than 100 defendants. Of the claims settled, the average settlement was less than $3. There remained approximately 30 pending
asbestos claims as of December 31, 2018. BNS Sub believes it has significant defenses to any liability for toxic-tort claims on the
merits. None of these toxic-tort claims has gone to trial and, therefore, there can be no assurance that these defenses will prevail.
BNS Sub has insurance policies covering asbestos-related claims for years beginning 1974 through 1988. BNS Sub annually
receives retroactive billings or credits from its insurance carriers for any increase or decrease in claims accruals as claims are filed,
settled or dismissed, or as estimates of the ultimate settlement costs for the then-existing claims are revised. As of both December 31,
2018 and 2017, BNS Sub has accrued $1,349 relating to the open and active claims against BNS Sub. This accrual includes the
amount of unpaid retroactive billings submitted to the Company by the insurance carriers and also the Company's best estimate
of the likely costs for BNS Sub to settle these claims outside the amounts funded by insurance. There can be no assurance that the
number of future claims and the related costs of defense, settlements or judgments will be consistent with the experience to-date
of existing claims and that BNS Sub will not need to significantly increase its estimated liability for the costs to settle these claims
to an amount that could have a material effect on the consolidated financial statements.

In the ordinary course of our business, we are subject to other periodic lawsuits, investigations, claims and proceedings,
including, but not limited to, contractual disputes, employment, environmental, health and safety matters, as well as claims
associated with our historical acquisitions and divestitures. There is insurance coverage available for many of the foregoing actions.
Although we cannot predict with certainty the ultimate resolution of lawsuits, investigations, claims and proceedings asserted
against us, we do not believe any currently pending legal proceeding to which we are a party will have a material adverse effect
on our business, prospects, financial condition, cash flows, results of operations or liquidity.

20. RELATED PARTY TRANSACTIONS

Management Agreement with SP General Services LLC

SPLP is managed by the Manager, pursuant to the terms of the Management Agreement, which receives a fee at an annual
rate of 1.5% of total Partners' capital ("Management Fee"), payable on the first day of each quarter and subject to quarterly
adjustment. In addition, SPLP may issue to the Manager partnership profits interests in the form of incentive units, which will be

classified as Class C common units of SPLP, upon the attainment of certain specified performance goals by SPLP, which are
determined as of the last day of each fiscal year (see Note 15 - "Capital and Accumulated Other Comprehensive Loss" for additional
information on the incentive units).

The Management Agreement is automatically renewed each December 31 for successive one-year terms unless otherwise
determined at least 60 days prior to each renewal date by a majority of the Company's independent directors. The Management
Fee was $8,119 and $8,987 for the years ended December 31, 2018 and 2017, respectively. The Management Fee is included in
Selling, general and administrative expenses in the Company's consolidated statements of operations. Unpaid amounts for
management fees included in Payables to related parties on the Company's consolidated balance sheets were $1 and $487 at
December 31, 2018 and 2017, respectively.

SPLP will bear (or reimburse the Manager with respect to) all its reasonable costs and expenses of the managed entities,
the Manager, SPH GP or their affiliates, including but not limited to: legal, tax, accounting, auditing, consulting, administrative,
compliance, investor relations costs related to being a public entity rendered for SPLP or SPH GP, as well as expenses incurred
by the Manager and SPH GP which are reasonably necessary for the performance by the Manager of its duties and functions under
the Management Agreement and certain other expenses incurred by managers, officers, employees and agents of the Manager or
its affiliates on behalf of SPLP. Reimbursable expenses incurred by the Manager in connection with its provision of services under
the Management Agreement were approximately $4,846 and $4,708 during the years ended December 31, 2018 and 2017,
respectively. Unpaid amounts for reimbursable expenses were approximately $254 and $881 at December 31, 2018 and 2017,
respectively, and are included in Payables to related parties on the Company's consolidated balance sheets.

