Greetings. Welcome to Crescent Energy's acquisition of Vital Energy conference call. T his time, all participants will be in listen-only mode. The question and answer session will follow the formal presentation. If anyone this morning should require operator assistance during the conference, please press star zero from your telephone keypad. Please note that this conference is being recorded at this time. I'll hand the conference over to Reid Gallagher with Investor Relations. Reid, you may now begin. Good morning and thank you for joining this call covering Crescent's announced transaction with Vital Energy. Our prepared remarks today will come from our CEO David Rockecharlie along with Vital's President and CEO Jason Pigott. We'll also have our CFO Brandi Kendall and other members of our leadership team available during Q&A. Today's call may contain projections and other forward-looking statements within the meaning of federal securities law. These statements are subject to risks and uncertainties including commodity price volatility, global geopolitical conflict, our business strategies, and other factors and may cause actual results to differ materially from those expressed or implied in these statements and our other disclosures. We have no obligation to update any forward-looking statements after today's call. With that, I will turn it over to our CEO David. Good morning everyone and thank you for joining us today. We're pleased to announce that Crescent Energy has signed a definitive agreement to acquire Vital Energy in an all-stock transaction, creating a top 10 independent operator with line of sight to an investment-grade rating. Alongside this acquisition, we are increasing our non-core divestiture pipeline to $1 billion. With these steps, we are even better positioned. Crescent will have more focus, more scale, and more potential to deliver long-term value to shareholders. Before getting into the merits of the transaction, I want to commend Jason and everyone on the team at Vital for the business that they have built. Crescent is looking forward to integrating Vital's attractive Permian assets into our portfolio and becoming a part of the Midland community. We are proud to welcome the Vital team into the Crescent organization. Turning to the transaction, I would like to start by highlighting the three things I hope you all take away from this call. First, this acquisition represents compelling value, generating attractive cash-on-cash investment returns in line with our target of greater than 2x multiple divested capital, with the valuation covered by Vital's existing production base and delivering immediate and significant accretion to both near-term and long-term metrics, including more than 20% accretion to five-year free cash flow per share and more than 10% accretion to net asset value per share. Second, as always, we will apply Crescent's consistent strategy to this acquisition. We plan to high-grade capital allocation on Vital's assets by reducing activity and increasing both free cash flow and returns. This is a leverage-accretive business plan. Our approach to pro forma operations, combined with our $1 billion divestiture pipeline, supports our commitment to an investment-grade balance sheet and to our attractive, peer-leading return of capital program. Finally, with its scaled entry into the Permian, we significantly expand Crescent's opportunity for future growth. With more than $60 billion of asset acquisition potential surrounding our pro forma footprint in the Eagle Ford, we have demonstrated our playbook for our accretive growth through acquisition strategy. We are confident in our ability to continue to execute across our combined portfolio. I will now go over the key terms of the transaction, which is structured as an all-stock deal. Each Vital shareholder will receive 1.9062 shares of Crescent common stock for each share of Vital common stock upon closing, which is expected by year-end. Vital shareholders will own approximately 23% of the combined company on a full legacy basis. Both boards have unanimously approved the transaction, and major shareholders of both companies are party to agreements serving to support the transaction. Following close, the Crescent board will expand to 12 members, with 10 representatives from Crescent and two from Vital. As mentioned in my opening remarks, this attractive combination creates a top 10 independent, catalyzing a step change in Crescent's market position. With attractive tailwinds from an increased investor pool, incremental index inclusion, and a potential ratings uplift with enhanced scale, the combined company will have an enterprise value of approximately $9 billion and a free cash flow generation capacity comparable to our new top 10 peers. The transaction provides a substantial foothold in the Permian that complements our existing scaled positions across the Eagle Ford and Uinta. Together the combined company produces nearly 400,000 barrels of oil equivalent per day with nearly $13 billion of total proved SEC reserves and has capital allocation flexibility across basins and commodities that support significant and sustainable free cash flow generation through commodity funds. The combined