Magnolia Oil & Gas (MGY) Risk Analysis

The WildFire Purchase Agreement contains a number of conditions to the consummation of the WildFire Acquisition, including, among others: the expiration or termination of the applicable waiting period under the HSR Act ("HSR Approval");the absence of orders or injunctions that prohibit the consummation of the applicable acquisition;subject to certain exceptions, the accuracy of representations and warranties with respect to Magnolia's businesses and the WildFire Seller's business, including, with respect to the WildFire Seller, representations and warranties regarding ownership and operation of the Seller, which generally must be true and correct as of the closing of the WildFire Purchase Agreement except for inaccuracies that would not, in the aggregate, have a material adverse effect; and subject to specified materiality thresholds in the WildFire Purchase Agreement, the aggregate values of title defects (less any offsetting title benefits), environmental defects, casualty losses, and exclusions related to the exercise of third-party consents or preferential purchase rights applicable to the WildFire Seller shall not exceed 15% of the unadjusted aggregate purchase price. If any of these conditions are not satisfied or waived prior to October 13, 2026 (or if all such conditions other than the HSR Approval are satisfied or waived by October 13, 2026, prior to March 12, 2027), it is possible that the WildFire Purchase Agreement may be terminated. The WildFire Purchase Agreement may also be subject to termination if at any time a final, non-appealable order or injunction prohibits the consummation of the WildFire Acquisition. In addition, satisfying the conditions to and the consummation of the WildFire Acquisition may take longer and could cost more than Magnolia or the WildFire Seller expects. Many of the conditions to the consummation of the WildFire Acquisition are not within Magnolia's control or the WildFire Seller's control, and the parties cannot predict when or if these conditions will be satisfied. Any delay in completing the WildFire Acquisition may adversely affect the cost savings and other benefits that Magnolia expects to achieve if the WildFire Acquisition and the integration of the parties' respective businesses are completed within the expected timeframe.

Magnolia's ability to achieve the anticipated benefits of the WildFire Acquisition will depend in part upon whether the Company can integrate WildFire into the existing business in an efficient and effective manner. Magnolia may not be able to accomplish this integration process successfully. The successful acquisition of producing properties, including WildFire, requires an assessment of several factors, including: recoverable reserves;future natural gas and oil prices and their appropriate differentials;availability and cost of transportation of production to markets;availability and cost of drilling equipment and of skilled personnel;development and operating costs including access to water and potential environmental and other liabilities; and regulatory, permitting and similar matters. The accuracy of these assessments is inherently uncertain. In connection with these assessments, Magnolia has performed a review of the subject properties that the Company believes to be generally consistent with industry practices. The review was based on the Company's analysis of historical production data, assumptions regarding capital expenditures and anticipated production declines. Data used in such review was furnished by the WildFire Seller or obtained from publicly available sources. Magnolia's review may not reveal all existing or potential problems or permit the Company to fully assess the deficiencies and potential recoverable reserves for all of the acquired properties, and the reserves and production related to the WildFire Seller may differ materially after such data is reviewed further by Magnolia. Inspections will not always be performed on every well, and environmental conditions or issues are not necessarily observable even when an inspection is undertaken. Even when issues are identified, the WildFire Seller may be unwilling or unable to provide effective contractual protection against all or a portion of the underlying deficiencies. Magnolia is often not entitled to contractual indemnification for environmental liabilities and acquire properties on an "as is" basis, and, as is the case with certain liabilities associated with WildFire, Magnolia is entitled to indemnification for only certain environmental liabilities. The integration process may be subject to delays or changed circumstances, and Magnolia can give no assurance that WildFire will perform in accordance with the Company's expectations or that the Company's expectations with respect to integration or cost savings as a result of the WildFire Acquisition will materialize. In addition, to the extent the WildFire Acquisition is not consummated, the proceeds from this offering will be applied to reduce indebtedness which may ultimately be reborrowed.

Magnolia has incurred and is expected to continue to incur a number of non-recurring costs associated with the WildFire Acquisition, combining the operations of WildFire with the Company and realizing the expected benefits. A substantial majority of non-recurring expenses will consist of transaction costs and include, among others, fees paid to financial, legal, accounting and other advisors. Although the Company expects that the elimination of duplicative costs, as well as the realization of expected benefits related to the integration of WildFire, should allow Magnolia to offset these transaction costs over time, this net benefit may not be achieved in the near term or at all.

of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2025 ("2025 Form 10-K"), and

The pendency of the WildFire Acquisition could cause disruptions in Magnolia's business, which could have an adverse effect on Magnolia's business, results of operations and financial condition. In particular, the attention of Magnolia's management may be directed towards the WildFire Acquisition, including obtaining required approvals and other transaction-related considerations and may be diverted from our day-to-day business operations, and matters related to the WildFire Acquisition may require commitments of time and resources that could otherwise have been devoted to other opportunities that might have been beneficial to the Company. Any of these matters could adversely affect Magnolia's business, or harm our results of operations, financial condition or cash flows, even after the WildFire Acquisition is consummated.