UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

SCHEDULE 14C INFORMATION

INFORMATION STATEMENT PURSUANT TO SECTION 14(C) OF THE

SECURITIES EXCHANGE ACT OF 1934

COMSTOCK RESOURCES, INC.

(Name of Registrant As Specified In Its Charter)

COMSTOCK RESOURCES, INC.

5300 Town and Country Blvd.,

Suite 500

Frisco, Texas 75034

NOTICE OF ACTION BY WRITTEN CONSENT AND INFORMATION STATEMENT

WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND US A PROXY.

June 24, 2019

Dear Stockholder:

This notice of action by written consent and the accompanying information statement (this “Information Statement”) is being furnished by the Board of Directors (the “Board”) of Comstock Resources, Inc., a Nevada corporation (“Comstock”, the “Company”, “we”, “us” or “our”) to the holders of record at the close of business on June 11, 2019 of the outstanding shares of our common stock, $0.50 par value (“Common Stock”), pursuant to Rule 14c-2 promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

The purpose of this Information Statement is to inform the Company’s stockholders that on June 7, 2019, holders of approximately 84% of the outstanding shares of Common Stock acted by written consent (the “Written Consent”) in lieu of a special meeting of stockholders to approve (i) an amendment to the Company’s Second Amended and Restated Articles of Incorporation (the “Charter Amendment”) to increase the number of authorized shares of Common Stock from 155,000,000 to 400,000,000 (the “Share Increase”), (ii) the Agreement and Plan of Merger dated as of June 7, 2019 (the “Merger Agreement”), by and among the Company, Covey Park Energy LLC, a Delaware limited liability company (“Covey Park”), New Covey Park Energy LLC, a Delaware limited liability company (“Holdings”), and, solely for the purposes of Section 5.14 thereof, Covey Park Energy Holdings LLC, a Delaware limited liability company (“Current Holdings”), and subject to the satisfaction or waiver of specified conditions, the merger of Covey Park with and into the Company, with the Company existing as the surviving corporation (the “Merger”), pursuant to which the limited liability company interests in Covey Park will, upon consummation of the Merger, be converted into the right to receive (x) 28,833,000 shares of Common Stock (subject to the terms and conditions of the Merger Agreement) (such shares of Common Stock, the “Common Stock Consideration”), (y) 210,000 shares of Series A Preferred Stock (the “Preferred Stock Consideration” and, together with the Common Stock Consideration, the “Stock Consideration”), and (z) cash in an amount equal to $700.0 million plus the Series A Preferred Balance (as defined in the Merger Agreement) to be used to redeem the preferred units of Holdings (the “Cash Consideration” and together with the Stock Consideration, the “Merger Consideration”), and (iii) in accordance with Section 312.03 of the NYSE Listed Company Manual, the issuance of shares of Common Stock (the “Share Issuances”) (x) as Merger Consideration pursuant to the Merger, (y) pursuant to the Subscription Agreement (the “Subscription Agreement”), by and among the Company, Arkoma Drilling CP, LLC (“Arkoma LLC”) and Williston Drilling CP, LLC (“Williston LLC” and, together with Arkoma LLC, the “Jones LLCs”), under which, upon satisfaction of the terms and conditions therein, the Jones LLCs shall purchase in the aggregate (a) 50,000,000 shares of Common Stock for total consideration of $300.0 million and (b) 175,000 shares of Series B Preferred Stock for total consideration of $175.0 million, and (z) upon conversion of the Series A Preferred Stock and Series B Preferred Stock in accordance with the Certificate of Designations establishing the rights, preferences and privileges thereof (the “Certificate of Designations”). Copies of the Merger Agreement, the Subscription Agreement, and the Certificate of Designations have been included as Annex A, Annex B, and Annex C, respectively. Approval of the Charter

Amendment, the Merger Agreement and the Merger and the Share Issuances are referred to herein collectively as the “Shareholder Approved Actions.” The transactions contemplated by the Merger Agreement, the Subscription Agreement, the Shareholders Agreement (as described below), the Charter Amendment, the Certificate of Designations and the Registration Rights Agreement (as described below) are referred to herein collectively as the “Transactions.”

Under Nevada law and the Company’s Second Amended and Restated Articles of Incorporation and Amended and Restated Bylaws, adoption of the Charter Amendment and Merger Agreement, and the transactions contemplated thereby, by the Company’s stockholders required the affirmative vote or written consent of the holders of a majority of the voting power of all outstanding shares of Common Stock. In addition, our Common Stock is listed on the New York Stock Exchange (the “NYSE”). Under Section 312.03 of the NYSE Listed Company Manual, stockholder approval is required prior to the issuance of shares of common stock, or of securities convertible into common stock, if:

Because the maximum number of shares of our Common Stock issuable pursuant to the Share Issuances would represent greater than 20% of the number of shares of our Common Stock outstanding prior to the issuance of the Stock Consideration and the shares of Common Stock and Series B Preferred Stock to the Jones LLCs, stockholder approval of the Share Issuances is required under NYSE rules and regulations. See “The Merger Agreement—The Series A and Series B Preferred Stock” for more detail on the number of shares of Common Stock that may be issuable upon conversion of the Series A Preferred Stock and Series B Preferred Stock. In addition, because the shares of Common Stock to be issued to the Jones LLCs pursuant to the Subscription Agreement and that may be issuable to the Jones LLCs upon conversion of the Series B Preferred Stock represent more than 5% of the issued and outstanding shares of Common Stock prior to the Share Issuances, and the Jones LLCs together with their affiliates disclosed below collectively are substantial security holders of the Company, stockholder approval is required for the issuance of such shares of Common Stock to the Jones LLCs under the NYSE rules and regulations.

On June 7, 2019, Arkoma Drilling, LP (“Arkoma”) and Williston Drilling, LP (“Williston” and, together with Arkoma, the “Principal Stockholders”) delivered to the corporate secretary of the Company an irrevocable written consent approving the Shareholder Approved Actions. As of June 7, 2019, the Principal Stockholders held shares of Common Stock representing approximately 84% of the voting power of all outstanding shares of Common Stock. Accordingly, the adoption of the Shareholder Approved Actions by the Company’s stockholders was effected in accordance with Section 78.390 of the Nevada Revised Statutes as of June 7, 2019 and the NYSE rules and regulations. No further approval of the stockholders of the Company under the Nevada Revised Statutes or NYSE rules and regulations is required to complete the Shareholder Approved Actions. As a result, the Company has not solicited and will not be soliciting your vote for the Shareholder Approved Actions and does not intend to call a meeting of stockholders for purposes of voting on the adoption of either matter.

Pursuant to Rule 14c-2 of the Exchange Act, the actions contemplated by written consent may not be taken until July 14, 2019, which is 20 calendar days following the date we first mail this Information Statement to our stockholders. The Charter Amendment will not become effective until it is filed with the Secretary of State of the State of Nevada, which will occur only if the other conditions under the Merger Agreement are satisfied.

The Board carefully reviewed and considered the terms and conditions of the Merger Agreement, the Merger and the other transactions contemplated by the Merger Agreement. The Board (i)(A) determined that the Merger and the other transactions contemplated by the Merger Agreement, on the terms and subject to the conditions set forth in the Merger Agreement, are fair to, and in the best interests of, the Company and its stockholders, (B) approved and declared advisable the Merger Agreement, the Merger and the other transactions contemplated by the Merger Agreement, on the terms and subject to the conditions set forth in the Merger Agreement, and (C) subject to certain provisions of the Merger Agreement described under “The Merger Agreement—No Solicitation” in the Information Statement, recommended that the holders of Common Stock vote in favor of adopting the Merger Agreement and (ii) directed that the Shareholder Approved Actions be submitted to the holders of the Common Stock for their adoption.

This notice of action by written consent and the Information Statement shall constitute notice to you from the Company that the Shareholder Approved Actions have been adopted by the holders of a majority of the voting power of the Common Stock by written consent in lieu of a meeting in accordance with Section 78.390 of the Nevada Revised Statutes and the NYSE regulations.

COMSTOCK IS NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND COMSTOCK A PROXY.

PLEASE NOTE THAT THE PRINCIPAL STOCKHOLDERS OF COMSTOCK HAVE VOTED TO APPROVE AND ADOPT THE SHAREHOLDER APPROVED ACTIONS. THE NUMBER OF VOTES HELD BY THE PRINCIPAL STOCKHOLDERS IS SUFFICIENT TO SATISFY THE STOCKHOLDER VOTE REQUIREMENT UNDER THE NEVADA REVISED STATUTES AND NYSE RULE 312 FOR THESE ACTIONS AND CONSEQUENTLY, NO ADDITIONAL VOTES WILL BE NEEDED TO APPROVE THESE TRANSACTIONS. THE CORPORATE ACTIONS DESCRIBED IN THIS INFORMATION STATEMENT REQUIRED SHAREHOLDER APPROVAL FROM THE HOLDERS OF OUR OUTSTANDING COMMON STOCK BECAUSE OUR COMMON STOCK IS TRADED ON THE NYSE AND THE REQUIREMENTS OF NEVADA LAW.

The Information Statement accompanying this letter provides you with more specific information concerning the Charter Amendment, the Merger Agreement, the Merger and the other transactions contemplated by the Merger Agreement. We encourage you to carefully read this Information Statement and the copy of the Merger Agreement included as Annex A to the Information Statement.

By order of the Board of Directors

Very truly yours,

M. Jay Allison

Chairman of the Board and Chief Executive Officer

The Merger has not been approved or disapproved by the U.S. Securities and Exchange Commission or any state securities or other regulatory agency. Neither the U.S. Securities and Exchange Commission nor any state securities or other regulatory agency has passed upon the merits or fairness of the Merger or upon the adequacy or accuracy of the information contained in this document or the Information Statement. Any representation to the contrary is a criminal offense.

