COMSTOCK RESOURCES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS For the Years Ended December 31, 2011, 2012 and 2013 2011 2012 2013 (Inthousands) CASH FLOWS FROM OPERATING ACTIVITIES: Net income (loss) .................................................................... $ (33,472) $(100,060) $ 41,029 Adjustments to reconcile net income (loss) to net cash provided by operating activities: Income from discontinued operations ................................................... — (3,019) (147,752) Gain on sale of assets ............................................................... (35,061) (50,892) (5,844) Deferred income taxes .............................................................. (14,652) (50,472) (56,291) Dry hole costs and leasehold impairments ............................................... 9,819 61,300 32,984 Impairment of oil and gas properties ................................................... 60,817 25,368 652 Depreciation, depletion and amortization ................................................ 290,776 343,858 337,134 (Gains) losses on derivative financial instruments ......................................... — (21,256) 8,388 Cash settlements of derivative financial instruments ....................................... — 9,766 2,293 Loss on early extinguishment of debt ................................................... 1,096 — 17,854 Debt issuance cost and discount amortization ............................................ 3,733 5,277 6,074 Stock-based compensation ........................................................... 15,032 13,728 12,785 Excess income taxes from stock-based compensation ...................................... 612 1,701 2,016 Decrease (increase) in accounts receivable ............................................... (9,769) 16,166 (11,120) Decrease (increase) in other current assets ............................................... 3,311 (972) 1,905 Increase (decrease) in accounts payable and accrued expenses ............................... (16,809) (30,772) 26,887 Net cash provided by continuing operations .......................................... 275,433 219,721 268,994 Net cash provided by (used for) discontinued operations ................................ — 42,508 (7,715) Net cash provided by operating activities ............................................ 275,433 262,229 261,279 CASH FLOWS FROM INVESTING ACTIVITIES: Capital expenditures .................................................................. (651,226) (385,034) (422,244) Proceeds from sales of oil and gas properties ............................................... — 141,936 174 Proceeds from sales of marketable securities ............................................... 53,417 37,705 13,392 Investing activities of continuing operations ......................................... (597,809) (205,393) (408,678) Cash flow from investing activities of discontinued operations: Capital expenditures ................................................................ (344,277) (203,077) (101,037) Proceeds from sale of oil and gas properties .............................................. — 24,750 823,072 Investing activities of discontinued operations ........................................ (344,277) (178,327) 722,035 Net cash provided by (used for) investing activities .................................... (942,086) (383,720) 313,357 CASH FLOWS FROM FINANCING ACTIVITIES: Borrowings ......................................................................... 970,000 515,912 305,000 Principal payments on debt ............................................................. (287,000) (390,000) (835,000) Costs related to early extinguishment of debt ............................................... (529) — (12,471) Debt issuance costs ................................................................... (8,478) (6,709) (2,744) Tax withholding related to stock grants ................................................... — — (1,680) Repurchases of common stock .......................................................... — — (9,232) Excess income taxes from stock-based compensation ........................................ (612) (1,701) (2,016) Dividends paid ...................................................................... — — (17,997) Net cash provided by (used for) financing activities ................................... 673,381 117,502 (576,140) Net increase (decrease) in cash and cash equivalents ................................... 6,728 (3,989) (1,504) Cash and cash equivalents, beginning of the year ..................................... 1,732 8,460 4,471 Cash and cash equivalents, end of the year ........................................... $ 8,460 $ 4,471 $ 2,967 The accompanying notes are an integral part of these statements. F-7