SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.
June 7, 2005
Date of Report
CIMAREX ENERGY CO.
(Exact name of registrant as specified in its charter)
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Delaware |
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001-31446 |
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45-0466694 |
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(State or other jurisdiction |
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(Commission File Number) |
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(I.R.S. Employer |
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of incorporation) |
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Identification No.) |
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1700 Lincoln Street, Suite 1800, Denver, Colorado |
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80203-4518 |
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(Address of principal executive offices) |
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(Zip Code) |
Registrant’s telephone number, including area code 303-295-3995
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o Written communications pursuant to Rule 425 under the Securities Act
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act
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ITEM 1.01 |
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ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT |
As described more fully under Item 2.03 below, Cimarex Energy Co. (“Cimarex”) entered into a Second Supplemental Indenture with Magnum Hunter Resources, Inc. (“Magnum Hunter”), the Subsidiary Guarantors party thereto and Deutsche Bank Trust Company Americas (the “Trustee”), the trustee under the Indenture dated as of December 17, 2003 between Magnum Hunter and the Trustee, as supplemented by the First Supplemental Indenture dated as of June 6, 2005 (the “Indenture”). A copy of the Second Supplemental Indenture is attached hereto as Exhibit 4.1 and is incorporated herein by reference.
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ITEM 2.01 |
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COMPLETION OF ACQUISITION OR DISPOSITION OF ASSETS |
On June 7, 2005, Cimarex and Magnum Hunter issued a joint press release announcing the closing of the merger of Cimarex Nevada Acquisition Co. (“Merger Sub”), a wholly owned subsidiary of Cimarex, with and into Magnum Hunter. Magnum Hunter is the surviving entity of the merger continuing as a wholly owned subsidiary of Cimarex. The combined organization will be headquartered in Denver, Colorado. As a result of the merger, each outstanding share of Magnum Hunter common stock was cancelled and converted into the right to receive 0.415 shares of Cimarex common stock. Cimarex will issue approximately 39.5 million common shares to Magnum Hunter stockholders and will then have approximately 81.3 million shares outstanding. The press release is attached hereto as Exhibit 99.1 and is incorporated by reference herein.
The terms of the merger were described in the Joint Proxy Statement/Prospectus of Cimarex and Magnum Hunter included as part of the Registration Statement on Form S-4 (File No. 333-123019) filed by Cimarex with the Securities and Exchange Commission (the “SEC”) on May 2, 2005, as supplemented on May 3, 2005 (the “Joint Proxy Statement/Prospectus”). A copy of the Agreement and Plan of Merger dated as of January 25, 2005, among Cimarex, Merger Sub and Magnum Hunter, as amended on February 18, 2005 and April 20, 2005 (the “Merger Agreement”), has been filed as Annex A to the Joint Proxy Statement/Prospectus and is incorporated into this Item 2.01 by reference.
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CREATION OF A DIRECT FINANCIAL OBLIGATION OR AN OBLIGATION UNDER AN OFF-BALANCE SHEET ARRANGEMENT OF A REGISTRANT |
On June 7, 2005, Cimarex entered into a Second Supplemental Indenture with Magnum Hunter and the Trustee. Magnum Hunter has issued $125 million of Floating Rate Convertible Senior Notes due 2023 (the “Notes”) under the Indenture. Upon the happening of certain events, the Notes are convertible into cash in the amount of the principal amount of the Notes, plus shares of Magnum Hunter common stock to the extent the conversion value exceeds the principal amount.
The Second Supplemental Indenture provides that the portion of the Notes that had been convertible into Magnum Hunter common stock will become convertible into Cimarex common
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stock. The Second Supplemental Indenture also provides that Cimarex will guarantee Magnum Hunter’s obligations under the Indenture.
A copy of the Second Supplemental Indenture is attached hereto as Exhibit 4.1 and is incorporated herein by reference.
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ITEM 5.02 |
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DEPARTURE OF DIRECTORS OR PRINCIPAL OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF PRINCIPAL OFFICERS |
Effective June 7, 2005, in accordance with the Merger Agreement, Cimarex increased the size of its board of directors by one member and appointed Jerry Box, who served as a member of the Magnum Hunter board of directors, as a Class I director to fill the vacancy created by such increase. Mr. Box has not been appointed to a committee of Cimarex’s board of directors.
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ITEM 5.03 |
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AMENDMENTS TO ARTICLES OF INCORPORATION OR BYLAWS; CHANGE IN FISCAL YEAR |
On June 7, 2005, Cimarex filed an amended and restated certificate of incorporation with the Secretary of State of the State of Delaware. The amended and restated certificate of incorporation includes the amendments to the Cimarex certificate of incorporation approved at Cimarex’s annual meeting of stockholders held on June 6, 2005. At that meeting, Cimarex’s stockholders approved an increase in the number of authorized shares of Cimarex common stock from 100 million to 200 million and an increase in the maximum size of the board of directors from nine to ten directors.
A copy of the Amended and Restated Certificate of Incorporation is attached hereto as Exhibit 3.1 and is incorporated herein by reference.
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ITEM 9.01 |
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FINANCIAL STATEMENTS AND EXHIBITS |
A. Financial Statements of Businesses Acquired
The financial statements required to be filed as part of this report will be filed by an amendment to this Current Report on Form 8-K as soon as practicable, but not later than 71 days after this Current Report is required to be filed.
B Pro Forma Financial Information
The unaudited pro forma condensed combined financial statements were filed as Exhibit 99.2 to Cimarex’s Current Report on Form 8-K filed with the SEC on May 19, 2005, and are incorporated by reference herein. Such unaudited pro forma financial information has been prepared to present a picture of the results of operations of the combined company after giving effect to the merger of Merger Sub with and into Magnum Hunter, absent any operational or other changes, had Cimarex and Magnum Hunter’s businesses been combined for the periods and at the dates indicated.
