EX-99.2

EX-99.2 4 d175953dex992.htm EX-99.2 EX-99.2

Exhibit 99.2

Offering Memorandum Excerpts

For the purposes of this Exhibit:

“Aera” means Aera Energy LLC.

“Aera Companies” means Aera Energy LLC and its operating affiliate Aera Energy Services Company.

“Aera Merger” means the business combination of California Resources Corporation with the Aera Companies in an all-stock transaction.

“Berry” means Berry Corporation (bry).

“Berry Merger” means the business combination of California Resources Corporation with Berry in an all-stock transaction.

“CRC,” the “Company,” “we,” “us,” “our” or similar terms refer to California Resources Corporation.

“GAAP” means U.S. Generally Accepted Accounting Principles.

“NGL” means natural gas liquid.

“PSC” means production-sharing contracts.

“PSU” means performance stock unit.

“Revolving Credit Facility” means the Credit Agreement, dated as of April 26, 2023, between CRC, Citibank, N.A., as administrative agent, collateral agent, and issuing bank, and the several lenders party thereto, as amended.

“RSU” means restricted stock unit.

“Unrestricted Subsidiaries” means certain of CRC’s subsidiaries that do not guarantee CRC’s outstanding senior notes.

* * *

As of and for the six months ended June 30, 2025, and assuming the addition of all of Berry’s subsidiaries as guarantors concurrent with the closing of the Berry Merger, our subsidiaries that do not guarantee our Revolving Credit Facility accounted for approximately 7% of our pro forma property, plant and equipment, net, 9% of our pro forma average daily net production, 8% of our pro forma total operating revenues and 1% of our pro forma adjusted EBITDAX. As of and for the year ended December 31, 2024, and assuming the addition of all of Berry’s subsidiaries as guarantors concurrent with the closing of the Berry Merger, our subsidiaries that do not guarantee our Revolving Credit Facility accounted for approximately 11% of our pro forma average daily net production, 10% of our pro forma total operating revenues and 5% of our pro forma adjusted EBITDAX. In addition, our subsidiaries that do not guarantee our Revolving Credit Facility will have no long-term indebtedness.

As of and for the six months ended June 30, 2025, and assuming the addition of all of Berry’s subsidiaries as guarantors concurrent with the closing of the Berry Merger, our Unrestricted Subsidiaries accounted for approximately 1% of our pro forma property, plant and equipment, net, none of our pro forma net production volumes, none of our pro forma total operating revenues and negative 4% of our pro forma adjusted EBITDAX due to operating losses. As of and for the year ended December 31, 2024, and assuming the addition of all of Berry’s subsidiaries as guarantors concurrent with the closing of the Berry Merger, our Unrestricted Subsidiaries did not account for any of our pro forma average daily net production or our total pro forma total operating revenues and did account for approximately negative 5% of our pro forma adjusted EBITDAX due to operating losses.

* * *


	Historical CRC												Pro Forma
	Six months ended June 30,						Year ended December 31,						Six months ended June 30, 2025			Year ended December 31, 2024			Twelve months ended June 30, 2025
	2025			2024			2024			2023			Six months ended June 30, 2025			Year ended December 31, 2024			Twelve months ended June 30, 2025
(in millions)							(Audited)						(Unaudited)
Statements of Operations Data:
Oil, natural gas and NGL sales	$	1,516		$	841		$	2,537		$	2,155		$	1,789		$	3,184
Total operating revenues		1,890			968			3,198			2,801			2,277			4,654		$	4,960
Operating costs		(611	)		(332	)		(966	)		(822	)		(716	)		(1,510	)
General and administrative expenses		(151	)		(120	)		(321	)		(267	)		(191	)		(493	)
Depreciation, depletion and amortization		(259	)		(106	)		(388	)		(225	)		(314	)		(653	)
Total operating expenses		(1,437	)		(941	)		(2,589	)		(2,025	)		(1,867	)		(3,969	)
Interest and debt expense		(52	)		(30	)		(87	)		(56	)		(69	)		(160	)

Net income (loss)		287			(2	)		376			564			245			383			691
Balance Sheet Data (at period end):
Total current assets	$	728		$	1,439		$	1,024		$	929		$	883
Total current liabilities		928			593			980			616			1,079
Property, plant and equipment, net		5,560			2,773			5,680			2,770			6,396
Total assets		6,712			4,490			7,135			3,998			7,766
Long-term debt, net		888			1,161			1,132			540			1,333
Non-current asset retirement obligations		969			436			995			422			1,149
Stockholders’ equity		3,407			2,052			3,538			2,219			3,704
Statements of Cash Flows Data:
Net cash provided by operating activities	$	351		$	184		$	610		$	653		$	432		$	1,127		$	952
Net cash used in investing activities		(130	)		(82	)		(1,077	)		(175	)
Net cash (used in) provided by financing activities		(521	)		433			343			(289	)
Other Supplementary Data (unaudited):
Adjusted EBITDAX⁽¹⁾		652			288			1,006			862			773			1,730			1,640
Free cash flow⁽²⁾		240			96			355			468			238			703			548

(1)	Adjusted EBITDAX is a non-GAAP financial measure.

(2)	Free cash flow is a non-GAAP financial measure.