company will hold nearly 1 million net acres across its four core areas with more than a decade of low-risk development inventory and significant resource upside to support our development programs far into the future. We operate some of the largest positions across both the Eagle Ford and Uinta basins and this transaction provides a scaled foothold in the Permian where we see significant opportunity for future growth. Vital contributes substantial and competitive inventory to a pro forma portfolio that generates attractive returns in today's price environment. We also expect to deliver meaningful pro forma efficiencies including $90 million- $100 million of immediate annual savings to further enhance our free cash flow focused operating plan. These savings are straightforward, driven by Crescent 's more favorable cost of debt, lower corporate overhead as we eliminate redundant public company expenses, and meaningful interest savings as our operating plan improves returns and free cash flow and accelerates debt repayment. Altogether, the five-year PD plan of our expected synergies is approximately $350 million which covers about 11% of the headline transaction value. Beyond these immediate savings, we see significant potential for operational efficiency gains across the acquired assets as well as longer-term cost of capital benefits as we advance towards our goal of being an investment-grade business. These opportunities, while not included in our valuation, represent potential for more than $100 million in decremental annual savings or more than $200 million combined with our base case synergies. We want to give ourselves time to do this right. We've demonstrated our ability to find the goals buried in assets we acquire through efficient execution and improved operating performance and we are confident in our ability to maximize the value of this transaction for investors. Under our operating plan and including our baseline synergy expectations, we expect five year cumulative free cash flow well in excess of our combined market cap. We've always had a free cash flow focused business model and our strategy applied to these assets creates compelling value for all shareholders. With our increased base of free cash flow, our capital allocation priorities remain consistent with a continued focus on putting our investors first. As we always say, priorities 1A and 1B with free cash flow are maintaining a strong balance sheet and returning capital to our shareholders. Through this transaction we will maintain our fixed $0.12 per share quarterly dividend, which offers an extremely compelling yield versus our peers, as well as our existing $150 million buyback authorization. This transaction enhances our investment-grade quality balance sheet with an improved credit profile driven by increased scale and our leverage accretive business plan, and it makes Crescent the largest liquids weighted producer yet to receive an investment-grade rating. We have no financing requirements associated with the transaction and at closing we expect to maintain our current leverage of 1.5x within the bounds of our target leverage range of 1x- 1.5x. We also have $1.5 billion of liquidity on top of our substantial cash flow generation. We see significant opportunity to drive value and accelerate further deleveraging through incremental asset divestitures. We announced a $250 million divestiture pipeline in the fourth quarter of last year and we now see $1 billion of divestiture opportunity in the pro forma company. With our strong balance sheet, sustainable free cash flow and a highly executable divestiture pipeline, we continue to advance towards our ambition of being an investment-grade business. We have a proven track record of returns driven growth through M&A, averaging three acquisitions per year over the last decade. We hold ourselves accountable to a consistent underwriting criteria and we've demonstrated our ability to acquire and integrate successfully. With our consistent strategy, we have more than tripled production and grown annual cash flow more than five fold since our public listing about four years ago, all while maintaining the strength of our balance sheet and increasing our credit ratings. Our recent success in the Eagle Ford highlights our value proposition of stockholder investing, efficient integration, and operational improvement to build a basin-leading position. We saw a highly fragmented basin with a compelling growth opportunity, and we got to work executing on a transformative series of transactions, completing seven acquisitions over two years to more than triple our asset footprint, production base, and inventory. We integrated each asset seamlessly, and we relentlessly pursued operational efficiencies, driving approximately $200 million in annual synergies across these recent acquisitions. We consistently execute our playbook for M&A success, and this transaction offers a unique opportunity to use it in a basin with the largest acquisition opportunity set remaining in the lower 48. The addition of a scaled Permian position significantly expands Crescent's scope for accretive growth. We now have more than $60 billion of potential growth opportunities surrounding our pro