UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
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Securities registered pursuant to Section 12(b) of the Act:
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(1) The registrant’s common stock ceased being traded on July 1, 2022 in connection with the closing of the Merger described herein and will no longer be listed on the New York Stock Exchange.
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2).
Emerging Growth Company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Introductory Note
On July 1, 2022 (the “Closing Date”), Chord Energy Corporation, a Delaware corporation formerly known as Oasis Petroleum Inc. (“Chord”), completed its previously announced “merger of equals” with Whiting Holdings LLC, a Delaware limited liability company formerly known as Whiting Petroleum Corporation (“Whiting”), pursuant to the terms of that certain Agreement and Plan of Merger, dated as of March 7, 2022 (the “Merger Agreement”), by and among Chord, Whiting, Ohm Merger Sub Inc., a Delaware corporation and wholly owned subsidiary of Chord (“Merger Sub”), and New Ohm LLC, a Delaware limited liability company and wholly owned subsidiary of Chord (“LLC Sub”). Upon consummation of the Merger (defined below), Chord changed its name from “Oasis Petroleum Inc.” to “Chord Energy Corporation”. On July 5, 2022, the first trading day following the Closing Date, common stock of Chord, par value $0.01 per share (the “Chord Common Stock”), began trading on the Nasdaq Global Select Market under the new name and new ticker symbol “CHRD”.
The Merger
Pursuant to the Merger Agreement, at the effective time of the Company Merger (as defined below) (the “Company Merger Effective Time”), Merger Sub merged with and into Whiting, with Whiting surviving the merger as a wholly owned subsidiary of Chord (the “Company Merger”). Immediately following the Company Merger, Whiting merged with and into LLC Sub, with LLC Sub continuing as the surviving entity (such surviving entity, “Whiting Holdings”) as a wholly owned subsidiary of Chord (the “LLC Sub Merger” and together with the Company Merger, the “Merger”).
Following the completion of the Merger, (i) each share of common stock, par value $0.001 per share, of Whiting (the “Whiting Common Stock”) issued and outstanding as of immediately prior to the Company Merger Effective Time was converted into the right to receive $6.25 in cash, without interest, and 0.5774 shares of Chord Common Stock (together, the “Merger Consideration”), and (ii) all existing shares of Chord Common Stock remained outstanding. Following the completion of the Merger, persons who were stockholders of Whiting immediately prior to the Merger owned approximately 53% of Chord and persons who were stockholders of Chord immediately prior to the Merger owned approximately 47% of Chord, in each case on a fully diluted basis.
As of the Company Merger Effective Time, each Converted RSU (as defined in the Merger Agreement) continued to be governed by the same terms and conditions (including vesting and forfeiture) that were applicable to the corresponding Whiting RSU Award (as defined in the Merger Agreement) immediately prior to the Company Merger Effective Time. However, (i) approximately one-third of each Whiting RSU Award granted in September 2020 to an executive officer of Whiting vested immediately prior to the Company Merger Effective Time and each share of Whiting Common Stock issuable in respect of such vested portion was cancelled in exchange for the right to receive the Merger Consideration at the Company Merger Effective Time and (ii) Chord assumed and converted the remaining unvested portion of such award. Each Whiting RSU Award held by a member of the Whiting board vested in full prior to the Company Merger Effective Time and such award was cancelled in exchange for the right to receive, at the Company Merger Effective Time, the Merger Consideration with respect to each share of Whiting Common Stock subject to such award.
Pursuant to the Merger Agreement, each outstanding Whiting PSU Award (as defined in the Merger Agreement) was assumed by Chord and converted into the right to receive, upon vesting, the Merger Consideration with respect to each share of Whiting Common Stock subject to such Whiting PSU Award, with such number determined based on the greater of (i) the target number of performance stock units subject to such award and (ii) actual achievement of the performance criteria applicable to such award measured based on a truncated performance period ending immediately prior to the Company Merger Effective Time.
At the Company Merger Effective Time, each Converted PSU Award (as defined in the Merger Agreement) continued to be governed by the same terms and conditions that were applicable to the corresponding Whiting PSU Award immediately prior to the Company Merger Effective Time (other than any performance-based vesting condition but including any continued service requirements).
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Additionally, at the Company Merger Effective Time, in accordance with the terms of (i) the Whiting Series A warrants to purchase Whiting Common Stock (the “Series A Warrants”), issued pursuant to that certain Warrant Agreement by and between Whiting and Computershare Trust Company, N.A., as warrant agent, dated as of September 1, 2020 (the “Series A Warrant Agreement”), and (ii) the Whiting Series B warrants to purchase Whiting Common Stock (the “Series B Warrants” and, together with the Series A Warrants, the “Whiting Warrants”), issued pursuant to that certain Warrant Agreement by and between Whiting and Computershare Trust Company, N.A., as warrant agent, dated as of September 1, 2020 (the “Series B Warrant Agreement” and each, a “Warrant Agreement”), all of the outstanding Whiting Warrants were assumed by Chord pursuant to that certain Warrant Assignment and Assumption Agreement dated as of July 1, 2022, by and among Chord, Whiting, Computershare Inc. and Computershare Trust Company, N.A. (the “Warrant Assignment and Assumption Agreement”), on terms and conditions as nearly equivalent as practicable to provisions set forth in the applicable Warrant Agreement, except that (1) the number of shares of Chord Common Stock subject to each such assumed warrant equaled the product of (x) the number of shares of Whiting Common Stock that were subject to such warrant immediately prior to the Company Merger Effective Time, multiplied by (y) the exchange ratio, and (2) the per-share exercise price of each such assumed warrant equaled the quotient of (A) the exercise price per share of Whiting Common Stock at which such warrant was exercisable immediately prior to the Company Merger Effective Time less the cash consideration, divided by (B) the exchange ratio.
The foregoing description of the Merger Agreement, the Series A Warrant Agreement, the Series B Warrant Agreement, and the Warrant Assignment and Assumption Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Merger Agreement, the Series A Warrant Agreement, the Series B Warrant Agreement, and the Warrant Assignment and Assumption Agreement, which are attached hereto as Exhibit 2.1, Exhibit 10.1, Exhibit 10.2, and Exhibit 10.3, respectively, and are incorporated herein by reference.
| Item 1.01 | Entry into a Material Definitive Agreement |
The information set forth in the Introductory Note of this Current Report on Form 8-K is incorporated by reference into this Item 1.01.
| Item 1.02 | Termination of a Material Definitive Agreement |
In connection with the closing of the Merger, on the Company Merger Effective Date, Whiting terminated all outstanding commitments under that certain Credit Agreement, dated as of September 1, 2020, among Whiting, as parent guarantor, Whiting Oil and Gas Corporation, as borrower, the lenders party thereto and JPMorgan Chase Bank, N.A., as administrative agent, as amended by the First Amendment thereto executed effective as of June 7, 2021, and as further amended by the Second Amendment thereto executed effective as of September 15, 2021 (as amended, the “Credit Agreement”). In connection with the termination of the Credit Agreement, on the Company Merger Effective Date, all outstanding obligations under the Credit Agreement were paid off in full, and all liens securing such obligations and guarantees of such obligations were released.
| Item 2.01 | Completion of Acquisition or Disposition of Assets |
As discussed in the Introductory Note to this Current Report on Form 8-K, on July 1, 2022, Chord completed its previously announced merger of equals with Whiting pursuant to the terms of the Merger Agreement.
The foregoing description, the Merger Agreement, and the transactions contemplated thereby, is a summary only, does not purport to be complete, and is subject to and qualified in its entirety by reference to the full text of the Merger Agreement. The information set forth in the Introductory Note of this Current Report on Form 8-K is incorporated by reference into this Item 2.01.
| Item 2.02 | Results of Operations and Financial Condition |
On July 1, 2022, Chord issued a press release annoucing completion of the transactions contemplated by the Merger Agreement, containing updated guidance for historical Oasis and for Whiting for the quarter ended June 30, 2022. In addition, on July 1, 2022, Chord released an investor presentation regarding the transactions contemplated by the Merger Agreement and containing pro forma financial results for the quarter ended March 31, 2022 and updated guidance for the quarter ended June 30, 2022.
The full text of the press release and the investor presentation are included as Exhibits 99.1 and 99.2, respectively, to this Current Report on Form 8-K and are incorporated by reference into this Item 2.02.
