Schedule I: Condensed Financial Information of Registrant

Camping World Holdings, Inc.

Condensed Balance Sheet

(Parent Company Only)

(In Thousands Except Share Amounts)


	December 31,		December 31,
	2017		2016
			Restated
Assets
Current assets:
Cash and cash equivalents	$	14,503	$	2,232
Prepaid income taxes and other		2,244		—
Total current assets		16,747		2,232

Deferred tax asset		153,445		20,998
Investment in subsidiaries		24,315		(33,411)
Total assets	$	194,507	$	(10,181)

Liabilities and stockholders' equity
Current liabilities:
Accrued liabilities	$	313	$	110
Income tax payable		—		268
Current portion of liabilities under Tax Receivable Agreement		8,093		991
Total current liabilities		8,406		1,369

Liabilities under Tax Receivable Agreement, net of current portion		129,596		18,190
Total liabilities		138,002		19,559

Commitments and contingencies		—		—

Stockholders' equity:
Preferred stock, par value $0.01 per share – 20,000,000 shares authorized; none issued and outstanding as of December 31, 2017 and December 31, 2016		—		—
Class A common stock, par value $0.01 per share – 250,000,000 shares authorized; 36,758,233 issued and 36,749,072 outstanding as of December 31, 2017 and 18,935,916 issued and outstanding as of December 31, 2016		367		189
Class B common stock, par value $0.0001 per share – 75,000,000 shares authorized; 69,066,445 issued; and 50,836,629 outstanding as of December 31, 2017 and 62,002,729 outstanding as of December 31, 2016		5		6
Class C common stock, par value $0.0001 per share – one share authorized, issued and outstanding as of December 31, 2017 and December 31, 2016		—		—
Additional paid-in capital		49,941		(30,006)
Retained earnings		6,192		71
Total stockholders' equity (deficit)		56,505		(29,740)
Total liabilities and stockholders' equity (deficit)	$	194,507	$	(10,181)

See accompanying Notes to Condensed Financial Statements

Schedule I: Condensed Financial Information of Registrant (continued)

Camping World Holdings, Inc.

Condensed Statement of Income

(Parent Company Only)

(In Thousands)


	Year Ended		Year Ended
	December 31,		December 31,
	2017		2016
			Restated
Revenue:
Intercompany revenue	$	4,768	$	1,564
Total revenue		4,768		1,564

Operating expenses:
Selling, general, and administrative		4,770		1,564
Total operating expenses		4,770		1,564

Loss from operations		(2)		—

Tax Receivable Agreement liability adjustment		99,687		—
Equity in net income of subsidiaries		84,092		2,877

Income before income taxes		183,777		2,877
Income tax expense		(155,415)		(1,291)
Net income	$	28,362	$	1,586

See accompanying Notes to Condensed Financial Statements

Schedule I: Condensed Financial Information of Registrant (continued)

Camping World Holdings, Inc.

Condensed Statement of Cash Flows

(Parent Company Only)

(In Thousands)


	Year Ended		Year Ended
	December 31,		December 31,
	2017		2016
			Restated
Operating activities
Net income	$	28,362	$	1,586

Adjustments to reconcile net income to net cash used in operating activities:
Equity in net income of subsidiaries		(84,092)		(2,877)
Deferred tax expense		127,305		965
Tax receivable agreements liability adjustment		(99,687)		—
Change in assets and liabilities, net of acquisitions:
Prepaid income taxes and other assets		(2,240)		—
Accounts payable and other accrued assets		(1,798)		(471)
Payment pursuant to Tax Receivable Agreement		(203)		—
Income taxes payable		651		684
Net cash used in operating activities		(31,702)		(113)

Investing activities
Purchases of LLC Interest from CWGS, LLC		(124,150)		(243,845)
Distributions received from CWGS, LLC		66,092		3,889
Net cash used in investing activities		(58,058)		(239,956)

Financing activities
Proceeds from issuance of Class A common stock sold in an initial public offering net of underwriter discounts and commissions		—		243,809
Proceeds from issuance of Class A common stock sold in a public offering net of underwriter discounts and commissions		122,544		—
Proceeds from issuance of Class B common stock		—		7
Dividends paid to Class A common stockholders		(22,241)		(1,515)
Proceeds from exercise of stock options		1,728		—

Net cash provided by financing activities		102,031		242,301

Increase in cash		12,271		2,232
Cash at beginning of year		2,232		—
Cash at end of the year	$	14,503	$	2,232

See accompanying Notes to Condensed Financial Statements

Schedule I: Condensed Financial Information of Registrant (continued)

Camping World Holdings, Inc.