forma footprint in Eagle Ford and Permian, and we are confident in our ability to capitalize on it. With that, I'd like to welcome Jason to share a few thoughts before we close. Thanks, David. This is an exciting new chapter for Vital Energy and a compelling value proposition for our shareholders, providing attractive value and accelerating our trajectory in a larger and better-positioned combined business. This transaction is fully aligned with a strategy we've consistently pursued, creating long-term value through responsible growth and capital discipline. Our investors will be part of a combined company that is extremely well positioned in our sector, with a scaled asset portfolio across premier basins, a strong balance sheet, significant free cash flow generation supporting peer-leading dividend, and a large opportunity set for future growth. In addition to the financial and strategic metrics, our company shares similar values and a commitment to safe and responsible operations. With those shared principles and complementary strengths, I am confident this combination will create meaningful and lasting value across all stakeholders. I also want to express my sincere gratitude to the employees of Vital. Your dedication, hard work, and commitment have built a company we can all be proud of, one with high-quality assets, operational excellence, integrity, and discipline. Without you, we wouldn't be in a position to make a transformative step for our business. With that, I'll turn the call back over to David. Great. Thank you, Jason. Before we close, I want to reiterate the three things I hope everyone takes. This combination represents the total value for last year holders, the attractive acquisition returns, and significantly impact. Second, we plan to align these assets under our consistent strategy with lower activities, higher returns, and higher free cash flow. Plus, a $1 billion divestiture pipeline to maximize values from assets and accelerate our path to investment-grade. Finally, we have more than a billion dollars of potential opportunity surrounding the fulfillment, and we are confident in our ability to continue to grow the business creatively from here. The capital system from our billion dollar onboard divestiture pipeline is transformative for our business. There is no change to our strategy. With these steps, we are even better positioned. Crescent will have no fillers, more clear and more potential to deliver long-term values to holders to make bars to have changed, and we'll be working hard to deliver. With that, I'll open it up to Q& A. Thank you. My name is Beckett. Question and answer session. If you'd like to ask a question at this time, you may press star one on your telephone keypad and a confirmation tone will indicate your line is in the question queue. You may press star two if you'd like to remove your question from the queue. For positioning your speaker equipment, leave the message, [accept your handset] before pressing the star keys. One moment, we'll complete all for questions. Thank you. The third question is shortly come to the line of Neal Dingmann from William Blair. Please [state] your questions. Dave, congrats and [thanks] [We have some good side. Obviously,] [audio distortion] you all. My first question is just the asset value assets. Quite well. I'm just curious, how do you and the team believe that the Vital assets both immediately start to compete for capital? Is it fair to say that will go for a midpoint or how do you see this? Yeah, good question. We're really pleased to pull it into our business plan. I think we look at it as, you know, adding incremental oil inventory to the business. So yes, very probably compete. As you heard us say, we are going to significantly reduce activity on the depth. We think that's going to allow us to hybrid the development within the context of our broader plan and our core assets, one in one, and you know, decided you had one in one in the middle of the Delaware. These assets are just kind of thinking of how you sort out a pro forma DNC going forward. It's just too early to start providing any helpful points, but generally, just so you have some context, Vital ran about four rigs, and we see a program that's more likely in the 1- 2 range. I can take one last point, just on the divestitures for the non-core. Is that something that you're finding a hotline on, and is there any assets you could talk about that you've already identified? [audio distortion] Have we started the [audio distortion] company the in the fourth quarter, and what you're hearing from us is we're confident in the pipeline and our ability to capture value sooner rather than later. Very good, thanks [audio distortion] Your next question is in the line of Tim Rezvan with KeyBanc Capital Markets. Thanks for keeping the question. We've got a Permian entering the interest and splitting light at a higher of your COO in May, recognizing we see right there. Can you talk about the change, what made you decide that being legal for a consolidator is just not going to be the path forward every bit of time? We're constantly trying to pay attention to that, in particular areas that we think fit our operating skill set and assets we can