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C. Exhibits
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Exhibit No. |
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Description |
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2.1 |
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Agreement and Plan of Merger, dated as of January 25, 2005, among Cimarex Energy Co., Cimarex Nevada Acquisition Sub and Magnum Hunter Resources, Inc. (attached as Annex A to the joint proxy statement/prospectus which forms a part of Cimarex’s Registration Statement on Form S-4 (File No. 333-123019) and incorporated herein by reference). |
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2.2 |
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Amendment No. 1 to Agreement and Plan of Merger, dated as of February 18, 2005, among Cimarex Energy Co., Cimarex Nevada Acquisition Sub and Magnum Hunter Resources, Inc. (attached as Annex A to the joint proxy statement/prospectus which forms a part of Cimarex’s Registration Statement on Form S-4 (File No. 333-123019) and incorporated herein by reference). |
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2.3 |
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Amendment No. 2 to Agreement and Plan of Merger, dated as of April 20, 2005, among Cimarex Energy Co., Cimarex Nevada Acquisition Sub and Magnum Hunter Resources, Inc. (attached as Annex A to the joint proxy statement/prospectus which forms a part of Cimarex’s Registration Statement on Form S-4 (File No. 333-123019) and incorporated herein by reference). |
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3.1 |
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Amended and Restated Certificate of Incorporation of Cimarex Energy Co. |
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4.1 |
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Second Supplemental Indenture dated as of June 7, 2005, among Cimarex Energy Co., Magnum Hunter Resources, Inc., the Subsidiary Guarantors party thereto and Deutsche Bank Trust Company Americas. |
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99.1 |
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Press Release dated June 7, 2005. |
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99.2 |
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Unaudited Pro Forma Condensed Combined Financial Statements (incorporated by reference to Exhibit 99.2 to Cimarex’s Current Report on Form 8-K dated May 19, 2005, file no. 001-31446). |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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CIMAREX ENERGY CO. |
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Dated: June 7, 2005 |
By: |
/s/ Paul Korus |
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Paul Korus, Vice President, |
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Chief Financial Officer and Treasurer |
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EXHIBIT INDEX
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Exhibit No. |
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Description |
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2.1 |
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Agreement and Plan of Merger, dated as of January 25, 2005, among Cimarex Energy Co., Cimarex Nevada Acquisition Sub and Magnum Hunter Resources, Inc. (attached as Annex A to the joint proxy statement/prospectus which forms a part of Cimarex’s Registration Statement on Form S-4 (File No. 333-123019) and incorporated herein by reference). |
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2.2 |
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Amendment No. 1 to Agreement and Plan of Merger, dated as of February 18, 2005, among Cimarex Energy Co., Cimarex Nevada Acquisition Sub and Magnum Hunter Resources, Inc. (attached as Annex A to the joint proxy statement/prospectus which forms a part of Cimarex’s Registration Statement on Form S-4 (File No. 333-123019) and incorporated herein by reference). |
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2.3 |
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Amendment No. 2 to Agreement and Plan of Merger, dated as of April 20, 2005, among Cimarex Energy Co., Cimarex Nevada Acquisition Sub and Magnum Hunter Resources, Inc. (attached as Annex A to the joint proxy statement/prospectus which forms a part of Cimarex’s Registration Statement on Form S-4 (File No. 333-123019) and incorporated herein by reference). |
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3.1 |
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Amended and Restated Certificate of Incorporation of Cimarex Energy Co. |
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4.1 |
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Second Supplemental Indenture dated as of June 7, 2005, among Cimarex Energy Co., Magnum Hunter Resources, Inc., the Subsidiary Guarantors party thereto and Deutsche Bank Trust Company Americas. |
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99.1 |
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Press Release dated June 7, 2005. |
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99.2 |
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Unaudited Pro Forma Condensed Combined Financial Statements (incorporated by reference to Exhibit 99.2 to Cimarex’x Current Report on Form 8-K dated May 19, 2005, file no. 001-31446). |
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Exhibit 3.1
AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF CIMAREX ENERGY CO.
1. The name of the Corporation is Cimarex Energy Co.
2. The name under which the Corporation was originally incorporated was Helmerich & Payne Exploration and Production Co. and the original Certificate of Incorporation of the Corporation was filed with the Secretary of State of the State of Delaware on February 14, 2002.
3. An Amended and Restated Certificate of Incorporation was filed with the Secretary of State of the State of Delaware on September 30, 2002.
4. This Amended and Restated Certificate of Incorporation was duly adopted in accordance with the provisions of Sections 242 and 245 of the General Corporation Law of the State of Delaware.
5. The text of the Restated Certificate of Incorporation of the Corporation as amended hereby is restated to read in its entirety, as follows:
FIRST : The name of the Corporation is Cimarex Energy Co. (hereinafter the “Corporation”).
SECOND : The address of the registered agent is 2711 Centerville Road, Suite 400, in the City of Wilmington, County of New Castle, State of Delaware. The name of its registered agent at that address is the Corporation Service Company.
THIRD : The purpose of the Corporation is to engage in any lawful act or activity for which a corporation may be organized under the General Corporation Law of the State of Delaware as set forth in Title 8 of the Delaware Code (the “GCL”).
FOURTH : The total number of shares of stock which the Corporation shall have authority to issue is Two Hundred Fifteen Million (215,000,000) shares of capital stock, consisting of (i) Two Hundred Million (200,000,000) shares of common stock, par value $.01 per share (the “Common Stock”), and (ii) Fifteen Million (15,000,000) shares of preferred stock, par value $.01 per share (the “Preferred Stock”).
1. Common Stock . The powers, preferences and rights, and the qualifications, limitations and restrictions, of the Common Stock are as follows:
a. Voting . Except as otherwise expressly required by law or provided in this Certificate of Incorporation, and subject to any voting rights provided to holders of Preferred Stock at any time outstanding, at each annual or special meeting of stockholders, each holder of record of shares of Common Stock on the relevant record date shall be entitled to cast one vote in person or by proxy for each share of the Common Stock standing in such holder’s name on the stock transfer records of the Corporation. Holders of shares of Common Stock shall not have cumulative voting rights.
b. Dividends . Subject to the rights of the holders of Preferred Stock, and subject to any other provisions of this Certificate of Incorporation, as it may be amended from time to time, holders of shares of Common Stock shall be entitled to receive such dividends and other distributions in cash, stock or property of the Corporation when, as and if declared thereon by the Board of Directors from time to time out of assets or funds of the Corporation legally available therefor.
c. Liquidation, Dissolution, etc. In the event of any liquidation, dissolution or winding up (either voluntary or involuntary) of the Corporation, the holders of shares of Common Stock shall be entitled to receive the assets and funds of the Corporation available for distribution after payments to creditors and to the holders of any Preferred Stock of the Corporation that may at the time be outstanding, in proportion to the number of shares held by them.
d. No Preemptive or Subscription Rights . No holder of shares of Common Stock shall be entitled to preemptive or subscription rights.
2. Preferred Stock . The Board of Directors is hereby expressly authorized to provide for the issuance of all or any shares of the Preferred Stock in one or more classes or
series, and to fix for each such class or series such voting powers, full or limited, or no voting powers, and such designations, preferences and relative, participating, optional or other special rights and such qualifications, limitations or restrictions thereof, as shall be stated and expressed in the resolution or resolutions adopted by the Board of Directors providing for the issuance of such class or series, including, without limitation, the authority to provide that any such class or series may be (i) subject to redemption at such time or times and at such price or prices; (ii) entitled to receive dividends (which may be cumulative or non-cumulative) at such rates, on such conditions, and at such times, and payable in preference to, or in such relation to, the dividends payable on any other class or classes or any other series; (iii) entitled to such rights upon the dissolution of, or upon any distribution of the assets of, the Corporation; or (iv) convertible into, or exchangeable for, shares of any other class or classes of stock, or of any other series of the same or any other class or classes of stock, of the Corporation at such price or prices or at such rates of exchange and with such adjustments, all as may be stated in such resolution or resolutions.
