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1700 Lincoln Street, Suite 1800 
Denver, CO 80203-4518 

NOTICE OF 2013 ANNUAL MEETING OF SHAREHOLDERS

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Proxy Statement Highlights

DATE, TIME AND PLACE OF MEETING

May 15, 2013, 9:00 a.m.
Hershner Room, 1700 Lincoln Street, Denver, Colorado 80203

SHAREHOLDER VOTING MATTERS

DIRECTOR NOMINEES

You are being asked to vote on the following three Director Nominees. Directors are elected by a majority of votes cast. Detailed information about each Director’s background, skill sets and areas of expertise can be found beginning on page 11.

CONTINUING DIRECTORS

The following are Cimarex’s continuing Directors. Detailed information about each Director’s background, skill sets and areas of expertise can be found beginning on page 13.

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CIMAREX 2012 COMPANY HIGHLIGHTS

·                   Grew production 6% to a record 626.5 MMcfe/d; combined Permian Basin and Mid-Continent production increased 20% to an all-time high of 586 MMcfe/d.

·                   Increased proved reserves 10% to 2.3 Tcfe, adjusted for property sales reserves increased 13%.

·                   Added 757 Bcfe of proved reserves from extensions and discoveries replacing 330% of production.

·                   Net income of $353.8 million, or $4.07 per diluted share.

·                   Cash flow from operating activities of $1.2 billion.

·                   Sold $306 million of non-strategic assets which will be reinvested in core area exploration and development activities.

·                   Evaluated, de-risked and expanded our acreage position in several key long-term future drilling projects.

·                   Ended the year with debt to total capitalization of 18%.

ALIGNMENT OF CEO COMPENSATION TO TOTAL SHAREHOLDER RETURN (TSR)

We have performed an analysis of “realizable compensation” of our CEO, on an absolute and relative basis. The following tables illustrate a strong correlation between CEO compensation and TSR. The definition of “realizable compensation” and the full analysis are depicted in charts appearing in Alignment of CEO Compensation to Total Shareholder Return, Section 1 of Compensation Discussion and Analysis.

Absolute CEO Realizable Compensation Compared to Total Shareholder Return – Years 2008-2012

The following table illustrates our CEO realizable pay compared to our TSR for the years 2008 through 2012. Indexed TSR represents the cumulative total return of Cimarex stock for a five-year period based on a $100 investment at the start of the first year, and reinvestment of all dividends. The table shows the value of the investment at the end of each year.

Relative CEO Realizable Compensation Compared to Relative TSR – Three-Year Period (2009 to 2011)

2012 CEO compensation for peer group companies was not available at the time of preparation of this Proxy Statement]

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RESPONSE TO 2012 ADVISORY VOTE ON EXECUTIVE COMPENSATION

The following is a summary of Cimarex’s responses to the 2012 advisory vote on executive compensation. Detailed information about Cimarex’s responses can be found in Section 1, Compensation Discussion and Analysis.

·                  Initiated regular shareholder outreach to identify and discuss shareholder concerns relating to executive compensation and other matters.

·                  Refined our annual cash incentive program for 2013 to provide for updated specific measurable goals and objectives that align with the company’s financial and operational goals and objectives.

·                  Postponed the timing of long-term equity awards to December of each year. The postponement provides the Committee with a more complete picture of our actual annual results (absolute performance and performance relative to our peer group) when determining equity awards. This allows the Committee to make more informed equity award decisions that correlate to Cimarex’s objectives of executive retention and alignment of value of the awards with financial and operational performance.

·                 Eliminated all tax gross ups in change in control payment arrangements.

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PROXY STATEMENT

CORPORATE GOVERNANCE

Our governance structure and processes are based on our Corporate Governance Guidelines, Code of Business Conduct and Ethics and Code of Ethics.

Our Corporate Governance Guidelines and Board committee charters provide the framework for Cimarex’s governance by the Board. The Guidelines address matters such as qualifications, standards for independence, election and responsibilities of directors, limitation of service on other public company boards, number and structure of Board committees, conduct and frequency of Board and committee meetings, Board evaluation, management succession, director access to management, counsel and advisors, and board orientation and education. The Board of Directors, directly or through the Compensation and Governance Committee, reviews and revises as necessary the Corporate Governance Guidelines.

The Code of Business Conduct and Ethics applies to all directors, officers and employees. The Code is a guideline that promotes honest and ethical conduct, encourages compliance with laws and proper use of our assets. As required by the NYSE listing standards or applicable law, we will post on our website all waivers of or amendments to our Code of Business Conduct that are required to be disclosed by applicable law and the NYSE listing standards. We do not anticipate any waivers of or amendments to our Code of Business Conduct.

We have an additional Code of Ethics that applies to our CEO, CFO and Controller, and its purpose is to promote honest and ethical conduct and compliance with the law, particularly as related to the maintenance of Cimarex’s financial records and the preparation of financial statements. The obligations of the Code of Ethics supplement the Code of Business Conduct.

A summary of key governance matters are noted in the table below:

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Interested parties may communicate with our Board by mail directed to our Corporate Secretary or by calling our Confidential Hotline (1-866-519-1898). All communications will be forwarded to the Lead Director for his review. The Lead Director may take any action he deems appropriate or necessary, including, without limitation, forwarding the information to the Board for consideration or, with the concurrence of the Board, retaining independent or outside counsel, accountants or other advisors to address the concern. No adverse action will be taken against any individual making any such communication to the Lead Director.

Shareholder Outreach

Cimarex’s relationships with its shareholders are an important part of our corporate governance profile, and we recognize the value of taking their views into account. Engagement with shareholders helps us to understand the larger context and impact of our operations, learn about expectations for our performance, assess emerging issues that may affect our business or other aspects of our operations and shape corporate and governance policies.