fold indoors. From general, we don't think this is a change in terms of operating profile or business strategies. We're getting great value with the business, and that's looking for no change there. We see some facing, and we're even better positioned as a company following this acquisition. I think what you're hearing from us with both this transaction and the program is, as I said in the earlier remarks, I think we're getting more scale but also more focused and bigger opportunity around both financial going forward. I appreciate that, David. In the past, you talked about being comfortable in that one to one that had plenty of leverage because of the low PC-oriented business. I believe it went from 1.9- 2.5 with Silver Bow. How does that change? You haven't told what you're going to sell, but it's likely that you're the part of share which is Milwaukee. So you won short assets. How do you think about fulfillment leverage if you're willing to hire PDP just to get the decline up front? We're still committed to what I would call our core targets of 50% or lower the investment rate and a 25% decline rate. While you're correct our conventional assets have had reasonably low decline, it's a really small part of the business and you'll see that through the cycle we've acquired shale assets that were sub 20%. A lot of times we acquire assets that were operated at a different business plan, come into the company at a high decline rate and then we manage that in our position. That's in terms of strategy or asset profile and portfolio, may be worth hitting up front. Turning to the leverage question specifically, our standalone business is 1.5x leveraged today and on a great path. We expect to fully repay the RDL by year end. Vital is above our 1.5x target, but we expect to close at 1.5x. Given the free cash flow generation for both businesses and obviously the $1 billion pipeline of divestitures, we feel confident about that adding to the balance sheet as well. The other thing I would highlight to your question, we've got confidence in the balance sheet management. It comes from over a decade of running the business with average leverage of 1.2x. As we talked about together before, it may take a bit longer at lower prices or a bit faster at higher prices. We're committed to the strategy and we'll get there. I appreciate the comments. Thank you. Our next questions are from the line of Charles Meade with Johnson Rice. Please proceed with your question. Yes, good morning David, to you and the Crescent and the Vital teams. Picking up on that, picking up on that point of debt management. I understand the details are going to need to wait for post close, but can you give us an idea of what you would regard as kind of positive milepost or positive achievements post close in 2026 on the debt front, what that would look like? I think in general the business generates significant free cash flow and hopefully what you're hearing very strongly from us is that combined we're going to have a significant increase in free cash flow driven partly by lower activity and higher returns going forward. We just expect to continue to delever out of free cash flow. The business is well positioned and I'll just maybe one just great example of what we hope you'll continue to hear from us is in the second quarter, you know, we paid down a couple hundred million of debt and used 80% plus or minus of the free cash flow has been targeted to debt repayment. We feel very good about it. Got it, got it. Thank you. To the point about reducing activity on the biolasis, can you elaborate a bit more on that? Is this just kind of harmonizing the reinvestment on those assets with your existing philosophy of this, you know, going from four to one to two rigs? Is this also, you know, you are going to keep the best kind of project? Is there an element of this that some of those projects, you know, for rigs three and four, say for example, aren't going to, you know, wouldn't compete in the combined company portfolio? Yes. As a starting point, we would say we find this asset position really attractive. Just to confirm for you, we're going to bring it into our business strategy and operate it how Crescent operates, that is different than others in the industry. First of all, I'd say that Pridal strategy had included a more growth through the drillbit approach along with the acquisitions they were doing. That just hasn't been our style from the beginning. We're going to maximize cash flow and returns here. The other thing I think worth highlighting is we also like to take our time and we think there's great capital projects to do here. As we look at this business, we want to do this right. Taking your time and being able to high grade inventory plan within the context of our broader portfolio and then also integrate and high grade among the opportunities we have to develop is just the way we like to do things. I'm confident that we're going to be successful. We have high conviction around the quality of the inventory available to us here, but we're just going to take it slower and we think that's going to be better for all shareholders. Great, thanks for the detail. Our next questions are from the line of Michael Scallia with