The Information Statement is dated June 24, 2019 and is first being mailed to our stockholders on or about June 24, 2019.

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COMSTOCK RESOURCES, INC.

5300 Town and Country Blvd., Suite 500

Frisco, Texas 75034

INFORMATION STATEMENT

This information statement and notice of action by written consent (collectively, this “Information Statement”) contains information relating to (i) amending the Second Amended and Restated Articles of Incorporation (the “Charter Amendment”) of Comstock Resources, Inc., a Nevada corporation (“Comstock”, the “Company” “we”, “us” or “our”), to increase the number of authorized shares of Company common stock, par value $0.50 (“Common Stock”), from 155,000,000 to 400,000,000 (the “Share Increase”) and (ii) the Agreement and Plan of Merger, dated as of June 7, 2019 (the “Merger Agreement”), entered into by and among the Company, Covey Park Energy LLC, a Delaware limited liability company (“Covey Park”), New Covey Park Energy LLC, a Delaware limited liability company (“Holdings”), and, solely for the purposes of Section 5.14 thereof, Covey Park Energy Holdings LLC, a Delaware limited liability company (“Current Holdings”), and subject to the satisfaction or waiver of specified conditions, the merger of Covey Park with and into the Company, with the Company existing as the surviving corporation (the “Merger”), pursuant to which the limited liability company interests in Covey Park will, upon consummation of the Merger, be converted into the right to receive (x) 28,833,000 shares of Common Stock (subject to the terms and conditions of the Merger Agreement) (such shares of Common Stock, the “Common Stock Consideration”), (y) 210,000 shares of Series A Preferred Stock of the Company (the “Preferred Stock Consideration” and, together with the Common Stock Consideration, the “Stock Consideration”), and (z) cash in an amount equal to $700.0 million plus the Series A Preferred Balance (as defined in the Merger Agreement) to be used to redeem the preferred units of Holdings (the “Cash Consideration” and together with the Stock Consideration, the “Merger Consideration”), (iii) the Subscription Agreement (the “Subscription Agreement”), by and among the Company, Arkoma Drilling CP, LLC (“Arkoma LLC”) and Williston Drilling CP, LLC (“Williston LLC” and, together with Arkoma LLC, the “Jones LLCs”), pursuant to which, upon satisfaction of the terms and conditions therein, the Jones LLCs shall purchase in the aggregate (x) 50,000,000 shares of Common Stock for total consideration of $300.0 million and (y) 175,000 shares of Series B Preferred Stock of the Company for total consideration of $175.0 million, and (iv) in accordance with Section 312.03 of the NYSE Listed Company Manual, the issuance of shares of Common Stock (the “Share Issuances”) (x) as Merger Consideration pursuant to the Merger, (y) to the Jones LLCs, pursuant to the Subscription Agreement and (z) upon conversion of the Series A Preferred Stock and Series B Preferred Stock in accordance with the Certificate of Designations establishing the rights, preferences and privileges thereof (the “Certificate of Designations”). The Charter Amendment, the Merger Agreement and the transactions contemplated thereby and the Share Issuances are referred to herein collectively as the “Shareholder Approved Actions.” The Merger Agreement, the Subscription Agreement, the Shareholders Agreement (as described below), the Charter Amendment, the Certificate of Designations and the Registration Rights Agreement (as described below) are referred to herein collectively as the “Transaction Documents” and, the transactions contemplated thereby, including the Share Issuances, the “Transactions.” We are furnishing this Information Statement to stockholders of the Company pursuant to applicable provisions of Nevada law and certain securities regulations. This Information Statement is dated June 24, 2019 and is first being mailed to our stockholders on or about June 24, 2019.

WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED

NOT TO SEND US A PROXY.

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QUESTIONS AND ANSWERS ABOUT THE MERGER AND THE CHARTER AMENDMENT

The following questions and answers are intended to briefly address some commonly asked questions regarding the Merger and Charter Amendment. These questions and answers may not address all questions that may be important to you as a stockholder. You should read the more detailed information contained elsewhere in this Information Statement, the annexes to this Information Statement and the documents referred to or incorporated by reference in this Information Statement.

For a discussion of the factors that the Board considered in determining to approve the Merger Agreement, please see the section of this Information Statement entitled “The Merger—Reasons for the Merger.”

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The foregoing factors are some of the principal factors considered by the Board. The Board did not assign relative weights to the factors it considered or determine that any factor was of particular importance. For a discussion of the factors that the Board considered in determining to approve the Merger Agreement, please see the section of this Information Statement entitled “The Merger—Reasons for the Merger.”

We are also subject to Rule 312 of the NYSE Listed Company Manual (“Rule 312”), which requires that we obtain stockholder approval in certain circumstances, including before issuing shares of common stock in excess of 20% of our outstanding common stock prior to such issuance and before issuing shares of common stock to related parties in excess of 5% of our outstanding common stock prior to such issuance. The number of votes held by the Principal Stockholders is sufficient to satisfy the stockholder vote requirement under Rule 312 for these actions. Therefore, no additional votes will be needed to approve these transactions.

No further approval of the stockholders of the Company is required to adopt the Shareholder Approved Actions. As a result, the Company has not solicited and will not be soliciting your vote for the approval of the Shareholder Approved Actions and does not intend to call a meeting of stockholders for purposes of voting on the approval of the Shareholder Approved Actions.

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For all holders of Common Stock that are not Exchangors, the Merger should not have U.S. federal income tax consequences for such holders.

For a more detailed discussion, see “The Merger—Material U.S. Federal Income Tax Consequences of the Merger.” Tax matters can be complicated and the tax consequences of the Merger to any particular holder of Common Stock will depend on such holder’s particular facts and circumstances. Holders of Common Stock should consult their own tax advisors to determine the tax consequences of the Merger to them, including the effects of U.S. federal, state, local and foreign tax laws.

If you received a householded mailing and you would like to have additional copies of this Information Statement mailed to you, or you would like to opt out of this practice for future mailings, please submit your request to the Company by phone at (972) 668-8800 or by mail to Comstock Resources, Inc., 5300 Town and Country Blvd., Suite 500, Frisco, Texas 75034. We will promptly send additional copies of this Information Statement upon receipt of such request.

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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

Any statements in this Information Statement regarding the Charter Amendment, the Merger, the expected timetable for completing the Merger, future financial and operating results, future capital structure and liquidity, benefits and synergies of the Merger, future opportunities for the combined company, general business outlook and any other statements about the future expectations, beliefs, goals, plans or prospects of the Board or management of the Company constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any statements that are not statements of historical fact (including statements containing the words “expects,” “intends,” “anticipates,” “estimates,” “predicts,” “believes,” “should,” “potential,” “may,” “forecast,” “objective,” “plan,” or “targets,” and their variants and other similar expressions) are intended to identify forward-looking statements.

There are a number of factors that could cause actual results or events to differ materially from those indicated by such forward-looking statements, including:

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The Company disclaims any intention or obligation to update or revise any forward-looking statements as a result of developments occurring after the date of this document except as required by law.

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RISK FACTORS

An investment in the surviving corporation may include different risks than an investment in the Company on a stand-alone basis. Moreover, by reason of the pending Merger, and the potential change in the business of the surviving corporation as compared to the Company’s business as currently conducted, the nature of the investment by each stockholder of the Company will change. In addition to the other information contained in or incorporated by reference in this Information Statement, including the risk factors contained in the Company’s annual report on Form 10-K for the year ended December 31, 2018, as updated by subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, which are all incorporated by reference in this Information Statement, you should carefully review the risks described below together with all of the other information included in this Information Statement. Additional risks and uncertainties not presently known to the Company or Covey Park, or that are not currently believed to be important to you, if they materialize, may also adversely affect the Merger and the Company as the surviving corporation. See “Where You Can Find Additional Information” for the location of information incorporated by reference into this Information Statement.

Risks Relating to the Merger

The Company and Covey Park may fail to complete the Merger if certain required conditions, many of which are outside the companies’ control, are not satisfied.

Completion of the Merger is subject to various customary closing conditions, including, but not limited to, (i) the expiration or termination of any applicable waiting period under the HSR Act, (ii) the absence of any order of injunction prohibiting the consummation of the Merger, (iii) no material adverse effect occurring with respect to the Company or Covey Park, (iv) subject to certain exceptions and materiality and material adverse effect standards, the accuracy of the representations and warranties of the parties to the Merger Agreement and (v) performance and compliance by the parties to the Merger Agreement in all material respects with the agreements and covenants contained in the Merger Agreement. Despite the companies’ best efforts, they may not be able to satisfy or receive the various closing conditions and obtain the necessary approvals in a timely fashion or at all.

Failure to complete the Merger could negatively impact the Company’s stock price, future business and financial results.

If the Merger is not completed, the Company will be subject to several risks, including the following:

The Company will be subject to various uncertainties and contractual restrictions while the Merger is pending that could adversely affect its business and operations.

Uncertainty about the effect of the Merger on customers, suppliers and vendors may have an adverse effect on the Company’s business, financial condition and results of operations. It is possible that some customers,

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suppliers and other persons with whom the Company has business relationships may delay or defer certain business decisions, or might decide to seek to terminate, change or renegotiate their relationship with the Company as a result of the Merger, which could negatively affect the Company’s financial results, as well as the market price of the Common Stock, regardless of whether the Merger is completed.

