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OKLAHOMA CITY--(BUSINESS WIRE)--Aug. 8, 2007--Chesapeake Energy
Corporation (NYSE:CHK) today announced that it has priced its
previously announced offering of an additional $500 million aggregate
principal amount of 2.500% Contingent Convertible Senior Notes due
2037 (the Notes) at 97.625% of par. In addition, Chesapeake has
granted the underwriter a 13-day option to purchase up to an
additional $75 million of the Notes to cover over-allotment options.
The Notes will bear interest at a rate of 2.50% per annum and will
also bear contingent interest, in certain circumstances, for periods
commencing with the six-month period ending November 14, 2017. The
Notes will mature on May 15, 2037 and may not be redeemed by
Chesapeake prior to May 15, 2017, after which they may be redeemed at
100% of the principal amount plus accrued interest. Holders of the
Notes may require Chesapeake to repurchase some or all of the Notes on
May 15, 2017, 2022, 2027 and 2032, or in the event of certain change
of control transactions, at 100% of the principal amount plus accrued
interest. The Notes will be senior unsecured obligations of Chesapeake
and will be guaranteed by substantially all of Chesapeake's
The offering is being made under a shelf registration statement
filed with the Securities and Exchange Commission on May 8, 2007 by
means of a separate prospectus supplement and a final term sheet.
The offering is expected to close on August 14, 2007, subject to
customary closing conditions. Chesapeake intends to use the net
proceeds from the offering to repay outstanding indebtedness under its
revolving credit facility.
Deutsche Bank Securities Inc. was the Sole Book-Running Manager
for the offering. Copies of the prospectus supplement may be obtained
from the offices of Deutsche Bank Securities Inc. by writing to
Deutsche Bank Securities Prospectus Department, 100 Plaza One, Second
Floor, Jersey City, NJ 07311 or by calling 800-503-4611. An electronic
copy of the prospectus supplement will be available on the website of
the Securities and Exchange Commission at www.sec.gov.
The Notes issued in this offering will be issued as additional
securities under an indenture pursuant to which Chesapeake issued
$1.150 billion of 2.500% Contingent Convertible Notes on May 15, 2007.
The Notes issued in this offering and the prior Notes will be treated
as a single class of notes under the indenture but will not be
fungible and will have different CUSIP numbers.
This press release shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of these
securities in any state or country in which such offer, solicitation
or sale would be unlawful prior to registration or qualification under
the securities laws of any such state or country.
This document contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E
of the Securities Exchange Act of 1934. Forward-looking statements
include estimates and give our current expectations or forecasts of
future events. Although we believe our forward-looking statements are
reasonable, they can be affected by inaccurate assumptions or by known
or unknown risks and uncertainties.
Chesapeake Energy Corporation is the largest independent producer
and third-largest overall producer of natural gas in the United
States. Headquartered in Oklahoma City, the company's operations are
focused on exploratory and developmental drilling and corporate and
property acquisitions in the Mid-Continent, Fort Worth Barnett Shale,
Fayetteville Shale, Permian Basin, Delaware Basin, South Texas, Texas
Gulf Coast, Ark-La-Tex and Appalachian Basin regions of the United
CONTACT: Chesapeake Energy Corporation
Jeffrey L. Mobley, CFA
Senior Vice President - Investor Relations and Research
Executive Vice President
and Chief Financial Officer
SOURCE: Chesapeake Energy Corporation