Consistent with our commitment to seek and respond to shareholder input on corporate governance topics, we have considered and discussed with investors a wide variety of matters, including our executive compensation program and disclosures and have made changes in these areas. See Response to 2012 Say on Pay Vote and Shareholder Outreach, Compensation Discussion and Analysis elsewhere in this Proxy Statement.

BOARD AND COMMITTEE INFORMATION

OUR BOARD

During 2012, the Board of Directors met seven times. The Board has three Committees: the Audit Committee, the Compensation and Governance Committee and the Nominating Committee. Each of our directors attended greater than 75% of the meetings of the Board and the Board Committees on which he served during 2012.

All Board members are expected to attend the Annual Meeting. All of our Directors attended our 2012 Meeting.

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Criteria for Board Membership

The Nominating Committee is responsible for recruiting and recommending to the full Board of Directors nominees for election as Directors. The Committee identifies and reviews the qualifications of candidates for Board membership and determines the desired qualifications. Important general criteria for Board membership include the following:

·                  Members of the Board should possess certain desired qualifications, including judgment, skill and experience with businesses and other organizations of comparable size.

·                  The Committee considers the relationship of a candidate’s experience with the experience of existing Board members, experience building or working with a company culture similar to Cimarex and the extent to which the candidate would be a desirable addition to the Board and any of its Committees.

·                  The Committee considers additional attributes, including diversity of gender and ethnicity and senior management experience in the oil and gas industry in the areas of exploration, production, marketing, finance or legal.

Director Independence and Related Person Transactions

Our Corporate Governance Guidelines require that a majority of our Board of Directors be independent as defined by applicable laws, rules, regulations and listing standards. We comply with the criteria for independence established by the New York Stock Exchange (NYSE) listing requirements and other governing laws and regulations.

With the assistance of legal counsel, the Compensation and Governance Committee has reviewed the applicable legal and NYSE standards for Board and Committee member independence. A summary of the answers to annual questionnaires completed by each of the Directors and a report of transactions with Director-affiliated entities are also made available to the Committee. On the basis of this review, the Committee has delivered a report to the full Board of Directors, and the Board has made its independence determinations based on the Committee’s report and the supporting documents.

As a result of this review, the Board has affirmatively determined that Jerry Box, Hans Helmerich, David Hentschel, Harold Logan, Floyd Price, Monroe Robertson, Michael Sullivan and L. Paul Teague, representing eight of our ten Directors, are independent of Cimarex and its management. Thomas Jorden and Joseph Albi are not independent because of their employment as CEO and COO of Cimarex, respectively.

In making these determinations, the Board considered that in the ordinary course of business, relationships and transactions may occur between Cimarex and entities with which some of our Directors are or have been affiliated. As a result of the Committee’s review, certain relationships and transactions are not considered to be material transactions that would impair a Director’s independence, including the following:

·                  The Director is an employee of another company that does business with Cimarex, and our annual sales to or purchases from the other company amount to less than 2% of the annual revenues of the other company and that such sales to or purchases from the other company are part of our ordinary course of business and conducted in the same manner as we obtain services from other companies that provide similar services; or

·                  The Director is a director (but not an employee) of another company that does business with Cimarex.

Hans Helmerich is the Chairman of the Board and CEO of Helmerich & Payne, Inc., a company with which Cimarex engages in ordinary course of business transactions. During Helmerich & Payne’s fiscal year ended September 30, 2012, Cimarex paid Helmerich & Payne $25.3 million for drilling rigs and services in arms’ length transactions and as part of our ordinary course of business in the same manner as we obtain services from other companies that provide similar services. The aggregate amount of the payment represented 0.8% of Helmerich & Payne’s revenue during that period. The Committee reviewed these transactions and concluded that (i) the transactions are proper and not material when compared to Cimarex’s total drilling costs and with Helmerich & Payne’s total revenues; (ii) the transactions occur in the ordinary course of business and at arms’ length; (iii) the Board does not review or approve drilling service contracts or arrangements; and (iv) Mr. Helmerich’s relationship with Helmerich & Payne, Inc. does not interfere with his independent judgment as a director of Cimarex.

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Board Leadership Structure

Cimarex has a combined Chairman of the Board and CEO. Cimarex also has a Lead Director who is chosen annually from our independent directors. Following is a summary of the functions of the Chairman of the Board/CEO and the Lead Director:

The Board believes that the role of a combined Chairman/CEO and an independent Lead Director having the duties described above serve the interests of our shareholders because this structure provides an appropriate balance between strategy development and independent oversight of management.

Thomas Jorden was elected Chief Executive Officer on September 30, 2011 and Chairman of the Board on August 14, 2012. He has served as an executive officer of Cimarex since its formation in 2002. He brings to the position of Chairman of the Board considerable knowledge and experience gained through his executive positions with Cimarex and prior industry experience. This knowledge and experience allow him to focus the activities of the Board on matters most relevant to the success of Cimarex.

Our Board structure is designed to avoid any undue influence by the Chairman of the Board/CEO on the Board. The Compensation and Governance Committee, which recommends the compensation of the Chairman/CEO to the full Board and makes grants to the Chairman/CEO under our long-term equity incentive program, is comprised entirely of independent Directors. When the Board acts on the Compensation and Governance Committee’s recommendation for compensation of the Chairman/CEO, it acts without him being present.

The substantial experience and background of our independent Board members ensure their active and knowledgeable involvement in Board matters. This involvement, and the presence and involvement of our Lead Director, provide the Board with a strong, independent point of view.

Executive Sessions

The non-employee members of the Board meet in executive session at each regularly scheduled Board meeting. During 2012, four executive sessions were held, and all of the non-employee Directors attended each session. These sessions allow non-employee Directors to review the CEO’s performance and determine his compensation, to discuss issues of importance to Cimarex, including the business and affairs of Cimarex, as well as matters concerning management, without any member of management present.