Additionally, under the terms of the Merger Agreement, the Company is subject to certain restrictions on the conduct of its business prior to the consummation of the Merger, which may adversely affect its ability to execute certain aspects of its business strategies. These restrictions may, among other matters, prevent the Company from pursuing otherwise attractive business opportunities, selling assets, incurring indebtedness, engaging in significant capital expenditures in excess of certain limits set forth in the Merger Agreement, entering into other transactions or making other changes to the Company’s business prior to consummation of the Merger or termination of the Merger Agreement. Such limitations could negatively affect the Company’s businesses and operations prior to the completion of the Merger.

The Company may have difficulty attracting, motivating and retaining executives and other employees in light of the Merger.

Uncertainty about the effect of the Merger on the Company’s employees may impair its ability to attract, retain and motivate personnel until the Merger is completed. Employee retention may be particularly challenging during the pendency of the Merger, as employees may feel uncertain about their future roles with the Company. In addition, the Company may have to provide additional compensation in order to retain employees. If employees depart because of issues relating to the uncertainty and difficulty of integration or a desire not to become employees of the Company, the Company’s ability to realize the anticipated benefits of the Merger could be adversely affected.

In connection with the Merger, the Company may be required to take write-downs or write-offs, restructuring and impairment or other charges that could negatively affect the business, assets, liabilities, prospects, outlook, financial condition and results of operations of the Company.

Although the Company has conducted extensive due diligence in connection with the Merger, it cannot assure you that this diligence revealed all material issues that may be present, that it would be possible to uncover all material issues through a customary amount of due diligence, or that factors outside of the Company’s control will not later arise. Even if the Company’s due diligence successfully identifies certain risks, unexpected risks may arise and previously known risks may materialize in a manner not consistent with the Company’s preliminary risk analysis. Further, as a result of the Merger, purchase accounting, and the proposed operation of the Company going forward, the Company may be required to take write-offs or write-downs, restructuring and impairment or other charges. As a result, the Company may be forced to write-down or write-off assets, restructure its operations, or incur impairment or other charges that could negatively affect the business, assets, liabilities, prospects, outlook, financial condition and results of operations of the Company.

In the event the Covey Park Notes are downgraded within 90 days following the consummation of the Transactions, the Company may be obligated to repurchase the Covey Park Notes at 101% of the principal amount of the Covey Park Notes.

Pursuant to the Covey Park Notes Indenture, the Transactions will result in a “Change of Control” if, within 90 days following the consummation of the Transactions, the ratings of the Covey Park Notes are decreased by either Moody’s or S&P by one or more gradations. In such an instance, the Company would be required to make an offer to repurchase the Covey Park Notes at a purchase price in cash equal to 101% of the aggregate principal amount of the Covey Park Notes, plus accrued and unpaid interest, if any, to the date of purchase. As of the date of this Information Statement, the aggregate principal amount of the Covey Park Notes is $625.0 million. If the holders of the Covey Park Notes accept any such offer, such repurchase could significantly affect the liquidity, business, assets, liabilities, prospects, outlook, financial condition and results of operations of the Company.

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The market price of the Common Stock may be volatile, and holders of the Common Stock could lose a significant portion of their investment due to drops in the market price of the Common Stock following completion of the Merger.

The market price of the Common Stock may be volatile, including changes in price caused by factors unrelated to the Company’s operating performance or prospects.

Specific factors that may have a significant effect on the market price for the Common Stock include, among others, the following:

Risks Relating to the Business of the Company upon Completion of the Merger

The Company may fail to realize the anticipated benefits of the Merger and may assume unanticipated liabilities.

The success of the Merger will depend on, among other things, the Company’s ability to combine the Company’s and Covey Park’s businesses in a manner that realizes the various benefits, growth opportunities and synergies identified by the companies. Achieving the anticipated benefits of the transaction is subject to a number of risks and uncertainties. It is uncertain whether the Company’s and Covey Park’s existing operations and the acquired properties and assets can be integrated in an efficient and effective manner.

The pro forma financial statements presented for illustrative purposes may not be indicative of the Company’s financial condition or results of operations following the Merger.

The pro forma financial statements contained in this Information Statement are presented for illustrative purposes only and may not be indicative of the Company’s financial condition or results of operations following the Merger for several reasons. The pro forma financial statements have been derived from the Company’s and Covey Park’s historical financial statements, and certain adjustments and assumptions have been made regarding the Company after giving effect to the Merger. The information upon which these adjustments and assumptions have been made is preliminary, and these kinds of adjustments and assumptions are difficult to make with complete accuracy. Moreover, the pro forma financial statements do not reflect all costs that are expected to be incurred by the Company in connection with the Merger. For example, the impact of any incremental costs incurred in integrating the two companies is not reflected in the pro forma financial statements. As a result, the actual financial condition and results of operations of the Company following the Merger may not be consistent with, or evident from, these pro forma financial statements.

The assumptions used in preparing the pro forma financial information may not prove to be accurate, and other factors may affect the Company’s financial condition or results of operations following the Merger. Any potential decline in the Company’s financial condition or results of operations could cause the stock price of the Company to decline.

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Combining the businesses of the Company and Covey Park may be more difficult, costly and time-consuming than expected, which may adversely affect the Company’s results and negatively affect the value of the Common Stock following the Merger.

The Company and Covey Park have entered into the Merger Agreement because each believes that combining the businesses of the Company and Covey Park will produce benefits and cost savings. However, the Company and Covey Park have historically operated as independent companies and will continue to do so until the completion of the Merger. Following the completion of the Merger, the Company’s management will need to integrate the Company’s and Covey Park’s respective business. The combination of two independent businesses is a complex, costly and time-consuming process and the Company’s management may face significant challenges in implementing such integration, many of which may be beyond the control of management, including, without limitation:

Some of these factors will be outside of the control of the Company and any one of them could result in increased costs and diversion of management’s time and energy, as well as decreases in the amount of expected revenue that could materially impact the business, financial conditions and results of operations of the Company. The integration process and other disruptions resulting from the Merger may also adversely affect the Company’s relationships with employees, suppliers, customers, distributors, licensors and others with whom the Company and Covey Park have business or other dealings, and difficulties in integrating the businesses of the Company and Covey Park could harm the reputation of the Company.

If the Company is not able to successfully combine the businesses of the Company and Covey Park in an efficient, cost-effective and timely manner, the anticipated benefits and cost savings of the Merger may not be realized fully, or at all, or may take longer to realize than expected, and the value of the Common Stock, the revenues, levels of expenses and results of operations of the Company may be affected adversely. If the Company is not able to adequately address integration challenges, the Company may be unable to successfully integrate the Company’s and Covey Park’s operations or realize the anticipated benefits of the Merger.

The Share Issuances and potentially the preferred stock if converted, will dilute the percentage ownership interests of the Company’s stockholders.

If the Merger is completed, the Company will issue to Holdings 28,833,000 shares of Common Stock, representing approximately 16% of the Company’s outstanding Common Stock. The issuance of Common Stock to Holdings will cause a reduction in the relative percentage interest of the Company’s current stockholders in the Company’s earnings, if any, voting power, and market capitalization. In addition, the Company will issue to Holdings 210,000 shares of the Company’s Series A Preferred Stock. Under certain circumstances, the Series A Preferred Stock is convertible into Common Stock, which could represent up to an additional approximate 22% of the Company’s outstanding Common Stock.

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THE PARTIES

Comstock Resources, Inc.

Comstock Resources, Inc. is an independent energy company based in Frisco, Texas and is engaged in oil and gas acquisitions, exploration and development primarily in Texas, Louisiana, and North Dakota. The Company’s Common Stock is traded on the NYSE under the ticker symbol “CRK.” Its principal executive offices are located at 5300 Town and Country Blvd., Suite 500, Frisco, Texas 75034 and its telephone number is (972) 668-8800.

Covey Park Energy LLC

Covey Park is an independent natural gas company engaged in the acquisition, development, exploitation and exploration of natural gas properties targeting the Haynesville and Bossier shale plays in North Louisiana and East Texas. Its principal executive offices are located at 8401 N. Central Expressway, Suite 700, Dallas, Texas 75225 and its telephone number is (214) 548-6000.

New Covey Park Energy LLC

Holdings is a Delaware limited liability Company and wholly-owned subsidiary of Covey Park that was formed prior to the execution of the Merger Agreement to hold all of the equity interests in the Company following completion of the Restructuring and the Merger Consideration following completion of the Merger. Its principal executive offices are located at 8401 N. Central Expressway, Suite 700, Dallas, Texas 75225 and its telephone number is (214) 548-6000. Please see The Merger—Restructuring for more details regarding the Restructuring.

Covey Park Energy Holdings LLC

Current Holdings is a Delaware limited liability company and currently holds all of the outstanding common equity interests in Covey Park. Following completion of the Restructuring, the Merger and the redemption of the Series A Preferred Units, Current Holdings will hold all of the outstanding limited liability company interests in Holdings. Its principal executive offices are located at 8401 N. Central Expressway, Suite 700, Dallas, Texas 75225 and its telephone number is (214) 548-6000.

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THE MERGER

Overview

Under the terms of the Merger Agreement, subject to the satisfaction or waiver (if permissible under applicable law) of specified conditions, Covey Park will be merged with and into the Company, with the Company surviving the Merger as the surviving corporation. The Board approved the Merger Agreement on June 5, 2019 and the Principal Stockholders, among other things, approved and adopted the Shareholder Approved Actions on June 7, 2019. This section of the Information Statement describes material aspects of the Merger, including the Merger Agreement and other transactions that are being entered into in connection with the Merger. While the Company believes that the description covers the material terms of the Merger, the Merger Agreement, and the other documents in connection thereto, this summary may not contain all of the information that is important to you. You should read carefully this entire document and the other documents to which the Company refers, including the Merger Agreement attached as Annex A, for a more complete understanding of the Merger and the Merger Agreement.