Corporate Services

The Company's subsidiary, Steel Services Ltd ("Steel Services"), through management services agreements with its
subsidiaries and portfolio companies, provides services, which include assignment of C-Level management personnel, legal, tax,
accounting, treasury, consulting, auditing, administrative, compliance, environmental health and safety, human resources,
marketing, investor relations, operating group management and other similar services. In addition to its servicing agreements with
SPLP and its consolidated subsidiaries, which are eliminated in consolidation, Steel Services has management services agreements
with other companies considered to be related parties, including J. Howard Inc., Steel Partners, Ltd. and affiliates, STCN and
Aerojet Rocketdyne Holdings, Inc. In total, Steel Services currently charges approximately $2,350 annually to these companies.
All amounts billed under these service agreements are classified as a reduction of Selling, general and administrative expenses.

Mutual Securities, Inc.

Pursuant to the Management Agreement, the Manager is responsible for selecting executing brokers. Securities
transactions for SPLP are allocated to brokers on the basis of reliability and best price and execution. The Manager has selected
Mutual Securities, Inc. as an introducing broker and may direct a substantial portion of the managed entities' trades to such firm,
among others. An officer of the Manager and SPH GP is affiliated with Mutual Securities, Inc. The commissions paid by SPLP to
Mutual Securities, Inc. were not significant in any period.

Other

At December 31, 2018 and 2017, several related parties and consolidated subsidiaries had deposits totaling $1,667 and
$2,438, respectively, at WebBank. Approximately $616 and $357 of these deposits, including interest which was not significant,
have been eliminated in consolidation as of December 31, 2018 and 2017, respectively.

21. SEGMENT INFORMATION

SPLP operates through the following segments: Diversified Industrial, Energy, Financial Services, and Corporate and
Other, which are managed separately and offer different products and services. The Diversified Industrial segment is comprised
of manufacturers of engineered niche industrial products, including joining materials, tubing, building materials, performance
materials, electrical products, blades and route repair services, and packaging businesses. The Energy segment provides drilling
and production services to the oil & gas industry and owns a youth sports business. The Financial Services segment consists
primarily of the operations of WebBank, a Utah chartered industrial bank, which engages in a full range of banking activities. The
Corporate and Other segment consists of several consolidated subsidiaries, including Steel Services, equity method and other
investments, and cash and cash equivalents. Its income or loss includes certain unallocated general corporate expenses. Steel
Services has management services agreements with our consolidated subsidiaries and other related companies as further discussed
in Note 20 - "Related Party Transactions."

Steel Services charged the Diversified Industrial, Energy and Financial Services segments approximately $13,269, $8,150
and $4,700 for the year ended December 31, 2018. For the year ended December 31, 2017, Steel Services charged the Diversified
Industrial, Energy and Financial Services segments approximately $12,000, $8,150 and $4,700 for these services. These service
fees are reflected as expenses in the segment income (loss) below, but are eliminated in consolidation.

Segment information is presented below:

Revenue:

Diversified industrial

Energy

Financial services

Total

Income (loss) before income taxes:

Diversified industrial

Energy

Financial services

Corporate and other

(Loss) income before income taxes

Income tax provision

Net (loss) income
(Loss) income of associated companies, net of taxes:

Energy

Corporate and other

Total

Diversified industrial

Energy

Financial services

Corporate and other

Total

Diversified industrial

Energy

Financial services

Corporate and other

Total

Year Ended December 31,

2018

2017

1,286,665

175,950

121,999

1,584,614

42,661

(6,342)

54,544

(109,794)

(18,931)

12,559

(31,490) $

(1,685) $

(7,824)

(9,509) $

1,156,187

135,461

80,379

1,372,027

50,104

(21,514)

41,328

(12,607)

57,311

51,299

6,012

593

16,295

16,888

Year ended December 31, 2018

Interest
Expense (a)

Capital
Expenditures

Depreciation
and
Amortization

13,395

39,589

388

10,288

25,451

7,399

59,582

20,214

397

130

49,522

47,085

80,323

Year ended December 31, 2017

Interest
Expense (a)

Capital
Expenditures

Depreciation
and
Amortization

13,471

40,374

1,421

4,685

7,912

13,468

834

50,741

20,735

294

166

27,489

54,737

71,936

(a) Interest expense includes Finance interest expense of $10,288 and $4,685 for the years ended December 31, 2018 and 2017, respectively.