Notes to Condensed Financial Statements

(Parent Company Only)

December 31, 2017

1. Organization

Camping World Holdings, Inc. (the “Parent Company”) was formed on March 8, 2016 as a Delaware corporation and is a holding company with no direct operations. The Parent Company's assets consist primarily of cash and cash equivalents, its equity interest in CWGS Enterprises, LLC ("CWGS, LLC”), and certain deferred tax assets

On October 13, 2016, the Parent Company completed an initial public offering ("IPO") of 11,872,200 shares of its Class A common stock at a public offering price of $22.00 per share, which includes 508,564 shares issued pursuant to the underwriters' over-allotment option on November 4, 2016. The Parent Company received $243.8 million in proceeds, net of underwriting discounts and commissions, which it used to purchase newly-issued common units from CWGS, LLC at a price per interest equal to the IPO price of its Class A common stock.

The Parent Company's cash inflows are primarily from cash dividends or distributions and other transfers from CWGS, LLC. The amounts available to the Parent Company to fulfill cash commitments and pay cash dividends on its common stock are subject to certain restrictions in CWGS, LLC’s Senior Secured Credit Facilities. See Note 7 to the consolidated financial statements.

2. Basis of Presentation

These condensed parent company financial statements should be read in conjunction with the consolidated financial statements of Camping World Holdings, Inc. and the accompanying notes thereto, included in this Form 10-K. For purposes of these condensed financial statements, the Parent Company's interest in CWGS, LLC is recorded based upon its proportionate share of CWGS, LLC's net assets (similar to presenting them on the equity method).

The Parent Company is the sole managing member of CWGS, LLC, and pursuant to the Amended and Restated LLC Agreement of CWGS, LLC (the “LLC Agreement”), receives compensation in the form of reimbursements for all costs associated with being a public company. Intercompany revenue consists of these reimbursement payments and is recognized when the corresponding expense to which it relates is recognized.

Certain intercompany balances presented in these condensed Parent Company financial statements are eliminated in the consolidated financial statements. $4.8 million and $84.1 million of intercompany revenue and equity in net income of subsidiaries, respectively, was eliminated in consolidation for the year ended December 31, 2017. $1.6 million and $2.9 million of intercompany revenue and equity in net income of subsidiaries, respectively, was eliminated in consolidation for the year ended December 31, 2016. $0.1 million of an intercompany payable to CWGS, LLC was included in accrued liabilities at December 31, 2017. Related party amounts that were not eliminated in the consolidated financial statements include the Parent Company's liabilities under the tax receivable agreement, which totaled $137.7 million and $19.2 million as of December 31, 2017 and 2016, respectively.

3. Restatement to Prior Periods

Following the purchase of newly-issued common units from CWGS, LLC in connection with the IPO, the Parent Company’s deferred tax balances have reflected the differences in the book and tax basis of its investment in CWGS, LLC (i.e., outside basis) (the “Outside Basis Deferred Tax Asset”). In connection with preparing its financial statements for the year ended December 31, 2017, the Parent Company determined that a portion of the Outside Basis Deferred Tax Asset related to its acquisition of its direct interest in CWGS, LLC through newly issued LLC units is not expected to be realized unless the Parent Company were to dispose of its investment in CWGS, LLC, which the Parent Company has no current plan to do. Accordingly, the Parent Company has determined that it should have established a valuation allowance of $102.7 million against this portion of its deferred tax asset that was recorded through equity as of December 31, 2016. Following the establishment of the valuation allowance as of December 31, 2016, the Parent Company recognizes subsequent changes to the valuation allowance through the provision for income taxes or equity, in accordance with generally accepted accounting principles, and at December 31, 2017 the valuation allowance was $89.5 million, which includes the decrease of $47.0 million during the year ended December 31, 2017 for the remeasurement of this deferred tax asset under the U.S. Tax Cuts and Jobs Act of 2017 (the “2017 Tax Act”).