3. Power to Sell and Purchase Shares . Subject to the requirements of applicable law, the Corporation shall have the power to issue and sell all or any part of any shares of any class of stock herein or hereafter authorized to such persons, and for such consideration, as the Board of Directors shall from time to time, in its discretion, determine, whether or not greater consideration could be received upon the issue or sale of the same number of shares of another class, and as otherwise permitted by law. Subject to the requirements of applicable law, the Corporation shall have the power to purchase any shares of any class of stock herein or hereafter authorized from such persons, and for such consideration, as the Board of Directors shall from time to time, in its discretion, determine whether or not less consideration could be paid upon the purchase of the same number of shares of another class, and as otherwise permitted by law.
FIFTH : The following provisions are inserted for the management of the business and the conduct of the affairs of the Corporation, and for further definition, limitation and regulation of the powers of the Corporation and of its directors and stockholders.
1. The business and affairs of the Corporation shall be managed by or under the direction of the Board of Directors.
2. The directors shall have concurrent power with the stockholders to make, alter, amend, change, add to or repeal the By-Laws of the Corporation.
3. a. The number of directors of the Corporation shall be at least six and not more than ten, with the exact number to be from time to time fixed by resolution adopted by a majority of the entire Board of Directors. Election of directors need not be by written ballot unless the By-Laws so provide. The directors shall be divided into three classes, designated Class I, Class II and Class III. Each class shall consist, as nearly as may be possible, of one-third of the total number of directors constituting the entire Board of Directors. The initial division of the Board of Directors into classes shall be made by the decision of the affirmative vote of a majority of the entire Board of Directors. The term of the initial Class I directors shall terminate on the date of the 2003 annual meeting; the term of the initial Class II directors shall terminate on the date of the 2004 annual meeting; and the term of the initial Class III directors shall
terminate on the date of the 2005 annual meeting. At each annual meeting of stockholders beginning in 2003, successors to the class of directors whose term expires at that annual meeting shall be elected for a three-year term. If the number of directors is changed, any increase or decrease shall be apportioned among the classes so as to maintain the number of directors in each class as nearly equal as possible, and any additional director of any class elected to fill a vacancy resulting from an increase in such class shall hold office for a term that shall coincide with the remaining term of that class, but in no case will a decrease in the number of directors shorten the term of any incumbent director. Notwithstanding any other provision of this Certificate of Incorporation (and in addition to any other vote that may be required by Law), the affirmative vote of the holders of at least eighty percent (80%) of the voting power of the shares entitled to vote at an election of directors shall be required to amend, alter, change or repeal, or to adopt any provision as part of this Certificate of Incorporation inconsistent with the purpose and intent of this Article FIFTH.
b. A director shall hold office until the annual meeting for the year in which his or her term expires and until his or her successor shall be elected and shall qualify subject, however, to prior death, resignation, retirement, disqualification or removal from office.
c. Subject to the terms of any one or more classes or series of Preferred Stock, any vacancy on the Board of Directors that results from an increase in the number of directors may be filled by a majority of the Board of Directors then in office, provided that a quorum is present, and any other vacancy occurring on the Board of Directors may be filled by a majority of the Board of Directors then in office, even if less than a quorum, or by a sole remaining director. Any director of any class elected to fill a vacancy resulting from an increase in the number of directors of such class shall hold office for a term that shall coincide with the remaining term of that class. Any director elected to fill a vacancy not resulting from an increase in the number of directors shall have the same remaining term as that of his predecessor. Subject to the rights, if any, of the holders of shares of Preferred Stock then outstanding, any or all of the directors of the Corporation may be removed from office at any time, but only for cause and only by the affirmative vote of the holders of at least a majority of the voting power of the Corporation’s then outstanding capital stock entitled to vote at an election of directors. Notwithstanding the foregoing, whenever the holders of any one or more classes or series of Preferred Stock issued by the Corporation shall have the right, voting separately by class or series, to elect directors at an annual or special meeting of stockholders, the election, term of office, filling of vacancies and other features of such directorships shall be governed by the terms of this Certificate of Incorporation applicable thereto, and such directors so elected shall not be divided into classes pursuant to this Article FIFTH unless expressly provided by such terms.
d. In addition to the powers and authority hereinbefore or by statute expressly conferred upon them, the directors are hereby empowered to exercise all such powers and do all such acts and things as may be exercised or done by the Corporation, subject, nevertheless, to the provisions of the GCL, this Certificate of Incorporation, and any By-Laws adopted by the stockholders; provided , however , that no By-Laws hereafter adopted by the stockholders shall invalidate any prior act of the directors which would have been valid if such By-Laws had not been adopted.
4. No director shall be personally liable to the Corporation or any of its stockholders for monetary damages for breach of fiduciary duty as a director, except to the extent such exemption from liability or limitation thereof is not permitted under the GCL, as the same exists or may hereafter be amended. If the GCL is amended hereafter to authorize further elimination or limitation of liability of directors, then the liability of a director of the Corporation shall be eliminated or limited to the fullest extent authorized by the GCL, as so amended. Any repeal or modification of this Article FIFTH by the stockholders of the Corporation shall not adversely affect any rights or protection of a director of the Corporation existing at the time of such repeal or modification with respect to acts or omissions occurring prior to such repeal or modification.
5. In addition to the powers and authority hereinbefore or by statute expressly conferred upon them, the directors are hereby empowered to exercise all such powers and do all such acts and things as may be exercised or done by the Corporation, subject, nevertheless, to the provisions of the GCL, this Certificate of Incorporation, and any By-Laws adopted by the stockholders; provided, however, that no By-Laws hereafter adopted by the stockholders shall invalidate any prior act of the directors which would have been valid if such By-Laws had not been adopted.
SIXTH : Meetings of stockholders may be held within or without the State of Delaware, as the By-Laws may provide. The books of the Corporation may be kept (subject to any provision contained in the GCL) outside the State of Delaware at such place or places as may be designated from time to time by the Board of Directors or in the By-Laws of the Corporation.
SEVENTH : The Corporation shall indemnify its directors and officers to the fullest extent authorized or permitted by law, as now or hereafter in effect, and such right to indemnification shall continue as to a person who has ceased to be a director or officer of the Corporation and shall inure to the benefit of his or her heirs, executors and personal and legal representatives; provided , however , that, except for proceedings to enforce rights to indemnification, the Corporation shall not be obligated to indemnify any director or officer (or his or her heirs, executors or personal or legal representatives) in connection with a proceeding (or part thereof) initiated by such person unless such proceeding (or part thereof) was authorized or consented to by the Board of Directors. The right to indemnification conferred by this Article SEVENTH shall include the right to be paid by the Corporation the expenses incurred in defending or otherwise participating in any proceeding in advance of its final disposition.
The Corporation may, to the extent authorized from time to time by the Board of Directors, provide rights to indemnification and to the advancement of the expenses to employees and agents of the Corporation similar to those conferred in this Article SEVENTH to directors and officers of the Corporation.