Identifiable Assets Employed:

Diversified industrial

Energy

Financial services

Corporate and other

Segment total

Discontinued operations

Total

December 31,

2018

2017

1,018,700

1,070,874

352,179

924,763

60,417

2,356,059

—

2,356,059

416,460

612,378

61,779

2,161,491

2,549

2,164,040

The following table presents geographic revenue and long-lived asset information as of and for the year ended
December 31. Foreign revenue is based on the country in which the legal subsidiary generating the revenue is domiciled. Long-
91

lived assets in 2018 and 2017 consist of property, plant and equipment, plus approximately $5,994 and $6,300, respectively, of
land and buildings from previously operating businesses and other non-operating assets that are carried at the lower of cost or fair
value less cost to sell and are included in Other non-current assets on the Company's consolidated balance sheets as of December 31,
2018 and 2017, respectively. Neither revenue nor long-lived assets from any single foreign country were material to the consolidated
financial statements of the Company.

Geographic information:

United States

Foreign

Total

22. REGULATORY MATTERS

2018

2017

Revenue

Long-lived
Assets

Revenue

Long-lived
Assets

$ 1,368,778

215,836

$ 1,584,614

260,512

$ 1,149,792

$ 239,834

42,949

222,235

38,457

303,461

$ 1,372,027

$ 278,291

WebBank is subject to various regulatory capital requirements administered by federal banking agencies. Failure to meet
minimum capital requirements can initiate certain actions by regulators that, if undertaken, could have a direct material effect on
WebBank's financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action,
WebBank must meet specific capital guidelines that involve quantitative measures of its assets, liabilities and certain off-balance
sheet items as calculated under regulatory accounting practices. WebBank's capital amounts and classification are also subject to
qualitative judgments by the regulators about components, risk weightings and other factors.

In July 2013, the Federal Deposit Insurance Corporation approved the final rules implementing the Basel Committee on
Banking Supervision's capital guidelines for U.S. banks ("Basel III"). Under the final rules, which began for WebBank on January
1, 2015 and have been fully implemented as of January 1, 2019, minimum requirements increased for both the quantity and quality
of capital held by WebBank. The rules include a new common equity Tier 1 capital to risk-weighted assets ratio ("CET1 Ratio")
of 4.5% and a capital conservation buffer of 2.5% of risk-weighted assets, which as fully phased-in, effectively results in a minimum
CET1 Ratio of 7.0%. Basel III raised the minimum ratio of Tier 1 capital to risk-weighted assets from 4.0% to 6.0% (which, with
the capital conservation buffer, effectively results in a minimum Tier 1 capital ratio of 8.5% as fully phased-in), effectively results
in a minimum total capital to risk-weighted assets ratio of 10.5% (with the capital conservation buffer fully phased-in), and requires
a minimum leverage ratio of 4.0%. Basel III also made changes to risk weights for certain assets and off-balance-sheet exposures.
WebBank expects that its capital ratios under Basel III will continue to exceed the well capitalized minimum capital requirements,
and such amounts are disclosed in the table below:

Actual

For Capital Adequacy
Purposes

Minimum Capital
Adequacy With Capital
Buffer

To Be Well Capitalized
Under Prompt
Corrective Provisions

Amount of Capital Required

As of December 31, 2018

Amount

Ratio

Amount

Ratio

Amount

Ratio

Amount

Ratio

Total Capital

(to risk-weighted assets)

$ 151,799

22.60% $

53,807

8.00% $

66,418

9.88% $

67,258

10.00%

Tier 1 Capital

(to risk-weighted assets)

$ 143,275

21.30% $

40,355

6.00% $

52,966

7.88% $

53,807

8.00%

Common Equity Tier 1 Capital

(to risk-weighted assets)

$ 143,275

21.30% $

30,266

4.50% $

42,877

6.38% $

43,718

6.50%

Tier 1 Capital

(to average assets)