* * *

The following tables represent a reconciliation of the GAAP financial measures of net income and net cash provided by operating activities to the non-GAAP financial measure of adjusted EBITDAX.


	Historical CRC			Historical Berry						Pro Forma
	Six months ended June 30, 2025			Six months ended June 30, 2025			Adjustments			Six months ended June 30, 2025
(in millions)	(Unaudited)
Net income (loss)	$	287		$	(63	)	$	21		$	245
Interest and debt expense		52			31			(14	)		69
Income tax provision (benefit)		117			(25	)		8			100
Interest income		(5	)		—			—			(5	)
Depreciation, depletion and amortization		259			76			(15	)		320
Exploration expense		1			—			—			1
Unusual, infrequent and other items
Non-cash derivative gain		(162	)		(61	)		—			(223	)
Asset impairment		—			158			—			158
Severance and termination costs		8			—			—			8
Transaction costs		3			—			—			3
Other, net		24			2			—			26


Other non-cash items		68			3		—			71

Adjusted EBITDAX	$	652		$	121	$	—		$	773

Net cash provided by operating activities	$	351		$	75	$	6		$	432
Cash interest payments		50			28		(14	)		64
Cash income taxes		39			5		8			52
Exploration expenditures		1			—		—			1
Working capital changes		216			13		—			229
Cash interest received		(5	)		—		—			(5	)

Adjusted EBITDAX	$	652		$	121	$	—		$	773


	Historical CRC			Historical Berry						Pro Forma
	Six months ended December 31, 2024			Six months ended December 31, 2024			Adjustments			Six months ended December 31, 2024			Twelve months ended June 30 2025
(in millions)	(Unaudited)
Net income	$	378		$	68		$	—		$	446		$	691
Interest and debt expense		57			20			18			95			164
Income tax provision		146			26			—			172			272
Interest income		(5	)		—			—			(5	)		(10	)
Depreciation, depletion and amortization		282			86			(18	)		350			670
Exploration expense		1			—			—			1			2
Unusual, infrequent and other items
Non-cash derivative gain		(322	)		(64	)		—			(386	)		(609	)
Asset impairment		1			—			—			1			159
Severance and termination costs		29			—			—			29			37
Transaction costs		31			1			—			32			35
Net gain on asset divestitures		(4	)		—			—			(4	)		(4	)
Other, net		38			7			—			45			71
Other non-cash items		86			5			—			91			162

Adjusted EBITDAX	$	718		$	149		$	—		$	867		$	1,640

Net cash provided by operating activities	$	426		$	112		$	(18	)	$	520		$	952
Cash interest payments		66			30			18			114			178
Cash income taxes		79			3			—			82			134
Acquisition costs		—			1			—			1			1
Non-recurring costs		—			1			—			1			1
Exploration expenditures		1			—			—			1			2
Working capital changes		151			—			—			151			380
Cash interest received		(5	)		—			—			(5	)		(10	)
Other operating income– cash portion		—			(2	)		—			(2	)		(2	)
Losses on debt retirement – cash portion		—			4			—			4			4

Adjusted EBITDAX	$	718		$	149		$	—		$	867		$	1,640


	Pro Forma CRC			Historical Berry			Adjustments			Pro Forma
	Twelve months ended December 31,			Twelve months ended December 31,						Twelve months ended December 31,
	2024⁽¹⁾			2024						2024
(in millions)	(Unaudited)
Net income	$	352		$	19		$	12		$	383
Interest and debt expense		125			39			(4	)		160
Income tax provision		129			9			4			142
Interest income		(24	)		—			—			(24	)
Depreciation, depletion and amortization		528			172			(35	)		665
Exploration expense		2			—			—			2
Unusual, infrequent and other items
Non-cash derivative gain		(37	)		(8	)		—			(45	)
Asset impairment		14			44			—			58
Severance and termination costs		30			—			—			30


Transaction costs		73			5			14			92
Net gain on asset divestitures		(15	)		—			—			(15	)
Other, net		97			4			9			110
Other non-cash items		165			7			—			172

Adjusted EBITDAX	$	1,439		$	291		$	—		$	1,730

Net cash provided by operating activities	$	940		$	210		$	(23	)	$	1,127
Cash interest payments		123			47			(4	)		166
Cash income taxes		106			3			4			113
Acquisition costs		—			5			23			28
Non-recurring costs		—			2			—			2
Exploration expenditures		2			—			—			2
Working capital changes		291			26			—			317
Cash interest received		(23	)		—			—			(23	)
Other operating income – cash portion		—			(6	)		—			(6	)
Losses on debt retirement – cash portion		—			4			—			4

Adjusted EBITDAX	$	1,439		$	291		$	—		$	1,730

(1)	Reflects the Aera Companies’ historical results for the period from January 1, 2024 through June 30, 2024 and related transaction accounting and financing adjustments associated with CRC’s business combination with the Aera Companies completed on July 1, 2024, as presented below:


