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    Hess Urges Shareholders to Not Elect Activist Investor's Board Nominees

    CEO says Elliott Management is attempting to "dismantle" the oil company.

    NEW YORK -- In a letter issued today, Hess Corp. urged its shareholders not to elect five new board of director nominees proposed by activist hedge fund Elliott Management Corp., which continues to accumulate shares of the oil company.

    Elliott Management, run by Paul Singer, has repeatedly stated Hess' stock is worth much more than its current $70 per share price, and that electing its five proposed nominees to the board of directors would help Hess achieve its proper value, which the hedge fund believes is $128 per share.

    However, today's letter, written by Chairman and CEO John Hess, accuses Elliott Management of directly paying the five new board members to support its short-term agenda. "Under this highly unusual scheme, Elliott would control its directors by potentially paying them millions in cash to effectively dismantle Hess and all but foreclose the prospect of future value creation," wrote Hess.

    Hess has already addressed shareholder concerns by recently announcing it would become a pure-play exploration and production (E&P) company, the CEO added. That plan includes spinning off or selling the oil company's entire convenience store and gas station business, which comprised 1,361 locations as of Dec. 31.

    The New York-based company also nominated a different set of six people to its board of directors, including ones with past experience at General Electric Co., ConocoPhillips Inc., CBS Corp. and Royal Dutch Shell plc.

    "Among the many misleading claims Singer has made about Hess -- one of the more curious -- is the assertion that Hess' nominees lack conventional E&P and restructuring experience," wrote John Hess. "This is not only patently untrue (and easily refuted), but misses the point that Hess' new directors have considerable experience in broad matters such as restructurings, divestitures and corporate transformations, as well as specific experience in E&P, midstream, monetization, international exploration and shale operations."

    Wall Street analysts have applauded Hess' decision to become a pure-play E&P company and the company's six proposed independent directors are "unequivocally the right choice to continue to execute our transformation," the chief executive continued. The letter provides quotes from five such analysts to back its claims.

    Hess shareholders can submit votes by mail or in person by attending the oil company's annual meeting, set to take place on May 16.

    Elliott Management, which owns 4.39 percent of Hess' stock, has yet to respond to today's letter.

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