As of December 31, 2017

Total Capital

$ 143,275

18.30% $

31,250

4.00%

n/a

39,063

5.00%

(to risk-weighted assets)

$ 111,102

28.90% $

30,710

8.00% $

35,509

9.25% $

38,388

10.00%

Tier 1 Capital

(to risk-weighted assets)

$ 106,296

27.70% $

23,033

6.00% $

27,831

7.25% $

30,710

8.00%

Common Equity Tier 1 Capital

(to risk-weighted assets)

$ 106,296

27.70% $

17,275

4.50% $

22,073

5.75% $

24,952

6.50%

Tier 1 Capital

(to average assets)

$ 106,296

19.00% $

22,398

4.00%

n/a

27,998

5.00%

23. SUPPLEMENTAL CASH FLOW INFORMATION

The amount of Cash, cash equivalents and restricted cash as of December 31, 2018 and 2017 in the consolidated statements

of cash flows is reconciled to the Company's consolidated balance sheets as follows:

Cash and cash equivalents

Restricted cash

Total cash, cash equivalents and restricted cash

Year Ended December 31,

2018

2017

334,884

12,434

347,318

418,755

15,629

434,384

A summary of supplemental cash flow information for the years ending December 31, 2018 and 2017 is presented in the

following table:

Cash paid during the period for:

Interest

Taxes

Non-cash investing and financing activities:

Acquisition of iGo shares in exchange for Kasco equity

Exchange of debt securities for equity securities

Contingent purchase price (future earn-out) associated with the Dunmore acquisition

Issuance of SPLP common units to purchase subsidiary shares from noncontrolling interests

Issuance of SPLP Preferred Units to purchase subsidiary shares from noncontrolling interests

24. OTHER (INCOME) EXPENSE, NET

Other (income) expense, net consists of the following:

Investment income

Realized (gains) losses on financial instrument obligations

Realized and unrealized (gains) losses on derivatives

Other, net

Total

25. QUARTERLY FINANCIAL DATA (unaudited)

Year Ended December 31,

2018

2017

40,773

9,463

6,156

—

3,800

3,159

3,812

22,029

19,774

—

3,317

—

198,817

Year Ended December 31,

2018

2017

(5,615) $

(121)

(840)

(1,434)

(8,010) $

(1,191)
2,918

145
(843)
1,029

Quarter

Revenue

Net (Loss) Income

Net (Loss) Income Attributable to
Common Unitholders

Net (Loss) Income
Attributable to
Common Unitholders

Per Common
Unit Basic

Per Common
Unit Diluted

2018

First

Second

Third
Fourth (a), (b)

2017

First

Second

Third
Fourth (c)

434,437

405,319

378,613

1,584,614

323,319

358,391

355,040

335,277

366,245

(8,851) $

(9,078) $

(0.35) $

13,555

(6,191)

(30,003)

(31,490) $

13,042

(6,095)

(30,473)

(32,604)

0.50

(0.23)

(1.19)

(3,098) $

(4,082) $

(0.16) $

15,718

10,905

(17,513)

11,253

7,013

(14,200)

(16)

0.43

0.27

(0.55)

(0.35)
0.42
(0.23)
(1.19)

(0.16)
0.41

0.27
(0.55)

(a) Effective January 1, 2018 upon adoption of ASU 2016-01, unrealized gains or losses on equity securities are no longer recorded in AOCI
on the consolidated balance sheet, but are instead recognized in Realized and unrealized losses (gains) on securities, net in the consolidated

1,372,027

6,012

statement of operations. Realized and unrealized losses (gains) on securities, net totaled $62,586 for the full year of 2018 and $14,557 for
the fourth quarter of 2018, as compared with $(790) for the full year of 2017 and $45 for the fourth quarter of 2017.

(b) The Company recorded asset impairment charges of approximately $8,108 in the fourth quarter of 2018, primarily related to intangible

assets in the Diversified Industrial segment (See Note 5 - "Divestitures and Asset Impairment Charges").