	Historical CRC			Historical Aera			Transaction Adjustments - Disposals			Transaction Adjustments - Acquisitions			Financing Adjustments			Pro Forma
	Twelve months ended December 31,			Six months ended June 30,												Twelve months ended December 31,
	2024			2024												2024
(in millions)	(Unaudited)
Net income (loss)	$	376		$	(105	)	$	8		$	100		$	(27	)	$	352
Interest and debt expense		87			—			—			—			38			125
Interest expense		—			59			—			(59	)		—			—
Income tax provision		140			1			—			(1	)		(11	)		129
Interest income		(19	)		(5	)		—			—			—			(24	)
Depreciation, depletion and amortization		388			149			—			(9	)		—			528
Exploration expense		2			—			—			—			—			2
Unusual, infrequent and other items
Non-cash derivative (gain) loss		(274	)		237			—			—			—			(37	)
Asset impairment		14			—			—			—			—			14
Severance and termination costs		30			—			—			—			—			30
Transaction costs		57			16			—			—			—			73
Net gain on asset divestitures		(11	)		(4	)		—			—			—			(15	)
Other, net		93			4			—			—			—			97
Other non-cash items		123			83			(10	)		(31	)		—			165

Adjusted EBITDAX	$	1,006		$	435		$	(2	)		—			—		$	1,439

Net cash provided by operating activities	$	610		$	258		$	8		$	91		$	(27	)	$	940
Cash interest payments		88			56			—			(59	)		38			123
Cash income taxes		105			1			—			—			—			106
Exploration expenditures		2			—			—			—			—			2
Working capital changes		220			124			(10	)		(32	)		(11	)		291
Cash interest received		(19	)		(4	)		—			—			—			(23	)

Adjusted EBITDAX	$	1,006		$	435		$	(2	)		—			—		$	1,439

* * *

The following tables present a reconciliation of net cash provided by operating activities to free cash flow.


	Historical CRC			Historical Berry			Adjustments		Pro Forma
	Six months ended June 30,			Six months ended June 30,					Six months ended June 30,
	2025			2025					2025
(in millions)									(Unaudited)
Net cash provided by operating activities	$	351		$	75		$	6	$	432
Capital investments		(111	)		(83	)		—		(194	)

Free cash flow		240			(8	)		6		238

Integration and transaction fees		3			—			—		3

Free cash flow, after special items	$	243		$	(8	)	$	6	$	241


	Historical CRC			Historical Berry			Adjustments			Pro Forma
	Six months ended December 31,			Six months ended December 31,						Six months ended December 31,			Twelve months ended June 30
	2024			2024						2024			2025
(in millions)										(Unaudited)
Net cash provided by operating activities	$	426		$	112		$	(18	)	$	520		$	952
Capital investments		(167	)		(43	)		—			(210	)		(404	)

Free cash flow		259			69			(18	)		310			548

Integration and transaction fees		31			—			—			31			34

Free cash flow, after special items	$	290		$	69		$	(18	)	$	341		$	582


	Pro Forma CRC			Historical Berry			Adjustments			Pro Forma
	Twelve months ended December 31,			Twelve months ended December 31,						Twelve months ended December 31,
	2024⁽¹⁾			2024						2024
(in millions)										(Unaudited)
Net cash provided by operating activities	$	940		$	210		$	(23	)	$	1,127
Capital investments		(322	)		(102	)		—			(424	)

Free cash flow		618			108			(23	)		703

Integration and transaction fees		73			—			14			87

Free cash flow, after special items	$	691		$	108		$	(9	)	$	790

(1)	Reflects the Aera Companies’ historical results for the period from January 1, 2024 through June 30, 2024 and related transaction accounting and financing adjustments associated with CRC’s business combination with the Aera Companies completed on July 1, 2024, as presented below:


	Historical CRC			Historical Aera							Financing Adjustments			Pro Forma
	Twelve months ended December 31,			Six months ended June 30,			Transaction Adjustments							Twelve months ended December 31,
	2024			2024			Disposals		Acquisitions					2024
(in millions)	(Unaudited)
Net cash provided by operating activities	$	610		$	258		$	8	$	91	$	(27	)	$	940
Capital investments		(255	)		(67	)		—		—		—			(322	)

Free cash flow		355			191			8		91		(27	)		618

Integration and transaction fees		57			16			—		—		—			73

Free cash flow, after special items	$	412		$	207		$	8	$	91	$	(27	)	$	691

***


	Six months ended June 30, 2025
	CRC		Berry		Pro Forma
Average Daily Net Production:
Oil (MBbl/d)		110		23		133
NGLs (MBbl/d)		10		—		10
Natural gas (MMcf/d)		114		8		123
Total net production (MBoe/d)		139		24		163
Average realized prices:
Oil with hedge ($/Bbl)	$	69.39	$	68.57	$	69.08
Oil without hedge ($/Bbl)		69.34		65.44		68.68
NGLs ($/Bbl)		48.60		28.35		47.89
Natural gas ($/Mcf)		3.46		3.06		3.43
Average benchmark prices:
Brent oil ($/Bbl)	$	70.84	$	70.81	$	70.84
WTI oil ($/Bbl)		67.58		67.69		67.58
NYMEX gas ($/MMBtu)		3.55		—		3.55
Average costs per Boe:
Operating costs	$	24.90	$	25.10	$	24.76
Operating costs, excluding effects of PSC-type contracts⁽¹⁾	$	23.80

(1)

Operating costs, excluding effects of PSCs is a non-GAAP measure. The reporting of our PSC-type contracts creates a difference between reported operating costs, which are for the full field, and reported volumes, which are only our net share, inflating the per barrel production costs. These amounts represent our operating costs after adjusting for this difference. Berry does not have any PSC-type contracts.