The rights to indemnification and to the advance of expenses conferred in this Article SEVENTH shall not be exclusive of any other right which any person may have or hereafter acquire under this Certificate of Incorporation, the By-Laws of the Corporation, any statute, agreement, vote of stockholders or disinterested directors or otherwise.
Any repeal or modification of this Article SEVENTH by the stockholders of the Corporation shall not adversely affect any rights to indemnification and to the advancement of expenses of a director or officer of the Corporation existing at the time of such repeal or modification with respect to any acts or omissions occurring prior to such repeal or modification.
EIGHTH : No action by shareholders shall be valid unless taken at a duly constituted meeting pursuant to the terms of the By-Laws of the Corporation and no action may be taken by stockholders by written consent without a meeting. Notwithstanding any other provision of this Certificate of Incorporation (and in addition to any other vote that may be required by law), the affirmative vote of the holders of at least eighty percent (80%) of the voting power of the shares entitled to vote at an election of directors shall be required to amend, alter, change or repeal, or to adopt any provision as part of this Certificate of Incorporation inconsistent with the purpose and intent of this article EIGHTH.
NINTH : The Corporation reserves the right to amend, alter, change or repeal any provision contained in this Certificate of Incorporation, in the manner now or hereafter prescribed by statute, and all rights conferred upon stockholders herein are granted subject to this reservation. In furtherance and not in limitation of the powers conferred upon it by the laws of the State of Delaware, the Board of Directors shall have the power to adopt, amend, alter or repeal the Corporation’s By-Laws. The affirmative vote of at least a majority of the entire Board of Directors shall be required to adopt, amend, alter or repeal the Corporation’s By-Laws. The Corporation’s By-Laws also may be adopted, amended, altered or repealed by the affirmative vote of at least eighty percent (80%) of the voting power of the shares entitled to vote at an election of directors. Notwithstanding any other provision of this Certificate of Incorporation (and in addition to any other vote that may be required by law), the affirmative vote of the holders of at least eighty percent (80%) of the voting power of the shares entitled to vote at an election of directors shall be required to amend, alter, change or repeal, or to adopt any provision as part of this Certificate of Incorporation inconsistent with the purpose and intent of this Article NINTH.
IN WITNESS WHEREOF, Cimarex Energy Co. has caused this Certificate to be duly executed in its corporate name as of this 7 th day of June, 2005.
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CIMAREX ENERGY CO. |
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By: |
/s/ PAUL KORUS |
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Paul Korus |
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Vice President, Chief Financial |
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Officer and Treasurer |
Exhibit 4.1
EXECUTION VERSION
CIMAREX ENERGY CO.
AND
MAGNUM HUNTER RESOURCES, INC.
AND
THE SUBSIDIARY GUARANTORS PARTY HERETO
AND
DEUTSCHE BANK TRUST COMPANY AMERICAS,
as Trustee
SECOND SUPPLEMENTAL INDENTURE
Dated as of June 7, 2005
To
INDENTURE
Dated as of December 17, 2003
Floating Rate Convertible Senior Notes Due 2023
TABLE OF CONTENTS
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Section 2.7 |
Amendments to Securities |
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SECOND SUPPLEMENTAL INDENTURE, dated as of June 7, 2005 (this “ Second Supplemental Indenture ”), among CIMAREX ENERGY CO., a Delaware corporation (the “ Successor Issuer ”), MAGNUM HUNTER RESOURCES, INC., a Nevada corporation (the “ Existing Issuer ”) and the “Company” under the First Amended Indenture (as defined below), MAGNUM HUNTER PRODUCTION, INC., a Texas corporation (“ MHP ”), GRUY PETROLEUM MANAGEMENT CO., a Texas corporation (“ Gruy ”), HUNTER GAS GATHERING, INC., a Texas corporation (“ Hunter ”), TRAPMAR PROPERTIES, INC., a Texas corporation (“ Trapmar ”), CONMAG ENERGY CORPORATION, a Texas corporation (“ Conmag ”), PINTAIL ENERGY, INC., a Delaware corporation (“ Pintail ”), PRIZE OPERATING COMPANY, a Delaware corporation (“ Prize Operating ”), PEC (DELAWARE), INC., a Delaware corporation (“ PEC ”), PRIZE ENERGY RESOURCES, L.P., a Delaware limited partnership (“ Prize Energy ”), OKLAHOMA GAS PROCESSING, INC., a Delaware corporation (“ Oklahoma Gas ,” and together with MHP, Gruy, Hunter, Trapmar, Conmag, Pintail, Prize Operating, PEC and Prize Energy, the “ Existing Subsidiary Guarantors ”), and DEUTSCHE BANK TRUST COMPANY AMERICAS, a banking corporation organized under the laws of the State of New York (herein called the “ Trustee ”).
WITNESSETH:
WHEREAS, the Existing Issuer, the Existing Subsidiary Guarantors and the Trustee are parties to an Indenture, dated as of December 17, 2003 (the “ Original Indenture ”), pursuant to which the Existing Issuer’s Floating Rate Convertible Senior Notes due 2023 in the principal amount of $125,000,000 were issued;
WHEREAS, the Existing Issuer, the Existing Subsidiary Guarantors, and the Trustee have entered into a First Supplemental Indenture, dated as of June 6, 2005 (the “ First Supplemental Indenture ”), pursuant to which, among other things, the Original Indenture was modified at the time and in accordance with the terms thereof (such Original Indenture as amended and supplemented by the First Supplemental Indenture is herein called the “ First Amended Indenture ”);
WHEREAS, at the Second Supplemental Indenture Effective Time (as defined in Article VI hereof), pursuant to an Agreement and Plan of Merger, dated January 25, 2005, as amended by Amendment No. 1 dated as of February 18, 2005 and Amendment No. 2 dated as of April 20, 2005 (the “ Merger Agreement ”), among the Successor Issuer, the Existing Issuer, and Cimarex Nevada Acquisition Co., a Nevada corporation (“ CNAC ”), and a wholly-owned subsidiary of Cimarex, the Existing Issuer and CNAC will merge (the “ CNAC Merger ”), with the Existing Issuer being the surviving corporation, and in connection with and upon the effectiveness of the CNAC Merger, the Existing Issuer will become a wholly-owned subsidiary of the Successor Issuer, and the separate existence of CNAC will cease;
WHEREAS, under the Merger Agreement, holders of shares of Common Stock will receive 0.415 of a share of common stock, par value $.01 per share (the “ Successor Issuer Common Stock ”), of the Successor Issuer (plus cash in lieu of any fractional share interest) for each share of Common Stock that they own immediately before the Effective Time (as such term is defined in the Merger Agreement) of the CNAC Merger;
WHEREAS, the Successor Issuer desires to issue a guarantee to the Holders of the Securities as provided in this Second Supplemental Indenture;
WHEREAS, the Successor Issuer, the Existing Issuer, and the Existing Subsidiary Guarantors are entering into this Second Supplemental Indenture with the Trustee in compliance with Sections 9.01 and 10.11 of the Indenture;
NOW, THEREFORE, each party agrees as follows for the benefit of the Trustee and for the equal and ratable benefit of the Holders of the Securities:
Capitalized terms that are defined in this Second Supplemental Indenture (including without limitation in the introductory paragraph and the Recitals hereto) shall have the meanings assigned to them herein. Capitalized terms used in this Second Supplemental Indenture (including without limitation in the introductory paragraph and the Recitals hereto) that are not otherwise defined herein shall have the meanings assigned to them in the First Amended Indenture.
