|Hess Sends Second Letter to Shareholders|
Encourages Shareholders to Preserve the Integrity of the Company’s Transformation and Protect Long Term Value
Recommends Voting the WHITE Proxy Card for the Election of Hess’ Highly Qualified, Independent Nominees
The Board recommends that shareholders vote for the election of Hess’ highly qualified independent nominees on the WHITE proxy card.
For information about Hess’ transformation and the 2013 Annual Meeting, please visit: www.transforminghess.com.
Included below is the full text of the letter to Hess shareholders:
Dear Fellow Shareholder:
PLEASE VOTE THE WHITE PROXY CARD TODAY TO SUPPORT THE HESS BOARD
DON’T LET THE ELLIOTT HEDGE FUND PURSUE ITS SELF-SERVING SHORT-TERM AGENDA AND DESTROY THE LONG TERM VALUE OF YOUR INVESTMENT
Hess’ upcoming 2013 Annual Meeting is vitally important for your Company and the value of your investment. Hess is executing a transformation into a focused, pure play exploration and production (“E&P”) company that will create significant and lasting value for all Hess shareholders.
Hess has nominated five outstanding new, highly experienced and independent candidates for election to the Board, and your vote in favor of these nominees is critical to preserve the integrity of our transformation and protect the long-term value of your investment. Please vote the enclosed WHITE PROXY CARD today in support of the Hess Nominees.
In contrast, Paul Singer’s hedge fund Elliott Management recently acquired shares in Hess and is seeking to elect five of its own directors to your Board without even making the effort to meet with us to learn about Hess. The Elliott directors are being compensated directly by Elliott through an unusual contingent payment scheme that incentivizes them to support a short term break-up plan that will effectively liquidate Hess.
The Elliott plan, which has been roundly criticized by
Your vote on the WHITE PROXY CARD will help ensure that Hess has a Board of Directors focused on our market-endorsed strategy to create lasting value for all Hess shareholders. You may vote by telephone, by Internet, or by signing, dating and returning the enclosed WHITE PROXY CARD in the postage‐paid envelope provided. Please take a moment and vote your shares today.
HESS IS SUCCESSFULLY CREATING VALUE
We recently unveiled a number of decisive actions to advance our previously announced transformation to a pure play E&P company with a higher growth, lower risk, portfolio of world class assets. We are selling non-core assets, paying down debt, strengthening our balance sheet, and efficiently allocating capital to fund growth. We have committed to increased dividends and have authorized a substantial share repurchase program that will deliver real value to you.
Hess is Executing Its Transformation Strategy
We are making significant progress against our carefully vetted transformation plan.
The market recognizes that Hess is pursuing a superior path to create
value. Hess shares significantly outperformed the peer index, rising
Our long standing view on the shares is that Hess has provided line of sight for investors that provides a route to release value and underlines a balanced growth outlook that is competitive versus peers. To separate the company in two introduces unnecessary risks and a level of uncertainty that reasonably impacts our current view of the investment case.
In short…we do not believe that [Elliott’s] plan provides the best path forward. In our view, Hess's own plan makes more sense…
We take management’s side in terms of the future course of the company. As it stands, management has already laid out its intention to do much of what Elliott Management would like. However, we do not think breaking up the company into an onshore resource player (Hess Resources) and international, mostly offshore, entity (Hess Remainco) is the best way to generate value.
At the same time, our field team, led by
It is this issue [Bakken drilling and completion costs] that underlines our view that as an operator Hess has consistently bettered well results of many of its peers, in stark contrast to the premise presented by Elliott.
Hess appears to be drilling one of the best portfolios of wells in the industry according to our analysis.
…[The] Bakken wells that Hess was much punished for last year are a thing of the past.
We are convinced that we have the right assets, the right operators, the right technology, the right strategy, and the right Board to create substantial value for all Hess shareholders.
THE RIGHT BOARD FOR HESS
Execution and accountability are critical at this juncture of the Company’s transformation. As such, you deserve a Board with seriousness of purpose – one that is independent and committed to the execution of a strategy that has been overwhelmingly endorsed by the market. The six new Hess directors we have named, including our five nominees up for election this year, bring the skills and experience we need that bear directly on all aspects of our transformation.
We are confident that the Hess Board, including our five new nominees, will continue to bring you: real execution; real accountability; no conflicts; no distractions; and strong performance.
Our nominees have reviewed the Hess plan in detail and believe it is vastly superior to the Elliott plan. They are committed to overseeing the continued execution of our plan to create value for all shareholders. In contrast, Elliott is offering conflicted directors who signed onto a payoff scheme in which Elliott will potentially reward them with millions of dollars if they pursue short sighted strategies, including Elliott’s breakup plan.
YOUR VOTE IS IMPORTANT - NO MATTER HOW MANY SHARES YOU OWN - MAKE YOUR VOICE HEARD
PLEASE VOTE THE WHITE PROXY CARD TODAY
The slate listed on the WHITE PROXY CARD is comprised of serious, accomplished and dedicated senior executives who are committed to doing what is in the best interests of all of Hess’ stockholders. We urge you to vote for them today.
There is a very stark choice in front of all of us as Hess shareholders. It is also an easy choice. Your vote FOR our five highly qualified and experienced Hess director nominees will ensure Hess continues creating near term value and driving returns over the long term for all Hess shareholders.
Whether or not you plan to attend the Annual Meeting, you have the opportunity to protect your investment by promptly voting the WHITE PROXY CARD. We urge you to vote today by telephone, by Internet, or by signing, dating and returning the enclosed WHITE PROXY CARD in the postage-paid envelope provided. We urge you to reject Elliott’s value destructive ideas by discarding any proxy materials sent you by Elliott Management or its representatives.
On behalf of the Board of Directors, we thank you for your continued support, and we look forward to continuing to deliver outstanding value to you in the future.
This document contains projections and other forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. These projections
and statements reflect the Company’s current views with respect to
future events and financial performance. No assurances can be given,
however, that these events will occur or that these projections will be
achieved, and actual results could differ materially from those
projected as a result of certain risk factors. A discussion of these
risk factors is included in the Company’s periodic reports filed with
This document contains quotes and excerpts from certain previously published material. Consent of the author and publication has not been obtained to use the material as proxy soliciting material.
Important Additional Information