Filed by: Cabot Oil &
Gas Corporation
Pursuant to Rule 425 under
the Securities Act of 1933
and deemed filed pursuant
to Rule 14d-2(b) and Rule 14a-12
under the Securities Exchange
Act of 1934
Subject Company: Cimarex
Energy Co.
Commission File Number: 001-31446
Dan O. Dinges
Chairman, President and Chief Executive
Officer
May 24, 2021
Dear Cabot Employees,
I am pleased to share some exciting news about our company. Today,
we announced that we have entered into a definitive agreement with Cimarex Energy to combine in an all-stock merger of equals to create
a leading, diversified energy company.
It is thanks to your efforts and relentless dedication to working safely
and efficiently that we were able to pursue this opportunity from a position of financial and operational strength. We are excited about
the compelling benefits for our investors, employees and other stakeholders.
As you may know, Cimarex is an oil and gas exploration and production
company with principal operations in the Permian Basin and Mid-Continent areas and has experienced management and operating teams. The
combination of its oil portfolio with our natural gas assets will create a diversified energy leader that is positioned to drive enhanced
free cash flow generation and returns for investors through market cycles.
Compelling Benefits of the Combination
Over the past few years, we have successfully executed our operating
plan to drive sustainable free cash flow and shareholder value creation. We have established a track record of operational excellence,
taking important steps across our footprint to maximize efficiency and production. This transaction will accelerate our strategy and create
an industry leading operator with the size, scale and financial position to thrive in today’s market and beyond, across the commodity
price cycles.
Together, we will have more geographic and asset diversity, with scale
and strong positions in the premier oil and natural gas basins in the United States. With the addition of Cimarex’s oil assets in
the Permian and Anadarko basins to our natural gas assets in the Marcellus Shale, we will be more resilient and better positioned to continue
delivering strong results through market cycles. We intend to execute a prudent strategy built on disciplined capital investment, strong
free cash flow generation and increasing returns to shareholders. We expect to have a strong financial foundation, which will underpin
everything we do. In fact, the combined business is expected to have one of the strongest balance sheets in our industry
Ensuring the health and safety of our employees and stakeholders, as
well as protecting the environment and the communities in which we live and operate, will remain top priorities. We have made significant
advances in our ESG practices and disclosures, and as a combined business, we will build on our ESG and sustainability commitments and
work to advance the benefits of cleaner energy.
In short, this transaction builds on and accelerates the strategy we
have been executing. With premier assets, increased resource diversity and a strong financial foundation, we will be well positioned to
deliver long-term value creation for our shareholders, employees and other stakeholders.
Three Memorial City Plaza
840 Gessner Road, Suite 1400, Houston,
Texas 77024-4152 • P.O. Box 4544, Houston, Texas 77210-4544 • 281 589-4600
An Equal Opportunity Employer
Board, Leadership and Headquarters
As mentioned earlier, this transaction is structured as a merger of
equals, which means the combined company will have approximately 50/50 ownership by the current shareholders of both companies and our
Board will include five current Cabot directors and five Cimarex directors.
Upon closing of the transaction, I will serve as Executive Chairman
of the Board and Cimarex’s President and CEO, Tom Jorden, will serve as Chief Executive Officer. Scott Schroeder, our Chief Financial
Officer, will serve as CFO of the combined business. The company plans to be headquartered in Houston and we plan to maintain Cabot’s
regional presence, including our Pennsylvania regional and field offices in both Pittsburgh and Montrose, and GDS office.
Please keep in mind that there are still many decisions to be made,
including the name of the combined business. We are establishing a team that will include leaders from both companies to develop a detailed
and thoughtful integration plan to bring our companies together and make the post-closing transition as seamless as possible.
Next Steps
Looking ahead, the transaction is expected to close in the fourth quarter
of 2021. Until the closing, it remains business as usual for all of us at Cabot, and we will continue to operate as an independent,
standalone company. It is important that we all remain focused on safely carrying out our day-to-day responsibilities.
As always, we will keep you informed as we have updates to share. To
that end, I have recorded a special message for all Cabot employees, which will be broadcast later today. Tom will also be hosting a virtual
meeting to introduce himself and discuss more about the benefits of the transaction tomorrow. Please keep an eye out for calendar invites
with the details of these meetings.
In the meantime, we recognize you may have questions, so we ask that
you review the attached FAQ. As always, if you have additional questions, please reach out to your supervisor or human resources.
Today’s announcement is likely to generate increased interest
in Cabot. Consistent with our usual policies, all media, investor and analysts inquiries should be referred to Matt Kerin at Matt.Kerin@cabotog.com.
On behalf of our Board and management team, thank you for your continued
hard work and commitment to Cabot. I am incredibly proud of what our Company has achieved and I’m excited to see what the future
will bring. I hope you share our enthusiasm as we embark on this exciting next chapter.
Sincerely,
Dan O. Dinges
Chairman, President and CEO of Cabot
Three Memorial City Plaza
840 Gessner Road, Suite 1400, Houston,
Texas 77024-4152 • P.O. Box 4544, Houston, Texas 77210-4544 • 281 589-4600
An Equal Opportunity Employer
Cautionary Statement Regarding Forward-Looking Information
This communication contains certain “forward-looking statements”
within the meaning of federal securities laws. Words such as “anticipates,” “believes,” “expects,”
“intends,” “plans,” “outlook,” “will,” “should,” “may” and similar
expressions may be used to identify forward-looking statements. Forward-looking statements are not statements of historical fact and reflect
Cabot’s and Cimarex’s current views about future events. Such forward-looking statements include, but are not limited to,
statements about the benefits of the proposed merger involving Cabot and Cimarex, including future financial and operating results; Cabot’s
and Cimarex’s plans, objectives, expectations and intentions; the expected timing and likelihood of completion of the transaction;
the expected timing and amount of any future dividends; and other statements that are not historical facts, including estimates of oil
and natural gas reserves and resources, estimates of future production, assumptions regarding future oil and natural gas pricing, planned
drilling activity, future results of operations, projected cash flow and liquidity, the achievement of synergies, business strategy and
other plans and objectives for future operations. No assurances can be given that the forward-looking statements contained in this communication
will occur as projected and actual results may differ materially from those projected. Forward-looking statements are based on current
expectations, estimates and assumptions that involve a number of risks and uncertainties that could cause actual results to differ materially
from those projected. These risks and uncertainties include, without limitation, the ability to obtain the requisite Cabot and Cimarex
stockholder approvals; the risk that Cabot or Cimarex may be unable to obtain governmental and regulatory approvals required for the merger;
the risk that an event, change or other circumstances could give rise to the termination of the proposed merger; the risk that a condition
to closing of the merger may not be satisfied on a timely basis or at all; the length of time necessary to close the proposed transaction,
which may be longer than anticipated for various reasons; the risk that the businesses will not be integrated successfully; the risk that
the cost savings and any other synergies from the transaction may not be fully realized or may take longer to realize than expected; the
risk that any announcement relating to the proposed transaction could have adverse effects on the market price of Cabot’s common
stock or Cimarex’s common stock; the risk of litigation related to the proposed transaction; the effect of future regulatory or
legislative actions on the companies or the industry in which they operate, including the risk of new restrictions with respect to well
spacing, hydraulic fracturing, natural gas flaring or other oil and natural gas development activities; the risk that the credit ratings
of the combined business may be different from what the companies expect; disruption from the transaction making it more difficult to
maintain relationships with customers, employees or suppliers; the diversion of management time on merger-related issues; the volatility
in commodity prices for crude oil and natural gas; the continuing effects of the COVID-19 pandemic and the impact thereof on Cabot’s
and Cimarex’s businesses, financial condition and results of operations; actions by, or disputes among or between, the Organization
of Petroleum Exporting Countries and other producer countries; the presence or recoverability of estimated reserves; the ability to replace
reserves; environmental risks; drilling and operating risks; exploration and development risks; competition; the ability of management
to execute its plans to meet its goals; and other risks inherent in Cabot’s and Cimarex’s businesses. In addition, the declaration
and payment of any future dividends, whether regular base quarterly dividends, variable dividends or special dividends following completion
of the proposed transaction, will depend on the combined business’ financial results, cash requirements, future prospects and other
factors deemed relevant by the board of directors of Cabot (as then constituted). These risks, as well as other risks related to the proposed
transaction, will be described in the registration statement on Form S-4 and joint proxy statement/prospectus that will be filed with
the SEC in connection with the proposed transaction. While the list of factors presented here is, and the list of factors to be presented
in the registration statement on Form S-4 are, considered representative, no such list should be considered to be a complete statement
of all potential risks and uncertainties. Should one or more of these risks or uncertainties materialize, or should underlying assumptions
prove incorrect, actual outcomes may vary materially from those indicated. For additional information about other factors that could cause
actual results to differ materially from those described in the forward-looking statements, please refer to: (1) Cabot’s annual
reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, which are available on Cabot’s website at
www.cabotog.com/investor-relations and on the SEC’s website at http://www.sec.gov; and (2) Cimarex’s annual reports on Form
10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, which are available on its website at www.cimarex.com/investor-relations
and on the SEC’s website at http://www.sec.gov.