(c) The Company recorded asset impairment charges of approximately $2,028 in the fourth quarter of 2017, primarily related to an other-than-
temporary impairment on a certain available-for-sale security (see Note 5 - "Divestitures and Asset Impairment Charges"). In addition, the
Act was enacted in the fourth quarter of 2017, and in connection therewith, the Company recorded income tax expense of $56,552 from
the remeasurement of deferred tax balances. During 2017, the Company recorded an income tax benefit of $44,681 associated with the
reversal of its deferred tax valuation allowances at certain subsidiaries, which primarily impacted the fourth quarter (see Note 16 - "Income
Taxes").

26. SUBSEQUENT EVENT

On February 28, 2019, the Company entered into a 7.50% convertible senior note due 2024 ("New Note") with STCN,
whereby the Company will loan $14,940 to STCN. STCN will use the proceeds plus cash on hand to redeem at maturity its 5.25%
convertible senior notes ("Steel Connect Notes"), which will mature on March 1, 2019. The Company holds $14,940 in aggregate
principal amount of such Steel Connect Notes at December 31, 2018, which are further discussed in Note 10 - "Investments." The
New Note is convertible into shares of STCN's common stock at an initial conversion rate of 421.2655 shares of common stock
per $1,000 principal amount of the New Note (which is equivalent to an initial conversion price of approximately $2.37 per share),
subject to adjustment upon the occurrence of certain events.

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

None.

Item 9A. Controls and Procedures

Disclosure Controls and Procedures

As required by Rule 13a-15(b) under the Exchange Act, we conducted an evaluation under the supervision and with the
participation of our management, including the Principal Executive Officer and the Chief Financial Officer, of the effectiveness of
our disclosure controls and procedures as of the end of the period covered by this report. Based on that evaluation, the Principal
Executive Officer and the Chief Financial Officer concluded that as of December 31, 2018 our disclosure controls and procedures
are effective in ensuring that all information required to be disclosed in reports that we file or submit under the Exchange Act is
recorded, processed, summarized and reported within the time periods specified in the SEC rules and forms and that such information
is accumulated and communicated to our management, including our Principal Executive Officer and Chief Financial Officer, in a
manner that allows timely decisions regarding required disclosure.

Management's Report on Internal Control Over Financial Reporting

Management of the Company is responsible for establishing and maintaining adequate internal control over financial
reporting, as such term is defined in Rule 13a-15(f) under the Exchange Act. Our internal control over financial reporting is a process
designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the Company's
consolidated financial statements for external reporting purposes in accordance with U.S. GAAP.

The Company completed the acquisition of Dunmore on February 16, 2018. The Company's management excluded the
operations of Dunmore from its evaluation of, and conclusion on, the effectiveness of management's internal control over financial
reporting as of December 31, 2018. This business represents approximately 3.2% of the Company's total assets as of December 31,
2018, and approximately 3.8% of the Company's total revenue for the year then ended. The Company's management will fully
integrate the operations of Dunmore into its assessment of the effectiveness of its internal control over financial reporting in 2019.

Under the supervision and with the participation of the Company's management, including the Company's Principal
Executive Officer and the Chief Financial Officer, the Company conducted an evaluation of the effectiveness of the internal control
over financial reporting of the Company as referred to above as of December 31, 2018 as required by Rule 13a-15(c) under the
Exchange Act. In making this assessment, the Company used the criteria set forth in the framework in Internal Control - Integrated
Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on its evaluation under the
framework in Internal Control - Integrated Framework (2013), management concluded that the Company's internal control over
financial reporting was effective as of December 31, 2018.

Deloitte & Touche LLP, the independent registered public accounting firm who audited the Company's 2018 consolidated
financial statements included in this Annual Report on Form 10-K, has issued a report on the effectiveness of the Company's internal
control over financial reporting as of December 31, 2018, which is included herein.

Changes in Internal Control over Financial Reporting

No change in internal control over financial reporting occurred during the quarter ended December 31, 2018 that has

materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.

Inherent Limitations Over Controls

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also,
projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because
of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Item 9B. Other Information

None.

Item 10. Directors, Executive Officers and Corporate Governance

PART III

The Company's definitive proxy statement which will be filed with the SEC pursuant to Registration 14A within 120 days