Risk Oversight

Board and Committee Oversight. The Board has overall responsibility for risk oversight. In carrying out its responsibility, the Board has requested that the Audit Committee discuss with management and report to the Board with respect to:

·                  Processes Cimarex has taken to mitigate corporate risks;

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·                  Guidelines and processes pertaining to financial risk assessment;

·                  Steps management has taken to measure, monitor and control such financial risk exposures; and

·                  Management’s conclusion as to the effectiveness of the guidelines and processes utilized to mitigate such corporate and financial risks and exposures.

In addition, each quarter management provides the Board with an overview of Cimarex’s operations, financial results and other aspects of its business. Significant strategic considerations, such as material acquisitions or mergers are brought to the Board for deliberation and, as appropriate, decisions.

The Audit Committee, at its December 2012 meeting, reviewed, discussed and reported to the Board about corporate, operational and financial risks and Cimarex’s processes for mitigation of these risks.

Compensation of Non-Management Directors

Our Compensation and Governance Committee administers our Director compensation program. Director compensation is designed to be near the 50th percentile of that paid by comparable public oil and gas companies with similar market capitalization and revenue. We use the same group of companies in reviewing Director compensation as we use in reviewing executive base salary and total compensation. See Competitive Positioning, Section 2, Compensation Discussion and Analysis for a list of the companies and the methodology followed in selecting the companies. The Committee uses its independent compensation consultant, Longnecker & Associates, to review Director compensation. The Committee, after reviewing the consultant’s recommendations with the CEO and Vice President of Human Resources, recommends Director compensation for Board consideration and approval at the annual May Board meeting. Director compensation is determined and paid for the 12-month period beginning with the date of Cimarex’s Annual Meeting and ending on the following Annual Meeting date.

Through May 15, 2012, compensation for non-employee Directors consisted of the following:

·                  Annual cash retainer of $50,000

·                  Annual equity retainer of $165,000, comprised of restricted stock that vests in one-third increments on each anniversary of the date of grant

·                  Committee chairman fee of $20,000

·                  Lead Director (who also acts as Nominating Committee chairman) fee of $20,000

·                  Board meeting attendance fee of $1,800 per meeting

·                  Committee meeting attendance fee of $1,500 per meeting

At the May 16, 2012 meeting, the Committee’s independent consultant advised that Director compensation was below the 50th percentile of director compensation paid by comparable public oil and gas companies. On May 16, 2012, the Board, on the recommendation of the Compensation and Governance Committee and in consultation with the Committee’s independent compensation consultant, based on a study of peers and market trends, made the following changes to the compensation program for non-employee Directors:

·                  Increased annual cash retainer to $65,000

·                  Increased annual equity retainer to $180,000

The increases brought Director compensation to approximately the 62nd percentile. The following table sets forth 2012 compensation for our non-management Directors:

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(1)       Represents fees earned for services as a Director during 2012, including the annual cash retainer fee, Board and Committee meeting attendance fees, Committee Chairman fee and Lead Director fee.

(2)       Represents the intrinsic value of the 3,014 shares of restricted stock granted to each of the non-employee Directors on May 16, 2012.

(3)       Mr. Price was elected a director in December 2012 and received a pro rata share of the annual cash and equity retainer fees for the year May 2012-May 2013.

The following table discloses the aggregate number of outstanding unvested stock awards and the market value at December 31, 2012. (Market value is based on the closing price of $57.73 on December 31, 2012.) There were no outstanding vested but unexercised option awards as of that date.

COMMITTEES

The table below provides 2012 membership and meeting information for each of the Board Committees:

Audit Committee

The Audit Committee is comprised entirely of independent Directors and is governed by a Board-approved Charter stating its responsibilities. A copy of the Audit Committee Charter is available on our website at www.cimarex.com. Under its Charter, the Audit Committee performs the following functions:

·                  Appoints independent auditor.

·                  Approves the nature and scope of services of independent auditor and reviews range of fees for such services.

·                  Oversees internal audit function.

·                  Reviews qualification and independence of auditor.

·                  Reviews and discusses with independent auditors (i) the auditors’ responsibilities and management’s responsibilities in audit process, (ii) overall audit strategy, (iii) scope and timing of annual audit, and (iv) any significant risks identified during auditor’s risk assessment procedures.

·                  Monitors integrity of financial statements.

·                  Monitors compliance with legal and regulatory requirements.

·                  Reviews and reports to Board on corporate and financial risk.

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The Board of Directors has determined that each of the members of the Audit Committee is financially literate and independent as defined by the rules of the SEC and the NYSE. The Board has also determined that each of Messrs. Logan, Price and Robertson is an “audit committee financial expert” as defined by the SEC’s rules.

Compensation and Governance Committee

The Compensation and Governance Committee is comprised entirely of independent Directors and is governed by a Board-approved Charter stating its responsibilities. A copy of the Compensation and Governance Committee Charter is available on our website at www.cimarex.com. Under its Charter, the Compensation and Governance Committee performs the following functions:

Compensation Functions

·      Recommends CEO and executive officer cash compensation for approval by the Board.

·      Recommends director compensation for approval by the Board.

·      Reviews and recommends the Compensation Discussion and Analysis disclosure for approval by the Board.

·      Determines amount and terms of equity awards.

·      Reviews and approves long-term incentive plans.

·      Reviews relationship of compensation to risk.

·      Approves the nature and scope of services of independent compensation consultant.

Governance Functions

·      Oversees corporate governance.

·      Develops plans for managerial succession.

·      Oversees annual Board and Committee evaluations.

Each year the Compensation and Governance Committee performs a compensation risk assessment. In 2012, the Committee determined that risks arising from our compensation policies and practices for our employees are not reasonably likely to have a material adverse effect on Cimarex. See Compensation Discussion and Analysis for a description of the compensation risk assessment process.

