Energy Corporation February Resolute / Cimarex Merger 2019
Page 3 Resolute representatives Joe Citarrella, Independent Director (representing 10% stockholder) Wilkie Colyer, Independent Director (representing 8% stockholder) Rob Raymond, Independent Director (representing 2% stockholder)…
Page 4 Transaction overview and highlights Upside potential in Cimarex stock Resolute/Cimarex merger announced November 19, 2018 60% stock and 40% cash1 0.2366 shares of Cimarex stock and 14.00 cash per Resolute share, assuming…
Page 5 Compelling strategic rationale for Cimarex merger Combination of two top tier Delaware Basin acreage positions with complementary operations Scale and credit profile of combined company significantly de-risks standalone…
Page 6 Resolute benefits from combined company scale Pro forma Delaware Basin leasehold map Diversified asset base: Delaware Basin and Mid Continent Cimarexs extensive operational experience augments Resolute knowledge base…
Page 7 Leading results vs peers Resolute and Cimarex assets are among the most productive in the Delaware Basin Combination with Cimarex enhances exposure to superior asset quality for Resolute stockholders 180 day average…
Page 8 Financial strength improves dramatically post-merger Combined market cap of Cimarex leverage comparison approximately 8 billion1 Net debt / 2019E EBITDA 1 Investment grade balance sheet 3.0x with combined net debt/2019E…
Page 9 Merger results from thorough strategic review process Strategic review process started in May 2018 following settlement with Monarch, consistent with input from large stockholders Full Board, including stockholder…
Page 10 Thorough sales process provided market test Resolute conducted a rigorous, broad outreach process in line with recent upstream mergers and including all likely counterparties in the opinion of Board and its advisors Thirteen…
Page 11 Recent merger timelines: pre-announcement Rigorous process consistent with recent transactions Timeline Summary Initial Initial First Draft Target Board Total Discussions to Proposal to First of MA to of Director Companies…
Page 12 Transaction negotiated at time of relative strength For twelve months prior to announcement on November 19, 2018: Resolute common stock outperformed both peers and Cimarex Resolute shares experienced higher relative volatility…
Page 13 Resolute shares have traded well in a volatile market Subsequent to announcement on November 19, 2018: Resolute common stock has outperformed both peers and Cimarex Positive market reaction to merger demonstrated by relative…
Page 14 Updated transaction value Implied Total transaction value (millions except as indicated) Resolute Resolute 2018 E&P Last 3 Corp. M&A Corp. M&A Statistics 2 Trans. Avg. Deals Resolute fully diluted shares outstanding 1…
Page 15 Relative price comparison: pre-announcement Deal priced at 90% of Resolute 52-week high Cimarex shares at 69% of 52-week high 52-week stock price range on day before announcement 11/16/18 Close: Trans. Price 52-week low…
Page 16 Resolute / Cimarex historical exchange ratio Transaction exchange ratio approximates three year peak Announcement date: Exchange ratio approximates November 19, 2018 0.500 three-year highs More Favorable for Resolute…
Page 17 Analysts supportive of transaction XECs Delaware Basin results are among the most prolific in the industry in terms of initial production rates, with high initial oil yields offsetting the impact of a higher gas mix. One of the…
Page 18 Transaction clearly aligned with views of largest stockholders Excerpts from letters to the Board from stockholders representing 36% of shares outstanding1 We therefore ask that Resolutes Board immediately launch a formal…
Page 19 Transaction timeline Cimarex advised of no review by SEC and transaction was granted early termination of Hart-Scott-Rodino review period Relevant dates Record date for vote was January 18, 2019 Form S-4 was effective on…
Page 20 Certain risks relating to Resolute if merger voted down Would be required to quickly refinance 600 million in high yield debt Slowdown in operational activity since merger announcement would need to be reversed Ability to…
Page 21 Compelling strategic rationale for Cimarex merger Combination of two top tier Delaware Basin acreage positions with complementary operations Scale and credit profile of combined company significantly de-risks standalone…
Appendix
Page 23 Resolute director representatives Joseph Citarrella Joseph Citarrella is a Managing Principal at Monarch Alternative Capital LP (Monarch). In addition to his investment responsibilities at Monarch, Mr. Citarrella has served…
Page 24 Resolute management representatives Richard F. Betz Richard F. Betz has been Chief Executive Officer and a member of the Board since January 2017 and prior to that was Executive Vice President and Chief Operating Officer of…
Page 25 Cimarex standalone net acreage Delaware Basin 259,000 total net acres 31,384 net acres in Lea County 61,853 net acres in Reeves County 100,000+ net acres in Culberson/White City Wolfcamp Wolfcamp Bone Spring…
Page 26 Cimarex total net acreage Mid-Continent 326,000 total net acres 116,500 net acres in Meramec 135,625 net undeveloped acres in Woodford Meramec outline Woodford outline Cana Core 14N10W Lone Rock
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