Stephens, please. Please state your question. Good morning and congratulations. David, you mentioned some upside on the operations. Just want to see if you could provide any more color on things you might attack there to increase that synergy target number. Great question. Obviously we've got a lot of confidence in the first $100 million and we're really focused on that second $100 million. We didn't include these in the base underwriting, but what I would say is we've been able to get these same things in prior acquisitions and the same potential exists here. Back to some of the comments about inventory high grading as well. We're going to give ourselves the time to get it right, but I think it's across everything, LOE, BMC efficiencies. We've brought different completion practices to every acquisition and I think it's the normal playbook, just going to take us some time to get things integrated and optimized. We're excited about the opportunity, but we know we need to go get after that. Thank you for that. I assume, as you mentioned, you look at everything. I'm sure you've looked at other Permian opportunities. You've even owned some Permian assets in the past. I wanted to ask what made Vital the right one to transact on at this point? Not every day you can do an all stock transaction that's accretive, but anything beyond valuation that you can point to that really tells us why this deal made sense at this time? It's both from the entry point for us and the significant upside. Just a really attractive, compelling investment opportunity and we think the combined company is great for all the shareholders. Everything with us starts with investment returns and no difference here. To your point, we do look at everything, but we also think about what's the ability for us to drive operational performance and future growth. We want to be scaled. The team at Vital put together an attractive position that really lends itself to our operating strategy. We're excited about what we can do, just bringing it in again to how we like to operate from a free cash flow perspective. It's a huge area and opportunity for further consolidation, just like we pursued in the Eagle Ford. We think the resource in this basin is tremendous. We've looked at it for a long time and it's, you know, I think we're very good at being disciplined and patient and this was a great chance for us to get in with what I'll call a set of assets that fit us really well for our operating philosophy. Thank you, David. Our next question is in the line of John Abbott with Wolfe Research. Please [receive us] your questions. Hey, good morning and thank you for taking our question. I guess at this point in time you're not really providing pro forma guidance, but Vital really didn't have any sort of timeline to pay cash taxes. I guess the question for you, Brandi, is what is the potential benefit decreasing on the tax side from this transaction? Hi, John. Good morning. I would say at a high level, no anticipated changes to the guidance we've provided on our Q2 earnings with respect to cash taxes. As a pro forma business, we don't anticipate being material cash pay over the next couple of years. The caveats being that that's highly dependent on commodity prices and ultimate capital programs. I would say no change to what we would have talked about a couple weeks ago. My follow up question will be on the bundling and non-core divestitures. You have the $250 million card you've been able to execute on things. There is commodity volatility out there. There's some concern prices for oil to be lower towards the end of the year. How do you think about commodity divestitures and commodity volatility? When you look at your assets, does the mineral, some sort of sale of your mineral business sort of make sense at this point in time? Yeah, great question. First thing, our three core areas where we see the most growth potential pro forma are the Eagle Ford, the Permian and Uinta. Everything else we constantly evaluate for opportunities to maximize value. I think the most clear way I can answer your question on volatility and timing is as I said earlier, we announced the divestiture program in the fourth quarter of last year. We have been very active in the market and I would say feel very good and confident about the pipeline increase that we've announced today. I think our focus and ability to capture value sooner rather than later is something we're trying to convey. Thank you very much for taking our questions. Thank you. At this time we've reached the end of our question and answer session. I'll hand the call to David Rockecharlie for closing remarks. Great. Thanks everybody. Again, we want to welcome the entire Vital team and I appreciate Jason sitting here with me today as we were able to share this great news with both of our shareholders. We look forward to getting the transaction closed appropriately and getting after the combined business together, making sure that investors get a great outcome across the board. We look forward to keeping you up to date and thank you for joining us. This will conclude today's conference. You may disconnect your lines at this time. We thank you for your participation and have a wonderful day.