Compensation and Governance Committee Interlocks and Insider Participation. Hans Helmerich, a member of the Committee, was an executive officer of Cimarex from February 14, 2002 until September 30, 2002. Cimarex was formed on February 14, 2002, as a wholly owned subsidiary of Helmerich & Payne, Inc. for the purpose of facilitating a spinoff by Helmerich & Payne of its oil and gas exploration and production business. Cimarex became a publicly traded company on September 30, 2002, at which time Mr. Helmerich resigned as an executive officer.

Nominating Committee

The Nominating Committee is comprised of all of the independent Directors and is governed by a Board-approved Charter stating its responsibilities. A copy of the Nominating Committee Charter is available on our website at www.cimarex.com. Under its Charter, the Nominating Committee performs the following functions:

·                  Determines desired Board skills and attributes

·                  Recommends candidates to serve on the Board and to stand for election at annual meeting of shareholders or to fill vacancy occurring between meetings

·                  Recommends Committee appointments

PROPOSALS REQUIRING YOUR VOTE

ITEM 1 – ELECTION OF DIRECTORS

Our current Board consists of ten members, which is the maximum number of Directors permitted by our Certificate of Incorporation. The Board is divided into three classes, Class I, Class II and Class III Directors. At each Annual Meeting a class of Directors is elected for a term expiring at the Annual Meeting in the third year following the year of election. Each Director holds office until his successor is elected and qualifies.

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The terms of the three Class II directors, Hans Helmerich, Harold R. Logan, Jr. and Monroe W. Robertson, will expire at the 2013 Annual Meeting. The Nominating Committee, at its February 2013 meeting, nominated Messrs. Helmerich, Logan and Robertson for re-election as Class II directors, with a term expiring at the 2016 Annual Meeting.

If prior to the Annual Meeting a nominee becomes unavailable to serve as a Director, any shares represented by a proxy directing a vote will be voted for the remaining nominees and for any substitute nominee or nominees designated by our Board or its Nominating Committee. As of the mailing of these proxy materials, the Board knows of no reason why any Director nominee would not be available to serve as a Director.

A nominee is elected if the votes cast for his election exceed the votes cast against his election. Each Director who is nominated below has tendered an irrevocable resignation that is effective upon his failure to receive the required vote and the Board’s acceptance of such resignation. If a nominee fails to receive more favorable votes than votes cast against him, the Nominating Committee will act on an expedited basis following the Annual Meeting to determine whether to recommend that the Board accept the Director’s resignation. The Nominating Committee and the Board may consider any factors they deem relevant in deciding whether to accept the Director’s resignation. The Director whose resignation is under consideration must abstain from participating in any decision regarding his resignation. The Board will publicly disclose its decision regarding acceptance of his resignation within 90 days after the results of the election are certified. If the resignation is not accepted, the Director will continue to serve as a Director until his successor is elected and qualified. If the Board accepts the resignation, then the Board may fill the vacancy in accordance with the Bylaws or may decrease the size of the Board in compliance with the Certificate of Incorporation.

Information concerning the nominees recommended by our Nominating Committee and nominated by our Board, as well as each of our continuing Directors, is set forth below.

Nominees for Class II Directors

HANS HELMERICH, 54

Position, Principal Occupation and Business Experience

Mr. Helmerich has been Chairman of Helmerich & Payne, Inc. since March 2012 and CEO since 1989. Helmerich & Payne, Inc., a publicly held company located in Tulsa, Oklahoma, designs and builds land drilling rigs. Helmerich & Payne is primarily engaged in contract drilling of oil and gas wells for exploration and production companies and is one of the major land and offshore platform drilling companies in the world. Prior to his election as Chairman and CEO in January 2012, Mr. Helmerich served as President and CEO since 1989 and has served as a director since 1987. Cimarex acquired Helmerich & Payne’s exploration and production business in 2002.

Mr. Helmerich serves as a director of Atwood Oceanics, Inc., Houston, Texas, an international offshore drilling company, and as a Trustee of The Northwestern Mutual Life Insurance Company of Milwaukee, Wisconsin.

Key Attributes, Experience and Skills

Mr. Helmerich’s background with the oil and gas business and his over 25 years’ executive experience provide a strong background for his service on Cimarex’s Board and on the Compensation and Governance Committee. In addition, his service as a director of Atwood Oceanics and as a Trustee of The Northwestern Mutual Life Insurance Company provide him with additional experience and knowledge to serve as a Director.

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HAROLD R. LOGAN, JR., 68

Position, Principal Occupation and Business Experience

Mr. Logan currently serves as Chairman of the Board of Supervisors of Suburban Propane Partners, L.P. and is a Director of Graphic Packaging Corporation. He is also a Director of two privately held companies – Basic Materials and Services LLC that invests in companies providing specialized services for the pipeline construction and sand/silica industries, and Hart Energy Publishing, publisher of Oil and Gas Investor and other energy publications.

Mr. Logan was a Co-Founder of TransMontaigne, Denver, Colorado, in 1995 and Chief Financial Officer, Executive Vice President, Treasurer and a director through 2002. He served as a director of TransMontaigne and chairman of its finance committee from 2002-2006. From 1987 to 1995, he was Senior Vice President/Finance, Chief Financial Officer and a director of Associated Natural Gas Corporation. Prior to that, Mr. Logan was an investment banker with Dillon Read & Co. Inc. and Rothschild, Inc.

Since 1998, Mr. Logan has been a director of nine public companies and has served on audit, compensation and governance committees.

Key Attributes, Experience and Skills

Over the past 39 years, Mr. Logan’s education, investment banking/venture capital experience and business financial management experience have provided him with a comprehensive understanding of business and finance. Mr. Logan’s expertise and experience have been relevant to his responsibilities of providing oversight and advice to the management of public companies, and is of particular benefit in his role as Lead Director and as a member of the Audit Committee.

