Ring Energy (REI) Investor presentation summary

Transaction overview

• Acquiring Lime Rock Resources' assets in Andrews County, TX for $100 million, with up to 7.4 million shares issued and $10 million deferred cash payment.

• Upfront cash funded by borrowings under a $600 million credit facility; effective date October 1, 2024, expected close by March 2025.

• Assets include ~17,700 net acres, ~2,300 Boe/d production (>80% oil), and over 40 gross drilling locations.

• Acquisition price is less than 85% of proved developed PV-10 value at strip pricing.

• Pro forma leverage ratio expected to remain below 1.8x Net Debt/LTM EBITDA at close.

Strategic rationale and synergies

• Expands high-return operating area and strengthens position as a leading Permian consolidator.

• Seamless integration expected, with identified cost reduction opportunities and no additional G&A.

• Modern completion techniques projected to improve recoveries by ~40% and reduce capital costs.

• Asset's shallow decline rate (~13%) supports consistent cash flow and capital efficiency.

• Enhances inventory of high-return development opportunities with superior economics.

Financial impact and value creation

• Highly accretive to key per-share financial and operating metrics.

• Expected to accelerate free cash flow generation and debt reduction, with a reinvestment rate below 40%.

• Strong cash operating margins and EBITDA margin (~70%) provide resilience through commodity cycles.

• Purchase price structure supports balance sheet strength and future capital returns.

• Pro forma company will see increases in net production, oil weighting, and gross drilling locations.