Forward-looking statements are based on the estimates and opinions
of management at the time the statements are made. Except to the extent required by applicable law, neither Cabot nor Cimarex undertakes
any obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date hereof.
No Offer or Solicitation
This communication is not intended to and shall not constitute an offer
to buy or sell or the solicitation of an offer to buy or sell any securities, or a solicitation of any vote or approval, nor shall there
be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification
under the securities laws of any such jurisdiction. No offering of securities shall be made, except by means of a prospectus meeting the
requirements of Section 10 of the U.S. Securities Act of 1933, as amended.
Three Memorial City Plaza
840 Gessner Road, Suite 1400, Houston,
Texas 77024-4152 • P.O. Box 4544, Houston, Texas 77210-4544 • 281 589-4600
An Equal Opportunity Employer
Additional Information about the Merger and Where to Find It
In connection with the proposed transaction, Cabot intends to
file with the Securities and Exchange Commission (“SEC”) a registration statement on Form S-4 that will include a joint
proxy statement of Cabot and Cimarex and that also constitutes a prospectus of Cabot. Each of Cabot and Cimarex may also file other
relevant documents with the SEC regarding the proposed transaction. This communication is not a substitute for the joint proxy
statement/prospectus or registration statement or any other document that Cabot or Cimarex may file with the SEC. The definitive
joint proxy statement/prospectus (if and when available) will be mailed to stockholders of Cabot and Cimarex. INVESTORS AND SECURITY
HOLDERS ARE URGED TO READ THE REGISTRATION STATEMENT, JOINT PROXY STATEMENT/PROSPECTUS AND ANY OTHER RELEVANT DOCUMENTS THAT MAY BE
FILED WITH THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS, CAREFULLY AND IN THEIR ENTIRETY IF AND WHEN THEY
BECOME AVAILABLE BECAUSE THEY CONTAIN OR WILL CONTAIN IMPORTANT INFORMATION ABOUT CABOT, CIMAREX AND THE PROPOSED TRANSACTION.
Investors and security holders will be able to obtain free copies of the registration statement and joint proxy statement/prospectus
(if and when available) and other documents containing important information about Cabot, Cimarex and the proposed transaction, once
such documents are filed with the SEC through the website maintained by the SEC at http://www.sec.gov. Copies of the documents filed
with the SEC by Cabot may be obtained free of charge on Cabot’s website at www.cabotog.com/investor-relations or by contacting
Matt Kerin by email at matt.kerin@cabotog.com or by phone at 281-589-4642. Copies of the documents filed with the SEC by Cimarex may
be obtained free of charge on Cimarex’s website at www.cimarex.com/investor-relations.
Participants in the Solicitation
Cabot, Cimarex and certain of their respective directors and executive
officers may be deemed to be participants in the solicitation of proxies in respect of the proposed transaction. Information about the
directors and executive officers of Cabot, including a description of their direct or indirect interests, by security holdings or otherwise,
is set forth in Cabot’s proxy statement for its 2021 Annual Meeting of Stockholders, which was filed with the SEC on March 12, 2021,
and Cabot’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020, which was filed with the SEC on February 26,
2021. Information about the directors and executive officers of Cimarex, including a description of their direct or indirect interests,
by security holdings or otherwise, is set forth in Cimarex’s proxy statement for its 2021 Annual Meeting of Stockholders, which
was filed with the SEC on March 26, 2021, and Cimarex’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020,
which was filed with the SEC on February 23, 2021. Other information regarding the participants in the proxy solicitations and a description
of their direct and indirect interests, by security holdings or otherwise, will be contained in the joint proxy statement/prospectus and
other relevant materials to be filed with the SEC regarding the proposed transaction when such materials become available. Investors should
read the joint proxy statement/prospectus carefully when it becomes available before making any voting or investment decisions. You may
obtain free copies of these documents from Cabot or Cimarex using the sources indicated above.
Three Memorial City Plaza
840 Gessner Road, Suite 1400, Houston,
Texas 77024-4152 • P.O. Box 4544, Houston, Texas 77210-4544 • 281 589-4600
An Equal Opportunity Employer
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