MONROE W. ROBERTSON, 63

Position, Principal Occupation and Business Experience

Mr. Robertson is currently a private investor. Mr. Robertson retired from Key Production Company, Inc. (a company acquired by Cimarex in 2002), after serving ten years with the company. While with Key, he held the positions of President, Chief Operating Officer, Senior Vice President and Principal Financial Officer. Mr. Robertson has served in executive capacities with three other public energy companies, Apache Corp., Gulf Oil Corporation and Terra Resources.

Mr. Robertson currently serves as a Director, Chairman of the Audit Committee and member of the Compensation and Nominating committee of Earthstone Energy, Inc. (formerly named Basic Earth Science System), Denver, Colorado, an independent exploration and production company.

Key Attributes, Experience and Skills

Mr. Robertson has comprehensive knowledge of the financial and operational sides of the exploration and production business, which is of considerable value in his service as Chairman of the Audit Committee.

The Board of Directors recommends a vote FOR all Nominees.

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Continuing Directors – Class I – Term Expires 2015

JOSEPH R. ALBI, 54

Position, Principal Occupation and Business Experience

Mr. Albi was named Executive Vice President and Chief Operating Officer in 2011. He has served Cimarex in various capacities since September 2002, including Executive Vice President-Operations from 2005 to 2011, Sr. Vice President-Corporate Engineering from 2003 to 2005 and Vice President-Engineering from 2002 to 2003.

Key Attributes, Experience and Skills

Mr. Albi has over 30 years of experience in the oil and gas industry. His extensive understanding of the management of oil and gas production and drilling operations, business development, environmental and safety management and oil and gas marketing provide the Board with considerable insight about the operations of Cimarex.

JERRY BOX, 74

Position, Principal Occupation and Business Experience

Mr. Box was Chairman of Magnum Hunter Resources, Inc. from October 2004 until June 2005, and a director of Magnum Hunter from March 1999 to June 2005. He retired in June 2005 at the time of the acquisition by Cimarex of Magnum Hunter. Mr. Box served as President, COO and a director of Oryx Energy Company from February 1998 to March 1999. He had previously held a number of managerial and executive positions with Oryx Energy and its predecessor company, Sun Oil Company. Mr. Box serves as a non-management director and Chairman of the Board of Newpark Resources, Inc. of The Woodlands, Texas, an oilfield services company traded on the NYSE.

Key Attributes, Experience and Skills

Mr. Box holds undergraduate and graduate degrees in geology. He has served for several years in an executive capacity with public and private companies. Mr. Box has served on numerous oil and gas committees and task forces and as a President and Treasurer of the Dallas Petroleum Club. His extensive experience as an executive for companies in the energy business makes his service on the Compensation and Governance Committee particularly valuable.

MICHAEL J. SULLIVAN, 73

Position, Principal Occupation and Business Experience

Mr. Sullivan has been a senior attorney, partner or special counsel for the Denver-based law firm, Rothgerber Johnson & Lyons LLP since 2001, and the managing attorney of the Casper office of that firm. Mr. Sullivan practiced law as a partner with Brown, Drew, Apostolos, Massey & Sullivan from 1964 to 1986 and from 1995 until 1998.

Mr. Sullivan is a director and chairman of the governance committee and member of the compensation committee of First Interstate BancSystem, Billings, Montana and a director and member of the compensation and governance and audit committee of Sletten Construction, Inc., Great Falls, Montana (a non-public company). From 2001 to May 2009 he served as a director and during his tenure as a member of the audit, corporate social responsibility committee and governance committee of Allied Irish Bank Group, Dublin, Ireland. From 2003 to 2011 he served as a director of the Kerry Group Plc, a global food and food ingredients producer headquartered in Tralee Co., Kerry, Ireland.

Key Attributes, Experience and Skills

Mr. Sullivan brings a wealth of experience and a diverse background to our Board. In addition to his Juris Doctor degree, he has an undergraduate degree in petroleum engineering, years of governmental service as the Governor of Wyoming (1987-1995) and Ambassador to Ireland (1998-2001), and 37 years’ experience practicing law in the areas of natural resources, mediation and business. As Governor, he was involved in the process of reviewing and administering Wyoming’s budget. This experience is

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particularly relevant in his service on the Audit Committee. Mr. Sullivan’s education, legal experience, particularly in mediation and litigation, and his domestic and international service all provide a background that is beneficial in addressing the issues coming before the Cimarex Board.

Continuing Directors – Class III – Term Expires 2014

DAVID A. HENTSCHEL, age 79

Position, Principal Occupation and Business Experience

Mr. Hentschel was Chairman and Chief Executive Officer of Occidental Oil and Gas Corporation, a subsidiary of Occidental Petroleum, from 1986 until 1993 and from 1997 until 1999, when he retired. He also served as President and Chief Executive Officer of Canadian Occidental Petroleum, Ltd., now known as Nexen, from 1995 until 1997. He was in charge of the worldwide exploration and production operations for Cities Service, Occidental Oil and Gas Corporation for the last 20 years of his 40-year career.

Mr. Hentschel was a director of Occidental Petroleum from 1987-1993 and of Canadian Occidental or Nexen from 1985-2009. During his service as a director of Nexen, he was chair of the audit committee and a member of the compensation committee and various other committees. He was also a director of the Bank of Oklahoma from 1984-1995.

Key Attributes, Experience and Skills

Mr. Hentschel brings considerable executive experience in the domestic and international oil and gas industry to the Board. Mr. Hentschel’s extensive leadership background and his service on Nexen’s audit and compensation committees provide strong skills and experience for his service on our Compensation and Governance Committee.

THOMAS E. JORDEN, 55

Position, Principal Occupation and Business Experience

Mr. Jorden is the Chairman of the Board, Chief Executive Officer and President of Cimarex. He has served Cimarex in various capacities since September 2002. He was elected CEO in 2011, from 2003 to 2011 served as Executive Vice President-Exploration and from 2002 to 2003 as Vice President-Exploration.