Section 2.1 Amendments to Definitions .(a) For all purposes of the Indenture, this Second Supplemental Indenture and the Securities, the definitions of the following terms set forth in Section 1.1 of the First Amended Indenture are amended and restated to read in full as follows:
“ Common Stock ” means the common stock, par value $.01 per share, of the Successor Issuer, as it exists at the Second Supplemental Indenture Effective Time or any other shares of Capital Stock of the Successor Issuer into which Common Stock shall be reclassified or changed.
“ Common Stock Price ” on any date means the closing sale price per share (or if no closing sale price is reported, the average of the bid and ask prices or, if more than one in either case, the average of the average bid and the average ask prices) on such date for the Common Stock as reported in composite transactions on the principal United States securities exchange on which the Common Stock is traded or, if the Common Stock is not listed on a United States national or regional securities exchange, as reported by The NASDAQ System.
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“ Conversion Price ” means $28.99 per share of Common Stock as of the Second Supplemental Indenture Effective Time, subject to adjustments as described in Section 10.05 hereof.
“ Conversion Rate ” means the number of shares of Common Stock equal to $1,000 divided by the Conversion Price, which shall be approximately 34.4971 as of the Second Supplemental Indenture Effective Time, subject to the adjustments described in Section 10.05 hereof.
“ Enterprise Value ” means, as of any date of calculation, an amount equal to (i) the product of (A) the Common Stock Price on the immediately preceding Trading Day and (B) the aggregate number of shares of Common Stock outstanding on the immediately preceding Trading Day, plus (ii) the aggregate amount of outstanding indebtedness of the Successor Issuer and its subsidiaries on a consolidated basis, as determined in accordance with GAAP, on the immediately preceding Trading Day, plus (iii) the aggregate amount recorded as outstanding preferred stock of the Successor Issuer and its subsidiaries on a consolidated basis, as determined in accordance with GAAP, on the immediately preceding Trading Day, minus (iv) the aggregate amount of cash and cash equivalents held by the Successor Issuer and its subsidiaries on a consolidated basis on the immediately preceding Trading Day.
“ Indenture ” means this instrument as originally executed, as supplemented and amended by the First Supplemental Indenture and the Second Supplemental Indenture and as amended or supplemented from time to time in accordance with the terms hereof, including the provisions of the TIA that are deemed to be a part hereof.
(b) Section 1.1 of the First Amended Indenture is amended by adding the following defined terms:
“ Second Supplemental Indenture ” means the Second Supplemental Indenture, dated as of June 7, 2005, among the Successor Issuer, the Company, the Subsidiary Guarantors, and the Trustee.
“ Second Supplemental Indenture Effective Time ” means the Second Supplemental Indenture Effective Time as defined in Article VI thereof.
“ Successor Issuer ” means Cimarex Energy Co., a Delaware corporation, until a successor replaces it pursuant to the applicable provisions of this Indenture and, thereafter, shall mean such
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successor. The foregoing sentence shall likewise apply to any subsequent successor or successors.
(c) For avoidance of doubt, the terms “Company” and “Trustee” as set forth in Section 1.1 of the First Amended Indenture are not amended by this Second Supplemental Indenture.
Section 2.2 Amendments to Conversion of the Securities .(a) Section 10.01(a)(iv)(B) of the First Amended Indenture is amended and restated to read in full as follows:
(B) a distribution to all holders of Common Stock of evidences of Successor Issuer indebtedness, rights or warrants to purchase or subscribe for Capital Stock or other securities of the Successor Issuer, cash or assets, which distribution has an aggregate value that exceeds 10% of the Successor Issuer’s Enterprise Value on the Trading Day immediately preceding the declaration date of such distribution;
(b) Section 10.01(a)(v) of the First Amended Indenture is amended by deleting the term “Company” and replacing it with the term “Successor Issuer.”
(c) The second sentence of Section 10.01(c) of the First Amended Indenture is amended by deleting the term “Company’s” and replacing it with the term “Successor Issuer’s.”
(d) Section 10.02(b) of the First Amended Indenture is amended by deleting the references therein to the term “Company” and replacing them with the term “Successor Issuer.”
(e) Section 10.04 of the First Amended Indenture is amended by deleting the references in the first sentence, the heading, the penultimate paragraph, and the last paragraph thereof to the term “Company” and replacing them with the term “Successor Issuer.”
(f) Section 10.05(a) of the First Amended Indenture is amended by deleting the term “Company” and replacing it with the term “Successor Issuer.”
(g) Section 10.05(b) of the First Amended Indenture is amended by deleting the term “Company” and replacing it with the term “Successor Issuer.”
(h) Section 10.05(c) of the First Amended Indenture is amended by deleting the first two references therein to the term “Company” and replacing them with the term “Successor Issuer.”
(i) Section 10.05(d) of the First Amended Indenture is amended by deleting references therein to the term “Company” and replacing them with the term “Successor Issuer.”
(j) Section 10.05(e) of the First Amended Indenture is amended by deleting the reference therein to the term “Company” and replacing it with the term “Successor Issuer.”
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(k) Section 10.05(f) of the First Amended Indenture is amended by deleting the date “January 6, 1998” and replacing it with the date “February 23, 2002.” Section 10.05(f) of the First Amended Indenture also is amended by deleting references therein to the terms “Company’s” and “Company” and replacing them with the terms “Successor Issuer’s” and “Successor Issuer,” respectively.
(l) Section 10.05(g) of the First Amended Indenture is amended by deleting references therein to the term “Company” and replacing them with the term “Successor Issuer.” Section 10.05(g) of the First Amended Indenture also is amended by deleting the third reference therein to the term “Board of Directors” and replacing it with the term “board of directors of the Successor Issuer.”
(m) The first full paragraph following Section 10.05(g) of the First Amended Indenture is amended by deleting the third, fourth and fifth references therein to the term “Company” and replacing them with the term “Successor Issuer.”
(n) The second full paragraph following Section 10.05(g) of the First Amended Indenture is amended by deleting the references therein to the term “Company” and replacing them with the term “Successor Issuer.”
(o) Sections 10.06 and 10.07 of the First Amended Indenture are amended by deleting references therein to the term “Company” and replacing them with the term “Successor Issuer.”