Because the Parent Company’s consolidated financial statements as of and for the year ended December 31, 2016 included the Outside Basis Deferred Tax Asset, the Parent Company has restated its condensed financial statements as of and for the year ended December 31, 2016 to reflect a valuation allowance against the portion of the deferred tax asset related to the outside basis difference of $102.7 million (the “Restatement”). There was no impact on net income or cash flows resulting from the Restatement.

The Parent Company also corrected for errors that were immaterial to previously-reported condensed financial statements. These errors were also identified in connection with the preparation of the financial statements for the year ended December 31, 2017, and related to i) the lack of deferral of a portion of Good Sam roadside assistance policies sold through the finance and insurance process with the sale of new and used vehicles and ii) the application of a portion of certain vendor rebates against the related inventory balances. To quantify these errors, management performed an analysis of deferred roadside assistance policies and vendor rebates applicable to ending inventory for each period presented. The Parent Company evaluated the materiality of these errors both qualitatively and quantitatively in accordance with Staff Accounting Bulletin (“SAB”) No. 99, Materiality, and SAB No. 108 and, determined the effect of these corrections was not material to the previously issued financial statements as of and for the year ended December 31, 2016. As a result of also correcting these errors, equity in net income of subsidiaries and net income have been revised (the “Immaterial Adjustments”).

The following table presents the effect on the Parent Company’s condensed balance sheet for the period indicated.


	At December 31, 2016
($ in thousands)	As Reported		Adjustment		As Corrected
Deferred tax asset	$	122,444	$	(101,446)	$	20,998
Investment in subsidiaries		(30,139)		(3,272)		(33,411)
Total assets		94,537		(104,718)		(10,181)
Additional paid-in capital		74,239		(104,245)		(30,006)
Retained earnings		544		(473)		71
Total stockholders' equity		74,978		(104,718)		(29,740)
Total liabilities and stockholders' equity		94,537		(104,718)		(10,181)

The following table presents the effect on the Parent Company’s condensed statement of income for the period indicated.


	Year Ended December 31, 2016
($ in thousands except per share amounts)	As Reported		Adjustment		As Corrected
Equity in net income of subsidiaries	$	3,350	$	(473)	$	2,877
Net income		2,059		(473)		1,586

4. Commitments and Contingencies

On October 6, 2016, the Parent Company entered into a tax receivable agreement with certain holders of common units in CWGS, LLC (the "Continuing Equity Owners") that provides for the payment by the Parent Company to the Continuing Equity Owners of 85% of the amount of any tax benefits that the Parent Company actually realizes, or in some cases are deemed to realize, as a result of certain transactions. See Note 10 to the consolidated financial statements for more information regarding the Parent Company's tax receivable agreement. As described in Note 10 to the consolidated financial statements, amounts payable under the tax receivable agreement are contingent upon, among other things, (i) generation of future taxable income of Camping World Holdings, Inc. over the term of the tax receivable agreement and (ii) future changes in tax laws. As of December 31, 2017 and 2016, liabilities under the tax receivable agreement totaled $137.7 million and $19.2 million, respectively.

5. Statements of Cash Flows

Supplemental disclosures of cash flow information for the years ended December 31, are as follows (in thousands):


	Year Ended		Year Ended
	December 31,		December 31,
	2017		2016
Cash paid during the period for:
Interest	$	—	$	—
Income taxes		31,543		58
Non-cash investing activities:
Portion of subsidiary's acquisition purchase price paid through issuance of Class A common stock		5,720		—
Non-cash financing activities:
Par value of Class A common stock issued in exchange for common units in CWGS, LLC		130		—
Par value of Class A common stock issued for vested restricted stock units		—		—
Par value of Class A common stock issued for acquisition		1		—