Key Attributes, Experience and Skills

Mr. Jorden brings to the Board over 30 years of experience in the oil and gas exploration and production industry, and as our Chief Executive Officer, a deep understanding of our business, operations and long-term strategic issues and goals. Mr. Jorden holds undergraduate and graduate degrees in geophysics and has headed the company’s exploration program since its inception. His service on the Board creates an important link between management and the Board.

FLOYD R. PRICE, 64

Position, Principal Occupation and Business Experience

Mr. Price, a former executive officer of Apache Corp., held various positions with Apache from 1991 through 2009, including Executive Vice President and Corporate Exploration Officer; President, Apache Canada; President, Apache International; and Exploration Manager. Mr. Price serves as Chairman of the Board of Tamarack Valley Energy, a Canadian public company, and as an independent member of the Boards of Directors of Source Energy and Nemaha Oil and Gas Company, both private oil and gas companies.

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Key Attributes, Experience and Skills

Mr. Price has over 35 years of experience in the exploration and production business. Mr. Price has considerable domestic and international experience in the oil and gas industry, and has held leadership positions with a large public oil and gas company. His experience during the past three years serving as a director of public and private companies also provide him with invaluable Board skills and experience. Mr. Price brings extensive oil and gas exploration, operations management and financial experience to Cimarex’s Audit Committee.

L. PAUL TEAGUE, 78

Position, Principal Occupation and Business Experience

Mr. Teague served 35 years with Texaco Inc. He retired in 1994 as Vice President, Western Exploration & Producing Region of Texaco USA in Denver, Colorado. Mr. Teague held various positions with Texaco USA, including Vice President-Producing in Houston; Vice President of the New Orleans Producing Division; Division Manager, New Orleans and General Superintendent of the Offshore Division in New Orleans.

Key Attributes, Experience and Skills

Mr. Teague holds a degree in Petroleum Engineering from Louisiana Tech University and is a graduate of the University of Southern California Executive Program. He has several industry affiliations, including the former Chairman of the API Executive Committee on Drilling and Production Practices, former President of the Colorado Petroleum Association, a 50-year Legion of Honor Member of the Society of Petroleum Engineers and a member of the Rocky Mountain Oil & Gas Hall of Fame. He brings his executive experience with a major oil and gas company to bear on corporate governance and executive compensation issues in his role as Chairman of our Compensation and Governance Committee.

Director Nomination Process and Review of Director Nominees

The Nominating Committee identifies and reviews the qualifications of candidates for Board membership and determines the desired qualifications, including judgment, skill, experience with businesses and other organizations of comparable size, the relationship of the candidate’s experiences with the experience of other directors and the extent to which the candidate would be a desirable addition to the Board and any of its committees. Our Nominating Committee charter specifically includes in the list of desirable attributes sought in our Board composition diversity of gender and ethnic background.

Each director candidate is evaluated on individual merit, experience and potential to contribute to the effectiveness of the Board. Although all the current directors have extensive oil and gas experience, either as company executives or attorneys, their experience is with companies with widely different operating strategies. This diversity and depth of experience provides our Board with the capacity to execute its duty of oversight and guidance.

The Committee will consider nominees recommended by shareholders. The Committee did not receive nominations for the 2013 Annual Meeting from any shareholder prior to the deadline for shareholder nominations. Shareholders who wish to nominate persons for election as directors at the 2014 Annual Meeting must submit a timely written notice complying with Cimarex’s Bylaws to Corporate Secretary, Cimarex Energy Co., 1700 Lincoln Street, Suite 1800, Denver, Colorado 80203-4518, facsimile (303) 295-3494. To be timely, the shareholder’s written notice must be received between February 5, 2014 and February 15, 2014. If the 2014 Annual Meeting is held more than 30 days before or after May 15, 2014, the written notice must be received no later than the earlier of (i) the close of business on the tenth day following the day on which the notice of the date of the 2014 Annual Meeting was mailed or (ii) public disclosure of the date of the Annual Meeting was made.

In addition to its standard meeting in February of each year held for the purpose of nominating candidates to stand for re-election at Cimarex’s annual meeting, the Committee met in September and December of 2012 to consider a replacement director to fill the vacancy created by the death of F. H. Merelli in August 2012. At those meetings, the Committee also reviewed its charter and the desired skills for a new director, and agreed upon a process to be followed for identifying and selecting candidates to fill Board vacancies. At its December meeting, the Committee reviewed the names, resumes and qualifications of candidates submitted. Following its review, the Committee selected and recommended that the Board elect Floyd R. Price as a Class III director with a term to expire at the 2014 annual meeting and appointed him to the Audit Committee.

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ITEM 2 – ADVISORY APPROVAL OF EXECUTIVE COMPENSATION

2012 Advisory Vote on Executive Compensation; Shareholder Outreach

At the 2012 Annual Meeting 69% of the shareholders who voted approved our executive compensation on an advisory basis. We were not satisfied with this voting result and reached out to certain large shareholders to discuss our executive compensation program and any other investor concerns. Based on input received, we believe that the 2012 voting result was largely attributable to a perceived misalignment of 2011 executive compensation compared to 2011 operational and financial performance.

The Summary Compensation Table of our proxy statement reported the accounting valuation for equity grants made the first week of January 2011. The value of these grants was primarily influenced by extraordinary 2010 financial and operational performance. Following the January 2011 grants, Cimarex experienced a relatively flat year of financial and operational performance. As reflected in our 2011 Summary Compensation Table, the equity grants represented approximately 70% of the total compensation reported for 2011, resulting in a perception of strong 2011 executive compensation aligned with moderate financial and operational performance.