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In accordance with General Instruction B.2 of Form 8-K, the information furnished pursuant to Item 2.02 and the press release and the investor presentation attached hereto as Exhibits 99.1 and 99.2, respectively, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
| Item 3.01 | Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing |
Prior to the completion of the Merger, shares of Whiting Common Stock were listed and traded on the New York Stock Exchange (the “NYSE”) under the trading symbol “WLL”. Pursuant to the Merger Agreement, Whiting notified the NYSE of the Merger and requested that the NYSE withdraw the listing of Whiting Common Stock. Upon Whiting’s request, the NYSE filed a notification of removal from listing on Form 25 with the U.S. Securities and Exchange Commission (the “SEC”) with respect to the delisting of the Whiting Common Stock and the deregistration of the Whiting Common Stock under Section 12(b) of the Exchange Act. The trading of Whiting Common Stock on the NYSE was suspended before the opening of the market on July 1, 2022 and is no longer listed on the NYSE. In addition, Whiting Holdings intends to file with the SEC a Form 15 requesting that the reporting obligations of Whiting Holdings under Sections 13(a) and 15(d) of the Exchange Act be suspended.
| Item 3.03 | Material Modification to Rights of Security Holders |
The information set forth in the Introductory Note and Item 3.01 of this Current Report on Form 8-K is incorporated by reference into this Item 3.03.
| Item 5.01 | Changes in Control of Registrant |
As a result of the consummation of the Company Merger, at the Company Merger Effective Time, Whiting become a wholly owned subsidiary of Chord. Immediately following the Company Merger, as a result of the consummation of the LLC Sub Merger, Whiting merged with and into Whiting Holdings, with Whiting Holdings continuing as the surviving entity and a wholly owned subsidiary of Chord.
The information set forth under the Introductory Note and Items 2.01, 3.03 and 5.02 of this Current Report on Form 8-K is incorporated by reference into this Item 5.01.
| Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers |
Pursuant to the Merger Agreement, all of the directors and officers of Whiting ceased serving in such capacities, effective as of the Company Merger Effective Time. The former directors and officers of Whiting will receive severance benefits pursuant to their respective employment agreements.
In addition, as contemplated by the Merger Agreement, effective as of the Company Merger Effective Time, Lynn A. Peterson, Susan M. Cunningham, Paul J. Korus, Kevin S. McCarthy and Anne Taylor, who were members of the board of directors of Whiting immediately prior to the Company Merger Effective Time, were appointed to Chord’s board of directors, with Mr. Peterson serving as Executive Chair. Charles “Chip” Rimer, who was Executive Vice President Operations and Chief Operating Officer of Whiting prior to the Company Merger Effective Date, was appointed as Chord’s Executive Vice President and Chief Operating Officer, as of the Company Merger Effective Time; and M. Scott Regan, who was Vice President, Legal, General Counsel and Secretary of Whiting prior to the Company Merger Effective Date, was appointed as Executive Vice President, General Counsel and Secretary of Chord, as of the Company Merger Effective Time.
| Item 5.03 | Amendments to Certificate of Incorporation or Bylaws; Change in Fiscal Year |
In connection with the consummation of the LLC Sub Merger, the certificate of formation and limited liability company agreement of LLC Sub as in effect immediately prior to the effective time of the LLC Sub Merger became the certificate of formation and limited liability company agreement of Whiting Holdings. On July 5, 2022, such certificate of formation was amended by that certain certificate of amendment (“Certificate Amendment”) to change the name of LLC Sub from New Ohm LLC to Whiting Holdings LLC. The certificate of formation and limited liability company agreement of Whiting Holdings LLC in effect after the LLC Sub Merger are attached as Exhibits 3.1 and 3.3, and the Certificate Amendment is attached as Exhibit 3.2 to this Current Report on Form 8-K.
The foregoing disclosures are subject to and qualified in their entirety by reference to Exhibits 3.1, 3.2 and 3.3 of this Current Report on Form 8-K, which are incorporated by reference into this Item 5.03.
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| Item 7.01 | Regulation FD Disclosure |
On July 1, 2022, Chord issued a press release and released an investor presentation announcing the completion of the Merger and other matters.
The full text of the press release and the investor presentation are included as Exhibits 99.1 and 99.2, respectively, to this Current Report on Form 8-K and are incorporated by reference into this Item 7.01.
In accordance with General Instruction B.2 of Form 8-K, the information furnished pursuant to Item 7.01 and the press release and the investor presentation attached hereto as Exhibits 99.1 and 99.2, respectively, shall not be deemed to be “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of that section, nor shall such information be deemed incorporated by reference in any filing under the Securities Act or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
| Item 9.01 | Financial Statements and Exhibits |
| (d) | Exhibits |
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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.
| Whiting Holdings LLC (successor in interest to Whiting Petroleum Corporation) | ||||||
| Date: July 7, 2022 | ||||||
| By: | /s/ M. Scott Regan | |||||
| M. Scott Regan | ||||||
| Executive Vice President, General Counsel and Secretary | ||||||
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Exhibit 3.1
CERTIFICATE OF FORMATION
OF
NEW OHM LLC
This Certificate of Formation, dated February 18, 2022, has been duly executed and is filed pursuant to Sections 18-201 and 18-204 of the Delaware Limited Liability Company Act, as amended (the “Act”) to form a limited liability company (the “Company”) under the Act.
1. Name. The name of the Company is: “New Ohm LLC”.
2. Registered Office; Registered Agent. The address of the registered office required to be maintained by Section 18-104 of the Act is:
Corporation Trust Center
1209 Orange Street
Wilmington, DE 19801.
The name and the address of the registered agent for service of process required to be maintained by Section 18-104 of the Act are:
The Corporation Trust Company
Corporation Trust Center
1209 Orange Street
Wilmington, DE 19801.
EXECUTED as of the date written first above.
| By: | /s/ John Frey | |
| Name: | John Frey | |
| Title: | Authorized Person |
Exhibit 3.2
CERTIFICATE OF AMENDMENT TO
CERTIFICATE OF FORMATION
OF
NEW OHM LLC
This Certificate of Amendment to the Certificate of Formation, dated July 5, 2022, has been duly executed and is filed pursuant to Section 18-202 of the Delaware Limited Liability Company Act (the “Act”) to amend the Certificate of Formation filed on February 18, 2022 (the “Certificate of Formation”) of New Ohm LLC, a Delaware limited liability company (the “Company”), under the Act.
| 1. | The name of the Company is New Ohm LLC. |
| 2. | The Certificate of Formation of the Company is hereby amended so that Article 1 is amended and restated in its entirety as follows: |
| “1. | Name. The name of the Company is: “Whiting Holdings LLC”.” |
IN WITNESS WHEREOF, the undersigned has executed this Certificate of Amendment to the Certificate of Formation as of the date first written above.
| NEW OHM LLC | ||
| By: | /s/ Daniel E. Brown | |
| Name: | Daniel E. Brown | |
| Title: | President and Chief Executive Officer | |
Exhibit 3.3
LIMITED LIABILITY COMPANY AGREEMENT
OF
NEW OHM LLC
A Delaware Limited Liability Company
This Limited Liability Company Agreement of New Ohm LLC (this “Agreement”), dated as of March 6, 2022, is adopted, executed and agreed to by the Sole Member (as defined below).
WHEREAS, the Company was formed as a limited liability company on February 18, 2022 by the filing of a Certificate of Formation with the Secretary of State of the State of Delaware pursuant to and in accordance with the Delaware Limited Liability Company Act, as amended from time to time; and
WHEREAS, the Sole Member agrees that the membership in and management of the Company shall be governed by the terms set forth herein.
NOW, THEREFORE, the Sole Member agrees as follows:
1. Formation. Effective with the filing of the Certificate (as defined below) on February 18, 2022, pursuant to Section 2 of this Agreement, New Ohm LLC (the “Company”) was formed as a Delaware limited liability company under and pursuant to the Delaware Limited Liability Company Act (the “Act”).
2. Term; Authorized Units. The Company commenced on the effective date of the filing of the Certificate of Formation (the “Certificate”) pursuant to the Act and shall have a perpetual existence, unless and until it is dissolved in accordance with Section 10 below. The number of authorized units representing membership interests in the Company issued and outstanding shall be 1,000.
3. Registered Office; Registered Agent. The registered office and registered agent of the Company in the State of Delaware shall be as specified in the Certificate or as determined by the Sole Member from time to time in the manner provided by applicable law.