Background of the Merger

The Board and the Company’s senior management periodically review the Company’s long-term strategic plan and prospects in light of the Company’s business and developments.

On April 24, 2018, Mr. Roland Burns, Comstock President and Chief Financial Officer met with Mr. Richard Burnett, Chief Financial Officer of Covey Park after the announcement of the investment by Dallas businessman Jerry Jones in Comstock. Mr. Burnett suggested that the companies meet after the transaction between Comstock and the principal stockholders closed to look at a potential merger given that the companies’ operations were so similar.

On May 25, 2018, Mr. Jay Allison, Chief Executive Officer of Comstock, discussed the potential acquisition of Covey Park with Messrs. Jerry and Stephen Jones who indicated that they would be interested in evaluting such a transaction.

During the week of June 18, 2018, the Company requested that BMO arrange for Mr. Allison to meet Mr. Alan Levande, Co-CEO of Covey Park. On June 20, 2018, Messrs. Allison and Levande met, where they discussed a potential combination of Comstock and Covey Park.

On September 26, 2018, Mr. Allison and Mr. Burns met with Mr. Levande at an investor conference where they discussed the potential of the companies meeting to consider a combination.

On October 8, 2018, Mr. Allison, Mr. Burns, as well as Mr. Mike McCoy and Mr. Bob Roth of Arkoma and Messrs. Jerry and Stephen Jones met with Messrs. Jacobi, Levande and Burnett to discuss a potential combination of the two companies.

As a result of these communications, on October 10, 2018, the Company and Covey Park entered into a confidentiality agreement enabling confidential negotiations and the conduct by the Company of due diligence on Covey Park.

On October 17, 2018, the management teams of both companies met with representatives of Wells Fargo to discuss the process for exchanging data and high-level deal parameters.

On October 24, 2018, Mr. Allison and Mr. Burns met with Messrs. Jacobi, Levande and Burnett and representatives of Wells Fargo to discuss materials that laid out possible transaction structures and objectives for the transaction, to ultimately be shared with Mr. Jerry Jones and Denham Capital, the principal equityholder of Covey Park.

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On October 26, 2018, Messrs. Burns and Burnett along with representatives of Wells Fargo met to discuss the financial model of a combined company.

On October 29, 2018, Messrs. Burns, Jacobi, Levande and Burnett met to discuss the potential merger and potential terms of such merger.

On October 30, 2018, the management teams of Comstock and Covey Park along with representatives of Wells Fargo held a teleconference call to discuss the terms of a potential merger in anticipation of a meeting with Mr. Jerry Jones.

On November 2, 2018, representatives of Wells Fargo along with Messrs. Allison and Burns met with Mr. Jerry Jones to walk through the overview of a possible transaction with Covey Park.

On November 6, 2018, the Covey Park and Comstock management teams met with Messrs. Jerry and Stephen Jones to discuss Covey Park, its assets and a possible transaction. Representatives of Wells Fargo also attended this meeting.

On November 7, 2018, the Covey Park and Comstock management teams and representatives of Wells Fargo met to talk through the various workstreams and prepared a timeline for how to consummate the proposed transaction.

On November 9, 2018, the Covey Park and Comstock management teams, representatives of Wells Fargo, Locke Lord, outside counsel to Comstock, Vinson & Elkins L.L.P. (“V&E”), outside counsel to Covey Park, held a teleconference call to discuss the potential transaction structure in connection with a proposed merger of Comstock and Covey Park.

On November 13, 2018, BMO was verbally retained as a financial advisor to Comstock.

On November 14, 2018, representatives of Wells Fargo and the Comstock management team met to discuss a preliminary term sheet, with Covey Park later joining the discussion.

On November 15, 2018, Mr. Jacobi called Mr. Allison and Mr. Jerry Jones to discuss the terms of a potential merger.

On November 16, 2018, Comstock and Covey Park agreed to exchange technical data of their respective businesses.

On November 20, 2018, Mr. Jacobi continued discussions of the potential merger with Mr. Allison and Mr. Burns and began the initial steps for diligence and set forth the terms of the potential merger.

On November 28, 2018, Messrs. Allison, Burns, Burnett and Levande held an in-person meeting to discuss potential merger terms.

On December 3, 2018, the management teams of both companies and Mr. Carl Tricoli and Mr. Jordan Marye of Denham Capital met with Messrs. Jerry and Stephen Jones to discuss the potential merger plan.

On December 11, 2018, the Board held a meeting where it discussed the potential merger with Covey Park. Mr. Burns reviewed Covey Park’s corporate presentation and discussed the term sheet that was given to Covey Park under which Comstock would complete a merger. Covey Park’s principal equityholder, Denham Capital, was still considering the proposal.

On December 12, 2018, Messrs. Allison and Mr. Burns along with Mr. McCoy and Mr. Roth of Arkoma met with the Covey Park management team. The Covey Park management informed Comstock that a merger

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would only be possible if Comstock increased the cash consideration or if Comstock would complete a stock offering in order to set the price of any stock issued in the potential merger. Given market conditions, talks of a merger ceased.

On January 9, 2019, Messrs. Allison and Jacobi met to reassess the potential merger and discuss potential terms of such merger.

On February 6, 2019, during a teleconference Messrs. Allison, Burns, Jacobi, Levande and Burnett and representatives of Wells Fargo discussed a proposal from Denham Capital for an all-cash offer from Comstock to acquire Covey Park.

On February 18, 2019, the Board held a meeting where one of the topics discussed was the potential merger with Covey Park. Management presented a financial analysis supporting a $2.2 billion acquisition price for Covey Park. The analysis included several financing scenarios, including an equity contribution by the Company’s majority stockholder, Mr. Jerry Jones. The Board authorized management to continue to negotiate with Covey Park and Mr. Jerry Jones the terms for a potential merger.

On February 19, 2019, representative of Wells Fargo called Mr. Jacobi to explore avenues to narrow the difference between what Comstock would pay and what Denham Capital would accept in an all-cash offer.

On February 22, 2019, Messrs. Allison, Burns, Jacobi and Burnett met to discuss a possible offer of $800.0 million in cash and Common Stock representing 14% of Comstock. Under the proposal, Covey Park would retain certain of its assets and Comstock would issue preferred stock to a third party to finance a portion of the transaction.

On March 1, 2019, the management teams of Covey Park and Comstock held a meeting to discuss the proposed structure of a merger.

On March 2, 2019, Mr. Jacobi sent an email to Messrs. Allison and Burns to agree to Comstock’s proposal of $800.0 million of cash and $233.0 million Common Stock to be valued based on a volume weighted average market price and exclusion of certain Covey Park assets (the “March 2 Proposal”).

On March 4, 2019, Locke Lord, representatives of Wells Fargo and the Comstock management team held a teleconference call to discuss a potential timeline to complete the transaction.

On March 11, 2019, Locke Lord delivered a draft of the Merger Agreement to V&E.

On March 21, 2019, V&E delivered a revised draft of the Merger Agreement and provided the terms of the Subscription Agreement, Registration Rights Agreement and Support Agreement.

On March 23, 2019, Locke Lord, representatives of Wells Fargo and the Comstock management team held a teleconference call to discuss the various transaction documents, including the draft Merger Agreement.

During the remainder of March, the management teams met on numerous occasions to discuss the Merger, create a combined drilling program and prepare projections for the combined company. Each of Covey Park and Comstock conducted extensive due diligence and prepared material for Comstock’s marketing of a preferred stock issuance to secure additional financing for the transaction.

On March 28 and March 29, 2019, the Comstock management team, Wells Fargo, and Messrs. Jerry Jones and Burnett met with Standard & Poor and Moody’s Investor Service, the rating agencies of the outstanding debt for Comstock and Covey Park, to confirm their respective ratings for the combined company.

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On April 9, 2019, Comstock engaged Wells Fargo, Barclays Capital Inc., Bank of America Merrill Lynch, Pierce, Fenner & Smith Incorporated and BMO as placement agents (the “Placement Agents”) for a preferred stock issuance to finance part of the merger consideration.

From April 11, 2019 until May 2, 2019, representatives of the Placement Agents met with various third parties to discuss the potential private placement of preferred stock.

On May 13, 2019, Mr. Allison met with Mr. Jacobi to discuss alternative solutions to preferred stock financing.

On May 23, 2019, representatives from Wells Fargo met with the management of the Company to discuss the submission of a revised proposal to Covey Park and Denham Capital. In addition, Messrs. Allison and Burns, and a representative of Wells Fargo met with Mr. Jerry Jones to discuss the revised proposal.

On May 24, 2019, Comstock submitted a revised proposal under which Denham Capital and Mr. Jerry Jones would provide the preferred stock.

On May 29, 2019, Mr. Jerry Jones had multiple discussions with representatives of Denham Capital and Mr. Jacobi. Mr. Jerry Jones and representatives to Denham Capital agreed to propose to Comstock that Covey Park would receive the Stock Consideration and Cash Consideration. Mr. Jerry Jones would invest $475.0 million, in the form of Common Stock and Series B Preferred Stock. Under the proposal Comstock would agree to increase the purchase price by $50.0 million to adjust the deal value for the inclusion of the assets previously excluded from the March 2 Proposal.