(p) Section 10.08 of the First Amended Indenture is amended by deleting second reference therein to the term “Company” and replacing it with the term “Successor Issuer.”
(q) Section 10.10 of the First Amended Indenture is amended by deleting the first seven references therein to the term “Company” and replacing them with the term “Successor Issuer.”
(r) Section 10.11 of the First Amended Indenture is amended by:
(1) deleting the first three references in the first sentence of the first paragraph thereof to the term “Company” and replacing them with the term “Successor Issuer;”
(2) deleting the fourth reference in the first sentence of the first paragraph thereof to the term “Company” and replacing it with the term “Company and the Successor Issuer;”
(3) deleting the references in the last sentence of the first paragraph thereof to the term “Company” and replacing them with the term “Successor Issuer;” and
(4) deleting the references in the second paragraph thereof to the term “Company” and replacing them with the term “Company and the Successor Issuer.”
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(s) The first two sentences of Section 10.14(c) of the First Amended Indenture are amended and restated to read in full as follows:
The Company shall pay the Principal Return and cash for fractional shares and the Successor Issuer shall issue and the Company shall deliver the Net Shares, if any, as promptly as practicable after the Conversion Date, but in no event later than four Business Days thereafter. Except as provided in Section 10.02(c) and this Section 10.14(c), delivery of the Principal Return and cash in lieu of fractional shares and the issuance and delivery of Net Shares, if any, shall be deemed to satisfy the Company’s and the Successor Issuer’s obligation with respect to a converted Security.
Section 2.3 Amendments to Section 12.11 .Section 12.11 of the First Amended Indenture is amended by adding the following sentence thereto:
All agreements of the Successor Issuer in this Indenture and the Securities shall bind its successor.
Section 2.4 Amendments to Exhibits A-1 and A-2 .(a) The first sentence in paragraph (4) of each of the Form of Reverse Side of Note attached as Exhibits A-1 and A-2 to the First Amended Indenture is amended and restated to read in full as follows:
Magnum Hunter Resources, Inc., a Nevada corporation, issued the Securities under an Indenture, dated as of December 17, 2003, among Magnum Hunter Resources, Inc., the Subsidiary Guarantors party thereto, and the Trustee. Such Indenture was supplemented and amended by the First Supplemental Indenture, dated as of June 6, 2005 (the “ First Supplemental Indenture ”), among Magnum Hunter Resources, Inc., the Subsidiary Guarantors party thereto and the Trustee and by the Second Supplemental Indenture, dated as of June 7, 2005 (the “ Second Supplemental Indenture ”), among Cimarex Energy Co., a Delaware corporation, Magnum Hunter Resources, Inc., the Subsidiary Guarantors party thereto and the Trustee. Such Indenture, as supplemented and amended by the First Supplemental Indenture and the Second Supplemental Indenture and as it may from time to time be supplemented or amended by one or more other indentures supplemental thereto entered into pursuant to the applicable provisions thereof is herein referred to as the “ Indenture .”
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(b) The third and fourth sentences of the first paragraph of paragraph (8) of the Form of Reverse Side of Note attached as Exhibits A-1 and A-2 to the First Amended Indenture are amended and restated to read in full as follows:
The Conversion Price shall, as of the Second Supplemental Indenture Effective Time, be $28.99. The Conversion Rate shall, as of the Second Supplemental Indenture Effective Time, be 34.4971.
Section 2.5 Amendment to Exhibit C .The last sentence of the first paragraph of the Guarantee attached as Exhibit C to the First Amended Indenture is amended and restated to read in full as follows:
Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Indenture, dated as of December 17, 2003, among Magnum Hunter Resources, Inc., the Subsidiary Guarantors party thereto, and Deutsche Bank Trust Company Americas, as Trustee (as supplemented and amended by the First Supplemental Indenture, dated as of June 6, 2005, among Magnum Hunter Resources, Inc., the Subsidiary Guarantors party thereto and the Trustee, and the Second Supplemental Indenture, dated as of June 7, 2005, among Cimarex Energy Co., a Delaware corporation, Magnum Hunter Resources, Inc., the Subsidiary Guarantors party thereto, and the Trustee and as it may from time to time be supplemented or amended by one or more other indentures supplemental thereto entered into pursuant to the applicable provisions thereof, the “ Indenture ”).
Section 2.6 Amendments to Securities .(a)The first sentence in paragraph (4) of the reverse side of the Securities is amended and restated to read in full as follows:
Magnum Hunter Resources, Inc., a Nevada corporation, issued the Securities under an Indenture, dated as of December 17, 2003, among Magnum Hunter Resources, Inc., the Subsidiary Guarantors party thereto, and the Trustee. Such Indenture was supplemented and amended by the First Supplemental Indenture, dated as of June 6, 2005 (the “ First Supplemental Indenture ”), among Magnum Hunter Resources, Inc., the Subsidiary Guarantors party thereto and the Trustee and by the Second Supplemental Indenture, dated as of June 7, 2005 (the “ Second Supplemental Indenture ”), among Cimarex Energy Co., a Delaware corporation, Magnum Hunter Resources, Inc., the Subsidiary Guarantors party thereto and the Trustee. Such Indenture, as supplemented and amended by the First Supplemental Indenture and the Second Supplemental Indenture and as it may from time to time be supplemented or amended by one or more other indentures supplemental thereto
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entered into pursuant to the applicable provisions thereof is herein referred to as the “ Indenture .”
(b) The third and fourth sentences of the first paragraph of paragraph (8) of the reverse side of the Securities are amended and restated to read in full as follows:
The Conversion Price shall, as of the Second Supplemental Indenture Effective Time, be $28.99. The Conversion Rate shall, as of the Second Supplemental Indenture Effective Time, be 34.4971.
(c) The first clause of the section titled “CONVERSION NOTICE” of the reverse side of the Securities is amended and restated to read in full as follows:
To convert this Security into Cash and Common Stock, check the box o
ARTICLE III
SUCCESSOR ISSUER GUARANTY
Subject to the provisions of this Article III, the Successor Issuer hereby unconditionally and irrevocably guarantees (such guarantee to be referred to herein as the “ Guarantee ”), to and for the benefit of each Holder of a Security authenticated and delivered by the Trustee, and to the Trustee and its successors and assigns, that (a) the principal of, premium, if any, and interest on the Securities (including Liquidated Damages, if any), Conversion Value, Change in Control Purchase Price, and Purchase Price, shall be duly and punctually paid in full when due, whether at maturity, by acceleration, upon redemption, purchase or otherwise, and interest on the overdue principal and (to the extent permitted by law) interest, if any, on the Securities and all other obligations of the Company to the Holders under the Indenture and the Securities (including amounts due the Trustee under Section 7.07 of the Indenture), in each case as they have been and may be further amended from time to time, shall be promptly paid in full, all in accordance with the terms hereof and thereof, and (b) in case of any extension of time of payment or renewal of any Securities or any of such other obligations, that the Securities and such other payment obligations will be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, whether at maturity, by acceleration or otherwise.
