Guarantor Financial Information

In March and April 2011, we issued $350 million of aggregate principal amount of 2019 Senior Notes. In October 2013, we issued $250 million of aggregate principal amount of the 2019 Senior Notes. The 2019 Senior Notes issued in October 2013 and the 2019 Senior Notes originally issued in March and April 2011 are treated as a single class of debt securities under the Indenture. In August 2016, we redeemed $100 million in aggregate principal amount of the 2019 Senior Notes in a tender offer and for the year ended December 31, 2016 recorded a $4 million gain on early extinguishment of long-term debt, consisting of a $5 million discount and a $1 million write-off of debt issuance costs (see Note 3). Presented below is condensed consolidated financial information of CWEI (the “Issuer”) and the Issuer’s material wholly owned subsidiaries. Other than CWEI Andrews Properties, GP, LLC, the general partner of CWEI Andrews Properties, L.P., an affiliated limited partnership formed in April 2013, all of the Issuer’s wholly owned and active subsidiaries (“Guarantor Subsidiaries”) have jointly and severally, irrevocably and unconditionally guaranteed the performance and payment when due of all obligations under the 2019 Senior Notes. The guarantee by a Guarantor Subsidiary of the 2019 Senior Notes may be released under certain customary circumstances as set forth in the Indenture. CWEI Andrews Properties, GP, LLC, is not a guarantor of the 2019 Senior Notes and its accounts are reflected in the “Non-Guarantor Subsidiary” column in this Note 19.

The financial information which follows sets forth our condensed consolidating financial statements as of and for the periods indicated.

Condensed Consolidating Balance Sheet December 31, 2016 (Dollars in thousands)


	Issuer		Guarantor Subsidiaries		Non-Guarantor Subsidiary			Adjustments/ Eliminations			Consolidated
Current assets	$	678,174	$	244,756	$	1,314		$	(293,058	)	$	631,186
Property and equipment, net	585,803		267,128		3,205			—			856,136
Investments in subsidiaries	289,424		—		—			(289,424		)	—
Other assets	5,197		2,120		—			—			7,317
Total assets	$	1,558,598	$	514,004	$	4,519		$	(582,482	)	$	1,494,639
Current liabilities	$	284,955	$	101,349	$	111		$	(279,649	)	$	106,766
Non-current liabilities:
Long-term debt	847,995		—		—			—			847,995
Fair value of commodity derivatives	12,895		—		—			(12,895		)	—
Fair value of common stock warrants	246,743		—		—			—			246,743
Deferred income taxes	99,879		85,113		(2,070		)	(106,332		)	76,590
Other	11,418		44,290		306			—			56,014
	1,218,930		129,403		(1,764		)	(119,227		)	1,227,342
Equity	54,713		283,252		6,172			(183,606		)	160,531
Total liabilities and equity	$	1,558,598	$	514,004	$	4,519		$	(582,482	)	$	1,494,639

Condensed Consolidating Balance Sheet December 31, 2015 (Dollars in thousands)

	Issuer		Guarantor Subsidiaries		Non-Guarantor Subsidiary			Adjustments/ Eliminations			Consolidated
Current assets	$	112,861	$	272,310	$	1,441		$	(317,807	)	$	68,805
Property and equipment, net	892,791		304,936		3,557			—			1,201,284
Investments in subsidiaries	324,484		—		—			(324,484		)	—
Other assets	6,681		10,650		—			—			17,331
Total assets	$	1,336,817	$	587,896	$	4,998		$	(642,291	)	$	1,287,420
Current liabilities	$	276,354	$	102,267	$	117		$	(312,999	)	$	65,739
Non-current liabilities:
Long-term debt	742,410		—		—			—			742,410
Deferred income taxes	90,387		130,471		(1,236		)	(110,626		)	108,996
Other	33,886		36,539		252			—			70,677
	866,683		167,010		(984		)	(110,626		)	922,083
Equity	193,780		318,619		5,865			(218,666		)	299,598
Total liabilities and equity	$	1,336,817	$	587,896	$	4,998		$	(642,291	)	$	1,287,420

Condensed Consolidating Statement of Operations and Comprehensive Income (Loss) Year Ended December 31, 2016 (Dollars in thousands)

	Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiary			Adjustments/ Eliminations		Consolidated
Total revenue	$	235,841		$	52,609		$	961		$	—	$	289,411
Costs and expenses	172,727			93,114			1,256			—		267,097
Operating income (loss)	63,114			(40,505		)	(295		)	—		22,314
Other income (expense)	(337,807		)	(7,753		)	768			—		(344,792		)
Equity in earnings of subsidiaries	(31,060		)	—			—			31,060		—
Income tax (expense) benefit	13,602			16,890			(165		)	—		30,327
Net income (loss)	$	(292,151	)	$	(31,368	)	$	308		$	31,060	$	(292,151	)

Condensed Consolidating Statement of Operations and Comprehensive Income (Loss) Year Ended December 31, 2015 (Dollars in thousands)

	Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiary			Adjustments/ Eliminations		Consolidated
Total revenue	$	169,705		$	61,224		$	1,443		$	—	$	232,372
Costs and expenses	244,187			87,008			14,612			—		345,807
Operating income (loss)	(74,482		)	(25,784		)	(13,169		)	—		(113,435		)
Other income (expense)	(41,187		)	(808		)	2,095			—		(39,900		)
Equity in earnings of subsidiaries	(24,483		)	—			—			24,483		—
Income tax (expense) benefit	41,956			9,307			3,876			—		55,139
Net income (loss)	$	(98,196	)	$	(17,285	)	$	(7,198	)	$	24,483	$	(98,196	)

Condensed Consolidating Statement of Operations and Comprehensive Income (Loss) Year Ended December 31, 2014 (Dollars in thousands)

	Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiary			Adjustments/ Eliminations			Consolidated
Total revenue	$	324,055		$	140,857		$	3,544		$	—		$	468,456
Costs and expenses	242,658			111,750			2,409			—			356,817
Operating income (loss)	81,397			29,107			1,135			—			111,639
Other income (expense)	(45,538		)	919			1,548			—			(43,071		)
Equity in earnings of subsidiaries	21,261			—			—			(21,261		)	—
Income tax (expense) benefit	(13,239		)	(10,509		)	(939		)	—			(24,687		)
Net income (loss)	$	43,881		$	19,517		$	1,744		$	(21,261	)	$	43,881

Condensed Consolidating Statement of Cash Flows Year Ended December 31, 2016 (Dollars in thousands)

	Issuer		Guarantor Subsidiaries			Non-Guarantor Subsidiary			Adjustments/ Eliminations		Consolidated
Operating activities	$	33,099	$	(22,247	)	$	(125	)	$	—	$	10,727
Investing activities	320,038		(6,801		)	(10		)	—		313,227
Financing activities	212,329		28,961			1			—		241,291
Net increase (decrease) in cash and cash equivalents	565,466		(87		)	(134		)	—		565,245
Cash at the beginning of the period	4,663		1,855			1,262			—		7,780
Cash at end of the period	$	570,129	$	1,768		$	1,128		$	—	$	573,025

Condensed Consolidating Statement of Cash Flows Year Ended December 31, 2015 (Dollars in thousands)

	Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiary			Adjustments/ Eliminations			Consolidated
Operating activities	$	61,138		$	836		$	(10,381	)	$	566		$	52,159
Investing activities	(113,543		)	(15,143		)	11,857			(566		)	(117,395		)
Financing activities	35,851			9,469			(320		)	—			45,000
Net increase (decrease) in cash and cash equivalents	(16,554		)	(4,838		)	1,156			—			(20,236		)
Cash at the beginning of the period	21,217			6,693			106			—			28,016
Cash at end of the period	$	4,663		$	1,855		$	1,262		$	—		$	7,780

Condensed Consolidating Statement of Cash Flows Year Ended December 31, 2014 (Dollars in thousands)

	Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiary			Adjustments/ Eliminations			Consolidated
Operating activities	$	178,769		$	69,543		$	5,842		$	3,967		$	258,121
Investing activities	(274,629		)	(34,749		)	(5,652		)	(3,967		)	(318,997		)
Financing activities	97,384			(34,987		)	(128		)	—			62,269
Net increase (decrease) in cash and cash equivalents	1,524			(193		)	62			—			1,393
Cash at the beginning of the period	19,693			6,886			44			—			26,623
Cash at end of the period	$	21,217		$	6,693		$	106		$	—		$	28,016