On May 31, 2019, the Board held a meeting attended by all of the directors as well as BMO. BMO presented its work on the potential merger and management provided its analysis on the potential merger. Following this discussion, BMO delivered its oral opinion to the Board that, as of such date and based upon and subject to the factors and assumptions set forth therein, the share consideration and the mixed consideration, taken in the aggregate, to be paid by the Company for the outstanding equity of Covey Park pursuant to the Merger Agreement was fair from a financial point of view to the Company.

Over the course of June 1 through June 5, 2019, the parties, including Locke Lord and V&E, finalized negotiation of the transaction documentation.

On June 4, 2019, the Company executed an engagement letter with Wells Fargo as lead financial advisor. On the same day, representatives from Wells Fargo joined the Board to discuss the merger, preferred stock marketing process, and Series A and Series B Preferred Stock.

On June 5, 2019, the Board held a telephonic meeting attended by all of the directors as well as representatives of Wells Fargo and Locke Lord. A representative of Locke Lord gave an updated presentation summarizing the proposed terms of the Merger Agreement. Comstock management then recommended that the Board approve the Transactions. After considering the proposed terms of the Merger and the terms of the Merger Agreement and transactions contemplated by the Merger Agreement, the Board (i)(A) determined that the Merger and the other transactions contemplated by the Merger Agreement, on the terms and subject to the conditions set forth in the Merger Agreement, are fair to, and in the best interests of, the Company and its stockholders and (B) approved and declared advisable the Merger Agreement, the Merger and the other transactions contemplated by the Merger Agreement, on the terms and subject to the conditions set forth in the Merger Agreement, recommended that the holders of Common Stock vote in favor of adopting the Merger Agreement and (ii) directed that the Merger Agreement be submitted to the holders of the Common Stock for their adoption.

Later in the day of June 7, 2019, Comstock and Covey Park executed and delivered the Merger Agreement and related transaction agreements. On June 10, 2019, Comstock and Covey Park issued a joint press release announcing entry into the Merger Agreement.

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Reasons for the Merger

In evaluating the Merger, the Board consulted with Comstock’s management, as well as Comstock’s legal and financial advisors, and considered a number of factors, weighing both perceived benefits of the Merger as well as potential risks of the Merger. In the course of its deliberations, the Board considered a variety of factors and information that it believes support its determinations and recommendations, including the following (which are not all-inclusive and not necessarily presented in order of relative importance):

In the course of its deliberations, the Company’s Board also considered a variety of risks, uncertainties and other potentially negative factors, including the following (which are not necessarily all-inclusive and not presented in order of relative importance):

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The Company’s Board considered all of these factors as a whole and unanimously concluded that they supported a determination to approve the Merger Agreement and the transactions contemplated thereby, including the issuance of shares of the Company’s Common Stock and Preferred Stock in connection with the Merger. The foregoing discussion of the information and factors considered by the Board is not exhaustive. In view of the wide variety of factors considered by the Board in connection with its evaluation of the Merger and the complexity of these matters, the Board did not consider it practical to, nor did it attempt to, quantify, rank or otherwise assign relative weights to the specific factors that it considered in reaching its decision. In considering the factors described above and any other factors, individual members of the Board may have viewed factors differently or given different weight or merit to different factors.

Required Approval of the Shareholder Approved Actions; Record Date; Action by Stockholder Consent

Under Nevada law and the Company’s Second Amended and Restated Articles of Incorporation and Amended and Restated Bylaws, the Shareholder Approved Actions required the affirmative vote or written consent of the holders of a majority of the voting power of all outstanding shares of Common Stock. On June 11, 2019, the record date, there were 105,953,681 shares of Common Stock outstanding and entitled to vote.

On June 7, 2019, the Principal Stockholders delivered to the corporate secretary of the Company the Written Consent in respect of shares of Common Stock representing approximately 84% of the voting power of all outstanding shares of Common Stock. Such Written Consent constituted approval of the Shareholder Approved Actions by the holders of the requisite number of shares of Common Stock in accordance with the Nevada

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Revised Statutes and, accordingly, the approval of the Shareholder Approved Actions by the Company’s stockholders was effected on June 7, 2019. No further approval of the stockholders of the Company is required to approve the Shareholder Approved Actions. As a result, the Company has not solicited and will not be soliciting your vote for the approval of the Shareholder Approved Actions and does not intend to call a meeting of stockholders for purposes of voting on the approval of the Shareholder Approved Actions.

Federal securities laws state that the Shareholder Approved Actions may not be completed until 20 days after the date of mailing of this Information Statement to the Company’s stockholders. Therefore, notwithstanding the execution and delivery of the Written Consent (which was obtained concurrently with the execution of the Merger Agreement), the Merger will not occur until that time has elapsed. We currently expect the Merger to be completed on or around July 31, 2019, subject to certain government regulatory reviews and approvals and the satisfaction of the other conditions to closing in the Merger Agreement. However, there can be no assurance that the Merger will be completed on or prior to that time, or at all.

Recommendation of the Board

At the meeting of the Board on June 5, 2019, after careful consideration, including detailed discussions with the Company’s management and its legal and financial advisors, the Board:

Opinion of BMO Capital Markets Corp.

Introduction

The Board retained BMO as its financial advisor and in connection therewith to provide an opinion to the Board as to the fairness, from a financial point of view, to the Company of the Merger Consideration to be paid by the Company in the Merger pursuant to the Merger Agreement.

On May 31, 2019, at a meeting of the Board held to evaluate the transactions, BMO delivered its opinion to the effect that, as of May 31, 2019 and based upon and subject to the assumptions, limitations and qualifications set forth in the opinion and other matters BMO considered relevant, the Merger Consideration to be paid by the Company in the Merger pursuant to the Merger Agreement was fair, from a financial point of view, to the Company.

The opinion speaks only as of the date and time it was rendered and not as of the time the transactions may be completed or any other time. The opinion does not reflect changes that may occur or may have occurred after its delivery, which could significantly alter the value, facts or elements on which the opinion was based. Neither BMO’s opinion nor the summary of its opinion herein are intended to be, and they do not constitute, advice or a recommendation to the Board, any security holder or any other person or entity as to how to act or vote with respect to any matter relating to the Merger. The full text of BMO’s written opinion, dated May 31, 2019, which

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sets forth the assumptions made, general procedures followed, matters considered and limitations on the review undertaken by BMO in rendering its opinion, is attached as Annex D to this Information Statement and is incorporated herein by reference. Stockholders of the Company are urged to read the opinion carefully in its entirety.

In connection with BMO’s services as the financial advisor to the Board, the Company has agreed to pay BMO a fee of $2.0 million. In addition, the Company has agreed to reimburse certain of BMO’s expenses arising, and to indemnify BMO against certain liabilities that may arise, out of BMO’s engagement.

Certain Effects of the Merger

Upon the consummation of the Merger, Covey Park will be merged with and into the Company, and the Company shall continue its existence under the laws of the State of Nevada as the surviving corporation. At the effective time of the Merger, all of the property, rights, privileges, powers, and franchises of the Company and Covey Park will vest in the Company, as the surviving corporation, and all debts, liabilities, obligations, restrictions, disabilities, and duties of the Company and Covey Park shall become the debts, liabilities, obligations, restrictions, disabilities, and duties of the Company, as the surviving corporation.

At the effective time, the organizational documents of the Company in effect immediately prior to the effective time shall continue to be the organizational documents of the Company, as the surviving corporation. Subject to the terms and conditions of the Shareholders Agreement, the directors and officers of the Company immediately prior to the effective time of the Merger shall continue to be the directors and officers of the Company, as the surviving corporation.

Governance Matters After the Merger

Following the closing of the Merger, the parties to the Shareholders Agreement will take all necessary actions to cause the Board to include one director who shall be designated by Holdings. The initial designated Holdings director will be Jordan Marye. In addition, pursuant to the Shareholders Agreement, the Corporate Governance and Nominating Committee of the Board will consider John Jacobi to be appointed to the Board. Therefore, following the consummation of the Merger and the transactions contemplated in connection with the Merger Agreement, the Board will consist of six, or possibly seven, directors, five of whom will have been directors of the Company prior to the consummation of the Merger and one (or two) of whom will be persons appointed to the Board in accordance with the terms of the Shareholders Agreement.

The following is a list of the directors and executive officers of the Company following the Merger.

Directors

Biographical information for the Company’s current directors who will serve on the Board is incorporated by reference from the Company’s Annual Report on Form 10-K for the year ended December 31, 2018.

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Jordan T. Marye. Mr. Marye has been a Managing Partner of Denham Capital Management since 2014, where he leads the firm’s Oil & Gas investment effort. He joined Denham Capital in 2006. Prior to joining Denham, Mr. Marye worked in the Global Energy Group of UBS Investment Bank and the Energy Practice of Huron Consulting Group. He currently serves on the Board of Directors of multiple Denham portfolio companies, including Covey Park Energy, Fairway Resources III, Clear Creek Resource Partners, Spire HoldCo, Atlantic Resources I & II and Rockies Resources. A native of south Louisiana, Mr. Marye received a Bachelor of Science from Louisiana State University.

John D. Jacobi. Mr. Jacobi has served as Co-CEO of Covey Park since June 2013. From 1999 through June 2013, he served as Vice President of Business Development and Marketing at EXCO Resources, Inc., where he led the acquisition efforts on over 100 transactions valued at approximately $8 billion. In 1991, he co-founded Jacobi-Johnson Energy, Inc., an independent oil and natural gas producer, and served as its President focusing on acquisitions in the Ark-La-Tex and Gulf Coast Basins before it was sold to EXCO Resources in 1998. Mr. Jacobi began his full-time employment in the energy business in 1981 working for Woolf & Magee, Inc., a drilling and exploration and production company where he was involved in acquisitions for the exploration and production company and contract negotiations for the drilling company. Mr. Jacobi previously served on the board of directors for three joint ventures between BG Group plc and EXCO Resources Inc.: TGGT Holdings, LLC, an intrastate pipeline company serving the East Texas & North Louisiana area; EXCO Resources (PA), LLC, an operating company that owns and operates wells and natural gas gathering systems throughout Ohio, Pennsylvania, West Virginia, and Kentucky; and Appalachia Midstream Company, LLC, a natural gas gathering and transportation company.