4. Purposes. The purposes of the Company are to carry on any lawful business, purpose or activity for which limited liability companies may be formed under the Act.
5. Sole Member. Oasis Petroleum Inc. (the “Sole Member”) shall be the sole member of the Company.
6. Contributions. Without creating any rights in favor of any third party, the Sole Member may, from time to time, make contributions of cash or property to the capital of the Company, but shall have no obligation to do so.
7. Distributions. The Sole Member shall be entitled to (a) receive all distributions (including, without limitation, liquidating distributions) made by the Company and (b) enjoy all other rights, benefits and interests in the Company.
8. Management. The management of the Company shall be exclusively vested in the Sole Member, and the Company shall not have “managers,” as that term is used in the Act. The powers of the Company shall be exercised by or under the authority of, and the business and affairs of the Company shall be managed under the direction of, the Sole Member.
9. Officers. The Sole Member may designate one or more persons to be officers of the Company. Officers are not “managers,” as that term is used in the Act. Any officers who are so designated shall have such titles and authority and perform such duties as the Sole Member may delegate to them. The salaries or other compensation, if any, of the officers of the Company shall be fixed by the Sole Member. Any officer may be removed as such, either with or without cause, by the Sole Member. Designation of an officer shall not of itself create contract rights.
10. Dissolution. The Company shall dissolve and its affairs shall be wound up at such time, if any, as the Sole Member may elect. To the maximum extent permitted by law, no other event (including, without limitation, an event described in Section 18-801(a)(4) of the Act) will cause the Company to dissolve.
11. Liability.
(a) The Sole Member and the officers shall not have any liability for the obligations or liabilities of the Company except to the extent provided herein or required by applicable law.
(b) The Company shall indemnify and hold harmless the Sole Member and the officers and their respective partners, shareholders, officers, directors, managers, employees, agents and representatives, and the partners, shareholders, officers, directors, managers, employees, agents and representatives of such persons, to the fullest extent permitted by applicable law.
12. Amendment. This Agreement may be amended from time to time only by a written consent executed by the Sole Member.
13. Governing Law. THIS AGREEMENT IS GOVERNED BY AND SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE (EXCLUDING ITS CONFLICT-OF-LAWS RULES).
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IN WITNESS WHEREOF, the undersigned, being the Sole Member of the Company, has caused this Agreement to be duly executed as of the date first written above.
| SOLE MEMBER: | ||
| OASIS PETROLEUM INC. | ||
| By: | /s/ Nickolas J. Lorentzatos | |
| Name: | Nickolas J. Lorentzatos | |
| Title: | Executive Vice President, General Counsel and Corporate Secretary | |
SIGNATURE PAGE TO
LIMITED LIABILITY COMPANY AGREEMENT OF
NEW OHM LLC
Exhibit 10.3
WARRANT ASSIGNMENT AND ASSUMPTION AGREEMENT
THIS WARRANT ASSIGNMENT AND ASSUMPTION AGREEMENT (the “Agreement”) is entered into and effective as of July 1, 2022, by and among Oasis Petroleum Inc., a Delaware corporation (“Oasis”), Whiting Petroleum Corporation, a Delaware corporation (“Whiting”), Computershare Inc., a Delaware corporation (“Computershare”) and its affiliate Computershare Trust Company, N.A., a federally chartered trust company (“CTC”). Capitalized terms used but not defined herein have the meanings given to such terms in the Merger Agreement (as defined below).
WHEREAS, Whiting, Computershare and CTC have previously entered into (i) a Series A Warrant Agreement, dated as of September 1, 2020 (the “Series A Warrant Agreement”), governing the terms of Whiting’s outstanding Series A Warrants to Purchase Common Stock (the “Whiting Series A Warrants”), and (ii) a Series B Warrant Agreement, dated as of September 1, 2020 (the “Series B Warrant Agreement” and, together with Series A Warrant Agreement, the “Warrant Agreements”), governing the terms of Whiting’s outstanding Series B Warrants to Purchase Common Stock (the “Whiting Series B Warrants” and, together with the Whiting Series A Warrants, the “Whiting Warrants”);
WHEREAS, Whiting has entered into an Agreement and Plan of Merger, dated as of March 7, 2022 (the “Merger Agreement”), by and among Whiting, Oasis, Ohm Merger Sub Inc., Inc., a Delaware corporation and a wholly owned subsidiary of Oasis (“Merger Sub”), New Ohm LLC, a Delaware limited liability company and a wholly owned subsidiary of Oasis (“LLC Sub”), pursuant to which Merger Sub will merge with and into Whiting (the “Company Merger”), with Whiting continuing as the surviving entity and a wholly owned subsidiary of Oasis. Following the Company Merger, Whiting will merge with and into LLC Sub (the “LLC Sub Merger” and, together with the Company Merger, the “Merger”), with LLC Sub surviving the LLC Sub Merger as a direct wholly owned subsidiary of Oasis;
WHEREAS, at the closing of the Merger (the “Closing”), each share of Whiting’s common stock, par value $0.001 (the “Whiting Common Stock”), issued and outstanding as of immediately prior to the Closing will be converted into the right to receive 0.5774 (the “Exchange Ratio”) shares of Oasis’s common stock, par value $0.01 (the “Oasis Common Stock”), and $6.25 in cash, without interest (the “Cash Consideration”);
WHEREAS, pursuant to Section 3.1(d) of the Merger Agreement and Section 5.1(f) of the Series A Warrant Agreement and Section 5.1(f) of the Series B Warrant Agreement, as applicable, upon the Closing, all of the outstanding Whiting Warrants will be assumed by Oasis on terms and conditions as nearly equivalent as may be practicable to provisions set forth in the applicable Warrant Agreement (each such Whiting Series A Warrant, following assumption, an “Oasis Series A Warrant” and each such Whiting Series B Warrant, following assumption, an “Oasis Series B Warrant” and collectively, the “Oasis Assumed Warrants”), except that (i) the number of shares of Oasis Common Stock subject to each such Oasis Assumed Warrant will be equal to the product of (a) the number of shares of Whiting Common Stock that were subject to each such Whiting Warrant immediately prior to the Company Merger Effective Time, multiplied by (b) the Exchange Ratio, and (ii) the per-share exercise price of each such Oasis Assumed Warrant will be equal to (rounded up to the nearest whole cent) the quotient obtained by dividing (x) (1) the exercise price per share of Whiting Common Stock at which such Whiting Warrant was exercisable immediately prior to the Closing less (2) the Cash Consideration, by (y) the Exchange Ratio;
WHEREAS, as a result of the foregoing, Whiting wishes to assign to Oasis all of Whiting’s rights, interests and obligations in and under the Warrant Agreements and Oasis wishes to accept such assignment and assume all of Whiting’s obligations thereunder, including, for the avoidance of doubt, the adjustment rights provided for in Section 5 of each Warrant Agreement, in each case, effective upon the Closing; and
WHEREAS, Section 13(b) of each Warrant Agreement provides that Whiting and the Warrant Agent (as defined in the applicable Warrant Agreement) may amend such Warrant Agreement without the consent of any Holders (as defined in the applicable Warrant Agreement) for the purpose of curing any ambiguity, or correcting or supplementing any defective provision contained therein or adding to the covenants and agreements of the Company further covenants an agreements thereafter to be observed provided that no such amendment adversely affects the rights or interests of the Holders in any material respect.
NOW, THEREFORE, for good and valuable consideration, receipt of which is hereby acknowledged, the parties hereby agree as follows:
1. Assignment and Assumption of Warrant Agreements. Whiting hereby assigns, and Oasis hereby agrees to accept and assume, effective as of the Closing, all of Whiting’s rights, interests and obligations in and under the Warrant Agreements, and Oasis hereby confirms that it agrees to all rights, interests and obligations under the Warrant Agreements.
