On April 14, 2015, Matador issued the Original Notes and on December 9, 2016, Matador issued the Additional Notes (see Note 6), which are jointly and severally guaranteed by certain subsidiaries of Matador (the “Guarantor Subsidiaries”) on a full and unconditional basis (except for customary release provisions). Matador filed a registration statement on Form S-3 with the SEC on August 11, 2017, which became effective upon filing, registering, among other securities, senior and subordinated debt securities and guarantees of debt securities by the Guarantor Subsidiaries. At December 31, 2017, the Guarantor Subsidiaries were 100% owned by Matador. Matador is a parent holding company and has no independent assets or operations, and there are no significant restrictions on the ability of Matador to obtain funds from the Guarantor Subsidiaries by dividend or loan. San Mateo and its subsidiaries are not guarantors of the Notes.

The following presents condensed consolidating financial information of the issuer (Matador), the Non-Guarantor Subsidiaries, the Guarantor Subsidiaries and all entities on a consolidated basis (in thousands). Elimination entries are necessary to combine the entities. This financial information is presented in accordance with the requirements of Rule 3-10 of Regulation S-X. The following financial information may not necessarily be indicative of results of operations, cash flows or financial position had the Guarantor Subsidiaries operated as independent entities.



Condensed Consolidating Balance Sheet December 31, 2017
	Matador		Non-Guarantor Subsidiaries		Guarantor Subsidiaries		Eliminating Entries			Consolidated
ASSETS
Intercompany receivable	$	585,109	$	2,912	$	—	$	(588,021	)	$	—
Third-party current assets	2,240		9,334		245,596		—			257,170
Net property and equipment	—		223,178		1,658,278		—			1,881,456
Investment in subsidiaries	1,147,295		—		111,077		(1,258,372		)	—
Third-party long-term assets	6,425		—		3,642		(3,003		)	7,064
Total assets	$	1,741,069	$	235,424	$	2,018,593	$	(1,849,396	)	$	2,145,690
LIABILITIES AND EQUITY
Intercompany payable	$	—	$	—	$	588,021	$	(588,021	)	$	—
Third-party current liabilities	8,847		19,891		254,142		(274		)	282,606
Senior unsecured notes payable	574,073		—		—		—			574,073
Other third-party long-term liabilities	1,593		3,466		29,135		(2,729		)	31,465
Total equity attributable to Matador Resources Company	1,156,556		111,077		1,147,295		(1,258,372		)	1,156,556
Non-controlling interest in subsidiaries	—		100,990		—		—			100,990
Total liabilities and equity	$	1,741,069	$	235,424	$	2,018,593	$	(1,849,396	)	$	2,145,690



Condensed Consolidating Balance Sheet December 31, 2016
	Matador		Non-Guarantor Subsidiaries		Guarantor Subsidiaries		Eliminating Entries			Consolidated
ASSETS
Intercompany receivable	$	316,791	$	3,571	$	12,091	$	(332,453	)	$	—
Third-party current assets	101,102		4,242		173,838		—			279,182
Net property and equipment	33		113,107		1,071,385		—			1,184,525
Investment in subsidiaries	856,762		—		90,275		(947,037		)	—
Third-party long-term assets	—		—		958		—			958
Total assets	$	1,274,688	$	120,920	$	1,348,547	$	(1,279,490	)	$	1,464,665
LIABILITIES AND EQUITY
Intercompany payable	$	—	$	12,091	$	320,362	$	(332,453	)	$	—
Third-party current liabilities	9,265		16,632		143,608		—			169,505
Senior unsecured notes payable	573,924		—		—		—			573,924
Other third-party long-term liabilities	1,374		602		27,815		—			29,791
Total equity attributable to Matador Resources Company	690,125		90,275		856,762		(947,037		)	690,125
Non-controlling interest in subsidiaries	—		1,320		—		—			1,320
Total liabilities and equity	$	1,274,688	$	120,920	$	1,348,547	$	(1,279,490	)	$	1,464,665



Condensed Consolidating Statement of Operations For the Year Ended December 31, 2017
	Matador			Non-Guarantor Subsidiaries			Guarantor Subsidiaries		Eliminating Entries			Consolidated
Total revenues	$	—		$	47,883		$	531,508	$	(35,115	)	$	544,276
Total expenses	5,610			21,260			391,680		(35,115		)	383,435
Operating (loss) income	(5,610		)	26,623			139,828		—			160,841
Net gain on asset sales and inventory impairment	—			—			23		—			23
Interest expense	(34,565		)	—			—		—			(34,565		)
Other income	27			37			3,487		—			3,551
Earnings in subsidiaries	157,589			—			14,251		(171,840		)	—
Income before income taxes	117,441			26,660			157,589		(171,840		)	129,850
Total income tax (benefit) provision	(8,426		)	269			—		—			(8,157		)
Net income attributable to non-controlling interest in subsidiaries	—			(12,140		)	—		—			(12,140		)
Net income attributable to Matador Resources Company shareholders	$	125,867		$	14,251		$	157,589	$	(171,840	)	$	125,867