Executive Officers

Biographical information for the Company’s executive officers who will continue to serve as executive officers of the Company is incorporated by reference from the Company’s Annual Report on Form 10-K for the year ended December 31, 2018.

Effects on the Company if the Merger is not Completed

If the Merger is not completed for any reason, Holdings will not receive any payment for its Covey Park Equity in connection with the Merger other than, under certain circumstances, the Financing Termination Fee. Instead, the Company and Covey Park will remain separate, independent companies and the Holdings will continue to own the Covey Park Equity.

If the Merger is not completed, there is no assurance as to the effect of these risks and opportunities on the future value of your shares of Common Stock, including the risk that the market price of the Common Stock may decline to the extent that the current market price of the Common Stock reflects a market assumption that the Merger will be completed. If the Merger is not completed, there is no assurance that any other transaction acceptable to the Company will be offered or that the business, operations, financial condition, earnings or prospects of the Company will not be adversely impacted. Pursuant to the Merger Agreement, under certain circumstances the Company and Covey Park are permitted to terminate the Merger Agreement. Please see the section of this Information Statement entitled “The Merger Agreement—Termination.”

Financing of the Merger

Subscription Agreement

Concurrent with the execution of the Merger Agreement, the Company executed the Subscription Agreement. Pursuant to the Subscription Agreement, the Company shall issue and sell to the Jones LLCs an aggregate of (i) 175,000 shares of Series B Preferred Stock, par value $10.00 per share of the Company (the “Series B Preferred Stock”), and (ii) 50,000,000 shares of Common Stock. The parties to the Subscription

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Agreement, as well as Holdings and the Principal Stockholders, will also enter into an Amended and Restated Registration Rights Agreement, which will govern certain rights and obligations of the parties thereto with respect to the registration of Common Stock issuable to the Jones LLCs pursuant to the Subscription Agreement as well as the Stock Consideration issuable under the Merger Agreement. The issuance of the Series B Preferred Stock and Common Stock will be exempt from registration under U.S. securities laws pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”).

The Company has also agreed to apply for NYSE listing of the Common Stock issuable pursuant to the Subscription Agreement and to take all appropriate action to increase the authorized number of shares of Common Stock available for issuance by the filing of the Charter Amendment. The closing of the Subscription Agreement is subject to certain conditions including the following: (1) all conditions to closing of the transactions contemplated by the Merger Agreement shall have been satisfied (or waived) and the parties thereto be ready to consummate the transactions contemplated by the Merger Agreement, (2) no order shall have been entered (or be in effect) by a court of competent jurisdiction which enjoins, prohibits or materially restrains the transactions contemplated by the Subscription Agreement, (3) the Charter Amendment shall have been filed with the Secretary of State of the State of Nevada, (4) each of the representations and warranties of the parties to the Subscription Agreement shall be true and correct in all material respects on the closing date and (5) each of the parties to the Subscription Agreement shall have executed the Registration Rights Agreement.

Series A and Series B Preferred Stock

The following is a summary of the material rights, preferences and privileges of the cumulative redeemable convertible perpetual preferred stock, designated the Series A Preferred Stock and the Series B Preferred Stock (together defined as the Preferred Stock), as contained in the Certificate of Designations, which is Exhibit G to the Merger Agreement (the “Certificate of Designations”). This summary is qualified in its entirety by reference to the complete Certificate of Designations included as part of Annex C to this Information Statement and incorporated by reference herein.

Dividends

Holders of Preferred Stock shall be entitled to receive cumulative cash dividends accrued on the liquidation value of $1,000 per share of Preferred Stock (the “Liquidation Value”) in an amount equal to a dividend rate of 10% per annum (the “Dividend Rate”). Dividends will be paid in arrears on March 31, June 30, September 30 and December 31 of each year, commencing on September 30, 2019.

In the event the Company fails to pay in cash in full all or any part of any dividend when due and payable, the Company’s Common Stock ceases to be listed or quoted on any national securities exchange, or the Company fails to cause a shelf registration statement with respect to the Registrable Securities (as defined in the Registration Rights Agreement) to be declared effective 30 days prior to the first anniversary of the initial issue date of the Preferred Stock, the Dividend Rate will be increased by up to 7.0% per annum, in accordance with the terms of the Certificate of Designations.

Dividends will be paid in cash if the Company has funds legally available for payment and the Board declares a cash dividend payable.

Liquidation Preference

In the event of any liquidation, winding up or dissolution of the Company, each holder of Preferred Stock will be entitled to receive out of the Company’s assets legally available for distribution to its stockholders, in accordance with the ranking of the Preferred Stock discussed below, an amount in cash equal to the greater of (i) the Liquidation Value per share of Preferred Stock plus an amount equal to all accrued dividends on such

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share of Preferred Stock, and (ii) if a liquidation, winding up or dissolution of the Company occurs following the 12-month anniversary of the initial issue date of the Preferred Stock, the total market value of the Common Stock into which all of a holder’s shares of Preferred Stock are convertible determined as of the trading day immediately prior to such liquidation, winding up or dissolution.

Ranking

The Preferred Stock ranks senior to the Company’s Common Stock and any shares of capital stock of the Company not expressly ranking senior to or pari passu with the Preferred Stock as to the payment of dividends and distributions of assets upon the liquidation, dissolution or winding up of the Company. Between the Series A and Series B Preferred Stock, Series A Preferred Stock ranks senior to all Series B Preferred Stock and the Series B Preferred Stock shall not receive any proceeds on the liquidation, dissolution or winding up of the Company unless and until the Series A Preferred Stock has been paid.

Voting Rights

Holders of Preferred Stock have limited voting rights under Nevada law, the Company’s Articles of Incorporation and the terms of the Certificate of Designations. Under the terms of the Certificate of Designations, in addition to certain other actions, the Company may not, without the affirmative vote of at least a majority of the holders of the Series A Preferred stock voting as a single class and the Series B Preferred Stock voting as a single class: (i) pay any dividends in respect of junior stock, subject to customary exceptions; (ii) issue any capital stock ranking senior or pari passu to the Preferred Stock; (iii) delist its Common Stock from a national securities exchange or enter into certain merger or acquisition transactions; however, the Preferred Stock will not have a right to vote on any material sale of assets, merger, consolidation or Change of Control transaction (discussed below) if the Company agrees to redeem the Preferred Stock in full for cash in the amount determined pursuant to the terms of the Certificate of Designations; (iv) amend the terms of the Company’s Second Amended and Restated Articles of Incorporation or the Certificate of Designations in whole or in part, by merger, consolidation or otherwise, so as to adversely affect the rights, preferences, privileges or powers of the shares of Preferred Stock; (v) voluntarily authorize, declare or initiate any bankruptcy, liquidation or dissolution proceedings, may not issue any equity securities of its subsidiaries other than to another subsidiary or in connection with the contribution of any assets or cash in excess of $10.0 million to any person that is not wholly-owned by the Company; or (vi) enter into any agreement that expressly prohibits the Company from declaring and paying dividends to the holders of the Preferred Stock.

Holder Conversion

The conversion price of each share of Preferred Stock is $4.00 per share, subject to adjustment pursuant to customary anti-dilution provisions as contained in the Certificate of Designations (the “Conversion Price”). At any time following the 12-month anniversary of the initial issue date of the Preferred Stock each holder may convert any or all shares of Preferred Stock into shares of Common Stock at the then prevailing conversion rate, equal to the quotient of (a) the Liquidation Value per share plus an amount equal to all accrued dividends on such share, and (b) the Conversion Price (the “Conversion Rate”). Holders may receive cash in lieu of fractional shares.

Special Rights Upon a Change of Control

In connection with any Change of Control, defined in the Certificate of Designations but generally meaning (i) the consummation of any transaction the result of which is that any person, with certain exceptions, becomes to beneficial owner of more than 50% of the voting stock of the Company, (ii) the direct or indirect sale, lease, transfer, conveyance or other disposition of all or substantially all of the properties or assets of the Company, or (iii) the adoption of a plan relating to the liquidation or dissolution of the Company, holders of Preferred Stock may convert all but not less than all shares of Preferred Stock into Common Stock at the then prevailing

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Conversion Rate. Alternatively, holders may elect to require the Company to purchase all but not less than all of its shares of Preferred Stock for cash at a purchase price per share equal to the Liquidation Value per share plus an amount equal to all accrued dividends on such share if such Change of Control occurs during the period prior to the 12-month anniversary of the initial issue date, or at a purchase price equal to the greater of (1) the Liquidation Value per share plus an amount equal to all accrued dividends on such share and (2) an amount equal to (A) the number of shares of Common Stock into which such share of Preferred Stock is convertible at the Conversion Rate then in effect as of immediately prior to such Change of Control multiplied by (B) the closing sale price of the Common Stock on the trading day immediately prior to such Change of Control, if the Change of Control occurs following the 12-month anniversary of the initial issue date (as applicable, the “Change of Control Cash Price”). The Company will only be required to pay the Change of Control Cash Price to the extent permitted by specified contract terms in the Covey Park Notes Indenture and that certain indenture dated as of August 3, 2018, by and between Comstock Escrow Corporation, as issuer, and the American Stock Transfer & Trust Company LLC, as trustee (the “Comstock Indenture”), as such terms relate to the purchase of Preferred Stock in connection with a Change of Control as contemplated by the definition of “Disqualified Stock” under the Covey Park Indenture and “Disqualified Capital Stock” under the Comstock Indenture.