* * *

As of September 19, 2025, we had $251 million of available cash and cash equivalents (excluding $15 million of restricted cash) and no borrowings under our Revolving Credit Facility. As of September 19, 2025, Berry had $37 million of available cash and cash equivalents (excluding an insignificant amount of restricted cash) and $428 million of Existing Berry Indebtedness.

* * *

UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

The following unaudited pro forma condensed combined financial information is derived from the historical condensed combined financial statements of CRC and the historical condensed combined financial statements of Berry, respectively, and gives effect to (i) the merger, (ii) the extinguishment of Berry’s outstanding debt, (iii) the issuance of new debt, and (iv) the 2024 acquisition of the Aera Companies, described below, (collectively, the “pro forma events”). The unaudited pro forma condensed combined financial information was prepared in accordance with Article 11 of Regulation S-X.

On September 14, 2025, CRC entered into a merger agreement with Berry, pursuant to which CRC will acquire Berry for approximately 5.8 million shares of its common stock (subject to customary adjustments in the event of stock splits, dividends paid in stock and similar items). Upon the closing of the merger, we expect to terminate and repay any outstanding indebtedness under Berry’s senior secured term loan credit agreement and its senior secured revolving credit agreement. Each party will pay its own expenses incident to preparing for, entering into and carrying out the merger agreement and the consummation of the merger and the stock issuance. In the event the merger is terminated by Berry for a superior proposal, a termination fee is payable in connection with such termination.

The unaudited pro forma condensed combined financial information giving effect to the pro forma events has been prepared by CRC using the acquisition method of accounting in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”). CRC has been treated as the acquirer for accounting purposes, and thus accounts for the merger as a business combination in accordance with Accounting Standards Codification Topic 805, Business Combinations (“ASC 805”). The valuations of the assets acquired, and liabilities assumed, and therefore the purchase price allocations, are preliminary and have not yet been finalized as of the date of this offering memorandum. As a result of the foregoing, the pro forma adjustments are preliminary and have been made solely for the purpose of providing unaudited pro forma condensed combined financial information.

On July 1, 2024, CRC completed the acquisition of the Aera Companies as contemplated by the merger agreement described in the Current Report on Form 8-K, filed by CRC on February 9, 2024. The impact of the Aera Merger is included in CRC’s historical condensed combined financial statements as of and for the six months ended June 30, 2025; as such, no adjustments have been applied to these financial statements on a pro forma basis.

The unaudited pro forma condensed combined balance sheet as of June 30, 2025 gives effect to the Berry Merger as if it had occurred as of June 30, 2025. The unaudited pro forma condensed combined statements of operations for the year ended December 31, 2024 and for six months ended June 30, 2025 give effect to the pro forma events as if they had occurred on January 1, 2024 (where the financial results for the Aera Companies during the period January 1, 2024 through June 30, 2024 is included with CRC’s financial results for the twelve months ended December 31, 2024 on a pro forma basis).

The unaudited pro forma condensed combined balance sheet and the unaudited pro forma condensed combined statements of operations have been derived from and should be read in conjunction with the following financial statements:

•

The historical audited condensed combined financial statements of CRC as of and for the year ended December 31, 2024;

•

The historical unaudited condensed combined financial statements of CRC as of and for the six months ended June 30, 2025;

•

The historical audited condensed combined financial statements of Berry as of and for the year ended December 31, 2024;

•

The historical unaudited condensed combined financial statements of Berry as of and for the six months ended June 30, 2025; and

•

The historical unaudited consolidated and combined financial statements of the Aera Companies as of and for the six months ended June 30, 2024.

The unaudited pro forma condensed combined financial statements contain certain reclassification adjustments to conform the historical financial statement presentation of the Aera Companies and Berry to that of CRC.

CRC purchased services from Berry during the year ended December 31, 2024 in the amount of $6 million and during the six months ended June 30, 2025 in the amount of $5 million. CRC sold natural gas to and purchased natural gas from the Aera Companies during the six months ended June 30, 2024 in the amounts of $1 million and $1 million, respectively. As such, adjustments were applied to the unaudited pro forma condensed combined statements of operations to remove this activity, which would be considered intercompany activity and be eliminated upon consolidation.

The pro forma adjustments are based on available information and upon assumptions that management believes are reasonable in order to reflect, on a pro forma basis, the effect of the pro forma events on the historical financial information of CRC. The adjustments are described in the notes to the unaudited pro forma condensed combined balance sheet and the unaudited pro forma condensed combined statements of operations.

The unaudited pro forma condensed combined financial information is included for informational purposes only. The unaudited pro forma condensed combined financial information should not be relied upon as being indicative of our results of operations or financial condition had the pro forma events occurred on the dates assumed. The unaudited pro forma condensed combined financial information also does not project our results of operations or financial position for any future period or date, including, but not limited to, the anticipated realization of ongoing savings from potential operating efficiencies, asset dispositions, cost savings, or economies of scale that the combined company may achieve with respect to the combined operations. Specifically, the unaudited pro forma condensed combined statement of operations does not include projected synergies expected to be achieved as a result of the mergers and any associated costs that may be required to be incurred to achieve those synergies. The unaudited pro forma condensed combined statements of operations also exclude the effects of costs of integration activities that may result from the mergers. The unaudited pro forma condensed combined statements of operations and balance sheet should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in CRC’s Annual Report on Form 10-K for the year ended December 31, 2024.

CRC has used currently available information to determine preliminary fair value estimates for the stock consideration and its allocation to the Berry assets acquired and liabilities assumed.

Unaudited Pro Forma Condensed Combined Balance Sheet

As of June 30, 2025

(in millions)


	CRC (as reported)			Berry (as reported)			Presentation Adjustments					Transaction Adjustments					Financing Adjustments				Pro Forma
Assets
Current assets:
Cash and cash equivalents	$	72		$	20							$	(430	)	(B	)	$	445	(F	)		92
													(15	)	(C	)
Trade receivables, net		297			71								(3	)	(D	)						365
Inventories		93			—			16		(A	)											109
Asset held for sale		8			—																	8
Receivable from affiliate		31			—																	31
Derivative instruments		—			40			(40	)	(A	)											—
Other current assets, net		227			27			40		(A	)											278
								(16	)	(A	)

Total current assets		728			158			—					(448	)				445				883
Property, plant, and equipment, net		5,560			1,176								(340	)	(B	)						6,396
Investments in unconsolidated subsidiaries		93			—																	93
Deferred income tax assets		33			55								19		(B	)						60
													(47	)	(F	)
Derivative instruments		—			29			(29	)	(A	)											—
Other noncurrent assets		298			10			29		(A	)		(3	)	(B	)						334

Total assets	$	6,712			1,428			—				$	(819	)			$	445			$	7,766

Current liabilities:
Current portion of long-term debt, net		122			45								(45	)	(B	)						122
Accounts payable		329			145			(124	)	(A	)		(3	)	(D	)						347
Income taxes payable		—			1			(1	)	(A	)											—
Accrued liabilities		477			—			125		(A	)		(1	)	(C	)						610
													9		(E	)

Total current liabilities		928			191			—					(40	)				—				1,079
Non-Current liabilities:
Long-term debt, net		888			365								(365	)	(B	)		445	(F	)		1,333
Asset retirement obligations		969			180																	1,149
Deferred tax liabilities		185			—								(47	)	(F	)						138
Other long-term liabilities		335			28																	363
Stockholders’ equity:
Common stock		1			—																	1
Treasury stock		(922	)		(114	)							114		(B	)						(922	)
Additional paid-in capital		2,359			785								(465	)	(B	)						2,679
Retained earnings (accumulated deficit)		1,897			(7	)							7		(B	)						1,874
													(14	)	(C	)
													(9	)	(E	)
Accumulated other comprehensive income		72			—																	72

Total stockholders’ equity		3,407			664			—					(367	)				—				3,704

Total liabilities and stockholders’ equity	$	6,712			1,428		$	—				$	(819	)			$	445			$	7,766

Please refer to the notes to the unaudited pro forma condensed combined financial information.

Unaudited Pro Forma Condensed Combined Statement of Operations

For the Six Months Ended June 30, 2025

(in millions, except share and per share amounts; shares in millions)


	CRC (as reported)			Berry (as reported)			Presentation Adjustments					Transaction Adjustments					Financing Adjustments					Pro Forma
Revenues:
Total operating revenues	$	1,890		$	392							$	(5	)	(DD	)						$	2,277
Operating expenses:
Operating costs		611			—			110		(AA	)		(5	)	(DD	)							716
Lease operating expenses		—			110			(110	)	(AA	)												—
Costs of services		—			40			—															40
General & administrative expenses		151			40																		191
Marketing expenses		—			1			(1	)	(AA	)												—
Depreciation, depletion and amortization		259			76			(6	)	(AA	)		(15	)	(BB	)							314
Asset impairments		—			158																		158
Taxes other than on income		117			22																		139
Costs related to marketing of purchased commodities		91			—			1		(AA	)												92
Electricity generation expenses		15			2																		17
Transportation costs		40			2																		42
Accretion expense		57			—			6		(AA	)												63
Net (gain) loss on natural gas purchase derivatives		(3	)		(3	)																	(6	)
Measurement period adjustments		1			—																		1
Other operating expenses, net		98			1			1		(AA	)												100

Total operating expenses		1,437			449			1					(20	)				—					1,867

Net loss on asset divestitures		—			—			1		(AA	)												1

Operating (loss) income		453			(57	)		—					15					—					411

Non-operating (expenses) income
Interest and debt expense		(52	)		(31	)							31		(CC	)		(17	)	(FF	)		(69	)
Loss of early extinguishment of debt		(1	)		—																		(1	)
Loss from investment in unconsolidated subsidiaries		(1	)		—																		(1	)
Other non-operating income		5			—																		5

Income (loss) before income taxes		404			(88	)		—					46					(17	)				345
Income tax (provision) benefit		(117	)		25								(13	)	(EE	)		5		(EE	)		(100	)

Net income (loss)	$	287		$	(63	)	$	—				$	33				$	(12	)			$	245

Pro forma net income per share:
Basic	$	3.20		$	(0.81	)																$	2.56
Diluted	$	3.18		$	(0.81	)																$	2.54
Weighted-average shares outstanding
Basic		89.8			77.40																		95.6
Diluted		90.3			77.40																		96.3

Please refer to the notes to the unaudited pro forma condensed combined financial information.

Unaudited Pro Forma Condensed Combined Statement of Operations

For the Year Ended December 31, 2024

(in millions, except per share amounts)


	CRC (pro forma)			Berry (as reported)			Presentation Adjustments					Transaction Adjustments					Financing Adjustments					Pro Forma
Revenues:
Total operating revenues	$	3,883		$	777			—				$	(6	)	(DD	)						$	4,654
Operating expenses:
Operating costs		1,290			—			226		(AA	)		(6	)	(DD	)							1,510
Lease operating expenses		—			226			(226	)	(AA	)												—
Costs of services		—			96			—		—													96
General & administrative expenses		416			77																		493
Marketing expenses		—			8			(8	)	(AA	)												—
Depreciation, depletion and amortization		528			172			(12	)	(AA	)		(35	)	(BB	)							653
Asset impairments		14			44																		58
Taxes other than on income		290			47																		337
Costs related to marketing of purchased commodities		193			—			8		(AA	)												201
Electricity generation expenses		40			4																		44
Transportation costs		85			5																		90
Accretion expense		121			—			12		(AA	)												133
Net loss on natural gas purchase derivatives		36			23																		59
Carbon management business expenses		62			—																		62
Measurement period adjustments		(12	)		—																		(12	)
Acquisition costs		—			5			(5	)	(AA	)												—
Other operating expenses (income), net		217			(4	)		5		(AA	)		14		(GG	)							245
								4		(AA	)		9		(HH	)

Loss on early extinguishment of debt		—			7			(7	)	(AA	)												—

Total operating expenses		3,280			710			(3	)				(18	)				—					3,969

Net gain on asset divestitures		15			—			4		(AA	)												19

Operating income (loss)		618			67			7					12					—					704
Non-operating (expenses) income
Interest and debt expenses		(125	)		(39	)							39		(CC	)		(35	)	(FF	)		(160	)
Loss on early extinguishment of debt		(5	)		—			(7	)	(AA	)												(12	)
Loss from investment in unconsolidated subsidiaries		(7	)		—																		(7	)

Income (loss) before income taxes		481			28			—					51					(35	)				525
Income tax provision		(129	)		(9	)							(14	)	(EE	)		10		(EE	)		(142	)

Net income	$	352		$	19		$	—				$	37				$	(25	)			$	383

Net income per share:
Basic	$	4.74		$	0.25																	$	4.00
Diluted	$	4.62		$	0.25																	$	3.90
Weighted-average common shares outstanding
Basic		90.0			76.8																		95.8
Diluted		92.1			77.0																		98.1

NOTES TO THE UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

1. Basis of Presentation

The unaudited pro forma condensed combined financial information was prepared in accordance with Article 11 of Regulation S-X and presents the pro forma financial condition and results of operations of CRC based upon the historical financial information of CRC, Berry, and the Aera Companies after giving effect to the pro forma events and related adjustments set forth in the notes to the unaudited pro forma condensed combined financial information.

The unaudited pro forma condensed combined financial information does not reflect any management adjustments for expected synergies or dis-synergies of the merger.

The unaudited pro forma condensed combined balance sheet as of June 30, 2025, gives effect to the pro forma events as if they had occurred on June 30, 2025. The unaudited pro forma condensed combined statements of operations for the year ended December 31, 2024, and for six months ended June 30, 2025 give effect to the pro forma events as if they had occurred on January 1, 2024.

The Mergers

On September 14, 2025, CRC entered into a merger agreement with Berry, pursuant to which CRC will acquire Berry for 5.8 million shares of common stock.

On July 1, 2024, CRC completed the Aera Merger, as contemplated by the merger agreement described in the Current Report on Form 8-K, filed by CRC on February 9, 2024.

Financing of the Merger

The total amount of funds necessary for CRC to close the merger includes the funds needed to extinguish the outstanding debt of Berry.

2. Notes to Unaudited Pro Forma Condensed Combined Balance Sheet

The following adjustments were made related to the unaudited pro forma condensed combined balance sheet as of June 30, 2025:

A.	Reflects certain reclassification adjustments to conform Berry’s historical assets and liabilities to the financial statement presentation of CRC.

B.	Reflects the purchase price allocation adjustments to record Berry’s assets and liabilities at estimated fair value based on the consideration conveyed of $750 million, as detailed below, and to eliminate Berry’s historical equity balances.

The purchase price was allocated among the identified assets to be acquired. This was considered appropriate based on the determination that the merger would be accounted for as a business acquisition under ASC 805. The estimates of fair value are based upon preliminary valuation assumptions believed to be reasonable, but which are inherently uncertain and unpredictable; and, as a result, actual results may differ from estimates. There can be no assurances that the valuations will not result in material changes to this purchase price allocation. In determining the preliminary estimate of fair values of assets acquired and liabilities assumed of Berry, CRC used publicly available benchmarking information as well as a variety of other assumptions, including market participant assumptions, to determine that substantially all of the purchase price adjustments would impact reserves. The pro forma purchase price allocation relating to the merger is preliminary and subject to change, as additional information becomes available and as additional analyses are performed. Any increase or decrease in fair values of the net assets as compared with the unaudited pro forma condensed combined financial information may change the amount of the total acquisition consideration allocated to reserves and may impact the Unaudited Pro Forma Condensed Combined Statements of Operations due to adjustments in the expenses related to the adjusted assets.


Net Assets Identified	Fair Value (in millions)
Cash and cash equivalents (5)	$	20
Trade receivables		71
Inventories		16
Other current assets		51
Oil and natural gas properties (1)		771
Other property and equipment (1)		65
Deferred income tax asset (6)		74
Other non-current assets (7)		36
Accounts payable		(21	)
Accrued liabilities		(125	)
Asset retirement obligations		(180	)
Other long-term liabilities		(28	)

Total Fair Value	$	750


Value Conveyed
Purchase Consideration (2)	$	309
Repayment of Berry’s outstanding debt (3)		428
Replacement of equity awards (4)		11
Cash settlement of equity awards (8)		2

Total Purchase Consideration	$	750

(1)	Berry’s principal assets are their oil and natural gas properties.

(2)	Purchase consideration was provided in the form of CRC common stock and was calculated as the 5.8 million total shares to be issued, multiplied by $53.01, the closing price of shares of CRC common stock on September 12, 2025.

(3)	In addition to the purchase consideration provided in the form of common stock, $428 million of Berry’s outstanding long-term debt as of June 30, 2025 will be repaid. Berry’s outstanding debt will be repaid upon closing due to a change in control provision within their legacy debt agreement.

(4)	Purchase consideration includes replacement of non-single trigger RSUs and PSUs of Berry with RSUs or common shares of CRC; these legacy Berry awards become fully vested due to the change in control.

(5)	In addition to cash and cash equivalents, Berry held an immaterial amount classified as restricted cash.

(6)

Based on a preliminary assessment of tax attributes included in Berry’s historical deferred tax assets, it was determined that $76 million of tax credit carryforwards will be subject to an annual limitation since Berry will experience an ownership change in connection with the merger. These tax attributes are not expected to be recoverable in the future.

(7)	Deferred issuance costs of $3 million related to Berry’s revolving debt facility were written off as this facility will be terminated due to a change in control provision within the legacy credit agreement.

(8)	Purchase consideration includes $2 million related to the cash settlement of single trigger RSUs and PSUs of Berry; these legacy Berry awards become fully vested due to the change in control.

Total merger-related transaction costs are estimated to be $15 million, including certain legal, accounting, investment banking, due diligence, and other related costs. Approximately $1 million of transaction costs were incurred and accrued for on the balance sheet of CRC as of June 30, 2025. All transaction costs were unpaid as of June 30, 2025.

D.	Reflects the elimination of balances between CRC and Berry that, following the merger, would be considered intercompany activity and eliminated upon consolidation.

E.	Reflects the accrual of $9 million for a retention bonus pool to be paid to certain employees of Berry.

F.	Reflects a reclassification entry to properly present both deferred tax assets and deferred tax liabilities of the combined entity by tax jurisdiction.

G.	Reflects the issuance of debt in the amount of $400 million in new notes, net of debt issuance costs of $6 million, and an additional $51 million, which is expected to be drawn on CRC’s existing revolving credit facility.

3. Notes to Unaudited Pro Forma Condensed Combined Statement of Operations

The following adjustments were made to the unaudited pro forma condensed combined statements of operations:

AA.	Reflects certain reclassification adjustments to conform Berry’s historical revenues and expenses to the financial statement presentation of CRC.

BB.	Reflects the estimated changes in pro forma depreciation, depletion, and amortization expense based on the preliminary purchase price allocation, resulting from the adjustment to basis associated with the property, plant, and equipment balance, which is related to proved oil and gas reserves.

CC.	Reflects the elimination of historical interest expense and amortization of debt issuance costs associated with the settlement of Berry’s outstanding debt, included in consideration as discussed at adjustment (B).

DD.	Reflects the elimination of activity between CRC and Berry that, following the merger, would be considered intercompany activity and eliminated upon consolidation.

EE.	Represents the pro forma adjustment to taxes as a result of adjustments to the income statement, which was calculated using a blended U.S. federal and California statutory income tax rate of 28%.

FF.	Reflects interest expense related to the issuance of new debt, as presented at adjustment (G). This adjustment also includes the amortization of estimated debt issuance costs of $6 million over the estimated term of the loan.

GG.	Reflects estimated transaction costs associated with the pro forma events, as presented at adjustment (C). This charge is not expected to recur in the twelve months following closing.

HH.	Reflects the compensation expense associated with a retention bonus pool, as presented at adjustment (E). This charge is not expected to recur in the twelve months following closing.

The pro forma statement of operations in the table below reflects CRC’s statement of operations for the twelve months ended December 31, 2024 adjusted for the Aera Merger as if it occurred on January 1, 2024. Transaction costs in the amount of $16 million are included in the historical results of the Aera Companies, and this is not expected to recur in the twelve months following closing. The following adjustments were made to the pro forma condensed combined statement of operations for the Aera Merger:

Unaudited Pro Forma Condensed Combined Statement of Operations

For the Year Ended December 31, 2024

(in millions, except per share amounts)


	CRC (as reported)			Aera Companies (as reported for the six months ended June 30, 2024)			Presentation Adjustments					Transaction Adjustments - Disposal					Transaction Adjustments - Acquisition					Financing Adjustments					Pro Forma
Revenues:
Total operating revenues	$	3,198		$	684		$	6		(A	)	$	(4	)	(B	)	$		(1)	(D	)						$	3,883
Operating expenses:
Operating costs		966			226			101		(A	)		(2	)	(B	)		(1	)	(D	)							1,290
General & administrative expenses		321			97			(2	)	(A	)																	416
Depreciation, depletion and amortization		388			149													(9	)	(C	)							528
Asset impairments		14			—																							14
Taxes other than on income		242			48																							290
Purchased natural gas marketing expense		193			84			(84	)	(A	)																	193
Electricity generation expenses		40			25			(25	)	(A	)																	40
Transportation costs		81			—			4		(A	)																	85
Accretion expense		87			75								(10	)	(B	)		(31	)	(C	)							121
Carbon management business expenses		56			—			6		(A	)																	62
Net loss on natural gas purchase derivatives		30			—			6		(A	)																	36
Measurement period adjustments		(12	)		—																							(12	)

Other operating expenses (income), net		183			34																							217

Total operating expenses		2,589			738			6					(12	)				(41	)				—					3,280

Net gain on asset divestitures		11			—			4		(A	)																	15

Operating income (loss)		620			(54	)		4					8					40					—					618
Non-operating (expenses) income
Interest income		—			4			(4	)	(A	)																	—
Interest expense		—			(59	)		59		(A	)																	—
Interest and debt expenses		(87	)		—			(59	)	(A	)							59		(E	)		(38	)	(H	)		(125	)
Loss on early extinguishment of debt		(5	)		—																							(5	)
(Loss) income from investments in unconsolidated subsidiaries		(10	)		—			3		(A	)																	(7	)
Income from equity investments		—			3			(3	)	(A	)																	—

Other non-operating (expense) income, net		(2	)		2																							—

Income (loss) before income taxes		516			(104	)		—					8					99					(38	)				481
Income tax provision		(140	)		—			(1	)									29		(F	)		11		(G	)		(129	)
Federal and state income tax (expense)/benefit		—			(1	)		1																				—
																		(28	)	(G	)

Net income (loss)	$	376		$	(105	)	$	—				$	8				$	100					(27	)			$	352

Net income per share:
Basic	$	4.74																									$	4.00
Diluted	$	4.62																									$	3.90
Weighted-average common shares outstanding
Basic		79.30																										90.0
Diluted		81.40																										92.1

(A)	Reflects certain reclassification adjustments to conform the Aera Companies’ historical revenues and expenses to the financial statement presentation of CRC.

(B)	Reflects the elimination of revenues and expenses associated with certain assets and associated liabilities, which were distributed prior to closing of the Aera Merger.

(C)	Reflects the changes in pro forma accretion expense and depreciation, depletion, and amortization expense based on the preliminary purchase price allocation.

(D)	Reflects the elimination of activity between CRC and the Aera Companies that, following the mergers, would be considered intercompany activity and eliminated upon consolidation.

(E)	Reflects the elimination of historical interest expense and amortization of debt issuance costs associated with the settlement of the Aera Companies’ outstanding debt.

(F)	Reflects the change in tax status of the Aera Companies and certain of its subsidiaries, which were previously pass-through entities for tax purposes, to taxable entities; this impact was calculated using a blended U.S. federal and California statutory income tax rate of 28%.

(G)	Represents the pro forma adjustment to taxes as a result of adjustments to the income statement, which was calculated using a blended U.S. federal and California statutory income tax rate of 28%.

(H)	Reflects interest expense related to the issuance of new debt. This adjustment also includes the amortization of debt issuance costs of $8 million over the estimated five-year period of the loan.

4. Unaudited Pro Forma Net Income Per Share

Unaudited basic pro forma net income per share is computed by dividing pro forma net income attributable to common shares by the pro forma weighted average number of common shares outstanding during the period. Unaudited diluted pro forma net income per share is computed by dividing pro forma net income attributable to common shares by the weighted average number of common shares outstanding during the period after adjusting for the impact of securities that would have a dilutive effect on net income per share.

Pro forma net income per share—basic and diluted

(in millions except per share amounts)

For the Six Months Ended June 30, 2025


Numerator:
Pro forma net income - basic and diluted	$	245
Denominator:
Pro forma weighted-average number of shares outstanding – basic		95.6
Pro forma weighted-average number of shares outstanding – diluted		96.3
Pro forma net income per share attributable to common shareholders:
Basic	$	2.56
Diluted		2.54

For the Year Ended December 31, 2024


Numerator:
Pro forma net income - basic and diluted	$	383
Denominator:
Pro forma weighted-average number of shares outstanding – basic		95.8
Pro forma weighted-average number of shares outstanding – diluted		98.1
Pro forma net income per share attributable to common shareholders:
Basic	$	4.00
Diluted	$	3.90