2. Amendments to Warrant Agreements. Whiting and the Warrant Agent (as such term is defined in the applicable Warrant Agreement) hereby amend each Warrant Agreement as provided in this Section 2, effective as of the Closing. Whiting acknowledges and agrees that the amendments to the Warrant Agreements set forth in this Section 2 do not adversely affect the rights or interests of the Holders (as defined in the applicable Warrant Agreement) in any material respect:
| a. | unless the context otherwise requires, from and after the Closing, any references in the Warrant Agreements or the Whiting Warrants to: (i) the “Company” shall be amended to reference Oasis; (ii) “Common Stock” or “shares” shall be amended to reference the Oasis Common Stock or shares thereof, respectively; (iii) the “Board of Directors” or any duly authorized committee of that board shall be amended to reference the board of directors of Oasis or any committee thereof; and |
| b. | Oasis shall be considered a “Successor Company” pursuant to Section 15 of each Warrant Agreement. |
| c. | The address for notice to the Company (as defined in the applicable Warrant Agreement upon giving affect to the amendment set forth in Section 2(a) of this Agreement) pursuant to Section 11 of each Warrant Agreement shall be 1001 Fannin Street, Suite 1500, Houston, Texas 77002. |
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3. Adjustment to Exercise Terms. Effective as of the Closing:
| a. | each Whiting Series A Warrant issued and outstanding immediately prior to the Closing is hereby converted into an Oasis Series A Warrant representing the right to acquire and receive, upon the exercise of such warrant and payment of the Exercise Price (as defined in the Series A Warrant Agreement), on the same terms and conditions as nearly equivalent as may be practicable to the provisions set forth in the Series A Warrant Agreement, 0.5774 shares of Oasis Common Stock, which Oasis Series A Warrant shall have an exercise price of $116.37 per share of Oasis Common Stock. The undersigned Chief Financial Officer of Whiting hereby certifies in such capacity to the Warrant Agent (as defined in the Series A Warrant Agreement) that this Section 3(a) shall serve as the certification required by Section 5.1(j)(iii) of the Series A Warrant Agreement with respect to the foregoing adjustments to the Series A Warrants and the Exercise Price (as defined in the Series A Warrant Agreement); and |
| b. | each Whiting Series B Warrant issued and outstanding immediately prior to the Closing is hereby converted into an Oasis Series B Warrant representing the right to acquire and receive, upon the exercise of such warrant and payment of the Exercise Price (as defined in the Series B Warrant Agreement), on the same terms and conditions as nearly equivalent as may be practicable to the provisions set forth in the Series B Warrant Agreement, 0.5774 shares of Oasis Common Stock, which Oasis Series B Warrant shall have an exercise price of $133.70 per share of Oasis Common Stock. The undersigned Chief Financial Officer of Whiting hereby certifies in such capacity to the Warrant Agent (as defined in the Series B Warrant Agreement) that this Section 3(b) shall serve as the certification required by Section 5.1(j)(iii) of the Series B Warrant Agreement with respect to the foregoing adjustments to the Series B Warrants and the Exercise Price (as defined in the Series B Warrant Agreement). |
4. Replacement Instruments. As of the Closing, all outstanding instruments evidencing Whiting Series A Warrants and Whiting Series B Warrants shall automatically be deemed to evidence Oasis Series A Warrants and Oasis Series B Warrants, respectively, reflecting the conversion and adjustment to the terms and conditions described herein and in Section 5.1(f) of the Series A Warrant Agreement and Section 5.1(f) of the Series B Warrant Agreement, respectively.
5. Applicable Law. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HERETO, INCLUDING THE INTERPRETATION, CONSTRUCTION, VALIDITY AND ENFORCEABILITY THEREOF, SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO ANY RULES OR PRINCIPLES THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF ANY OTHER JURISDICTION.
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6. Counterparts; Integration; Effectiveness. This Agreement may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Agreement shall constitute the entire contract among the parties relating to the subject matter hereof and supersedes any and all previous agreements and understandings, oral or written, relating to the subject matter hereof. Except as expressly set forth in this Agreement, provisions of the Warrant Agreements which are not inconsistent with this Agreement shall remain in full force and effect.
7. Successors. Whenever in this Agreement any of the parties hereto is referred to, such reference shall be deemed to include the successors and permitted assigns of such party, and all covenants, promises and agreements in this Agreement shall bind and inure to the benefit of the parties’ respective successors and permitted assigns.
8. Certification. The undersigned Chief Financial Officer of Whiting hereby certifies in such capacity to the Warrant Agent that he is the duly elected and qualified Chief Financial Officer of Whiting and that the amendments to the Warrant Agreements set forth in this Agreement are in compliance with the terms of Section 13 of the applicable Warrant Agreement.
[Signature Page Follows]
4
IN WITNESS WHEREOF, this Agreement has been duly executed by the parties hereto as of the day and year first above written.
| OASIS PETROLEUM INC. | ||||
| By: | /s/ Michael H. Lou | |||
| Name: | Michael H. Lou | |||
| Title: | Executive Vice President and Chief Financial Officer | |||
[Signature Page to Assignment and Assumption Agreement]
| WHITING PETROLEUM CORPORATION | ||||
| By: | /s/ Lynn A. Peterson | |||
| Name: | Lynn A. Peterson | |||
| Title: | President and Chief Executive Officer | |||
[Signature Page to Assignment and Assumption Agreement]
| COMPUTERSHARE TRUST COMPANY, N.A. and COMPUTERSHARE INC. (on behalf of both entities), as Warrant Agent | ||
| By: | /s/ Collin Ekeogu | |
| Name: Collin Ekeogu | ||
| Title: Manager, Corporate Actions | ||
[Signature Page to Assignment and Assumption Agreement]
Exhibit 99.1
Whiting and Oasis Complete Combination, Establishing Chord Energy
Chord Energy Is a Scaled Unconventional U.S. Oil Producer with a Premier Williston Basin Acreage Position and Sustainable Free Cash Flow
HOUSTON, July 1, 2022 /PRNewswire/ — Chord Energy Corporation (NASDAQ: CHRD) (“Chord” or the “Company”) today announced the successful completion of the combination of Whiting Petroleum Corporation (“Whiting”) and Oasis Petroleum Inc. (“Oasis”), creating a scaled unconventional U.S. oil producer with a premier Williston Basin position with top tier assets across approximately 972,000 net acres, combined first quarter production of 171.1 thousand boepd (historical Oasis has been adjusted for three stream reporting), and enhanced free cash flow generation. Chord’s common stock is expected to begin trading on the NASDAQ Global Select Market under the ticker symbol “CHRD” on July 5, 2022. The new company is headquartered in Houston.
The word “chord” is frequently used to describe multiple musical notes sounded simultaneously and harmoniously, while an alternative definition is a line segment joining two points on a circle. Chord Energy represents the joining of separate entities whose complementary strengths create something more formidable than either independent entity. Together the new company is positioned to prosper and deliver value creation through the constantly evolving energy landscape.
“We are excited to establish Chord Energy, which will build on the proud legacies and extraordinary talent and capabilities of Whiting and Oasis,” said Danny Brown, Chord’s President and Chief Executive Officer. “With a premier Williston Basin position, a peer-leading balance sheet, significant scale and enhanced free cash flow generation, Chord is positioned to succeed. Chord will execute a focused strategy to enhance value delivery to our shareholders and maintain a strong commitment to safety, gas capture and emissions reduction. I want to thank all of our talented employees for their dedication to operating safely and with integrity as we integrate our two companies.”
Chord is well positioned to drive significant shareholder value. With added scale, high-quality assets and sustainable free cash generation, Chord has significant financial strength anchored by an attractive balance sheet, with an expected net debt(1) to EBITDAX(1) ratio of approximately 0.2x as of June 30, 2022, which is pro forma for Oasis’ $15/share special dividend announced June 16, 2022 and the $6.25/share cash merger consideration paid to Whiting shareholders in connection with the closing of the merger.
The Company expects to return 60% of its free cash flow to shareholders in the second half of 2022 through its base dividend, variable dividends, and share buybacks, and as previously announced, has a $150MM share repurchase program in place. Chord expects to pay a base dividend of $0.585 per share beginning in the third quarter of 2022 and expects to use variable dividends and share repurchases to return the full targeted amount. The transaction is expected to be accretive to key per-share metrics, including E&P cash flow, E&P free cash flow, return of capital and net asset value. Chord expects to realize administrative and operational cost savings of at least $65MM on an annual basis by the second half of 2023.
(1) Non-GAAP financial measure. Please see “Non-GAAP Financial Measures” below.
Chord’s Senior Leadership Team
As previously announced, Chord’s executive leadership team includes:
| • | Danny Brown, President & Chief Executive Officer (previously Oasis’ CEO) |
| • | Chip Rimer, Executive Vice President & Chief Operating Officer (previously Whiting’s COO) |
| • | Michael Lou, Executive Vice President & Chief Financial Officer (previously Oasis’ CFO) |
| • | Scott Regan, Executive Vice President, General Counsel & Secretary (previously Whiting’s GC) |
Additional members of Chord’s senior leadership team announced today include:
| • | Charles Ohlson, Senior Vice President Base Production |
| • | Richard Robuck, Senior Vice President Corporate Planning & Investor Relations |
| • | Jason Swaren, Senior Vice President Operations |
| • | Jennifer Charbonneau, Vice President HSE & Supply Chain |
| • | Kevin Kelly, Vice President Sustainability |
| • | Michael King, Vice President Asset Management |
| • | Lara Kroll, Vice President Accounting |
| • | Alex Wall, Vice President Business Development |
Chord’s Board of Directors
Chord’s 10-member Board of Directors has equal representation from Whiting and Oasis and was selected to ensure that the Company has the right mix of skills, experience and perspectives to provide strong corporate governance. Members include:
| • | Lynn A. Peterson, Executive Chair |
| • | Danny Brown, President and Chief Executive Officer |
| • | Douglas E. Brooks |
| • | Susan M. Cunningham |
| • | Samantha Holroyd |
| • | Paul J. Korus |
| • | Kevin S. McCarthy |
| • | Anne Taylor |
| • | Cynthia L. Walker |
| • | Marguerite N. Woung-Chapman |
For more information on Chord’s Board of Directors and senior leadership team, please visit the Company’s website at www.chordenergy.com.
Credit Facility
In conjunction with the closing of the merger, Chord has entered into an amended and restated credit facility, with the following key updates:
| • | Borrowing base increased to $2B with elected commitments totaling $800MM |
| • | The lending group from the historical Oasis credit facility continues to support Chord, and Wells Fargo, National Association, will serve as the administrative agent |
| • | The maturity date was extended to July 2027 |
| • | The amended and restated credit facility includes, among other provisions, a reduction to pricing for borrowings under the facility by 125 basis points, an improved covenant package, and more flexibility for restricted payments and investments |
Immediately prior to the merger closing, the combined company’s bank cash balance exceeded $670MM, which is before the payment of the $6.25/share merger consideration to Whiting shareholders and the $15/share special dividend to Oasis shareholders. Chord’s pro forma debt consists of $400MM of senior unsecured notes outstanding with nothing drawn on the amended and restated credit facility.
Second Quarter Guidance Update
Chord is providing updated guidance for Oasis and initial guidance for Whiting for 2Q22. Oasis’ total 2Q volumes have been adjusted to include current three stream reporting assumptions, and Chord expects to formally report on a three stream basis for 3Q22. Oasis increased its initial three stream uplift assumption above two stream Mboe/d numbers from 9% to 18% based on more precise analysis, as it prepares to formally roll out three stream reporting in November, 2022. The updated guidance included below is not intended to represent quarterly results, as such guidance remains subject to the completions of accounting and financial close and reporting processes.
| Oasis | Whiting | Pro Forma Chord | ||||
| Oil Volumes (Mbbl/d) |
40.6 – 41.4 | 48.0 – 49.0 | 88.6 – 90.4 | |||
| Total Volumes (Mboe/d) |
74.7 – 75.9 | 81.7 – 82.9 | 156.4 – 158.8 | |||
| Oil Premium / (Discount) to WTI $ per Bbl |
$3.10 - $3.80 | ($0.35) – $0.35 | $1.20 - $1.95 | |||
| Gas Revenue ($/boe) |
$37.00 - $38.50 | $34.00 - $35.50 | $35.50 - $37.00 | |||
| LOE per Boe |
$9.50 - $10.00 | $10.15 - $10.65 | $9.85 - $10.10 | |||
| GP&T per Boe |
$4.25 - $4.75 | $1.00 - $1.50 | $2.30 - $3.30 | |||
| Cash G&A ($MM) |
$13.0 - $14.5 | $8.0 - $9.5 | $21.0 - $24.0 | |||
| Production taxes |
7.1% - 7.35% | 7.2% - 7.4% | 7.1% - 7.4% | |||
| CapEx ($MM) |
$50 - $58 | $115 - $130 | $165 - $188 | |||
| Cash Interest ($MM) |
$6.9 - $7.1 | $2.0 - $3.5 | $8.9 - $10.6 | |||
| Cash Taxes ($MM) |
$0.0 - $0.0 | $0.0 - $2.0 | $0.0 - $2.0 |
Note: Cash G&A excludes one-time transaction related expenses.
Share Exchange
As previously announced, in accordance with the terms of the merger agreement, Whiting shareholders are receiving 0.5774 shares of Oasis common stock and $6.25 in cash for each share of Whiting common stock owned. The Oasis board of directors declared a special dividend of $15.00 per share, which will be paid to the Oasis shareholders of record as of June 29, 2022 on or about July 8, 2022. Former Whiting shareholders will own approximately 53% and former Oasis shareholders will own approximately 47% of Chord on a fully diluted basis.
With the completion of the transaction, as of today, Whiting common stock will no longer be listed for trading. Whiting previously traded under the ticker symbol “WLL.” Oasis will continue to trade under the ticker symbol “OAS” until July 5, 2022 when Chord is expected to begin trading under the symbol “CHRD.”
Advisors
Citi served as financial advisor and Kirkland & Ellis LLP served as legal advisor to Whiting. Tudor, Pickering, Holt & Co. and RBC Capital Markets LLC served as financial advisors and Vinson & Elkins LLP served as legal advisor to Oasis.
About Chord Energy
Chord Energy is an independent exploration and production company with quality and sustainable long-lived assets in the Williston Basin. Chord is uniquely positioned with a best-in-class balance sheet and is focused on rigorous capital discipline and generating free cash flow by operating efficiently, safely and responsibly to develop its unconventional onshore oil-rich resources in the continental United States. For more information, please visit the Company’s website at www.chordenergy.com.
Forward-Looking Statements
Certain statements in this press release concerning the Oasis and Whiting merger, including any statements regarding Chord’s expected credit facility, the results, effects, benefits and synergies of the merger, future opportunities for Chord, future financial performance and condition, guidance and any other statements regarding Chord’s future expectations, beliefs, plans, objectives, financial conditions, assumptions or future events or performance that are not historical facts are “forward-looking” statements based on assumptions currently believed to be valid. This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that Chord expects, believes or anticipates will or may occur in the future are forward-looking statements. Forward-looking statements are all statements other than statements of historical facts. The words “anticipate,” “ensure,” “expect,” “if,” “intend,” “estimate,” “probable,” “project,” “forecasts,” “predict,” “outlook,” “aim,” “will,” “could,” “should,” “would,” “potential,” “may,” “might,” “anticipate,” “likely,” “plan,” “positioned,” “strategy” and similar expressions or other words of similar meaning, and the negatives thereof, are intended to identify forward-looking statements. Specific forward-looking statements include statements regarding Chord’s plans and expectations with respect to the merger and the anticipated impact of the merger on Chord’s results of operations, financial position, growth opportunities and competitive position.
These statements are based on certain assumptions made by Chord based on management’s experience and perception of historical trends, current conditions, anticipated future developments and other factors believed to be appropriate. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of Chord, which may cause actual results to differ materially from those implied or expressed by the forward-looking statements. These include, but are not limited to, potential adverse reactions or changes to business or employee relationships, including those resulting from the completion of the merger; the diversion of management time on merger-related issues; the ultimate timing, outcome and results of integrating the operations of Chord, the effects of the business combination on Chord, including Chord’s future financial condition, results of operations, strategy and plans, the ability of Chord to realize anticipated synergies in the timeframe expected or at all, changes in crude oil and natural gas prices, developments in the global economy, the impact of pandemics such as COVID-19, weather and environmental conditions, the timing of planned capital expenditures, availability of acquisitions, uncertainties in estimating proved reserves and forecasting production results, operational factors affecting the commencement or maintenance of producing wells, the condition of the capital markets generally, as well as Chord’s ability to
access them, the proximity to and capacity of transportation facilities, uncertainties regarding environmental regulations or litigation and other legal or regulatory developments affecting Chord’s business, the fact that operating costs and business disruption may be greater than expected following the public announcement or consummation of the merger, and other important factors that could cause actual results to differ materially from those projected as described in the Chord’s reports filed with the U.S. Securities and Exchange Commission (the “SEC”).
Any forward-looking statement speaks only as of the date on which such statement is made and Chord undertakes no obligation to correct or update any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by applicable law. As forward-looking statements involve significant risks and uncertainties, caution should be exercised against placing undue reliance on such statements. Additional information concerning other risk factors is also contained in the final prospectus and definitive proxy statement filed by the Company on May 25, 2022, Oasis’ (now Chord’s) and Whiting’s most recently filed Annual Reports on Form 10-K (as may be amended), subsequent Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and other SEC filings.
Non-GAAP Financial Measures
Net-debt and EBITDAX are financial measures not prepared in accordance with United States generally accepted accounting principles (“GAAP”) that are used by management and external users of the Company’s financial statements, such as industry analysts, investors, lenders and rating agencies. The Company believes that the foregoing are useful supplemental measures that provide an indication of the results generated by the Company’s principal business activities. However, these measures are not recognized by GAAP and do not have a standardized meaning prescribed by GAAP. Therefore, these measures may not be comparable to similar measures provided by other issuers. From time to time the Company provides forward-looking forecasts of these measures; however, the Company is unable to provide a quantitative reconciliation of the forward-looking non-GAAP measures to the most directly comparable forward-looking GAAP measures because management cannot reliably quantify certain of the necessary components of such forward-looking GAAP measure. The reconciling items in future periods could be significant. To see how the Company reconciles its historical presentations of these non-GAAP measures to the most directly comparable GAAP measures, please visit the Non-GAAP Reconciliation page on the Company’s website at https://www.ir.chordenergy.com/non-gaap.
For further information:
Danny Brown, President and Chief Executive Officer, Michael H. Lou, Executive Vice President and Chief Financial Officer, Bob Bakanauskas, Managing Director, Investor Relations, (281) 404-9600, ir@chordenergy.com
Stronger Together Positioned for Value Creation July 1, 2022 Exhibit 99.2
Welcome to Chord Energy Chord (noun) /kord/ A straight line joining two points on a curve Musical notes played in unison to produce harmony ̂ By bringing together Whiting and Oasis in a merger of equals, we joined two excellent oil and gas operators to strike a new chord and created a new harmony in the industry. Chord Energy combines complementary, high-quality assets and outstanding talent and operational practices. The companies were already strategically like-minded and culturally aligned, so as Chord Energy, we are ideally positioned to enhance return of capital and generate strong free cash flow, while being responsible stewards of communities and our environment – all in unison
Important Disclosures Forward-Looking Statements Certain statements in this presentation concerning the Oasis Petroleum Inc. (“Oasis”) and Whiting Petroleum Corporation (“Whiting”) merger, including any statements regarding Chord Energy Corporation’s (“Chord”) expected credit facility, the results, effects, benefits and synergies of the merger, future opportunities for Chord, future financial performance and condition, guidance and any other statements regarding Chord’s future expectations, beliefs, plans, objectives, financial conditions, assumptions or future events or performance that are not historical facts are “forward-looking” statements based on assumptions currently believed to be valid. This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical facts, included in this presentation that address activities, events or developments that Chord expects, believes or anticipates will or may occur in the future are forward-looking statements. Forward-looking statements are all statements other than statements of historical facts. The words “anticipate,” “ensure,” “expect,” “if,” “intend,” “estimate,” “probable,” “project,” “forecasts,” “predict,” “outlook,” “aim,” “will,” “could,” “should,” “would,” “potential,” “may,” “might,” “anticipate,” “likely,” “plan,” “positioned,” “strategy” and similar expressions or other words of similar meaning, and the negatives thereof, are intended to identify forward-looking statements. Specific forward-looking statements include statements regarding Chord’s plans and expectations with respect to the merger and the anticipated impact of the merger on Chord’s results of operations, financial position, growth opportunities and competitive position. These statements are based on certain assumptions made by Chord based on management’s experience and perception of historical trends, current conditions, anticipated future developments and other factors believed to be appropriate. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of Chord, which may cause actual results to differ materially from those implied or expressed by the forward-looking statements. These include, but are not limited to, potential adverse reactions or changes to business or employee relationships, including those resulting from the completion of the merger; the diversion of management time on merger-related issues; the ultimate timing, outcome and results of integrating the operations of Chord, the effects of the business combination on Chord, including Chord’s future financial condition, results of operations, strategy and plans, the ability of Chord to realize anticipated synergies in the timeframe expected or at all, changes in crude oil and natural gas prices, developments in the global economy, the impact of pandemics such as COVID-19, weather and environmental conditions, the timing of planned capital expenditures, availability of acquisitions, uncertainties in estimating proved reserves and forecasting production results, operational factors affecting the commencement or maintenance of producing wells, the condition of the capital markets generally, as well as Chord’s ability to access them, the proximity to and capacity of transportation facilities, uncertainties regarding environmental regulations or litigation and other legal or regulatory developments affecting the Chord’s business, the fact that operating costs and business disruption may be greater than expected following the public announcement or consummation of the merger, and other important factors that could cause actual results to differ materially from those projected as described in the Chord’s reports filed with the U.S. Securities and Exchange Commission (the “SEC”). Any forward-looking statement speaks only as of the date on which such statement is made and Chord undertakes no obligation to correct or update any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by applicable law. As forward-looking statements involve significant risks and uncertainties, caution should be exercised against placing undue reliance on such statements. Additional information concerning other risk factors is also contained in the final prospectus and definitive proxy statement filed by the Company on May 25, 2022, Oasis’ (now Chord’s) and Whiting’s most recently filed Annual Reports on Form 10-K, subsequent Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and other SEC filings. Non-GAAP Financial Measures EBITDAX and free cash flow are supplemental financial measures that are not presented in accordance with generally accepted accounting principles in the United States (“GAAP”). These non-GAAP measure should not be considered in isolation or as a substitute for net income (loss), operating income (loss), net cash provided by (used in) operating activities, earnings (loss) per share or any other measures prepared under GAAP. Because these non-GAAP measures exclude some but not all items that affect net income (loss) and may vary among companies, the amounts presented may not be comparable to similar metrics of other companies. Reconciliations of these non-GAAP financial measures to their most comparable GAAP measure can be found in Oasis’ (now Chord’s) and Whiting’s most recently filed Annual Reports on Form 10-K and subsequent Quarterly Reports on Form 10-Q and Chord’s website at www.chordenergy.com. Amounts excluded from these non-GAAP measure in future periods could be significant. Cautionary Statement Regarding Oil and Gas Quantities The SEC requires oil and gas companies, in their filings with the SEC, to disclose proved reserves, which are those quantities of oil and gas, which, by analysis of geoscience and engineering data, can be estimated with reasonable certainty to be economically producible—from a given date forward, from known reservoirs, and under existing economic conditions (using unweighted average 12-month first day of the month prices), operating methods, and government regulations—prior to the time at which contracts providing the right to operate expire, unless evidence indicates that renewal is reasonably certain, regardless of whether deterministic or probabilistic methods are used for the estimation. The accuracy of any reserve estimate depends on the quality of available data, the interpretation of such data and price and cost assumptions made by reserve engineers. In addition, the results of drilling, testing and production activities of the exploration and development companies may justify revisions of estimates that were made previously. If significant, such revisions could impact Chord’s strategy and future prospects. Accordingly, reserve estimates may differ significantly from the quantities of oil and natural gas that are ultimately recovered. The SEC also permits the disclosure of separate estimates of probable or possible reserves that meet SEC definitions for such reserves; however, neither Whiting nor Oasis disclosed probable or possible reserves in its SEC filings. The production forecasts and expectations of Chord for future periods are dependent upon many assumptions, including estimates of production decline rates from existing wells and the undertaking and outcome of future drilling activity, which may be affected by significant commodity price declines or drilling cost increases.
Converted to 3 stream for Oasis for 1Q22 based on latest shrink and yield estimates Operated based on 2021 combined PDP reserves Working interest of expected PF wells completed in 2022 Pro forma combined company, includes 1Q22 actuals, 2Q22 - 4Q22 run at $90 WTI and $5.00 HH using March 7th midpoint guidance (ex weather impacts in 2Q22). Reinvestment rate is before dividends, net debt includes impact of $15/share special dividend and $6.25/share merger cash consideration Economic locations (>30% IRR @ $60/ Bbl WTI flat) and assuming 108-110 2022E TILs; 6) At merger close , the borrowing base increased to $2B with $800MM of elected commitments Chord Energy is a Premier Williston Basin Company Materially Enhanced Scale High Quality Assets Generate Significant, Sustainable Free Cash Flow Shareholder Returns Focused Business Model Maintains Financial Strength / Flexibility ESG Leadership ~$5 B equity value 171.1 Mboe/d 1Q22 net production (3 stream)1 97.8 Mbo/d 1Q22 net production 972k net acres $1.4B FCF for full year 2022E4 Combined inventory supports ~10 years of development at pro forma 2022E pace5 <35% 2022 expected re-investment rate4, maintaining ~flat production 2H22 return of capital targeted at 60% of FCF Board to determine go forward plan 0.2x net debt / 1H22E annualized EBITDAX4 at close Strong liquidity with no borrowings under $2B borrowing base6 No near-term maturities Continued commitment to ESG, sustainability and capitalizing on combined best practices 972K 171.1 92% 68% Net Acres Mboepd1 Operated2 Working Interest3 Chord Energy Property
1) Pro forma excluding ownership of CEQP units Transaction Accretive on Key Metrics for Both Companies E&P Cash Flow Per Share and Free Cash Flow Per Share1 Return of Capital Per Share Size and Scale Net Asset value Credit Profile and Cost of Capital
Premier Management Team Aligned with Shareholders Strong strategic and cultural alignment Talented team bring operating best practices Management team with deep energy industry, M&A and operational backgrounds Significant Williston expertise from Whiting, Oasis and Kodiak Commercial, operational, and leadership experience from Anadarko and Noble Management equity compensation program focused on driving shareholder value creation Collective experience driving strong ESG outcomes Lynn A. Peterson Executive Chair of the Board Former Whiting President & CEO since September 2020 Former Chairman, CEO and President of SRC Energy and Co-founder, director, President & CEO of Kodiak Oil & Gas Corporation Danny Brown President & Chief Executive Officer Former Oasis director & CEO since April 2021 Former EVP, US Onshore at Anadarko; Former EVP, Deepwater/International at Anadarko Michael Lou Chief Financial Officer Former Oasis EVP and CFO since August 2011 Former Oasis SVP, Finance, President and Director at Oasis Midstream Partners, Former CFO at Giant Energy and XXL Energy Chip Rimer Chief Operating Officer Former Whiting EVP and COO since November 2018 Former SVP, Global Services for Noble Energy and served in multiple roles at Samedan/Noble Energy, including SVP, Global EHSR & Operations Services and Vice President of Operations Services M. Scott Regan General Counsel Former Whiting GC since November 2020 (formerly Deputy GC since November 2015) Former VP, Legal, Western and Southern Operations at Ovintiv
Sources: Company filings and Enverus 1Q22 reported Williston production. Converted to 3-stream for operators with 2-stream reported production Economic locations (>30% IRR @ $60/Bbl WTI flat) and assuming 108 - 110 2022E TILs Premier Williston Operator with Top-Tier Assets Williston Net Acreage by Operator (‘000s) Williston Net Production by Operator1 Asset Highlights Combined inventory supports ~10 years of development at pro forma 2022E pace2 Improved E&P margins from expected cost synergies and decline profiles Montana North Dakota Montana North Dakota Williams Divide Burke Sheridan Roosevelt Richland McKenzie Dunn Billings Golden Valley Wibaux Dawson Stark Mercer McLean Mountrail Ward Renville Morton Oliver
OAS returned approximately $70MM per quarter in 1H22 through base and variable dividends. WLL returned approximately $20MM in 1H22 through base dividends Cash flow from Operations (CFFO) and Free Cash Flow (FCF) before dividends based on March 7th midpoint guidance and $90 WTI and $5.00 HH. Significant FCF Generation Accretive to Return of Capital Program in 2022 Accretive Return of Capital Program for 2022 1H22: ~$160MM of capital returned to shareholders through base and variable dividends1 Merger Close: ~$540MM of cash returned to shareholders OAS special dividend of $15.00 per share WLL cash consideration of $6.25 per share Post Close: Aggregate base dividend increased to ~$25MM per quarter, or $0.585/ share Announced return of 60% of Free Cash Flow to shareholders in 2H22 through base dividend, variable dividends, and share buybacks. As previously announced, the Company has a $150MM share repurchase program in place. 2 2 2H22E FCF Generation at Various WTI Prices Returning 60% of FCF
Key Tenets of ESG Philosophy Header ESG Key Tenets Minimizing impact where we operate Reducing our land impact and water use through investment in infrastructure and optimized operations. Aligning incentives Aligning executive compensation with long term value creation and shareholder interests is key to earning investor confidence. Reducing emissions Investing to reduce emission intensity supports the responsible and sustainable development of our resources. Benefiting communities Supporting programs that address needs of the communities where we operate is critical to maintaining a sustainable business. Safety always Maintaining the safety of employees, contractors, and communities is of utmost importance and fundamental to our business. Promoting diverse and inclusive culture Fostering a collaborative work environment and encouraging diversity of ideas gives us a competitive advantage in our ability to innovate and meet the challenges of tomorrow.
Impressive Record of Emissions Reduction (28%) (47%) Chord GHG Emissions Intensity (TCO2E / MBOE) Reductions Since 20181 2020 GHG Emission Intensity (TCO2E / MBOE) Top 15 Operators Based on Gross OP. Production Sources: EPA and Enverus Williston Basin only, excludes historic Permian production as well as historic production associated with assets acquired in 2021
Short-tenured, Diverse, and Highly Capable Board of Directors Lynn A. Peterson Executive Chair of the Board Former Whiting President & CEO since September 2020 Former Chairman, CEO and President of SRC Energy and Co-founder, director, President & CEO of Kodiak Oil & Gas Corporation Danny Brown President & Chief Executive Officer Former Oasis director & CEO since April 2021 Former EVP, US Onshore at Anadarko; Former EVP, Deepwater/International at Anadarko Douglas Brooks Compensation & ESG Committees / Lead Independent Director Former Oasis director Leadership experience with Marathon, Energy XXI, Yates, and Aurora Board experience with California Resources, Chaparral, Madelena, Energy XXI, Yates, and Aurora Susan Cunningham ESG Chair / Audit Committee Former Whiting director Extensive experience including management, operations and geology at Noble Energy, Statoil, Amoco, and Texaco Samantha Holroyd Audit Committee / ESG Committee Former Oasis director Energy investment banking, principal investing and oil & gas experience at Lantana Energy, TPG Sixth Street, Denham, and Shell Board experience at Amerant Bancorp and Gulfport Energy. Paul Korus Audit Committee / ESG Committee Former Whiting director Extensive oil & gas industry experience at Cimarex, Key Production Company, and Apache Kevin McCarthy Compensation / Nomination & Governance Committees Former Whiting director Significant energy finance and investment experience with deep knowledge of oil and gas commodity markets and oil and gas companies Leadership experience with Kayne Anderson, UBS, PaineWebber and Dean Witter Anne Taylor Compensation Chair / Nomination & Governance Committee Former Whiting director Extensive background in business strategy development and execution, management and leadership, talent development and corporate governance, as well as energy industry and public company knowledge, primarily at Deloitte Cynthia Walker Audit Chair / Nomination & Governance Committee Former Oasis director Range of leadership experience at Occidental and Goldman Sachs. Current Board experience with Sempra. Marguerite Woung-Chapman Nomination & Governance Chair Compensation Committee Former Oasis director Management, land, corporate law experience at Energy XXI and EP Energy Board experience with Summit Midstream and the Girls Scouts of San Jacinto
Source: FactSet as of 6/30/2022. Note: Peers include CIVI, CPE, ERF, MGY, MTDR, PDCE and SM. Peers reflect FactSet consensus. OAS and WLL figures shown based on 1Q22 actuals and 2Q22-4Q22 run at $90 WTI and $5.00 HH based on March 7th midpoint of guidance and excludes 2Q22 weather impact. No synergies included in NewCo 2022E EBITDAX. Shown on an illustrative 3-stream basis to be comparable with peers.(assumed 18% uplift) Attractive Pro Forma Positioning 2022E NET PRODUCTION (MBOE/D AND MBO/D; WALL ST. CONSENSUS ESTIMATES1,2) 2022E EBITDAX ($B; WALL ST. CONSENSUS ESTIMATES1)
Source: FactSet as of 6/30/2022. Note: Peers include CIVI, CPE, ERF, MGY, MTDR, PDCE and SM. Peers reflect FactSet consensus. OAS and WLL figures shown based on 1Q22 actuals and 2Q22-4Q22 run at $90 WTI and $5.00 HH based on March 7th midpoint of guidance and excludes 2Q22 weather impact. No synergies included in NewCo 2022E EBITDAX. For FCF yield, estimated market cap reduced by $15/share special dividend to OAS and $6.25/share WLL merger concession, which assumes the market will revalue the equity for cash distributed in connection with the merger close on 7/01/22 Significant Upside Potential ENTERPRISE VALUE / 2022E EBITDAX WALL ST. CONSENSUS ESTIMATES1 2022E FCF YIELD2 WALL ST. CONSENSUS ESTIMATES TRADING AT MEDIAN OF 2.8X WOULD EQUATE TO ~22% UPLIFT IN NEWCO VALUE (2) (2)
Compelling Long Term Value Proposition Attractive pro forma valuation vs peers result in compelling investment opportunity Significant and Resilient Free Cash Flow Generation ~$1.4B of FCF1 expected in 2022 with a combined reinvestment rate below 40% Experienced and Talented Teams Combines outstanding talent and best practices from both companies Capital Returns Program to Deliver Significant Value Targeting return of capital at 60% of FCF in 2H22 through base and variable dividends and share buybacks Enhances Position as Low-Cost Operator Anticipate ~$65MM in identified administrative and operational cost synergies by 2H23 while combining operational best practices to further advance efficiencies Premier Williston Operator with Top Tier Assets Enhances size and scale with high quality assets across ~972K net acres and low breakeven pricing 1) Free Cash Flow (FCF) before dividends reflects 1Q22 actual performance and March 7th midpoint guidance which excludes weather impacts in 2Q22, run at $90/bbl WTI and $5.00 HH in 2Q22-4Q22 Chord Energy = Premier FCF Focused E&P
Appendix
EBITDAX, reinvestment rate & FCF before dividends, reflects 1Q22 actuals with 2Q22-4Q22 run at $90 WTI and $5.00 HH using midpoint of guidance announced March 7th and excludes 2Q22 weather impact. Excludes effective synergies, reflects guidance announced March 7th, adjusted for updated 3 stream assumption (see note #3). Does not include actuals. Expect to discuss 2022 guidance in August 2022. Assumes Oasis volumes as 3-stream using 18% uplift to volumes (mboepd) to convert from 2 to 3 stream. Gas revenue ($/boe) represents estimated natural gas and natural gas liquids (NGL) revenue per BOE at the assumed price deck of $85 WTI and $3.50 HH for 2H22 and Actuals/Estimates for 1H22. Cash G&A guidance excludes one-time items associated with transactions Combined 2022 Program Maximizes Returns HIGHLIGHTS Investing $655-695MM in attractive projects across core of Williston Basin Reinvestment rate below 35%1 Running 3 to 4 rigs Targeting 108-110 gross operated well completions ~68% Working interest >20% 3-mile laterals Only 27% of annual completions in 1H22, resulting in 2H22 volume growth 3-stream volumes of 170-175 Mboe/d3 (~56% oil cut ) Volumes an output of program designed to maximize returns with low reinvestment rate Sustainable maintenance level Key focus areas: South Nesson, Sanish, Indian Hills/City of Williston, FBIR, Foreman Butte and Cassandra EBITDAX ~$2.2B1 Free cash flow ~$1.4B1 2022 GUIDANCE RANGES2 Oil Volumes (Mbbl/d) 94.0 - 100.0 Total Volumes (Mboe/d)3 170.0 - 175.0 Oil Differential per Bbl $2.00 - $1.50 Gas Revenue ($/boe)4 $22.50 - $20.50 LOE per Boe $8.25 - $9.25 GP&T per Boe $2.70 - $3.00 Cash G&A ($MM)5 $87.0 - $95.0 Production taxes 7.0% - 7.3% CapEx ($MM) $655.0 - $695.0 Cash Interest ($MM) $34.0 - $38.0 Cash Taxes ($MM) $25.0 - $35.0
The updated guidance included herein is not intended to represent quarterly results, as such guidance remains subject to the completion of accounting and financial close and reporting processes. Oasis’ Total Volumes have been adjusted to include current 3 stream reporting assumptions, and Chord expects to formally report on a 3 stream basis for 3Q22. Oasis’s increased its initial 3 stream uplift assumption above 2 stream Mboepd numbers from 9% to 18% based on more precise analysis as it prepares to formally roll out 3 stream reporting in November. Cash G&A guidance excludes one-time items associated with transactions Preliminary PF Chord 2Q22 Guidance HIGHLIGHTS Exceeded expected pace for bringing wells online that were down due to inclement weather in 2Q Internal process during 2Q to convert two stream to three stream at OAS resulted in updated view of shrink and yield. Estimates for BOE uplift increased from 9% to 18%, and new estimates included in guidance. Weather pushed completions at OAS out from 2Q into 3Q, while minimal delays were experienced at WLL CapEx for OAS was pushed from 2Q into 3Q WLL 2Q CapEx/activity in-line with expectations Immediately prior to the merger closing, the Company’s bank cash balance exceeded $670MM, which is before the $6.25/share merger consideration to Whiting shareholders and $15/share special dividend to Oasis shareholders were paid. Pro forma debt consists of $400MM of senior unsecured notes with nothing drawn on the credit facility. 2Q22 GUIDANCE RANGES1 Oil Volumes (Mbbl/d) 40.6 – 41.4 48.0 - 49.0 88.6 – 90.4 Total Volumes (Mboe/d)2 74.7 – 75.9 81.7 - 82.9 156.4 - 158.8 Oil Premium / (Discount) to WTI $ per Bbl $3.10 - $3.80 ($0.35) – $0.35 $1.20 - $1.95 Gas Revenue ($/boe) $37.00 - $38.50 $34.00 - $35.50 $35.50 - $37.00 LOE per Boe $9.50 - $10.00 $10.15 - $10.65 $9.85 - $10.10 GP&T per Boe $4.25 - $4.75 $1.00 - $1.50 $2.30 - $3.30 Cash G&A ($MM)3 $13.0 - $14.5 $8.0 - $9.5 $21.0 - $24.0 Production taxes 7.1% - 7.35% 7.2% - 7.4% 7.1% - 7.4% CapEx ($MM) $50 - $58 $115 - $130 $165 - $188 Cash Interest ($MM) $6.9 - $7.1 $2.0 - $3.5 $8.9 - $10.6 Cash Taxes ($MM) $0.0 - $0.0 $0.0 - $2.0 $0 - $2 OAS WLL PF Chord
Chord PF 1Q22 Financial and Operational Results* * Oasis’ Total Production has been adjusted to include current 3 stream reporting assumptions. Oasis’s increased its initial 3 stream uplift assumption above 2 stream Mboepd numbers from 9% to 18%. 1Q22 excludes ~$4.1MM for OAS and $6.1MM of legal and other fees related to M&A Adjusted EBITDA conforms to definition of EBITDA in credit facility Excludes capitalized interest for OAS only
1) Pro forma for announced 11.3mm unit issuance associated with First Reserve acquisition Chord Energy Hedge Book & Investment in CEQP Hedge Book CEQP Ownership Q2-22 Q3-22 Q4-22 Q1-23 Q2-23 Q3-23 Q4-23 NYMEX WTI Oil Hedging Swap volume (mbopd) 28.0 28.0 30.0 25.0 16.0 14.0 14.0 Weighted avg. swap price $72.45 $72.45 $72.32 $61.57 $53.69 $50.00 $50.00 Collar volume (mbopd) 49.0 43.2 42.0 36.0 24.1 14.0 12.0 Weighted avg. ceiling price $60.83 $60.05 $60.00 $59.12 $63.66 $65.43 $64.88 Weighted avg. floor price $47.90 $47.85 $48.13 $45.75 $46.23 $45.71 $45.00 NYMEX Henry Hub Gas Hedging Swap volume (MMBtu/d) 84,000 15,000 30,000 20,000 Weighted avg. swap price $3.12 $3.53 $4.19 $4.25 Collar volume (MMBtu/d) 30,000 62,000 47,500 50,000 25,000 22,000 Weighted avg. ceiling price $2.80 $3.23 $3.41 $4.24 $2.75 $2.98 Weighted avg. floor price $2.30 $2.66 $2.71 $3.35 $2.15 $2.50 CEQP Capital Structure MM 2022 Distribution per Unit 2022E PF Distribution Public Units 76.98 Chord Units 21.0 $2.59 $54.4 Total Units 109.31