In addition, each holder may convert any or all shares of Preferred Stock into shares of Common Stock at the Conversion Rate in connection with the consummation of a Change of Control or Take-Private Transaction (as defined in the Certificate of Designations) in which all of such holder’s shares are not redeemed in full for the Change of Control Cash Price except that the price paid per share of Common Stock in the applicable Take-Private Transaction shall be substituted for the closing sale price of the Common Stock on the trading day immediately prior to a Change of Control transaction in calculating the cash price per share.

Company Optional Redemption

At any time the Company may elect to cause any and all shares of Preferred Stock to be redeemed for cash at a redemption price equal to the Liquidation Value per share of Preferred Stock plus an amount equal to all accrued dividends on such share. In no event may Series B Preferred Stock be redeemed to the extent any shares of Series A Preferred Stock remain outstanding. Customary notice and redemption procedure provisions apply. The Company may assign the right to exercise its redemption right to a third party, subject to certain conditions, and such third party will be entitled to exercise such right on the same terms as the Company provided that such party will be required to convert any acquired shares of Series A Preferred Stock immediately following the acquisition of such shares.

Debt Financing

The Company has a received a Debt Financing Term Sheet (as such term is defined in the Merger Agreement) from certain lenders (and other lender parties to be identified following the date of the Merger Agreement) in the amounts set forth in the Debt Financing Term Sheet for the purposes of funding a portion of the Cash Consideration, the Company’s other obligations (including the repayment of the Indebtedness under the Company’s revolving credit facility) and related fees and expenses required to be paid by the Company in connection with the transactions contemplated by the Merger Agreement. The Company must use reasonable best efforts under the Merger Agreement to obtain Debt Financing on the terms set forth in the Debt Financing Term Sheet.

Interests of the Company’s Directors and Executive Officers in the Merger

Certain of the Company’s directors and executive officers may have interests in the Merger that may be different from, or in addition to, the interests of the Company’s stockholders generally. These interests may present actual or potential conflicts of interest and you should be aware of these interests. The members of the Board were aware of and considered these interests in reaching the determination to approve the Merger Agreement and deem the Merger Agreement, the Merger and the other transactions contemplated by the Merger Agreement to be fair to, and in the best interests of, the Company and its stockholders.

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Merger Consideration

At the effective time of the Merger, and subject to the terms and conditions of the Merger Agreement, all of the Covey Park Equity that is issued and outstanding immediately prior to the effective time will be converted into the right to receive (i) the Stock Consideration, which shall consist of 28,833,000 shares of Common Stock and 210,000 shares of Series A Preferred Stock, and (ii) the Cash Consideration, which will be in an amount equal to $700.0 million plus the Series A Preferred Balance (as defined in the Merger Agreement) to be used to redeem the preferred units of Holdings. Following the consummation of the Merger it is expected that Holdings will own approximately 16% of the outstanding shares of Common Stock.

Material U.S. Federal Income Tax Consequences of the Merger

The following is a general discussion of the material United States federal income tax consequences of the Merger to holders of Common Stock. This discussion is limited to U.S. holders and non-U.S. holders that hold their shares of the Common Stock as “capital assets” within the meaning of Section 1221 of the Code (generally, property held for investment). This discussion is based upon the Code, the Treasury Regulations, judicial authorities and published positions of the Internal Revenue Service (“IRS”) all as currently in effect, and all of which are subject to change or differing interpretations possibly with retroactive effect, and any such change or differing interpretation could affect the accuracy of the statements and conclusions set forth herein.

This discussion is for general information purposes only and does not address all of the U.S. federal income tax consequences and considerations that may be relevant to a particular holder in light of such holder’s particular facts and circumstances and does not apply to holders that are subject to special treatment under U.S. federal income tax laws, such as, for example, banks or other financial institutions; insurance companies, regulated investment companies, real estate investment trusts or mutual funds; holders liable for the alternative minimum tax; certain former citizens or former long-term residents of the United States; U.S. holders having a “functional currency” other than the U.S. dollar; tax-exempt organizations; holders that exercise dissenters’ rights; dealers in securities or currencies; entities or arrangements treated as partnerships for U.S. federal income tax purposes or other flow-through entities (or investors therein); subchapter S corporations, retirement plans, individual retirement accounts or other tax-deferred accounts; traders in securities that elect to use a mark to market method of accounting; holders that hold (or that held, directly or constructively, at any time during the five year period ending on the date of the Merger) 5% or more of the equity exchanged, directly or constructively; holders that hold stock of the Company as part of a straddle, hedge, constructive sale, or conversion transaction or other integrated or risk reduction transaction; “controlled foreign corporations”; “passive foreign investment companies”; and holders that acquired the equity exchanged through the exercise of an employee stock option or otherwise as compensation or through a tax-qualified retirement plan.

This discussion does not address any tax consequences of the Merger under U.S. federal tax laws other than those pertaining to the income tax, nor does it address any considerations under any state, local or foreign tax laws or under the unearned income Medicare contribution tax pursuant to the Health Care and Education Reconciliation Act of 2010. This discussion also does not address any withholding considerations under the Foreign Account Tax Compliance Act of 2010 (including the Treasury Regulations issued thereunder and intergovernmental agreements entered into pursuant thereto or in connection therewith). No assurance can be given that the IRS would not assert, or that a court would not sustain, a position contrary to any of the tax consequences set forth below.

If a partnership or other entity or arrangement treated as a partnership for U.S. federal income tax purposes holds shares of the Common Stock, the tax treatment of a person treated as a partner in such partnership for U.S. federal income tax purposes generally will depend upon the status of the partner and the activities of the partnership. Such partnerships and partners in such partnerships should consult their tax advisors about the tax consequences of the Merger to them.

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All holders of the Common Stock are urged to consult with their tax advisors as to the specific tax consequences of the Merger to them in light of their particular facts and circumstances, including the applicability and effect of any U.S. federal, state, local, foreign or other tax laws.

For purposes of this discussion, the term “U.S. holder” means a beneficial owner of the Common Stock that for U.S. federal income tax purposes is:

For purposes of this discussion, the term “non-U.S. holder” means a beneficial owner of the Common Stock that is neither a U.S. holder nor a partnership for U.S. federal income tax purposes.

Tax Consequences of the Merger Generally

For U.S. federal income tax purposes, together with the rest of the Exchanges, the Company is intended to qualify as a transaction described in Section 351 of the Code. The Company has not sought and will not seek any opinion of counsel with respect to the U.S. federal income tax treatment of the Exchanges. The Company has not sought and will not seek any ruling from the IRS as to the U.S. federal income tax consequences of the Exchanges. Consequently, no assurance can be given that the IRS will not assert, or that a court would not sustain, a position contrary to any of the conclusions set forth below.

The remainder of this discussion proceeds on the basis that the Exchanges, taken together, will qualify as a transaction described in Section 351 of the Code.

Tax Consequences to U.S. Holders

The U.S. federal income tax consequences of the Merger to U.S. holders that are Exchangors (“U.S. Exchangors”) generally are as follows:

U.S. Exchangors who acquired different blocks of the equity being surrendered at different times or different prices should consult their tax advisors as to the determination of the tax bases and holding periods of the Common Stock received in the Merger.

The Merger should not have U.S. federal income tax consequences for a U.S. Holder that is not an Exchangor.

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Non-U.S. Holders

The U.S. federal income tax consequences of the Merger to non-U.S. holders that are Exchangors (“Non-U.S. Exchangors”) generally will be the same as those described above for U.S. Exchangors, except that a Non-U.S. Exchangor generally will not be subject to U.S. federal income tax or withholding tax on any gain realized in connection with the Merger unless:

Gain described in the first bullet point above generally will be subject to U.S. federal income tax on a net income basis at the regular graduated U.S. federal income tax rates in the same manner as if such Non-U.S. Exchangor were a U.S. person. A Non-U.S. Exchangor that is a corporation also may be subject to an additional branch profits tax at a rate of 30% (or such lower rate as may be specified by an applicable income tax treaty) on its “effectively connected earnings and profits” for the taxable year, subject to certain adjustments.

Gain described in the second bullet point above will be subject to U.S. federal income tax at a 30% rate (or such lower rate as may be specified by an applicable income tax treaty), but may be offset by U.S.-source capital losses, if any, of the Non-U.S. Exchangor.

The Merger should not have U.S. federal income tax consequences for a non-U.S. holder that is not an Exchangor.

Backup Withholding and Information Reporting

Payments of cash to an Exchangor in connection with the Merger may, under certain circumstances, be subject to information reporting and backup withholding, unless the Exchangor provides proof of an applicable exemption or furnishes its taxpayer identification number, and otherwise complies with all applicable requirements of the backup withholding rules. Certain holders (such as corporations and non-U.S. holders) are exempt from backup withholding.

Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules may be allowed as a refund or credit against a holder’s U.S. federal income tax liability, if any, provided the required information is timely furnished to the IRS. Non-U.S. Exchangors may be required to comply with certification requirements and identification procedures in order to establish an exemption from information reporting and backup withholding.

The preceding discussion is intended only as a general discussion of the material U.S. federal income tax consequences of the Merger. It is not a complete analysis or discussion of all potential tax effects that may be important to particular holders. Holders of Common Stock should consult their own tax advisors as to the particular tax consequences to them of the Merger, including tax return reporting requirements, the applicability and effect of federal, state, local and other tax laws and the effect of any proposed changes in the tax laws.

