Bonanza Creek Energy, Inc. (NYSE: BCEI) entered into an agreement to acquire Extraction Oil & Gas, Inc. (NASDAQ:XOG) from Kimmeridge Energy Management Company, LLC and others for $1.2 billion in a merger of equals transaction on May 9, 2021. Under the terms of the definitive merger agreement, Extraction shareholders will receive a fixed exchange ratio of 1.1711 shares of Bonanza Creek common shares for each share of Extraction common stock owned on the closing date. Upon completion of the transaction, Bonanza Creek and Extraction shareholders will each own approximately 50.0% of Civitas, both on a fully diluted basis. In a related transaction, Bonanza Creek Energy, Inc. and Extraction Oil & Gas, Inc. entered into a definitive agreement to acquire Crestone Peak Resources on June 6, 2021 in a bid to consolidate strategy in the Denver-Julesburg (DJ) Basin. The combined company, to be named Civitas Resources, Inc. with an aggregate enterprise value of approximately $2.6 billion. At closing, Civitas is projected to be one of most well-capitalized companies in the industry, with a leverage ratio below 0.3x pro forma 1Q21 Net Debt / 2021E EBITDA. Bonanza Creek's stock symbol on the NYSE will be changed to “CIVI.” The agreement covers a termination fee of $37.5 million for both Bonanza Creek Energy and Extraction Oil & Gas. As of June 8, 2021, reduction of BCEI's termination fee under the XOG Merger Agreement to $22,500,000.

Bonanza Creek President and Chief Executive Officer, Eric Greager, will serve as President and Chief Executive Officer of Civitas Following the merger, the Civitas Board of Directors will consist of eight members, four directors from Bonanza Creek and four from Extraction. Extraction's current Chairman, Ben Dell, will be Chairman of the Board and Bonanza Creek's current President and Chief Executive Officer will be President and Chief Executive Officer of Civitas. The combined company's executive team will include demonstrated leaders from each of Bonanza Creek and Extraction, including: Matt Owens as Executive Vice President and Chief Operating Officer, Marianella Foschi as Executive Vice President and Chief Financing Officer, Skip Marter as Executive Vice President and General Counsel, Sandi Garbiso as Senior Vice President and Chief Analytics Officer and Brian Cain as Vice President of External Affairs and ESG Policy. Extraction Chairman of the Board, Ben Dell, will serve as Chairman of Civitas. Civitas will be headquartered in Denver, Colorado.

The closing of the merger is subject to customary closing conditions, including approvals by Bonanza Creek and Extraction shareholders, credit party and lenders, Registration Statement shall have been declared effective by the SEC, shares of Bonanza Common Stock issuable to the holders of shares of Extraction Oil & Gas Common Stock to be issued pursuant to this agreement shall have been authorized for listing on the NYSE, upon official notice of issuance and any waiting period applicable to the transactions under the HSR Act shall have been terminated or shall have expired. The deal has been unanimously approved by the Boards of Directors of both companies. As of May 21, 2021, Bonanza Creek Energy, Inc. entered into a letter agreement with JPMorgan Chase Bank, N.A. under which the lenders consented, subject to certain limitations, the transaction. The lenders also agreed to a postponement of the May 1, 2021 borrowing base redetermination to July 1, 2021. Kimmeridge Energy has agreed to vote its 38% Extraction stake in favor of the transaction. The meeting of the shareholders of Bonanza Creek Energy is scheduled on July 28, 2021. The waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, expired for the XOG Merger on June 21, 2021. The transaction is expected to close in the third quarter of 2021. As of June 7, 2021, the transaction is expected to close in the fall of 2021. As of August 9, 2021, the transaction is expected to close in the fourth quarter of 2021. The transaction is expected to be significantly accretive to free cash flow and other per-share metrics.

John Fossum, Max Silverman, Austin Hughes and Jon Hughes of Petrie Partners Securities, LLC acted as financial advisor and fairness opinion provider to Extraction Oil & Gas, Inc. Jonathan Cox and Michael Johnson of J.P. Morgan Securities LLC acted as financial advisor and fairness opinion provider to Bonanza Creek. Steve Gill, Shelley Barber, Katherine Frank, James Meyer, Wendy Salinas, Shane Tucker, Sean Becker, Brett Santoli, Paul Heath, Larry Nettles, Suzanne Clevenger, John Grand and Elena Sauber of Vinson & Elkins LLP is serving as legal advisor to Bonanza Creek. Doug Bacon, Julian Seiguer, Enoch Varner, Alex Rose, Bryan Flannery, Anthony Speier, Chris Heasley, Mark Dundon, Will Bos, Stephen Jacobson, Stephanie Jeane, Mitch McClellan, Jeffrey Quinn, Jackson Phinney, R.D. Kohut, Sydney Jones, Mario Mancuso, Shan Khan, Joe Tobias, Jonathan Kidwell, Liz Dyer, Jennifer Cornejo, Erica Rozow, Brooksany Barrowes, Marcia Hook and Luci Hague from Kirkland & Ellis LLP is serving as legal advisor to Extraction Oil & Gas, Inc. and the combined company Civitas Resources. Schulte Roth & Zabel LLP acted as legal advisor to Kimmeridge Energy Management Company, LLC. MacKenzie Partners, Inc. acted as proxy solicitor to Bonanza Creek. For proxy solicitation services, MacKenzie Partners will receive an estimated fee of approximately $30,000, plus reasonable out-of-pocket expenses and fees for any additional services. Broadridge Corporate Issuer Solutions, Inc. acted as transfer agent to Bonanza Creek.

Bonanza Creek Energy, Inc. (NYSE: BCEI) completed the acquisition of Extraction Oil & Gas, Inc. (NASDAQ:XOG) from Kimmeridge Energy Management Company, LLC and others in a merger of equals transaction on November 1, 2021. The Civitas board of directors is now composed of nine members, four from legacy Bonanza Creek, four from legacy Extraction and one representative from legacy Crestone. Extraction's former Chairman, Ben Dell, will serve as Chairman of the Civitas Board. Brian Steck, former Chairman of Bonanza Creek and a continuing member of the Civitas Board.