We learned from these discussions that our shareholders did not unanimously agree on the preferred form of equity to deliver long-term incentive compensation. One investor indicated a preference for options over restricted stock, one investor preferred cash and yet another investor did not favor options. Almost all investors agreed they preferred a form of performance award and that relative TSR was a good performance metric. With respect to our annual short-term incentive cash award program, all investors suggested that we more specifically describe the methodology used to determine these awards. No investor advocated a non-discretionary formulaic program, but each investor requested that we better describe the methodology used to determine the final cash awards.

While the Compensation and Governance Committee believes that the January 2011 equity awards were appropriate following a year of record financial and operational performance in 2010, the Committee has become sensitive to the perception of reported compensation being compared to the comparable period of financial performance.

The following is a summary of Cimarex’s responses to the 2012 advisory vote on executive compensation. Detailed information about Cimarex’s responses can be found in Section 1, Compensation Discussion and Analysis (CD&A) later in this Proxy Statement:

·                  Emphasized shareholder outreach to discuss our executive compensation program and to react to other investor concerns.

·                  Refined our annual cash incentive program for 2013 to provide for updated specific measurable goals and objectives that align with financial and operational goals and objectives.

·                  Postponed the timing of long-term equity awards to December of each year beginning in 2013. The postponement provides the Committee with more fully developed peer group data and performance results, allowing the Committee to make more informed equity award decisions that correlate to Cimarex’s objectives of executive retention and alignment of the value of the awards with financial and operational performance.

·                  Eliminated all tax gross ups in change in control payment arrangements.

The Compensation and Governance Committee and the Board have carefully evaluated Cimarex’s executive compensation plan, including the feedback from shareholders, and believe that their actions demonstrate responsiveness to shareholders on these issues. The Board recommends that shareholders vote FOR the following resolution:

RESOLVED, that the shareholders approve, on an advisory basis, the compensation of Cimarex’s Named Executive Officers, as disclosed in this proxy statement, including the Compensation Discussion and Analysis, the executive compensation tables and the related narrative.

Because your vote is advisory, it will not be binding upon the Board. However, the Board values shareholders’ opinions, and the Committee will take into account the outcome of the vote when considering future executive compensation decisions.

The Board of Directors unanimously recommends a vote FOR the advisory vote to approve executive compensation.

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ITEM 3 – RATIFICATION OF INDEPENDENT AUDITORS

The Audit Committee of the Board has appointed KPMG LLP to audit our financial statements for 2013. KPMG LLP has been our independent auditor since October 1, 2002.

We are asking that shareholders ratify the appointment of KPMG LLP as independent auditor. If shareholders fail to ratify the appointment, the Audit Committee may reconsider this appointment. A KPMG LLP representative will be at the Annual Meeting to answer appropriate questions and to make a statement if he or she desires.

The Board of Directors recommends a vote FOR the ratification of KPMG LLP
as Cimarex’s independent auditor for 2013.

Audit and Non-Audit Fees

The following table shows the fees for professional services rendered by KPMG LLP for the audit of Cimarex’s annual financial statements for the years ended December 31, 2012 and December 31, 2011, and fees billed for other services rendered by KPMG LLP during those periods:

(1)            Audit fees were principally for audit work performed on the consolidated financial statements and internal controls over financial reporting.

(2)            Audit-related fees were principally for services associated with SEC registration statements, periodic reports and other documents filed with the SEC or issued in connection with securities offerings, e.g. comfort letters and consents and assistance in responding to SEC comment letters.

(3)            Tax fees were principally for services related to tax compliance and reporting and analysis services.

Policy for Approval of Audit, Audit-Related and Tax Services

The Audit Committee annually reviews and pre-approves certain categories of audit, audit-related and tax services to be performed by our independent auditor, subject to a specified range of fees. The Audit Committee may also pre-approve specific services. Certain non-audit services as specified by the SEC may not be performed by our independent auditor. The Audit Committee may delegate pre-approval authority to one or more of its members. In the event of any such delegation, any pre-approved decisions will be reported to the Audit Committee at its next scheduled meeting. The services described in the above table were pre-approved by the Audit Committee in 2011 and 2012.

Report of Audit Committee

The Audit Committee on behalf of the Board of Directors oversees (i) the quality of the Company’s financial reporting; (ii) the independent auditor’s qualifications and independence; and (iii) the performance of the Company’s internal auditors and independent auditor. In so doing, it is the responsibility of the Committee to maintain free and open communication between the directors, the independent auditor and the management of the Company. All members of the Audit Committee meet the independence, experience and financial literacy requirement of the New York Stock Exchange, the Sarbanes Oxley Act and any rules or regulations promulgated by the Securities and Exchange Commission. The Board of Directors has adopted a written charter for the Audit Committee, a copy of which is available on our website at www.cimarex.com.

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Management is responsible for the Company’s financial statements and the financial reporting process, including the systems of internal controls and disclosure controls and procedures. The Company’s independent registered public accounting firm is responsible for performing an independent audit of the Company’s financial statements in accordance with generally accepted auditing standards and issuing a report thereon. The Audit Committee’s responsibility is to monitor and oversee these processes and uses internal audit to assist with these responsibilities.

The Audit Committee reviewed Cimarex’s audited financial statements as of and for the year ended December 31, 2012 and met with both management and KPMG, Cimarex’s independent public accounting firm, to discuss those financial statements and the effectiveness of Cimarex’s internal control over financial reporting. In addition, we have received from KPMG the communication required by Public Company Accounting Oversight Board (PCAOB) Rule 3526, Communication with Audit Committees Covering Independence, and discussed with KPMG their independence from Cimarex and its management. The Audit Committee also discussed with KPMG any matters required by the PCAOB and Statement on Auditing Standards, No. 114, Communication with Audit Committees.

Based on these reviews and discussions, the Audit Committee recommended to the Board of Directors that Cimarex’s audited financial statements be included in Cimarex’s Annual Report on Form 10-K for the fiscal year ended December 31, 2012.