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Restructuring

Covey Park is currently a wholly-owned subsidiary of Current Holdings. In connection with the Merger, Holdings formed CPE Merger Sub LLC, a Delaware limited liability company (“Merger Sub”) as a wholly owned subsidiary of Holdings. Immediately prior to, but conditioned upon, the closing of the transactions contemplated by the Merger Agreement, Merger Sub shall merge with and into Covey Park, with Covey Park surviving as a wholly owned subsidiary of New Holdings (the “Restructuring”). In connection with the Restructuring, all issued and outstanding equity interests in Covey Park shall be converted into an equal number and class of equity interests in Holdings having the same rights, designations, preferences and obligations as such converted equity interests.

Regulatory Approvals Required for the Merger

Under the HSR Act, and the related rules and regulations issued by the FTC, certain transactions, including the Merger, may not be consummated until notification and report forms have been filed by each of the Company and Covey Park with the FTC and the DOJ and the applicable waiting periods have expired or terminated. The Company and Covey Park filed their respective notification and report forms under the HSR Act with the FTC and the DOJ on June 20, 2019.

At any time before or after the effective time of the Merger, the DOJ, the FTC or the U.S. state attorneys general could take action under applicable antitrust laws, including seeking to enjoin the consummation of the Merger, conditionally approving the Merger upon the divestiture of assets of the Company or Covey Park, subjecting the consummation of the Merger to regulatory conditions or seeking other remedies. Private parties may also seek to take legal action under the antitrust laws under certain circumstances.

Under the Merger Agreement, the respective obligations of the Company, Covey Park, Holdings, and Current Holdings to effect the Merger are subject to, among other things, the expiration or termination of the waiting period (or any extension thereof) applicable to the consummation of the Merger under the HSR Act and the receipt of the non-U.S. jurisdiction governmental approvals.

For a description of the Company’s and Covey Park’s respective obligations under the Merger Agreement with respect to regulatory approvals, please see the section of this Information Statement entitled “The Merger Agreement—Reasonable Best Efforts and Certain Pre-Closing Obligations.”

We currently expect to obtain all antitrust and other regulatory approvals that are required for the consummation of the Merger on or before July 31, 2019; however, we cannot guarantee when any such approvals will be obtained, or that they will be obtained at all.

Accounting Treatment of the Merger

The Company prepares its financial statements in accordance with GAAP and its pro forma financial statements as required by the SEC Article 11 of Regulation S-X. The Merger will be accounted for as an acquisition under FASB ASC Topic 805, Business Combinations, with the Company being considered the acquirer of Covey Park for accounting purposes. This means that the Company will allocate the purchase price to the fair value of Covey Park’s tangible and intangible assets and liabilities at the acquisition date, with the excess purchase price, if any, being recorded as goodwill. Under the acquisition method of accounting, goodwill is not amortized but is tested for impairment at least annually.

Dividend Policy

Since February 13, 2015, the Company has not paid any cash dividends. Because the Company anticipates that all earnings will be retained for the development of its business, the Company does not expect that any cash dividends will be paid on the Common Stock for the foreseeable future.

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Subject to limited exceptions, the Merger Agreement prohibits the Company (unless consented to in writing in advance by Covey Park) from paying dividends to holders of Common Stock until the earlier of the effective time and the termination of the Merger Agreement in accordance with its terms.

For additional information on the Company’s dividend policy, see “Description of Capital Stock.” For additional information on the treatment of dividends under the Merger Agreement, see “The Merger Agreement—Operating Covenants.”

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THE MERGER AGREEMENT

The following summary of the material provisions of the Merger Agreement, and such summary and the description of the Merger Agreement elsewhere in this Information Statement are qualified in their entirety by reference to the complete text of the Merger Agreement, a copy of which is included as Annex A to this Information Statement and is incorporated into this Information Statement by reference. This summary does not purport to be complete and may not contain all of the information about the Merger Agreement that is important to you. We urge you to carefully read this entire Information Statement, including the annexes and the other documents to which we have referred you. You should also review the section entitled “Where You Can Find Additional Information.”

The Merger Agreement has been included for your convenience to provide you with information regarding its terms and we recommend that you read it in its entirety. The Merger Agreement is not intended to be a source of factual, business or operational information about the Company, Covey Park, Holdings, or Current Holdings, and the following summary of the Merger Agreement and the copy thereof included as Annex A to this Information Statement are not intended to modify or supplement any factual disclosure about the Company in any documents it publicly files with the SEC. The Merger Agreement is a contractual document that establishes and governs the legal relations between the Company, Covey Park, Holdings, and Current Holdings, and allocates risks between the parties, with respect to the Merger. The Merger Agreement contains representations and warranties made by the Company, on the one hand, and Covey Park, Holdings, and Current Holdings, on the other hand, that are qualified in several important respects, which you should consider as you read them in the Merger Agreement.

The representations and warranties are qualified by certain information of the Company filed with the SEC prior to the date of the Merger Agreement. Certain of the representations and warranties made by the Company, on the one hand, and Covey Park and Holdings, on the other hand, were also made as of a specified date, may be subject to a contractual standard of materiality different from what might be viewed as material to stockholders, and may have been used for the purpose of allocating risk between the parties to the Merger Agreement rather than as establishing matters as facts. Moreover, information concerning the subject matter of the representations and warranties, which do not purport to be accurate as of the date of this Information Statement, may have changed since the date of the Merger Agreement, and subsequent developments or new information qualifying a representation or warranty may or may not be fully reflected in this Information Statement or the Company’s public disclosures. Accordingly, you should not rely on the representations and warranties as being accurate or complete or characterizations of the actual state of facts as of any specified date.

The Merger

At the effective time of the Merger, upon the terms and subject to the satisfaction or waiver of the conditions of the Merger Agreement and in accordance with the Delaware General Corporate Law and Nevada Revised Statutes, Covey Park will merge with and into the Company. The separate corporate existence of Covey Park will cease and the Company will be the surviving corporation of the Merger. The Second Amended and Restated Articles of Incorporation and Amended and Restated Bylaws of the Company as in effect immediately prior to the effective time will be the Articles of Incorporation and the Bylaws of the surviving corporation. Subject to the appointment of additional directors at the effective time of the Merger (see “Agreements Related to the Merger—The Shareholders Agreement”), the directors and officers of the Company immediately prior to the effective time of the Merger will, from and after the effective time of the Merger, be the directors and officers of the surviving corporation until their respective successors have been duly elected or appointed and qualified, or until their earlier death, resignation or removal.

Closing and Effective Time of the Merger

The closing of the Merger will take place at 9:00 a.m., Dallas, Texas time, on a date that is two (2) business days following the satisfaction or (to the extent permitted by applicable law) waiver (in accordance with the

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Merger Agreement) of all of the conditions described in the section below entitled “The Merger Agreement—Conditions to the Merger” (other than any such conditions that by their nature cannot be satisfied until the closing of the Merger, but subject to satisfaction of any such condition), unless the Company and Covey Park agree to another time in writing.

The Merger will become effective upon the filing and acceptance of the articles of merger with the offices of the Secretaries of State of Nevada and Delaware, or at such later time as shall be agreed upon in writing by the Company and Covey Park and specified in the articles of merger, which is referred to as the “effective time” of the Merger.

Consideration to be Received in the Merger

The Merger Agreement provides that, at the effective time of the Merger, all of the issued and outstanding Covey Park Equity outstanding immediately prior to the effective time of the Merger, shall be converted into the right to receive from the Company (i) 28,833,000 shares of Common Stock, (ii) 210,000 shares of Series A Preferred Stock, and (iii) cash in an amount equal to $700.0 million plus the Series A Preferred Balance. At the time of Closing, the Company will pay the Cash Consideration to Holdings by wire transfer and deliver to Holdings the Stock Consideration, in book entry form, together with an executed certificate of the transfer agent, certifying as to the book entry issuance thereof and any other evidence of issuance reasonably requested by Holdings.

The “Series A Preferred Balance” is defined as the aggregate Series A Preferred Liquidation Preference attributable to Holdings’ outstanding Series A Preferred Units as of the effective time of the Merger. The Company estimates such amount to be approximately $155.0 million.

Representations and Warranties

The Merger Agreement contains a number of representations and warranties made by the Company, including representations and warranties relating to:

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The Merger Agreement also contains a number of representations and warranties made by Covey Park and Holdings, including representations and warranties relating to:

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Significant portions of the representations and warranties of each of the Company, Covey Park and Holdings are qualified as to “materiality” or “material adverse effect.”

Under the Merger Agreement, a Company material adverse effect means a material adverse effect on (a) the business, assets, condition (financial or otherwise) or results of operations of the Company and its affiliates, taken as a whole, or (b) the Company’s ability to perform its obligations under the Merger Agreement (or the other transaction documents contemplated therein) or to consummate the transactions contemplated by the Merger Agreement (or the other transaction documents contemplated therein); provided, however, that the following shall not be considered when determining whether a Company material adverse effect has occurred or would reasonably be expected to occur:

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Under the Merger Agreement, a Covey Park material adverse effect means a material adverse effect on (a) the business, assets, condition (financial or otherwise) or results of operations of Covey Park or any of its affiliates, taken as a whole, or (b) Covey Park’s or any of its affiliates’ ability to perform their respective obligations under Merger Agreement or to consummate the transactions contemplated by the Merger Agreement; provided, however, that the following shall not be considered in determining whether a Covey Park material adverse effect has occurred or would be reasonably expected to occur: