SM Energy Company (SM) Proxy filing summary

Executive summary

• Achieved record operating cash flow of $2.01 billion and 21% increase in net production for 2025, despite a 14% decline in benchmark oil prices; oil comprised 53% of volumes.

• Completed merger with Civitas Resources in January 2026, creating a top 10 U.S. independent oil producer with 797,000 net acres across four basins and targeting $200–$300 million in annual synergies.

• Reduced net debt to a 1.05x leverage ratio and returned $104 million to stockholders in 2025, with cumulative returns since 2022 totaling $648 million.

• Announced a 10% increase in fixed dividend to $0.88 per share annually and plan to allocate 20% of 2026 free cash flow (after dividends) to share repurchases.

• CEO succession completed in early 2026, appointing Beth McDonald as President & CEO.

Voting matters and shareholder proposals

• Stockholders will vote to elect 11 director nominees, approve executive compensation on an advisory basis, and ratify Deloitte & Touche LLP as the independent auditor for 2026.

• Board recommends voting FOR all proposals.

Board of directors and corporate governance

• Board expanded to 11 members post-merger, with 10 independent directors and a non-executive independent Chair.

• Board committees (Audit, Compensation, Governance & Sustainability) are composed solely of independent directors.

• Annual elections for all directors; robust director qualification, onboarding, and refreshment processes in place.

• Board met 12 times in 2025; all directors attended at least 90% of meetings.