Halcon Resources : IRS Form 8937 – 6.75% Notes Solicitation (July 2017)

Form 8937Report of Organizational Actions

(December 2011)Affecting Basis of SecuritiesOMB No.1545-2224

.

Department of the Treasury

Internal RevenueService

. Reporting Issuer

1 Issuer's name

.,.. See separate instructions.

Halcon Resources Corooration

•':l>Toiilil.Organizational ActionAttach additional statements ifneeded. See back of form for additional questions.

1. Describe the organizational action and, ifapplicable, the date of theaction or the date against which shareholders' ownership ismeasured for the action .,.. see Attached

2. Describe the quantitative effect of the organizational action on the basis of the security in the hands of a U.S. taxpayer as an adjustment per

   share or as a percentage of old basis .,.. .S:c.e:ce.:c...A:.."t't;;a;:cca"h".e:a.d=--------------------------------

3. Describe the calculation of the change In basis and the data that supports the calculation, such as the market values of securities and the valuationdates .,.. See A-ttache-d---------------------------------------

For Paperwork Reduction ActNotice, see the separate Instructions. Cat.No. 37752P Form8937(12-2011)

Form 8937 (Rev.12 2011)Page 2

Hffl•liOrganizational Action(continued)

17 List the applicable Internal Revenue Code section(s) and subsection(s) upon which the tax treatment is based... _S_e_e_A_t_ta_c_h_e_d _

18 Can any resulting loss be recognized? ...-S""e"-e"--A'-"t""ta""c'"h""e"-d=-------------------------------

19 Provide any other information necessary to implement the adjustment ,such as the reportable tax year ... .S::ce.::ce.::...A:t"t'a,,_c_h...e::.d........_

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Sign Here

Under penalties of perjury, I declare that Ihave examined this um, lncluglng accompanying schedules and statements,and tothe best of myknowledge and

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Send Form 8937 Oncludingaccompanying statements) to:Department of the Treasury ,InternalRevenue Service,Ogden, UT 84201-0054

Part II Organizational Action

14. Halcon Resources Corporation ("the Company"} had outstanding $850 million of 6.75% senior notes due 2025 (the "Notes"), which were issued on February 16, 2017, at par. On July 12, 2017, the Company launched a consent solicitation to amend the indenture among the Company, the guarantors party thereto and U.S. Bank National Association, as trustee (the "Trustee"), governing the Notes. The Company agreed to make a cash payment of $20.00 per

$1,000 principal amount of Notes (such payments, collectively, the "Consent Fee") to each holder of record who validly delivered and did not revoke a consent to the Proposed Amendments under the terms of the solicitation, subject to certain conditions. On July 24, 2017, the Company executed the supplemental indenture implementing the modifications. The modifications require that upon the completion of the Williston sale (as defined in the amendments to the Indenture) the Company make an offer to purchase notes equal to 50% of the outstanding principal amount plus an additional principal amount equal to 50% of any sale proceeds exceeding $1.4 billion. This purchase will occur at a price of 103% of par.

15. The Company is treating the amendments to the Indenture as a significant modification of the Notes. All holders, regardless of consent, will be deemed to exchange the Notes for New Notes plus the Consent Fee. The Notes are publicly traded as defined in Treasury Regulation 1.1273-2, and the Company has determined the issue price of the New Notes to be 103.25% of par. The Company is treating the exchange of the Notes for the New Notes as a recapitalization transaction that is assumed to qualify as a tax-free reorganization pursuant to IRC Sec.

368(a)(l)(E) with gain being recognized to the extent of any boot received. For this purpose the Company is treating the Consent Fee as boot. Under IRC Sec. 358(a), a holder's aggregate adjusted tax basis in the New Notes is equal to such holder's aggregate adjusted basis in the Notes, increased by the gain recognized in the exchange (if any), and decreased by any cash received (i.e., boot). Holders should consult with a tax advisor regarding the tax basis of the New Notes received in the exchange.

16. See Line 15 above, the holder's aggregate tax basis in the New Note received is expected to equal the aggregate tax basis of the Notes surrendered, increased by the gain recognized (if any), and decreased by any cash received.

17. Sections 354, 368(a)(l)(E), 356, 358.

18. No loss can be recognized in conjunction with this organizational action that is a recapitalization.

19. Holders should consult with a tax advisor regarding the particular tax consequences of the exchange to the holder. The information contained in this document does not constitute tax advice and is not intended or written to be used, and cannot be used, for the purposes of avoiding penalties under the Internal Revenue Code.