The Successor Issuer hereby further agrees that its obligations under this Article III shall be unconditional, irrespective of the validity, regularity or enforceability of the Securities or the Indenture, the absence of any action to enforce the same, any waiver or consent by any Security holder with respect to any provisions of the Indenture or the Securities, or any modification or amendment of, or supplement of, the Indenture or the Securities. The Successor Issuer hereby waives diligence, presentment, demand of payment, filing of claims with a court in the event of insolvency or bankruptcy of the Existing Issuer or any Subsidiary Guarantor, any
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right to require a proceeding first against the Existing Issuer or any Subsidiary Guarantor, protest, notice and all demands whatsoever and covenants that its Guarantee will not be discharged except by complete performance by the Existing Issuer of all of its obligations under the Indenture.
Upon making any payment with respect to the Existing Issuer or any Subsidiary Guarantor hereunder, the Successor Issuer shall be subrogated to the rights of the payee against the Company and each Subsidiary Guarantor with respect to such payment; provided that the Successor Issuer shall not enforce any payment by way of subrogation or contribution until all obligations of the Company and the Subsidiary Guarantors under the Indenture have been paid in full.
Section 3.2 Release of Guarantee .
Notwithstanding anything in this Article III to the contrary, concurrently with the payment in full of (a) the principal amount at maturity or such other amounts as cause the Indenture to cease to be of further effect pursuant to Section 8.01 of the Indenture and (b) all other obligations of the Company and the Subsidiary Guarantors under the Indenture, the Successor Issuer shall be released from and relieved of its obligations under the Guarantee. Upon the delivery by the Company to the Trustee of an Officer’s Certificate and an Opinion of Counsel to the effect that the transaction giving rise to the release of the Guarantee was made by the Company in accordance with the provisions of the Indenture and the Securities, the Trustee shall execute any documents reasonably required in order to evidence the release of the Guarantor from its obligations under the Guarantee. If any of the obligations to pay the principal of, premium, if any, and interest on the Securities (including Liquidated Damages, if any), and any other payment obligations of the Company to the Holders under the Indenture or the Securities are revived and reinstated after the termination of the Guarantee, then all of the obligations of the Successor Issuer under the Guarantee shall be revived and reinstated as if the Guarantee had not been terminated until such time as such amounts on the Securities and all other obligations of the Company under the Indenture are paid in full, and the Successor Issuer shall enter into an amendment to the Guarantee evidencing such revival and reinstatement.
ARTICLE IV
CONCERNING CNAC MERGER
Section 4.1 Representations Concerning the CNAC Merger .The Existing Issuer hereby represents that it shall be the surviving corporation in connection with the CNAC Merger and that, immediately after giving effect to the CNAC Merger, no Event of Default and Default shall have occurred and be continuing.
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Section 4.2 Officers’ Certificate and Opinion of Counsel .Concurrently with the execution and delivery of this Second Supplemental Indenture, the Existing Issuer has delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel as required by Sections 5.01 and 10.11 of the First Amended Indenture.
ARTICLE V
CONCERNING THE TRUSTEE
Section 5.1 Terms and Conditions .The Trustee accepts this Second Supplemental Indenture and agrees to perform the express duties of the Trustee upon the terms and conditions set forth herein and in the First Amended Indenture, as modified by this Second Supplemental Indenture.
Section 5.2 No Responsibility .The Trustee makes no undertaking or representations in respect of, and shall not be responsible in any manner whatsoever for and in respect of, the validity or sufficiency of this Second Supplemental Indenture or the proper authorization or the due execution hereof by the Existing Issuer or the Subsidiary Guarantors or for or in respect of the recitals and statements contained herein, all of which recitals and statements are made solely by the Existing Issuer or the Subsidiary Guarantors, as the case may be.
ARTICLE VI
EFFECTIVE TIME; EFFECT OF EXECUTION AND DELIVERY
Notwithstanding the execution and delivery of this Second Supplemental Indenture on the date hereof, the amendments to the First Amended Indenture set forth in Article II of this Second Supplemental Indenture shall not become effective unless and until the Effective Time (as defined in the Merger Agreement) of the CNAC Merger occurs (the date and time of such Effective Time is herein called the “ Second Supplemental Indenture Effective Time ”). From and after the Second Supplemental Indenture Effective Time and without any further notice or action on the part of the Successor Issuer, the Existing Issuer, the Subsidiary Guarantors, the Trustee, any Holder or any other Person, (i) the First Amended Indenture shall be deemed to be modified in accordance with the assumption, substitution and amendments set forth in Article II of this Second Supplemental Indenture, (ii) this Second Supplemental Indenture shall form a part of the Indenture for all purposes, (iii) each reference in the Indenture to “this Indenture,” “hereunder,” “herein” or words of like import shall mean and be a reference to the Indenture, as affected, amended and supplemented hereby, (iv) except as expressly modified by this Second Supplemental Indenture, the First Amended Indenture shall continue in full force and effect, (v) the Securities shall continue to be governed by the First Amended Indenture, as modified by this Second Supplemental Indenture and (vi) every Holder of Securities heretofore or hereafter authenticated and delivered shall be bound by the First Amended Indenture, as modified by this Second Supplemental Indenture.
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ARTICLE VII
OBLIGATIONS UNDER THE INDENTURE
Notwithstanding anything to the contrary in the First Amended Indenture, this Second Supplemental Indenture or the First Amended Indenture, as modified by this Second Supplemental Indenture, (i) except as provided in Article III of this Second Supplemental Indenture, all obligations for payment of principal of, or premium, if any, interest, Liquidated Damages, if any, Principal Return, Change in Control Purchase Price, the Existing Issuer’s obligations concerning conversion of the Securities under the Indenture, or Purchase Price due to be paid on, the Securities shall remain solely the obligations of the Existing Issuer and (ii) any requirement to provide notices, make announcements or file documents with the Trustee in Article 10 of the First Amended Indenture, as modified by this Second Supplemental Indenture, shall remain the responsibility of the Existing Issuer, and, except to the extent provided in the TIA, the Successor Issuer shall not be responsible for such notices, announcements or filings. The Successor Issuer has executed this Second Supplemental Indenture only for the purpose of confirming its obligation to issue common stock, par value $.01 per share, of the Successor Issuer upon the conversion of Securities and to provide its Guarantee as set forth herein.
ARTICLE VIII
MISCELLANEOUS PROVISIONS
The Article and Section headings in this Second Supplemental Indenture are for convenience only and shall not affect the construction of this Second Supplemental Indenture.
Section 8.2 Rights and Obligations of the Trustee .All of the provisions of the First Amended Indenture with respect to the rights, privileges, immunities, powers and duties of the Trustee shall be applicable in respect of this Second Supplemental Indenture as fully and with the same effect as if set forth herein in full.