Condensed Consolidating Statement of Operations For the Year Ended December 31, 2016
	Matador			Non-Guarantor Subsidiaries			Guarantor Subsidiaries			Eliminating Entries			Consolidated
Total revenues	$	—		$	17,302		$	257,828		$	(10,708	)	$	264,422
Total expenses	5,319			7,031			439,947			(10,708		)	441,589
Operating (loss) income	(5,319		)	10,271			(182,119		)	—			(177,167		)
Net gain on asset sales and inventory impairment	—			—			107,277			—			107,277
Interest expense	(28,199		)	—			—			—			(28,199		)
Other expense	—			—			(4		)	—			(4		)
(Loss) earnings in subsidiaries	(64,349		)	—			9,810			54,539			—
(Loss) income before income taxes	(97,867		)	10,271			(65,036		)	54,539			(98,093		)
Total income tax (benefit) provision	(446		)	97			(687		)	—			(1,036		)
Net income attributable to non-controlling interest in subsidiaries	—			(364		)	—			—			(364		)
Net (loss) income attributable to Matador Resources Company shareholders	$	(97,421	)	$	9,810		$	(64,349	)	$	54,539		$	(97,421	)



Condensed Consolidating Statement of Operations For the Year Ended December 31, 2015
	Matador			Non-Guarantor Subsidiaries			Guarantor Subsidiaries			Eliminating Entries			Consolidated
Total revenues	$	—		$	6,310		$	316,067		$	(4,344	)	$	318,033
Total expenses	5,739			2,944			1,120,356			(4,344		)	1,124,695
Operating (loss) income	(5,739		)	3,366			(804,289		)	—			(806,662		)
Net gain on asset sales and inventory impairment	—			—			908			—			908
Interest expense	(20,511		)	—			(1,243		)	—			(21,754		)
Other income	—			—			616			—			616
(Loss) earnings in subsidiaries	(658,698		)	—			2,458			656,240			—
(Loss) income before income taxes	(684,948		)	3,366			(801,550		)	656,240			(826,892		)
Total income tax (benefit) provision	(5,163		)	647			(142,852		)	—			(147,368		)
Net income attributable to non-controlling interest in subsidiaries	—			(261		)	—			—			(261		)
Net (loss) income attributable to Matador Resources Company shareholders	$	(679,785	)	$	2,458		$	(658,698	)	$	656,240		$	(679,785	)



Condensed Consolidating Statement of Cash Flows For the Year Ended December 31, 2017
	Matador			Non-Guarantor Subsidiaries			Guarantor Subsidiaries			Eliminating Entries			Consolidated
Net cash (used in) provided by operating activities	$	(307,982	)	$	21,308		$	585,799		$	—		$	299,125
Net cash provided by (used in) investing activities	33			(119,922		)	(597,519		)	(106,595		)	(824,003		)
Net cash provided by (used in) financing activities	208,440			96,307			(2,843		)	106,595			408,499
Decrease in cash	(99,509		)	(2,307		)	(14,563		)	—			(116,379		)
Cash at beginning of year	99,795			2,307			110,782			—			212,884
Cash at end of year	$	286		$	—		$	96,219		$	—		$	96,505



Condensed Consolidating Statement of Cash Flows For the Year Ended December 31, 2016
	Matador			Non-Guarantor Subsidiaries			Guarantor Subsidiaries			Eliminating Entries			Consolidated
Net cash (used in) provided by operating activities	$	(45,215	)	$	6,694		$	172,607		$	—		$	134,086
Net cash used in investing activities	(324,724		)	(64,683		)	(401,034		)	384,801			(405,640		)
Net cash provided by financing activities	469,654			60,110			322,743			(384,801		)	467,706
Increase in cash	99,715			2,121			94,316			—			196,152
Cash at beginning of year	80			186			16,466			—			16,732
Cash at end of year	$	99,795		$	2,307		$	110,782		$	—		$	212,884



Condensed Consolidating Statement of Cash Flows For the Year Ended December 31, 2015
	Matador			Non-Guarantor Subsidiaries			Guarantor Subsidiaries			Eliminating Entries			Consolidated
Net cash (used in) provided by operating activities	$	(31,271	)	$	13,916		$	225,890		$	—		$	208,535
Net cash used in investing activities	(546,715		)	(31,101		)	(410,843		)	563,505			(425,154		)
Net cash provided by financing activities	577,973			17,353			193,123			(563,505		)	224,944
(Decrease) increase in cash	(13		)	168			8,170			—			8,325
Cash at beginning of year	93			18			8,296			—			8,407
Cash at end of year	$	80		$	186		$	16,466		$	—		$	16,732