Painted Pony Enters into Agreement to be Acquired by Canadian Natural Resources Limited - Seite 2

The Transaction is subject to various closing conditions, including receipt of court approval, the required Painted Pony Securityholder approval at the Meeting and certain regulatory approvals, including approval under the Competition Act (Canada). Upon closing of the Transaction, the Painted Pony Shares will be de-listed from the TSX.

The Arrangement Agreement contains customary representations and warranties of each party and interim operational covenants by Painted Pony. The Arrangement Agreement also provides for, among other things, customary support and non-solicitation covenants by Painted Pony, subject to a “fiduciary out” for unsolicited “superior proposals” in favour of Painted Pony and a provision for the right to match any superior proposals in favour of the Purchaser.

The Arrangement Agreement provides for a non-completion fee of $20 million, payable in the event that the Transaction is not completed or is terminated in certain circumstances, including if Painted Pony enters into an agreement with respect to a superior proposal or if the Board withdraws or modifies its recommendation with respect to the Transaction.

All of the directors and executive officers of Painted Pony, together with Painted Pony’s two largest shareholders, have entered into support agreements and have agreed to support the Transaction and vote an aggregate of approximately 25% of the outstanding Painted Pony Shares in favour of the Transaction, subject to the provisions of such support agreements.

Further details with respect to the Transaction will be included in the information circular to be mailed to the Securityholders in connection with the Meeting. The Meeting is expected to be held in September 2020 with closing of the Transaction to occur soon thereafter upon satisfaction of all conditions precedent. A copy of the Arrangement Agreement and the information circular will be filed on Painted Pony’s SEDAR profile and will be available for viewing at www.sedar.com.

RECOMMENDATION OF THE BOARD
Based on the Fairness Opinion (as defined below) and the recommendation of the Independent Committee, and after consulting with its financial and legal advisors, among other considerations, the Board has unanimously: (i) determined that the Arrangement is fair, from a financial point of view, to Painted Pony’s shareholders; (ii) resolved to recommend that the Securityholders vote in favour of the Transaction; and (iii) determined that the Arrangement and the entry into the Arrangement Agreement are in the best interests of Painted Pony.