Section 8.3 Successors .All agreements of the Successor Issuer in this Second Supplemental Indenture shall bind its successors. All agreements of the Existing Issuer and each of the Subsidiary Guarantors in this Second Supplemental Indenture shall bind their respective successors. All agreements of the Trustee in this Second Supplemental Indenture shall bind its successors.
Section 8.4 Separability Clause .In case any provision in this Second Supplemental Indenture shall be invalid, illegal, or unenforceable, the validity, legality, and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.
Section 8.5 Multiple Originals .This Second Supplemental Indenture may be executed in any number of counterparts, each of which shall be an original; but such counterparts shall together constitute but one and the same instrument.
Section 8.6 Governing Law .THIS SECOND SUPPLEMENTAL INDENTURE SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF NEW YORK, AND FOR ALL PURPOSES SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
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Section 8.7 Conflict with Trust Indenture Act .If any provision of this Second Supplemental Indenture limits, qualifies, or conflicts with another provision which is required to be included in this Second Supplemental Indenture by the TIA, the required provision shall control.
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IN WITNESS WHEREOF, the parties hereto have caused this Second Supplemental Indenture to be duly executed all as of the day and year first above written.
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SUCCESSOR ISSUER: |
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CIMAREX ENERGY CO. |
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By: |
/s/ Paul Korus |
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Name: |
Paul Korus |
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Title: |
Chief Financial Officer |
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EXISTING ISSUER: |
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MAGNUM HUNTER RESOURCES, INC. |
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By: |
/s/ Richard R. Frazier |
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Name: |
Richard R. Frazier |
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Title: |
President, Chief Executive Officer |
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SUBSIDIARY GUARANTORS: |
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MAGNUM HUNTER PRODUCTION, INC. |
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By: |
/s/ Richard R. Frazier |
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Name: |
Richard R. Frazier |
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Title: |
President, Chief Executive Officer |
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GRUY PETROLEUM MANAGEMENT CO. |
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By: |
/s/ Richard R. Frazier |
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Name: |
Richard R. Frazier |
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Title: |
President, Chief Executive Officer |
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HUNTER GAS GATHERING, INC. |
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By: |
/s/ Richard R. Frazier |
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Name: |
Richard R. Frazier |
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Title: |
President, Chief Executive Officer |
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TRAPMAR PROPERTIES, INC. |
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By: |
/s/ Richard R. Frazier |
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Name: |
Richard R. Frazier |
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Title: |
President, Chief Executive Officer |
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CONMAG ENERGY CORPORATION |
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By: |
/s/ Richard R. Frazier |
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Name: |
Richard R. Frazier |
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Title: |
President, Chief Executive Officer |
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PINTAIL ENERGY, INC. |
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By: |
/s/ Richard R. Frazier |
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Name: |
Richard R. Frazier |
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Title: |
President, Chief Executive Officer |
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PRIZE OPERATING COMPANY |
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By: |
/s/ Richard R. Frazier |
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Name: |
Richard R. Frazier |
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Title: |
President, Chief Executive Officer |
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PEC (DELAWARE), INC. |
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By: |
/s/ Richard R. Frazier |
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Name: |
Richard R. Frazier |
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Title: |
President, Chief Executive Officer |
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PRIZE ENERGY RESOURCES, L.P. |
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By: |
Prize Operating Company, |
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its General Partner |
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By: |
/s/ Richard R. Frazier |
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Name: |
Richard R. Frazier |
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Title: |
President, Chief Executive Officer |
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OKLAHOMA GAS PROCESSING, INC. |
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By: |
/s/ Richard R. Frazier |
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Name: |
Richard R. Frazier |
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Title: |
President, Chief Executive Officer |
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TRUSTEE: |
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DEUTSCHE BANK TRUST COMPANY AMERICAS |
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By: |
/s/ Irina Golovashchuk |
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Name: |
Irina Golovashchuk |
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Title: |
Associate |
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Exhibit 99.1
CIMAREX ENERGY AND MAGNUM HUNTER ANNOUNCE COMPLETION OF MERGER
Denver, CO — June 7, 2005 — Cimarex Energy Co. (NYSE: XEC) and Magnum Hunter Resources, Inc. (NYSE: MHR) jointly announced today that all conditions to the agreement and plan of merger that provides for the acquisition by Cimarex of Irving-based Magnum Hunter have been satisfied and the merger is effective today. As a result of the merger, Magnum Hunter will be a wholly-owned subsidiary of Cimarex, and the combined organization will be based in Denver, Colorado.
F.H. Merelli, Chairman and CEO of Cimarex said: “We look forward to successful integration of Magnum Hunter’s assets and operations. The combined asset base and drilling portfolio of the two companies provides an excellent opportunity for long-term growth and positive financial performance.”
Upon closing Cimarex will have a market capitalization of approximately $3.2 billion. Including debt, enterprise value exceeds $3.7 billion. Year end 2004 pro forma combined proved reserves total 1.5 trillion cubic feet equivalent (67% natural gas) and first quarter 2005 pro forma combined production was 482.5 million cubic feet equivalent per day. Cimarex will have approximately 600 employees.
Magnum Hunter stockholders will receive 0.415 shares of Cimarex common stock in exchange for each share of Magnum Hunter common stock. Cimarex will issue approximately 39.5 million common shares to Magnum Hunter stockholders and will then have approximately 81.3 million shares outstanding.
About Cimarex Energy
Denver-based Cimarex Energy Co. is an independent oil and gas exploration and production company with principal operations in the Mid-Continent, Gulf Coast, Permian Basin of West Texas and New Mexico and Gulf of Mexico areas of the U.S.
This communication contains statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on Cimarex Energy Co. and Magnum Hunter Resources, Inc. current expectations and beliefs and are subject to a number of risks, uncertainties and assumptions that could cause actual results to differ materially from those described in the forward-looking
statements. Risks, uncertainties and assumptions include 1) the possibility that problems may arise in successfully integrating the businesses of the two companies; 2) the possibility that the acquisition may involve unexpected costs; 3) the possibility that the combined company may be unable to achieve cost-cutting synergies; 4) the possibility that the businesses may suffer as a result of uncertainty surrounding the acquisition; 5) the possibility that the industry may be subject to future regulatory or legislative actions; 6) the volatility in commodity prices for oil and gas; 7) the presence or recoverability of estimated reserves; 8) the ability to replace reserves; 9) environmental risks; 10) drilling and operating risks; 11) exploration and development risks; 12) competition; 13) the ability of management to execute its plans to meet its goals and other risks that are described in SEC reports filed by Cimarex and Magnum Hunter. Because forward-looking statements involve risks and uncertainties, actual results and events may differ materially from results and events currently expected by Cimarex and Magnum Hunter. Cimarex and Magnum Hunter assume no obligation and expressly disclaim any duty to update the information contained herein except as required by law.
FOR FURTHER INFORMATION CONTACT
Cimarex Energy Co. contact:
Mark Burford, Director of Capital Markets
303-295-3995