THE AUDIT COMMITTEE
Monroe W. Robertson, Chairman
Harold R. Logan, Jr.
Floyd R. Price
Michael J. Sullivan

The Audit Committee Report does not constitute soliciting material and shall not be deemed to be filed or incorporated by reference into any other Company filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except to the extent that the Company specifically incorporates the Audit Committee Report by reference.

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EXECUTIVE COMPENSATION TABLE OF CONTENTS

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Executive Summary of Compensation Discussion & Analysis (CD&A)

NAMED EXECUTIVE OFFICERS (“NEOs”)

·                   Thomas E. Jorden, Chairman of the Board, Chief Executive Officer (CEO) and President

·                   Paul Korus, Senior Vice President, Chief Financial Officer (CFO)

·                   Joseph R. Albi, Executive Vice President-Operations, Chief Operating Officer

·                   Stephen P. Bell, Executive Vice President-Business Development

·                   John A. Lambuth, Vice President-Exploration

·                   F. H. Merelli (former Chairman of the Board, deceased August 2012)

ELEMENTS AND MIX OF EXECUTIVE COMPENSATION

Cimarex’s executive compensation program directly links a substantial portion of executive compensation to Cimarex’s performance through annual and long-term incentives. The mix of the pay elements for the CEO and other NEOs for fiscal 2012 is shown below. The compensation measured in the graph is “realizable compensation.” (See Compensation Discussion and Analysis, Section 1, Alignment of CEO Compensation to Total Shareholder Return for a definition of realizable compensation.) Eighty-eight percent of the CEO’s compensation is directly linked to Cimarex’s performance and 76% of his compensation is long-term compensation. The average compensation mix for the other NEOs is 84% performance linked and 68% is long-term compensation.

2012 Realizable Compensation
(consisting of base, annual incentive award & long-term incentives)

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2012 BUSINESS AND FINANCIAL PERFORMANCE OVERVIEW

·                   Grew production 6% to a record 626.5 MMcfe/d; combined Permian Basin and Mid-Continent production increased 20% to an all-time high of 586 MMcfe/d.

·                   Increased proved reserves 10% to 2.3 Tcfe, adjusted for property sales reserves increased 13%.

·                   Added 757 Bcfe of proved reserves from extensions and discoveries replacing 330% of production.

·                   Net income of $353.8 million, or $4.07 per diluted share.

·                   Cash flow from operating activities of $1.2 billion.

·                   Sold $306 million of non-strategic assets which will be reinvested in core area exploration and development activities.

·                   Evaluated, de-risked and expanded our acreage position in several key long-term future drilling projects.

·                   Ended the year with debt to total capitalization of 18%.

2012 EXECUTIVE COMPENSATION DECISIONS

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SAY ON PAY – SHAREHOLDER FEEDBACK

At the 2012 Annual Meeting 69% of the shareholders who voted approved our executive compensation on an advisory basis. We engaged in discussions with some of our largest shareholders and learned that overall our shareholders generally approved of our executive compensation program, although one large shareholder expressed concern about the magnitude of the reported value of the 2011 executive equity awards in relationship to Cimarex’s 2011 financial performance. The 2011 equity awards were made in January 2011 following a record year of financial performance in 2010. Cimarex’s financial, operational and stock performance all decreased in 2011.

In response, the Compensation and Governance Committee:

·                   Continued its ongoing shareholder outreach efforts.

·                   Refined the annual cash incentive program for 2013 to provide for updated specific measurable goals and objectives that align with the company’s financial and operational goals and objectives.

·                   Postponed the timing of long-term equity awards to December of each year beginning in 2013. The postponement provides the Committee with more fully developed peer group data and performance results, allowing the Committee to make more informed equity award decisions that correlate to Cimarex’s objectives of executive retention and alignment of value of the awards with financial and operational performance.

·                   Eliminated all tax gross ups in change in control payment arrangements.

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COMPENSATION DISCUSSION AND ANALYSIS

This Compensation Discussion and Analysis, or CD&A, describes Cimarex’s executive compensation program for 2012 and certain elements of the 2012 program. We use this program to attract (when appropriate) and retain the executives who lead our business. This CD&A explains how the Compensation and Governance Committee (the Committee) of the Board of Directors made 2012 compensation decisions for our executives, including the following Named Executive Officers (NEOs)

·                  Thomas E. Jorden, Chairman of the Board, Chief Executive Officer (CEO) and President

·                  Paul Korus, Senior Vice President, Chief Financial Officer (CFO)

·                  Joseph R. Albi, Executive Vice President, Chief Operating Officer

·                  Stephen P. Bell, Executive Vice President-Business Development

·                  John A. Lambuth, Vice President-Exploration

·                  F. H. Merelli (former Chairman of the Board, deceased August 2012)

This CD&A is divided into two sections:

Section 1 discusses 2012 and early 2013 actions related to executive compensation.

Section 2 discusses our compensation framework, post-employment compensation, retirement benefits, perquisites and other compensation policies.

SECTION 1

2012 PERFORMANCE OVERVIEW

·                  Grew production 6% to a record 626.5 MMcfe/d; combined Permian Basin and Mid-Continent production increased 20% to an all-time high of 586 MMcfe/d.

·                  Increased proved reserves 10% to 2.3 Tcfe, adjusted for property sales reserves increased 13%.

·                  Added 757 Bcfe of proved reserves from extensions and discoveries replacing 330% of production.

·                  Net income of $353.8 million, or $4.07 per diluted share.

·                  Cash flow from operating activities of $1.2 billion.

·                  Sold $306 million of non-strategic assets which will be reinvested in core area exploration and development activities.

·                  Evaluated, de-risked and expanded our acreage position in several key long-term future drilling projects.

·                  Ended the year with debt to total capitalization of 18%.

2012 AND EARLY 2013 COMMITTEE ACTIONS

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